Howard Marks On Uncertainty And The Fallacy Of 'Risk-On / Risk-Off' Investing
Oaktree's Howard Marks is mildly more positive than normal - due mainly to his belief that most people are not uber-bullish - but his latest letter expounds in succinct detail on all the risks that await us (notwithstanding nominal price eruptions courtesy of QuEnfinity). Critically, he notes:
These days we hear little about anything other than macro considerations. Thus investors believe more than ever [as security movements are highly correlated] that the route to investment success lies in correct judgments about the macro future - giving rise to 'risk-on, risk-off' investing.
Playing the market in the short-term based on macro forecasts is one of the many things in investing that could add greatly to results if it could be done right... but it can't, certainly not consistently!
Summing up: "The world seems more uncertain today than at any other time in my life."
Full letter below: