Well, I’m not as old as Charlie Munger, Warren Buffett’s revered business partner, but my take on present conditions kinda has me feeling like an old curmudgeon these days.

You see, having begun my career in 1984, having been in the trenches when the world came to end in one day (a 21% decline in stocks) in 1987; then managing through a relatively swift rebound that had existing clients and perfect strangers bringing me money on virtually every dip (including a mini-bear market in 1990, and a steep correction in ’98) till the world ended again from 2000 to 2003 (a 50% decline in stocks [80% in the Nasdaq]); then navigating the rebound that took a mere 5 years to lull everyone back to sleep — and to the belief that the Fed can fix anything (sound familiar?) — then the world coming to an end in virtual Great Depression-fashion in 2008 (a 58% decline in stocks); then remaining all-out bullish till late summer of last year; then hedging portfolios to protect unrealized gains while eking out a little more upside as the market melted higher; then having revamped portfolios to a much more diverse, all-weather mix, with a cheap put just in case; then, well, the next chapter’s yet to be written…


Anyway, it ain’t easy playing the curmudgeon, the party pooper, the downer, the what have you, but, frankly, while it could be my age, I prefer to believe that it’s my experience, my memory, my obsession with economic and market history, my understanding of investor behavior, my hunger for data and my wherewithal to dissect and interpret it that has me playing mama bear these days with our clients’ monies.


In a nutshell, I don’t know that the market’s on the verge of collapse, in fact my experience with late-cycle bubbles has me thinking that it could still be a ways off. But of one thing I am very certain; when the next great bear market arrives it will have been preceded by conditions very much like those of the present, which demands a careful approach to portfolio management for the time being.


Dear old Charlie, much more seasoned than me, echoed my assessment at a shareholder meeting this afternoon:

“I think there are lots of troubles coming… There’s too much wretched excess.”