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Deep Thoughts From Grey Owl Capital Management

Tyler Durden's picture




 
 

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Thu, 04/29/2010 - 10:45 | 323570 Hansel
Hansel's picture

No mention of gold, and they don't consider the dollar a risk asset.  Not my cup of tea.

Thu, 04/29/2010 - 11:02 | 323602 What_Me_Worry
What_Me_Worry's picture

How does he think he has an idea of the return on the S&P over the next 7-10 years?  That's insane.

Thu, 04/29/2010 - 11:50 | 323731 BlackBeard
BlackBeard's picture

1-800-GREY-OWL ha...ha...ha...

Thu, 04/29/2010 - 12:40 | 323855 Edmon Plume
Edmon Plume's picture

I think it's a fairly reasonable paper.  It recognizes many of the things contained in individual articles on 0H.  It recognizes the fairytale meltup, the flight to safety (although I agree that the typical flight is into gold, not "pockets of opportunity").  It also tackles the global sovereign debt crisis, and even includes China, about which many other sources are still pollyanna-ish.  State and local governments are mentioned as being in trouble.  And unemployment problems are recognized.

It also recognizes the ARM resets and thereby the next foreclosure crisis leg.

The worst part about the paper is their conclusions are way too upbeat given the direness of the inputs, but that's hardly surprising considering they are a for-profit enterprise.

But look at how they end.  They end by stating their strategy now includes anything with "significant margins of safety".  Sounds pretty cautious to me, and their customers would be wise to take note.  I think everyone's in the same boat, valuing safety (return of investment) as being at least as important as return on investment.

Thu, 04/29/2010 - 14:20 | 324134 DalFin
DalFin's picture

Who are these guys? They said that the run up led them to expect 3-4% annual returns.  Why so little?  I now expect the S&P to deliver those returns every 3-6 weeks.

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