What I Am Thinking About (April Edition)

The start of a new quarter is a good time to think about the factors that drive your investment returns. What is it that is propelling markets higher? What risks exist? What might you be overlooking? What variant perceptions can you develop apart from the crowd?

The following are the various ideas kicking around my head:

• The economy continues to slowly heal.

• The Federal Reserve should be interventionist in Depressions, but Laissez Faire during Recessions. Greenspan did not understand this; I hope Bernanke does.

• Investors now are carrying cash at 16 month highs, according to AAII.

• “Hunches” are a terrible investment theme.

• I much prefer Dividends to Share BuyBacks. The academics disagree with me. History does not.

• This is now the 6th, about to become the 5th, best rally in market history. (Merrill Lynch)

• Original thought is shockingly rare.

• The Fed is helping, Congress is hurting.

• Market Tops are long drawn out processes that very, very few people can call on a timely basis. You are not one of those people.

• The greatest ally of any crisis is time. 10 Years post crisis, it is likely to be a blip — and we will be on to the next crisis.

• Market Breadth remains constructive; there are no signs of selective buying or lagging of Advance-Decline Lines;

• Ain’t no cure for stupid.

• There is an enormous difference between Predictions and Probabilities. Beware forecasts dressed up in the mathematical guise of statistics.

• America does not have a debt crisis, she has a Pundit Crisis.

• Consuming more information does not help you make better decisions — rather, it helps you be more confident about bad decision you are making.

• 9/11 was 12 years ago; 1987 was over 25 years ago.

• Blah blah blah Euro blah blah blah Cyprus blah blah blah ECB.

• CEOs who cite” Uncertainty” are kidding themselves. They are ripe to be disrupted, see their companies marginalized and their best employees stolen from them. (They have my gratitude)

• Pick three money losing blogs to remove from your RSS feed, blog roll and daily routine. (Buh-bye)

• This remains the most hated rally in Wall Street history (TBP 2009).

• It is exceedingly difficult to change the world. It is apparently impossible to change human nature.

There are lots of other issues fighting for my attention, but these are the big ones.

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