Hedge while You can...

[Fifty Percent Off]

What was the last economically successful Republican administration?

[CaptainNJ]

Originally Posted by Fifty Percent Off

What was the last economically successful Republican administration?

all presidents tend to do pretty well once they start charging for speeches.

[arctic_gardener]

Originally Posted by ohio_peasant

I'm not qualified to speculate on the possible effect of the impending tax-bill, but let me reiterate a longstanding gripe, about the divergence between US and foreign stock market performance. Other than during the past 10 months, the US Dollar has been on an inexorable climb since global stocks peaked in 2007 (yes, most markets outside of the US have yet to retrace their 2007 highs!). Those of us who have been overweighted in foreign stocks have been more than patient. Though I don't wish a reversal or diminution for any nation, I'd love to see a rotation into foreign (and especially European) markets, with a stronger Euro as well.

I was thinking more along the lines of yen-Japanese and euro-German bonds, not stocks, to diversify the US dollar risk. Of course, that would have to rest on the assumption that those areas don't see inflation as well. If Japan sees inflation, that would be a miracle anyway.

[MrRational]

Originally Posted by Ariadne22

Just doing some thinking on incremental repositioning...
Not running scared. Just planning ahead.

We're largely in the same boat.

The biggest conflict I have is when others misinterpret or just misunderstand
when I talk about being contrarian and bearish which can make discussion awkward.

Earlier this year I saved this article and just re-read it.
No specific advice (which I never do here) beyond having a forward looking definition
and usage for those terms and how that might/should influence the decisions you make.

https://seekingalpha.com/article/4048737-means-bearish?

Originally Posted by Eric Parnell

Defining "bearish," on the other hand, is much more nuanced. ...an investor that is bearish
is one that expects that asset prices will do something other than steadily rise over a specific
period of time.

Yes, they may fall. But they also might move in a sideways pattern with rapid rises followed
by swift declines. Or they might stagnate for an extended period of time. This is an important
differentiation, as being bearish encompasses a far greater number of possible outcomes than
prices simply going down.

[ohio_peasant]

Originally Posted by MrRational

The biggest conflict I have is when others misinterpret or just misunderstand
when I talk about being contrarian and bearish which can make discussion awkward.

This not being math or physics, definitions are going to be subjective and elastic. That said, to be “bearish” means to hold the sentiment that the market has a serious and sustained mispricing, the resolution of which, would lead to a protracted decline. Volatility or sidewise doddering is not “bearish”. Marty Zweig’s famous call of the 1987 crash – mere weeks before it happened – was NOT bearish, because he qualified his statement, adding that over a year or two, he expects a cumulative rise. To be bearish means to smell a rat, to feel that there’ something dank and phony afoot, such that a wise person would eschew the stock market, for years to come. Thus in hindsight, in 1999 it would have made sense to be bearish, for the coming decade or so.

Importantly, a bearish sentiment isn’t a market-timing signal, in the sense of selling everything now, and buy it back next February. It’s a general impression of society, economy and prevailing mood.

Likewise, to be “contrarian” means to hold a minority and unpopular view, wherein one questions the consensus, as being facile and faulty. In times where half of the pundits call for a collapse, half call for unbridled increase, half for volatility and half for smooth sailing (there are, of course, more than two halves!), a contrarian view is impossible, because there is no prevailing consensus. One could be clever and to have picked what turned out to be the correct view, the one correct view out of many then current. But that does not make one a contrarian. A contrarian would have been someone like John Authers, the Financial Times columnist who around 2006 or 2007 lamented that the bear market of 2000-2003 didn’t bottom at a level where P/E suitably reset to justify a new bull market. He noted that, while the specific month or year couldn’t be guessed, the real surprise – writing in 2006 or 2007 – is that we’ve not had a second severe downturn… and that a true return to prosperity, though inevitable, may yet take many years.