I wrote the sentence above, which today seems like an understatement, before most market watchers had any inkling of what would become the Great Financial Crisis.
At the time, my goal was to alert my readers to the possibility of economic and market pain ahead. I wasn’t the only one sharing this warning, but still, I’m proud I had the conviction to state it.
In short, my work seeks to answer the question, “What’s hiding on page 12 of the paper today or in some obscure research report that could become front-page news next month or next year?”
That’s the big picture from which my research begins….
And to survey the risks and the opportunities ahead, I spend my days reading a wide range of thoughtful opinions.
Several of them I agree with. Many I respectfully disagree with.
But with each new piece of research, I get a clearer view of the forces that could affect the market, policy, and individual investors over the next 1, 2, or 5 years.
In my free weekly newsletter, Thoughts from the Frontline, I address many of these themes in broad strokes.
But for a select group of readers, I share the most critical pieces that cross my desk, along with a brief synopsis of the article.
My aim in Over My Shoulder is to help you position yourself for the types of seemingly unlikely scenarios (and their domino effects) that hide on the margins until they become very real, sometimes quickly.
In early 2015, for example, I wrote: “We have entered the Age of Transformation. We’re going to see the development of new technologies that will simply astound us… While riskier (potentially far riskier) than most of your investments should be, a basket of new-technology stocks should be considered for the growth part of your portfolio. I see the Age of Transformation as a 100% probability.”
Now, I’m not suggesting I called the rise of the FAANG trade or of crypto, but my research clearly said speculative tech deserved consideration.
More recently, if I’d told you a few years ago that 2022 would hand us 9% inflation, the fastest rate hikes since Volcker, and a full-fledged kinetic war in Europe…
You would’ve laughed me out of the room.
Almost no one had these threats on their 2022 Bingo cards.
Regarding inflation, however, in February 2021, I wrote, “Coming on top of trillions already authorized in prior bills, a budget deficit that was already approaching $2 trillion before the pandemic, and the Federal Reserve stimulating in its own ways, people are asking whether this is too much. The answer depends on the Coronavirus’s “Gripping Hand.” If the vaccines work well enough and are administered widely enough to stop the new variants and enable economic normalcy later this year, all that money might be excessive. Rising consumer demand combined with supply constraints could spark inflation.”
Again, in retrospect, what I wrote then seems understated. At the time, CPI was 1.7%.
Likewise, few predicted that the energy renaissance would be the lone bright spot in the markets last year.
My point is, it’s often the threats and opportunities we don’t see that have the biggest economic impact on your portfolio.
That’s why seeking out new sources to broaden your outlook is so important for preparing yourself today.
Since I started sharing this research in Over My Shoulder, I’ve received plenty of kind letters:
“I am a better investor because of the insights I receive. Even good for cocktail party conversations!” —BT
“This has literally changed the way I read and consume financial/economic news and analysis.” —FL
“There is no other data accumulator that ALWAYS provides ‘must-read-and-ponder’ quality research.” —JH
“This is the single best source of information from many of the investment industry’s greatest thinkers.” —TH
I’m always grateful to hear folks feel better prepared because of this research.
But I also understand that time is short.
