In The Lonely Bull

Strange days have certainly found us.  Good is now bad and Bad continues to be bad.  We are talking about economic strength.  This is because of fear that economic strength will lead to higher interest rates sooner.  Bad news calls into question the future earnings of companies and support for current prices.

Transition to normal rates ought to be expected and smooth, but that assumes that investors are adults acting rationally; always a bad assumption.  Instead, we expect bouts of panic and irrational expectations.  We will make a transition to higher rates and the investing world will not fall apart; just don’t expect it to be a smooth one.

In spite of the expected volatility, good gains are possible.  These depend on a continuation of good earnings growth; which is likely.  Stay steady my friends.

The Lonely Bull

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