Good Morning Class,
I'm thinking when we look back at the "markets" (casino?) at the end of the year, we're going to realize that in late January we were facing a very binary outcome...either the majority of us get the jab in the arm (key could be JNJ vaccine (?), there is a antidote by Merck or with the new admin, taxes go up, regulations go up, socialistic spending ramps up and markets (casino?) craters....look at the nonsense with GME Gamestop...you wanna put your life savings into this sheet show?
so...
1) Is it time for Hussman, HSGFX or HSAFX...go ahead and call me crazee but don't call me Shirley but I'm going to step into the Huss with a noticeable investment today.
2) Is it time for high grade rubies? I recall a passionate discussion during the "Financial Crisis" (housing bubble scam) with my CFO and others by the water cooler how you could shove a million dollars of high grade rubies in your sock and no one would know they were there...shared stories from my Grandma how her wealth was confiscated by the democratic socialists under Tito...she was lucky to escape with her life as they usually popped the wealthy
I recall The Gundlach stated he "likes real assets that he can put in the trunk of his car" (paraphrasing)
3) On the other half, I'm thinking the markets might be up 30-40% if the vaccines take effect, we don't have the nutty tweeties anymore and things calm down, economy and jobs pick up etc..so slowly adding to ARTTX on down days
4) I'd rather myself play the "bro-investor" approach by buying stocks like Penn Gaming than Bitcoin...
Like I said, binary, place your bets? Of course, posting for entertainment purposes only, I have no idea what will happen this year, etc.
Best and good health to all,
Baseball Fan
Comments
The point I was making is that who knows what will happen. It is true that folks had to cross borders during times of tumult. Now yes, it is a huge stretch compared to the displacement after WW2 and today's Middle East, but look at what you see now...folks leaving high tax states and moving to low tax states. Folks moving away from urban, high(er) crime areas to "safer" areas. You can't say that is not happening.
Now with the debt at all time high and no end of central bank activity in sight, what is the end game? No one knows for sure. How can anyone say that this market is not one big con, Ponzi scheme orchestrated by Central Banks, no one can say there is true price discovery.
So you call it what you want, what happened during Tito's time was his group's control of the economy; control of resource allocation; and collective ownership of the means of production which took the form of social property. So poor quality goods, no market incentive to make things better, only to meet quota.
Do you think folks don't have paintings, jewelry in their homes that are of value, women wear wedding rings etc. How would high grade rubies be any different?
Not sure where you were going when you asked for my address.
Best Regards to All,
Baseball Fan
Still, if you know the history of fascism--which the riot on capitol hill was all about--seeking to overturn a democratic election via pure violence--as opposed to democratic socialism--nowhere even close to that in the U.S.--diamonds and gold sometimes helped people escape and sometimes they didn't. Biden is no socialist. Taxes will go up almost certainly, but given the debt trajectory Trump had the country on previously, taxes were bound to go up anyway. But having any taxation, contrary to popular belief, is not socialism.
As for Hussman, he's a smart guy who's been wrong. He's bound to be right eventually as davfor points out. But in investing if a manager's timing is way off on a macro prediction, he is wrong. One thing I never quite understood regarding HSGFX is it was supposed to use both valuation and technical momentum driven signals to go long or hedge the market exposure. Despite the high valuations we've seen, I would've expected some of the fund to be long--or 50% long-- given the momentum we've also seen. Perhaps the reason it was often fully hedged--and I may be answering my own question here--is that while the market was always rallying, it was a narrow rally of a few giant stocks driving the market's returns. So perhaps Hussman felt that there wasn't enough breadth in the rallies to go partially long.
Some recent reading I’ve been doing about the rise of Hitler points out the crucial role played by various conspiracy theories that greatly benefitted the National Socialists’ takeover of the entire government and economy of Germany in a relatively short time. My take on the current state of affairs in our country suggests that many of us, regardless of our belief systems, can be victimized by falling for stories that we should be able to reject without a second thought. In my own case, on very little concrete evidence, I have come to mistrust my neighbor because he replaced his Trump 2020 flag with a Don’t Tread on Me flag and left for recycling a box that enclosed a new Sig Saur pistol, price tag still attached. My neighbor has never exhibited any untoward behavior towards me, yet I now am inclined to believe he might be a danger because of what I have seen on TV. Good time for the Serenity Prayer if there ever was one. Whatever Tito’s motives may have been, his country managed to produce the all-time joke of a car, the Yugo.
