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A Secular View of Assets: Surfing the Wedge


bmichaud
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Good read.  Thanks for the link.

 

This reflects my general feeling at the moment, but it hasn't worked it's way into my overall asset allocation since I like the stocks I own . . .

 

The first implication of our view that “almost everything is expensive” is that asset allocation portfolios should assume below-average risk today. While this is certainly not an obvious implication, it is perhaps the most important strategic asset allocation decision to be made at any given point in time. Investors face two difficult choices. The first is to increase risk and reach for return. The second is to reduce risk and wait for return.

 

Given our view of gradually deteriorating economic fundamentals combined with rising market volatility, we believe the latter choice is more prudent at this juncture.

 

And, just for fun you can see some pictures from the wedge on a reasonably big day (last week) here:  http://photography-on-the.net/forum/showthread.php?p=16010606#post16010606

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Never quite worked up the guts to bodysurf the wedge.  Certainly didn't have the surfing skills to do it.  But Bill Gross says I'm asset-surfing it, so cool.

 

I did it with my brother once and his arm ended up with a near compound fracture (bone didn't quite make it through). Now I'm more comfortable sitting on the rocks and watching others do it. :)

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