It Would Have Happened Already, Redux

It is always interesting and thought-provoking to hear the views of Marc Faber, writer of the “Gloom Boom & Doom Report”. The paragraphs below, courtesy of CommodityOnline, cover most markets.

Gold’s worst start to a year in a quarter century and the biggest sales by investors on record are increasing concern that bullion’s longest rally since the end of World War I is ending.

So far, 2013 isn’t proving much fun, despite fresh eurozone crisis, plus ongoing attacks on the value of currency by central banks everywhere. How come? Money managers have clearly grown tired of the financial crisis, if not blase. After a full decade of year-on-year gains, gold’s drop is a natural outcome, and by no means does this fall undermine gold’s safe haven appeal. It may well, however, be costing you money you’d really rather not lose. So what’s our take? For what it’s worth…

By AAII: The January effect is the tendency of low price, small-capitalization stocks to outperform in January. Historically, these are stocks that were sold for tax reasons late in the prior calendar year and repurchased the following January because investors still think the stocks are fundamentally attractive. Since individual investors using this strategy must wait 30 days before repurchasing any stock sold at a loss to avoid triggering the wash sale rule, these stocks can decline in December and rise in January.

Charles Lieberman submits:It is disputed in a few corners, but more analysts and strategists view bonds as severely overvalued and stocks as symmetrically cheap. We share this judgment and point to assorted different ways to reach this conclusion. Investors should be trying to inoculate their bonds holdings from losing value at some point and taking advantage of the upside potential in equities. The “lost decade” in stocks could easily be followed by a lost decade in bonds, while stocks recover.

David Merkel submits: People are good about making binary comparisons for the most part, leaving aside come of the more complex choices highlighted in the book, “Priceless.” Would you like coffee or tea?

By Olivier Coibion, Yuriy Gorodnichenko, and Johannes Wieland