Ralph Waldo Emerson is credited with the saying 'a foolish consistency is the hobgobblin of little minds'. It occurred to me about myself...was my little mind going to slavishly pursue a 'foolish consistency' or, given a whole lot of other obligations this week, would I consider letting my every other week schedule drift a week because I have been buried with other obligations and wasn't sure I would find the time. But the market's angst-inducing daily girations of 1.5%- 2% seemed to deserve some commentary, at least a little context…

It is a new year and yet, the more things change, the more they remain the same. This week presented the world, and investors, with another unexpected set of pronouncements from President Trump that roiled the markets. This was followed by the market resilience which has appeared repeatedly when the previously named TACO (Trump always chickens out) developments unfold - tariffs are rescinded or delayed, the rhetoric is calmer, sentiment improves, and share prices recover. There have been numerous examples in the past year so nobody should be surprised by any of this despite the unpredictability of the occurrences…

This past week I had lunch with a young friend, let’s call him Reed, who is building a successful career in the hedge fund world. He is smart, well-educated, engaging and insightful. Apart from all that, however, what struck me was how differently he approaches the investment landscape. Our discussion reminded me of an investment class I had back when I was a graduate student. The class gave repeated emphasis to the importance of diversification… much as I have frequently written about here…

2025 is drawing to a close. It has been another rewarding year for investors. That’s three years running and, surprisingly (to me at least), the overwhelming consensus is that the market will be up again next year. Until very recently, there have been few dissenting voices on that rosy outlook. Even now, resounding bubble talk notwithstanding, the gloomy voices remain the minority…

With less than a month left in the year, it seems likely that 2025 will mark the third consecutive year of positive market returns, double digit returns at that. It is also very likely that the Fed will cut rates next week and that, in a few months, Trump will appoint a new Fed chair whom he hopes will carry out his wish to lower rates further. All this may create some new challenges for investors, already nervous about all the bubble conjecture and the large capital gains sitting unrealized in their portfolios…

Last week the markets were volatile, experiencing the biggest drawdown in nearly 6 months on Tuesday yet finishing the week slightly positive overall. The respite was brief however. Selling continued into this week, highlighted (lowlighted?) by Thursday’s epic turnaround when, following market darling Nvidia’s strong earnings report on Wednesday evening, the market roared as it opened and then collapsed – the S&P 500 rising almost 2% before ending the day down 1.5%. Excitement over AI gave way to fears of excessive capital spending. Rate cut expectations declined in the face of various Fed Governor comments. Sentiment, formerly extremely positive and overly optimistic, had changed…suddenly fears of a bubble and investor pessimism had asserted control…