"When an investor focuses on short-term investments, he or she is observing the variability of the portfolio, not the returns - in short, being fooled by randomness." Nassim Nicholas Taleb

By the Dow Theory Team

 

Richard's Comments

 

One reason why many investors can't make money (translation: they lose money) is that they have no clear idea of what they are trying to do. They have not developed an investment philosophy.

 

Take, for instance, the case of Charlie. A broker tells Charlie to buy Logovision and he buys it. A neighbor tips Charlie to buy into the company where he works, X-jet. Charlie buys it. Next a close friend tells Charlie that he personally has been buying Muni bonds like crazy. Charlie buys Munis. A year later Charlie has lost half his capital. He puts what's left into a real estate partnership. You know the rest.

By Benjamin J. Butler

 

Devon, United Kingdom

A year ago when I warned that the world was about to enter a very volatile period of change with financial market crashes, societal upheavals and geopolitical turmoil, one could be forgiven for saying I was being a little dramatic. Even I wondered -- as I moved out of my apartment in the city to find a quieter refuge -- whether I was jumping at shadows. Perhaps the change would be drawn out over a longer period of time and some of these imbalances and pressures could be unwound over a longer period of time, I sometimes thought. Now, I think it's pretty clear that abrupt change is on the imminent horizon. 

Markets seem unfazed by the latest US primary results, which make Donald Trump seem all but unstoppable as the Republican presidential candidate in November.  Yet some writers are already commenting on how his presidency - still a very long-shot - might affect the various markets. 

 

But today was mild for the most part.  Asian markets were strong; Nikkei and Shanghai were both up over 4%.  European markets went basically nowhere, as did US stocks, which managed to hold on to yesterday's huge gains, partly aided by a strong jobs report (214,000 new jobs created).

 

 

by Jon S. Strebler 

 

What’s really strange to me is that the music I grew up with – rock’n roll from the 1960s and early 1970s that was radical and offensive to many adults at the time – is now the nostalgic reminder of a better time. And likely as not, the kind of stuff you hear on commercials or, oh God save us! elevators. So listening to the old Led Zepplin song Good Times/Bad Times on the radio yesterday I couldn’t help but wonder how mainstream that kind of music is considered today.