Friday, January 29, 2021Volume 2, Issue 7 “It’s dangerous to short stocks. Being short and seeing a promoter take a stock up is very irritating. It’s not worth it to have that much irritation in your life. We don’t like trading
Roger Lowenstein is the author of five books covering financial markets. His latest book, The End of Wall Street, was published in April. Mr. Lowenstein is also the author of an excellent biography on Warren Buffett written in 1995 which we reviewed previously. In an article for the Washington Post today, Mr. Lowenstein makes the case for more timely intervention by the Federal Reserve when financial market bubbles are forming. Read this article for a brief excerpt and more commentary.
In an interview with The Financial Times, Jeremy Grantham discusses a study on various financial bubbles that his firm has recently completed. Mr. Grantham found 34 examples of bubbles that fit his definition as a “forty year event” statistically. Of these 34 bubbles, 32 have moved back to trends prior to the bubble forming. The two bubbles currently outstanding are the U.K. and Australian housing bubbles which Mr. Grantham believes are driven by low rates on floating rate mortgages. Read this article for more details and a link to the interview.