Larry House

Dutch Fund Manager: The 'Great Recovery' Is Over - Time to Sell Stocks

I certainly agree with this sentiment. The higher the market marches, the chances increase for a dramatic change of course. Deflation is still on the radar.

Shifting Demographics Set to Affect Global Markets

I don't think the U.S. is ready for the near demographic shift caused by the retirement years of the Boomers. Many think these years will add more to our national debt as well as lower consumer spending (higher savings rate) and result in decreasing interest in equities. It is hard to prepare for all of those.

Expect Another Misguided Stimulus Plan

All stimulus plans are misguided.

Are Bond Investors Wrong?

Inflation is not in play. It may be anticipated, but it is not in play. I agree totally that we may face terrible inflation in a few years, but with 30% idle production capacity and 10% + in real unemployment, we do not face inflation---yet.

TIPS: Is Active Management a Benefit?

This is old news. PIMCO published this piece weeks ago. PRTNX is not a good example as it is only 55% TIPS. There is not reason for a fund like this to have a load up front. When it comes to TIPS, I prefer American Century ACITX, which has no load, .49% expense ratio, and a low minimum investment and low subsequent additions. It makes dollar-cost-averaging easy.

A Dow Double in 10 years? Easy

It may sound easy enough, but don't underestimate the long-term economic problems we face. Other "experts" who manage billions of dollars are predicting growth of 1-3% for the next few years--a good-sized chunk of the 10 years. Beyond that, we may face high inflation. On top of all, we have growing budget deficits. Stocks will have a hard time averaging 7.2% per year with that backdrop. I hope it happens, but I don't expect it.

Market Bias Remains to the Upside

The bias is up until it isn't.

What Do Stocks Really Return?

One point each investor must assess is just how much "long run" is in his/her investment horizon. We have had 20-year periods when stocks were subpar in returns. The "long-run" better be longer than that, or the data cannot be trusted.

John Hussman: Defensive, With a Measure of Equanimity

Reasonable assessment as always, John. One can't deny the tape, but it is hard to see substance upon which to base it. Interesting times.

Strong Investment Advice from David Swensen

IF what we are going through is like every other "hiatus" the economy has ever experienced, then the advice isn't bad. IF it is different this time, then the above advice can get you killed. Treauries are in bubble territory, but never mind that; just be a lemming and hold treasuries. IF we face years of below-par growth (which appears VERY likely), 30% in U.S. stocks is close to dead money. As you get older (I am there), increase your treasuries and cash. Boy, that is a recipe for disaster unless we have no inflation for the next 20 years--NOT likely. I know Swensen is one of those "respected" money managers, and he MUST know what he is talking about (and the author can parrot right along), but I think this is garbage that can ruin your wealth. What growth we will see is going to be outside the U.S. Emerging markets appear to be riskier that develped markets; they probably aren't. If you buy treasuries, make them 2-years and less. I don't want to hold the $100 trillionth treasure printed--unless I am going to use it for wallpaper.

Inflation Scorecard: Moderation in All Things

We do not now have nor can we yet see the right combination of forces for substantial inflation. We have 30% slack in production capacity, and almost 10% unemployment (weak consumer demand). We do, however, have the makings of a real inflation problem at some point down the road when the above conditions reverse along with too much liquidity by the Fed. The risk is real, and the probability is overwhelming, but it just isn't here or in sight yet. That said, I am overweight hard assets and will remain so. "Real objects" are better than paper assets in these uncertain times.

Equities Get a Kick in the Pants

All investors would prefer to avoid large drops in portfolio value. I think the market is returning to roller coaster mode, and only the tenacious will hold on. No one knows what is going to happen, so too large a bet on anything is inviting trouble. The Fed is on hold for a LONG time. Lack of growth is still the issue. Easy money is good for stocks; lack of growth is bad. Good dividends in solid companies can help smooth out the ride. For better growth prospects, look outside the U.S.

We Like Walgreen but Market Prices Cannot Be Trusted

You are sure to be disappointed if you look for sense in the market. I prefer CVS.

Today in Commodities: Holiday Volume

Anything can happen in the short term, but commodities are necessities; they aren't a fad--they don't come and go in popularity. Emerging economies want more of them, population is increasing, the world is not stable--it all means commodities of all types are long-term holdings.

Canada: Better Demographics than Many of Its Peers

I added EWC to the portfolio a few days ago. Seems as good bet as any.