Financial pundits love citing history and the myriad of anecdotal quotes that extol one strategy or another; comparing valuations and prices to bygone times, confident (or perhaps just hopeful) of a reversion to the mean. But what if the history we are repeating is part of a larger cycle than the last 10, 20, or even 50 years? What if the historical cycle we are allegedly repeating is more significant than just another economic recession? Conversely, what if we are actually in uncharted territory? What if globalization and the information age have plotted a new course, one for which we have no map?
As a country we face significant challenges; ones not simply resolved with collective optimism. Like spoiled children we’ve ignored wisdom and squandered our inheritance; an inheritance not of a monetary endowment but a socio/political/ economic system that allowed hard work, ingenuity, and intelligence to be justly compensated. My chief question is whether we’ll continue down this destructive path blissfully ignorant or wise up, make the necessary adjustments, and hopefully return to the ideals that previously allowed us to prosper.
From an investment perspective multiple possible outcomes is just information; it’s possible to profit in any environment if one is willing to question assumptions, face the facts, and act accordingly. Success depends on preparation for a variety of outcomes, an ability to adapt to changing conditions, and a recognition of the unknown. I plan to be prepared for whatever may come, protect what we have, and take advantage of opportunities as they are uncovered.
Have fun,
Joseph Graves
“In times of change, learners inherit the Earth, while the learned find themselves beautifully equipped to deal with a world that no longer exists.”
-Eric Hoffer