Comments

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  written on 06-Nov-2008

  Allan [http://allantyoung.com] says:

  The act of managing money is essentially a series of predictions about the future. At least that's the way good "money managers" look at it. You cannot go and buy Microsoft because it had a good last quarter. You have to buy Microsoft because you believe or have evidence to believe that Microsoft will perform well in the future. So as a money manager, you might think that Microsoft will be able to hold off Google Android and take market share from Apple's iPhone. You might be thinking that the Xbox360 will dominate gaming and that Halo 8 outsells GTA 7 and Rock Band 10. If you believe all this AND Microsoft is selling at a discount, creating a comfortable margin of safety, then you have a good probability to outperform the market.
  
  All predictions are predicated on loose assumptions - but it is an existential problem. What else are you doing if you're buying a company's stock or going long on a market index? You're essentially predicting good times ahead.
  
  I think you are letting a bit of political loyalty cloud your judgment. That is a sure way to "LOSE" money as an investor. You can be an Obama supporter politically and still arrive at logical conclusions based on loose assumptions that indicate he may not be good for the economy or the markets. You can also disagree with Obama politically but believe he'll implement policies that would turn this economy arround.

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  written on 07-Nov-2008

  chickerino says:

  You're quite right. There was more than a little bias in that statement. My gripe was more due to the fact that he said that because Obama won, it spelled doom in the next few years for investors. I think he was getting slightly personal about the whole thing.

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