Dow 36,000 for Bonds!

James Glassman must be a helluva salesman.

How else can you explain how the co-author of Dow 36,000 was able to convince a publisher to allow him to demonstrate his lack of acumen on a related subject?

After penning what became the classic exemplar of Dot Com excesses — a spectacularly wrong tome about equity valuation that sent Dodd & Graham spinning in their graves  — Glassman has now sharpened his pencil again, casting about for another subject to be just as spectacularly wrong about.

This time, it is bonds.I expect this book to be just as reliable a fade as the last one.

As Jason Zweig observes, even Glassman’s mea culpa was wrong:

“Mr. Glassman may not be exactly right about what he got wrong. His attempts to reconcile his earlier views with today’s realities shed light on a crucially important question: What does it mean to say that an investment is “risky”?”

I have a simpler explanation: Political bias.

Dow 36,000 was co-authored with Kevin Hasset, who now pollutes the pages of Bloomberg with his AEI inspired wingnuttery; Glassman is also an AEI alum, and he will head the George W. Bush Institute. And as I noted last weekend in The Washington Post (Why politics and investing don’t mix), political bias is a surefire way to lose money in the markets.

Glassman’s last book came out when EMH was de rigeur amongst the right leaning cognoscenti; He extrapolated the market rally to infinity — or at least 36k — based upon fundamentally flawed ideology.

And now, with a Socialist/Kenyan/Muslim in the White House, well . . .  draw your own conclusion.


How Now, 36,000 Dow? The Ominous Undertone of Rallies
Jason Zweig
WSJ, FEBRUARY 12, 2011

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