How I Got My Readers Through 2016

Is there room for market commentary that doesn’t offer certainty about what’s going to happen in the future? Is there a point in trying to understand the present if the exercise does not result in a forecast about tomorrow? Is contextual information as valuable as “actionable” information, if not more so?

My answer to these questions is yes. This is what I do here. If you’re a regular reader of The Reformed Broker blog, then you probably feel the same, to some extent.

I believe that having a complete picture of what’s going on today, along with a real sense of what has happened throughout history, enables us to make better investment decisions in light of the fact that tomorrow is unknowable. That’s the mission, in a nutshell. And it’s not a hobby, it’s my sole pursuit.

Now of course, some would say that prediction is unavoidable – that everyone is making some kind of forecast about the future, whether they admit it or not. Even if the reluctantly made prediction is that the future will be somewhat like the past, with stocks being riskier than bonds, and, as such, offering more reward for those taking on that risk. “Asset allocation,” they’ll snidely say, “is a form of forecasting too, when you think about it that way.”

Okay, I’m a good sport. I can play games with semantics too. I got out of bed and left the house this morning, which was inherently a prediction that I wouldn’t get hit by a train. By walking to work, I was predicting there would be enough oxygen for me to breathe by the time I got there. I can play this nonsense all day 😉

Here at TRB, I spent the year – as I spend every year – trying to share interesting information and viewpoints and data that I believed would helpful to form an understanding of what was going on in the markets, the economy, society and the world at large. My hope is that this process allows me to become a better, more knowledgable investor, and that it’s both stimulating and constructive for you, my readers. I think I did okay in 2016.

Here are some of the posts that readers have told me helped them get through a confounding, frustrating, volatile and ultimately profitable year.

Q1

It begins with a massive whoosh lower, the worst start to a year for US stocks in all of recorded history, believe it or not. I saw a lot of macro or fundamentally driven investors start allowing the price action to seep into their narratives and sentiment. This led to my second-highest trafficked post of the year…

Everyone is a Closet Technician

With small caps, mid-caps and global stock markets selling off between 20% and 30% from their highs, I called it a cyclical bear market for the stock market. I made the point that saying this was not the same as saying “we’re having a recession” or that the secular bull market, which began in 2013, was over…

If You’re Reading This It’s Not Too Late

I alienated some friends and colleagues in the financial media for calling them out when they said outrageous things at the worst possible time. I saw so-called professionals scaring investors when they should have been doing the opposite. I’m not the police of the world, but this is how I saw it, and I said so…

The Farce Awakens

A meditation on getting older and living in a world where there might be too much of everything – depressing prices, jeopardizing careers and causing problems just as daunting as those caused by scarcity…

Abundance

This was a fun one – giving people of all different age groups some food for thought at the very depths of the sell-off…

What Investors Should Be Thinking Right Now

Q2

“It’s been said that everyone has the right to have that one topic that they are utterly unreasonable about.” – Here’s my topic, that I simply will not compromise on…

Simple vs Complex

As we approached 18,000 on the Dow Jones Industrial Average in April – a new record high at the time – people were furious. Either the charging bull had screwed up their narrative, made them look dumb or threatened their careers, I don’t really know for sure – but the furor was palpable and ubiquitous…

Anger at 18,000

In May I relayed the case for why stocks could head higher and investors had all of the conditions they should want to be in place for continued upside…

The Conditions You’d Want Are Already Here

I took issue with the characterization of “eurphoria” being leveled at the investor class by the usual suspects, noting that “low vol” funds were the most allocated-to products in the whole market at the moment, not exactly indicative of a mania…

Everything You Need to Know About Sentiment Right Now

In June, ahead of the big, bad Brexit vote, I called bullshit on the whole “Soros is buying puts” meme…

What you’re not hearing about George Soros today

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So that was the first half of the year. I’m proud of these posts and the response they got from readers, fans and friends. I think I did an okay job at providing the context necessary to see people through the winter, spring and summer. In part II of this post tomorrow, we’ll look back at how this blog handled the post-Brexit period, the elections in the fall and the massive rally into year-end.