The term “animal spirits” got tossed around of late to describe the market’s performance to start the year.

John Maynard Keynes coined the term actually. Here he is:

Most, probably, of our decisions to do something positive, the full consequences of which will be drawn out over many days to come, can only be taken as a result of animal spirits — of a spontaneous urge to action rather than inaction, and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities.

The argument is that the current “animal spirits” is due to the election. Maybe. Or people just got tired of being pessimistic. Continue Reading…

Warren Buffett repeatedly says his favorite holding period is forever. He’s held Berkshire “forever” but most of his other stocks haven’t lasted that long. Still, this is one of Buffett’s mantras, held as gospel, that tends to lead investors astray.

Anytime you deal with stocks, you also deal with the fact that the business might change. Tying a stock to a predetermined holding period is a bad idea. I would like to think most people understand that, but I guess not.

In the recent Berkshire letter, Buffett actually took the time to qualify his “forever” statement: Continue Reading…

The 2017 version of the Credit Suisse Global Investment Returns Yearbook is out and available for download. The Yearbook, for those who don’t know, is a great resource for historical returns nerds like me. It takes a long view of market returns from 1900 to today for five asset classes and 23 countries.

The available Yearbook is only the summary version but it still has 60 pages worth of great info and charts like this: Continue Reading…