Investment Strategy
All valuation measures (price/cash flows, price/book, etc.) on the S&P 500 are at all-time highs except for P/E’s but we are at 2.5 standard deviations on P/E. Even median valuations are near all-time highs at a P/E of 19.
Analyzing Buffett’s Track Record
Warren Buffett gained control over Berkshire Hathaway (BRKA 797,750) in 1965 and has managed the insurance company and its investments for the last 60 years (1965-2024).
Speculation Rampant
Over the last month or two speculators have made 30 to 50% daily gains in “story stocks” a normal occurrence.
Once in a Generation
1968….1983….2000….2020. Those are the years that technology and/or internet bubbles peaked and it wasn’t pretty thereafter.
Upside Down in 2021
2021 will be a reversal of 2020. With few exceptions every investment strategy that performed well in 2020 will not do well in 2021, and vice versa.
Buying the Dip
Speculation continues to run rampant. Any stock market short term scare is met with frenzied buying. And so it goes.
The Last Phase
We are in the last phase of the first year of a bull market. In the past after recession induced bear markets, the first stage of a new bull market has consistently lasted for one year give or take a month on either side.
Go Go Stocks Go South
In the late 1960’s there was a technology bubble and the fastest growing companies were known as “Go Go” stocks.
Non Believers
Despite the dramatic outperformance of value over growth over the last six months, many investors and strategists still are not convinced this trade has legs.
The Craziness Is Ending
For the last few months I have been ranting about all of the excesses in the financial markets and forecasting the bubbles would burst soon.