The ‘Military’ Secret to Getting Rich

Priced for Perfection We got back from Argentina on Saturday…
The Argentines have seen it all. They know that politics, like markets, follow cycles. Good follows bad… followed by good again.
‘We’ve had a rough time,’ said one Argentine analyst we talked to.
‘Because the government has been so stupid. But people now know it has been stupid. There’ll be a change in a year, and it will almost surely be for the better.
‘The trouble with the US,’ continued our friend, ‘is stocks are already priced for good things. The Fed has to manage its withdrawal from money printing flawlessly. Profits have to go higher. Inflation and interest rates have to stay at record lows.
‘The economy doesn’t have to get a lot better, but it can’t give us any big surprises on the downside. And none of the geopolitical or other threats – like the Ebola virus – can get much worse.
‘I’d rather invest in a market that is already priced for disaster and be pleasantly surprised when it works out better than expected. Going into a market that is priced for perfection is always a mistake.’

Looking out for evil dudes hiding in the sand …
(Photo via talkmarkets.com)

This post was published at Acting-Man on September 23, 2014.