tag:blogger.com,1999:blog-7905515.post4171410180059306966..comments2024-03-14T11:09:32.759-05:00Comments on Falkenblog: Peter Schiff, Prophet?Eric Falkensteinhttp://www.blogger.com/profile/07243687157322033496noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-7905515.post-27520232540499393202008-12-20T22:38:00.000-06:002008-12-20T22:38:00.000-06:00Schiff called the bear market in US equities fairl...Schiff called the bear market in US equities fairly well, but his choice of what to own INSTEAD of U.S. equities hasn't worked out so well: international equities, short the dollar, and to a lesser extent, commodity related. This is because he has been an inflationista par excellence. <BR/><BR/>Previous commenter said "Timing is the key." Another key is to recognize how many times you have to "be right." Schiff could've just shorted U.S. equities. Instead he sought long opportunities he thought would hold up well.<BR/><BR/>This is a problem for many professional managers running benchmarked mutual funds or long-only-restricted separate accounts. We may think that an asset is overvalued (say, subprime bonds or financials), but what can we do about it? We can't short, we can't sit in cash.<BR/><BR/>I guess I'm arguing for a less constrained investment approach by people. But what are the limits of investment "edge"? We can't all have informed opinions about every asset class... European timberland to African small caps to U.S. blue chips to Japanese Govt Bonds...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7905515.post-35508830881126376442008-12-19T16:36:00.000-06:002008-12-19T16:36:00.000-06:00Laffer doesn't come off too well here.Laffer doesn't come off too well here.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7905515.post-23838448857607250972008-12-18T08:52:00.000-06:002008-12-18T08:52:00.000-06:00To anyone in the real estate business, it was comm...To anyone in the real estate business, it was common knowledge that people were getting loans they shouldn't at rediculous rates: 2, 3, 4 or 5 percent above the going mortgage rate. But everyone assumed the banks were pricing in the risk to get those juicy returns. <BR/>Who would have thought that 5% of total outstanding loans going into foreclosure and 9% late in their payments would topple the world as we know it.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7905515.post-85673351103501734712008-12-18T08:18:00.000-06:002008-12-18T08:18:00.000-06:00I remember buying puts in SPY in 2006 for similar ...I remember buying puts in SPY in 2006 for similar reasons. These expired worthless.<BR/><BR/>As once stated, bubbles are easy to spot but TIMING is the key. A simple 200 day MA or even volatility timing can suffice since asset classes become serially correlated in an 'event'Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7905515.post-77022590797166289502008-12-17T21:53:00.000-06:002008-12-17T21:53:00.000-06:00In 2006 it was a common opinion that there was a h...In 2006 it was a common opinion that there was a housing price bubble, and that teaser rates and interest-only mortgages predicated on continued price appreciation were the cause. I felt this way - it's why I moved from California to Pennsylvania, and I'm no pessimist. So this insight is not genius IMO. But no one anticipated the ramifications.<BR/><BR/>Lately I have been thinking it doesn't really matter what precipitated the financial crisis - there was too much leverage and reliance on inaccurate models, and it was an unstable system that would have come undone somehow anyway.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7905515.post-70743662578129379632008-12-16T21:03:00.000-06:002008-12-16T21:03:00.000-06:00i would save my money. listen to his podcasts firs...i would save my money. listen to his podcasts first. street unspun smth.Anonymousnoreply@blogger.com