Observations

I cannot fail but think that what is happening in the world seems nonsense and the outcome of random events. People act like bees in a beehive. Just trying to survive and randomly producing what we call history.

We want to believe we are guided. Like the idea of “intelligent design”. It makes us feel comfortable. There is overwhelming evidence, however, that history is the outcome of the unplanned fight of power groups seeking power and wealth. It was the theme of the last observation.

All this has important investment implications in choosing our time frame for investing. One thing is sure -- the concept of long-term is a dangerous one. Think of the 1930s, the 1970s, and 2000s. These periods add to 50% of stock market history. In other words, you have a 50% chance of forecasting the long term.

Just track the forecasts of the Fed. They missed this recession in an embarrassing way! Thinking near term reduces the randomness of the outcome because there is more certainty about the trend. This is the reason why momentum investing is the most successful strategy.

To find out more about my in depth view of the markets and my strategy just visit our website https://www.peterdag.com/ where you can review The Peter Dag Portfolio. You can also call me at 1-800-833-2782 to discuss your specific money management needs.

I will be happy to speak to your investment group on how the business cycle impacts investment strategies and the choice of asset classes.

George Dagnino, PhD
Editor, since 1977
Ranked No. 1 market timer by Timer Digest