Candidly, I always found it interesting that those who did NOT sell in 08'-09' and just held were considered "smart investors". As I recall at the time, the market could have easily lost another 50% at the lows, no one knew that the Bernake and the Fed were going to implement QE. Back then saw many "wise" investors come back to work after they retired as they "buy and hold'ed" and got sawed in half, 401k to 201k, home values plummeted, dangerous, frightening times...remember talk one weekend of the entire financial system locking up...thank goodness Paulsen saved us (sarc or did he really?)
I'm more interested in HSAFX than the older growth fund HSGFX...the former being more of an allocation fund. That being said I can't seem to purchase HSAFX thru Schwab. I think it's going to take combo of technical, trend and valuation investing skill sets and sure, pure luck to make sustainable money in the markets this year.
Best,
Baseball Fan
"Obviously, Hussman turned into a 'perma-bear,' calling for disaster constantly (and wrongly). Hussman still insists that he will be vindicated, and criticizes those who would 'declare victory at halftime.' He criticized 'declaring victory at halftime' previously six full years ago (that’s one long halftime). Hussman wants us to believe that he’s not wrong, merely right but early. However, if you keep making the same wrong call over and over, you don’t get any credit for it when you’re (eventually) right."
"Through 2019, Hussman’s Strategic Growth fund has suffered a 10-year average annual 'return' of -7.54 percent, compared to a 13.24 percent average annual gain by its benchmark, the S&P 500. Despite exceptional early returns, the fund not only badly trails the S&P since inception, it is now a money loser since inception. Notwithstanding this terrible performance, Hussman keeps charging investors 1.25 percent annually to lose their money."
Link
JB and Observant1, very difficult to disagree and argue against the viewpoint that cash is a better way to go, especially medium to long term...I'm thinking we're in for some choppy waters here in the near term, let's see how it plays out over the next 30-60-90 days.
I'm thinking of pair trades, HSGFX with VLSAX / ARTTX...Hussman Strategic Growth, Virtus Kar Long Short, Artisan Focus, equal ratio between all 3 funds.
I could be very wrong. Not recommending this to anyone, due your own homework.
Best,
Baseball Fan
I don't believe ARTTX and VLSAX have similar strat's. I like ARTTX as it is a "risk-aware, not specifically L/S" fund and the way I understand it is there is an associate on board whose role in managing the portfolio is focused on risk management thru use of options or other, etc. The fund is run using a very process oriented approach and has out performed the SP500 by a substantial margin since inception. I like his pedigree from where he used to work at a couple hedge funds, likely learned quite a bit and took away "best practices" experience.
VLSAX, run by KAR investments out of LA focuses long high quality, high ROIC, history of resilient earnings growth, minimal debt stock, short, low quality, high leverage, poor cash flow, declining financial metrics stocks
per July 2020 Value Investor (apologies to you and the board as I can't seem to get the linking thing down, argh, I kept looking for a post on how to do that from the past, can't find it). Another good article about ARTTX if you Google, morningstar, an up and comer from top notch fund group, July 2019
Lineage
While each successive manager typically customizes along the way, it’s not
uncommon in the investment business
for strategies to be passed from generation to generation. Christopher Smith of
Artisan Partners provides a representative case in point. The founding portfolio manager of the firm’s Focus Fund –
which was launched in 2017 and now
manages $1.3 billion in assets – Smith
takes an “industry-first” approach to
identifying attractive equity opportunities, looking initially for industries with
what he believes are accelerating profit
cycles and then for the companies that
are priced right and best positioned to
profit from them. He learned the basics
of the approach from Karsch Capital's
Michael Karsch [VII, March 31, 2010],
who learned it from Duquense Capital’s
Stanley Druckenmiller.
With three years under his belt at Artisan, Smith's rendition of a thematic
approach since its April 2017 launch
has earned a net annualized 23.8%, vs.
10.9% for the S&P 500
Good Luck to All,
Baseball Fan
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