"The real problem of humanity is the following: we have paleolithic emotions; medieval institutions; and god-like technology. And it is terrifically dangerous, and it is now approaching a point of crisis overall."
"Let me be clear on one point: I can't predict the short-term movements of the stock market. I haven't the faintest idea as to whether stocks will be higher or lower a month – or a year – from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over."A little history here: During the Depression, the Dow hit its low, 41, on July 8, 1932. Economic conditions, though, kept deteriorating until Franklin D.Roosevelt took office in March 1933. By that time, the market had already advanced 30%. Or think back to the early days of World War II, when things were going badly for the United States in Europe and the Pacific. The market hit bottom in April 1942, well before Allied fortunes turned. Again, in the early 1980s, the time to buy stocks was when inflation raged and the economy was in the tank. In short, bad news is an investor's best friend. It lets you buy a slice of America's future at a marked-down price."Over the long term, the stock market news will be good. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497."You might think it would have been impossible for an investor to lose money during a century marked by such an extraordinary gain. But some investors did. The hapless ones bought stocks only when they felt comfort in doing so and then proceeded to sell when the headlines made them queasy."Today people who hold cash equivalents feel comfortable. They shouldn't. They have opted for a terrible long-term asset, one that pays virtually nothing and is certain to depreciate in value. Indeed, the policies that government will follow in its efforts to alleviate the current crisis will probably prove inflationary and therefore accelerate declines in the real value of cash accounts."
"I have seen many exciting moves in my trading career and as a keen reader of market history, I have read about many others. An oil price move of 50% in six months is big but not a stand-out move. But I would point out the following as memorable: the US stock market had six Hindenburg Omens in six of eight trading days in December and between early December and January over 40% of trading days exhibited Hindenburg Omens. To my knowledge neither has happened before."A simple way to think about Hindenburg Omens is basically when over 2.2% of all stocks are making new highs and new lows on the same day, which implies the underlying market is pulling in separate directions. Remember that almost all stock market crashes have been preceded by confirmed Hindenberg Omens, although they can occur without a crash subsequently happening. They are rare events normally."
"Silver moved from $16.5 to $14.5 back to $16.5 in one trading session in December. That is a 25% round trip in a commodity which has been priced for thousands of years and should not therefore be behaving in such a volatile fashion ordinarily."The Ruble was even more volatile. One year ago it was at 32 to $1 yet in one day it moved from 58 to 80 back to 68 – a round trip of 32. Russia is a G8 nation with 140 million people. Now of course we have the Swiss Bank move and competitive devaluations in Turkey, Belarus and Kazakhstan. We expect the other former Communist states to shortly follow leading to further Euro weakness."Finally, the Baltic Dry [freight] is an index that is hard to manipulate; despite money printing it heads towards new lows; and companies such as UPS complain about poor Thanksgiving and Christmas sales despite a strong Dollar and a low oil price. 2015 is going to be a volatile year. Again we implore clients to think carefully about their currency and counterparty exposures."