Attention Economy


Thursday, November 10, 2016

Wise Advice for Investors

Jason Zweig of WSJ offers some good advice for financial market investors –
Afraid of What Comes Next for the Markets and Economy? Read This
“A time of political shock isn’t a time for investing action. Instead, it is a time to watch and wait. The worst possible moment to make clear and durable decisions is when you are surprised by what just happened….
In investing, what always matters is not what happens but how it differs from what people were expecting to happen. The best way to make the gods of financial history laugh is to say that anything is “clearly” going to happen.
President Obama “clearly” was going to impose health-care regulations, and so he did — but health-care stocks ended up resoundingly outperforming the rest of the stock market while he was in office.
President George W. Bush was “clearly” going to increase military spending, and so he did — but, according to FactSet, defense stocks lost 19% in 2001 and nearly 7% in 2002.”

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Stock Market vs. Bond Market - Divergence Ahead?
Interest rate expectations and inflation expectations have changed rather dramatically over the past two days:
http://www.bloomberg.com/news/articles/2016-11-09/pimco-joins-bond-traders-seeing-fast-tracked-fed-after-trump-win