Just a couple of random thoughts this morning.My base case for 2012 is some sort of range busting rally that then mostly retraces. If this scenario plays out then I think we would be lucky to finish out 2012 100 SPX points higher but I think a smaller gain is more like it.
That being said one idea that I believe many subscribe to is that US equities have benefited because of what is a lousy backdrop in Europe. The idea is that money that might have otherwise gone into European equities instead went into US equities because as shaky as the US fundamentals are, in my opinion, the fundamentals in Europe are far worse.
If the above is true then it stands to reason that some sort of recovery in Europe, real or perceived, could come at the expense of US equities meaning that US equities get sold to buy European equities perhaps leading to a reversal of the 2011 result where the US was in the green by a whisker and much of Europe was down in the low teens, or worse, percent wise.
We lagged by a small amount in 2011 (talking specific numbers makes a blog post a marketing piece subject to a lot of compliance stuff) as foreign mostly lagged domestic. I talk a lot about foreign because we own a lot of foreign because I believe in the long term fundamental outlook for foreign but in any given year where domestic outperforms then we obviously will lag the benchmark but over the course of an entire stock market cycle (which is our objective) I have unyielding faith that foreign will continue to be the better hold. We still have domestic exposure in case I turn out to be wrong.
2011 was a good year personally, we finally went to Yellowstone National Park, I became an EMT and our trip to take Pips the dog to University of Washington would have been awesome even without going to the town where Northern Exposure was filmed . Hopefully 2012 will be an even better year for everyone, I hope one personal highlight will be my project with AdvisorShares coming to fruition.
4 comments:
My strategic portfolio has positive real, risk-adjusted YoY gains which is all I care about. It has lagged the S&P in nominal terms but I don't use unmodified (nominal, non-risk adjusted) market indexes as benchmarks nor, frankly, should any individual investor.
I've said before that money managers actually work at some disadvantage because they cannot avoid benchmarks like the S&P -- widely used, highly recognizable and often used for comparison -- but individual investors gain little by emulating that and frankly expose themselves to under-performance anxiety w/ an accompanying tendency to overreach when they do.
Yellowstone was the first national park/monument and still one of the best but along with the rest of the park system it is deteriorating due to lack of funding. Be nice to see that and a few other things change for the better during this new year.
If you want to keep track of sun rise/set, day length and moon rise/set specific to your location during this new year there's a neat little calendar generator at http://www.sunrisesunset.com/ to do that and more.
hey roger really enjoyed your posts this year thx for all your hard work like you i think mkts could surprise on the upside lets hope so & all the best for 2012 jj
A healthy and successful 2012 to you, Roger.
And the same to all those who read your blog.
thank you!
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