MONEY PITY:Spare a thought for poor Bernie Madoff. The imprisoned $65 billion fraudster recently gave a lengthy interview to New York Magazine to "set the record straight".
And set it straight he did. “I am a good person,” he said. His early years in the investment arena were exemplary. “Does anybody want to hear that I had a successful business and did all these wonderful things for the industry? And got all these awards? And so did my family? I did all of this during the legitimate years. No. You don’t read any of that.”
Sad, isn’t it, that people instead choose to focus on, oh, the biggest fraud in history? The injustice prompted Wall Street tabloid Dealbreaker to pine for other victims of an unforgiving media, such as how “no one talks about how Mussolini made the trains run on time, or how Hitler built those wonderful autobahns, or how Ted Bundy made women feel special, even though they did”.
MARKET FORCES:The Iseq may have been stagnant over the last year but other markets are on an absolute tear.
Oil is once more in triple-digit territory, having tripled since bottoming two years ago. The price spike catalysed by the Libyan crisis recently caused it to close more than three standard deviations above its 50-day moving average. That hasn’t been seen in more than 10 years, according to Bespoke Investment Group. Historically, Bespoke note, similar oil price spikes have been followed with gains of over 4 per cent over the next month.
The Nasdaq, too, is flying it. It’s been over six months since the index closed below its 50-day moving average, making it the eighth-longest streak in history and the longest since 1997.
Meanwhile, the SP 500 has more than doubled since March 2009 – its fastest-ever double. The current secular bear market began in 2000, with the 2003-2007 surge turning out to be the “greatest sucker’s rally in history”, as Jeremy Grantham put it. Unfortunately, history indicates the bear is dormant, not dead.
BUFFET ZONE: Berkshire Hathaway chief Warren Buffett's recent letter to shareholders contained its usual mixture of wisdom and witticisms.
He took a dig at finance professors who cling to the theory of efficient, rational markets, dogmatically insisting bubbles and crashes and the like are mere anomalies. “I always love explanations of that kind,” Buffett quipped. “The Flat Earth Society probably views a ship’s circling of the globe as an annoying, but inconsequential, anomaly.”
Wittier still, reflecting on the global financial crisis in 2009, an investor said it was “worse than divorce. I’ve lost half my net worth – and I still have my wife.”
