When the chorus of investment commentary gets so strong in one direction, I start to question the collective wisdom of the market. I’m a believer in general market efficiency, that most news is recognized in prices. #-ad_banner-#But occasionally, herd mentality sets in and the market outlook clearly needs to be reevaluated. It’s in this ability to step back and question the herd’s stampede in one direction that investors can find huge opportunities. It was obvious when pundits argued that valuations didn’t matter during the tech bubble. It was obvious in 2007 when subprime defaults exploded and mortgage lenders started going… Read More
When the chorus of investment commentary gets so strong in one direction, I start to question the collective wisdom of the market. I’m a believer in general market efficiency, that most news is recognized in prices. #-ad_banner-#But occasionally, herd mentality sets in and the market outlook clearly needs to be reevaluated. It’s in this ability to step back and question the herd’s stampede in one direction that investors can find huge opportunities. It was obvious when pundits argued that valuations didn’t matter during the tech bubble. It was obvious in 2007 when subprime defaults exploded and mortgage lenders started going bankrupt, even as analysts still predicted higher prices. That same collective wisdom is starting to skew to one side again, despite strong evidence to the contrary. Traders and analysts alike are nearly unanimous in a trend that could unravel and become one of the biggest surprises of 2017. The Market’s Love Affair With The U.S. Dollar The greenback made a run at fresh highs in late 2016 and closed the year out strong on the prospect for faster U.S. economic growth and rate hikes. Net long positions by traders in the U.S. dollar reached $25.4 billion on January 3… Read More