Twice a year soothsayers and analysts dust off crystal balls and Ouija boards and report where they think the market will be at the end of the year. This is a far easier job to do at halftime then those who had the job of guessing at the beginning of the year simply because there is less ground to cover and whatever momentum has developed will usually carry forward.
Given a choice I personally would prefer doing the halftime analysis more than say the pre-game. There is nothing worse then telling folks about the up-coming big game and telling the world that it’ll be a tight fought contest and come back in an hour only to see one team absolutely pummeling the other into dust motes and then trying to explain, with a straight face, why you were so off the mark at the start of the show or switching gears and doing the old holding out hope sales talk that the team crawling back into the clubhouse is just gathering itself and with a few lucky breaks will be back in the game. No matter what you say the viewer knows it’s BS.
If you don’t think financial writers do this in some way or fashion about investing I have a bridge I’d like to show you. The biggest knock on CNBC has always been it’s been a cheer leader for equities and doesn’t give viewers an impartial look at reality.
Even magazines and web sites several times a year promote their must read features such as‘what funds to buy now’ or ‘best funds for retirees’, or the oldie-but-goody, ‘ five funds that will give your portfolio a boost’, using an arcane algorithm with dubious pedigree. Sometimes writers who know how to write but couldn’t pick out a value fund from a growth fund use outside help like their next door neighbor while hanging over the fence who considers himself an amateur Warren Buffett, Or, the old ‘let’s see who wrote what’ and plagiarize research analysis.
Even the experts have been so wrong you wonder what it is that they do to make so much money.These really smart folk can be extremely wrong folk as we saw a few years back. Guys like Bill Miller, Warren Buffett and the like all didn’t see the locomotive heading down the track, or if they did they didn’t do much about it. Certainly none of them raised their paw to give us any warning.
Pimco and BlackRock have had diverging views on the Treasury bonds all year. Pimco has urged investors to lighten up while BlackRock has recommended investors to either stay the course or buy bonds for the duration of the year. So far BlackRock is the leader at half-time. Still investors are unsure what to expect for the next six months. The Pimco argument makes sense as does BlackRock.
CNBC ‘Fast Money’, a show showcasing traders, have their own views on the markets. I often wonder if it’s simply one big tout for filling their positions. One just doesn’t know anymore.
Every morning and throughout the day I check the news on Bloomberg, Barrons, MarketWatch and WSJ, just to name the biggies. I also look at Yahoo and watch my share of CNBC on cable. The thing is that for every point I see against the economy I read another for.
I have just that kind of bi-polar piece on my desk from Barrons, and Steven Sears reports on an ‘antsy market’, which he is being way too kind. Maybe his people don’t let him use bad language. Steven write that the major trading desks are in a tug of war with each other. Ah, that makes sense. You have some traders telling clients one thing and others another. His point is that there is a method to this madness and the end result is not for the benefit for the average investor.
That’s truly the rub, dear reader. There is way too much information, or should I say commentary, out there for any investor to digest. It’s especially bad for the average person trying to build a portfolio. In the old days folks bought a few mutual funds, put them on the shelf and checked their values when they had nothing better to do, or when the taxes were due. They had no idea what they owned or what the fund did. Now it’s life and death everyday with average investors working with conflicting information and trying to emulate the Gates and Millers, and finding it frustrating that the economy is not cooperating.
So maybe, just maybe, we all take a step back and agree that 2010 is a lousy year and that there is absolutely nothing anyone can do anything about. So as long as the funds we bought haven’t changed their investment philosophy, managers or risk I suggest that we agree to stay where we are, put our feet up on the ottoman and watch the rest of the game for it’s entertainment value and not like we have five big ones laid out with Knuckles Kowalski.
My half time prediction is that it is going to get better, much better; I just don’t know when.
If you have questions call Paul at 877 783 7080 or write him at pstanley@westminsterfinancial.com. Share this blog with someone who cares about their money.
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