Interviews: James Grant, David Swensen, C B Bhave
- von Mises Institute: The Trouble with Prosperity
the Fed is trading–figuratively–at forty times earnings, five times book value, and it is yielding nothing, because people now believe in the integrity and the efficacy of managed currencies. They believe furthermore–and even more remarkably–in the clairvoyance of these intrabeltway economic planners known as central bankers.
A successful operator in the stock market is someone who gets on the right side of the primary trend and stays there. He does not object if the motive force of the primary trend is an excess creation of credit by the central bank, aided and abetted by an unprincipled Treasury.
A guy like Warren Buffet is not going to come out and say, we shouldn’t buy Coca Cola at forty times earnings because we know that all these things end badly. Wall Street is intrinsically and necessarily unprincipled in the sense that it does not operate day-to-day with an eye towards what is right and what is wrong. It is the citadel of expediency.
It’s a fairly old piece, but quite an interesting read.
- NY Times: Keep It Simple, Says Yale’s Top Investor
Don’t try anything fancy. Stick to a simple diversified portfolio, keep your costs down and rebalance periodically to keep your asset allocations in line with your long-term goals.
For most people, he recommends a very basic approach: use index funds, exchange-traded funds and other low-cost instruments, and stick to your long-term asset allocation — even when the markets are in tumult.
For most individual investors, he said, copying the strategies of institutions like Yale is virtually impossible: big investors have access to fund managers and arcane strategies that are beyond the reach of most people.
. . . it is fruitless for individual investors to pick stocks.
- Skoch, Google Video: C B Bhave
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