Given what the world has gone through, we should eventually be stronger for it. We strongly believe that our current problems will be dealt with given enough time. People’s memories are short and they eventually get used to their new circumstances. Also, time creates a normal replacement cycle, not only of machinery and equipment, but of new consumers, leaders, and business managers who do not have the same preconceived ideas or memories of their elders.

The things that people “know” today probably will not turn out to be completely accurate. Four years ago investors either did not see what was coming or more probably, did not ever imagine that financial markets would suffer as much as they did. There was a true under-appreciation of risk and an over-reliance on the belief that higher risk equals higher return. People’s ability to forecast based on what they know is tenuous at best, and we expect that this period’s mismatch is likely to err on the side of not being as bad as expected.

In addition to regular quarterly commentaries, we have published our thoughts about what is impacting the markets during times of extreme stress. This piece, as did our March 2009 remarks (archived below), happened to coincide with the market’s bottoming. Our intention with commentaries such as these is to provide a deeper perspective during fear driven market declines.

A Buyers’ Strike

A former colleague always used to say that “Now is the hardest time to invest.” Maybe it should be revised to “Now is the hardest time to stay invested.”