The proven strategies rational investors require for success in
an irrational market
When the dot-com and real estate bubbles of the 1990s and 2000s
burst, few were spared the financial fallout. So, how did an
investment advisory firm located in Elkhart, Indiana--one of
the cities hit hardest by the economic downturns--not only
survive, but also thrive during the highly contagious speculative
pandemics. By remaining rational. In A Decade of Delusions: From
Speculative Contagion to the Great Recession, Frank Martin
founder of Elkhart, Indiana's Martin Capital Management offers a
riveting and real-time insider's look at the two bubbles, and
reflects on how investors can remain rational even when markets are
anything but.
* Outlines strategies the average investor can use to wade
through the endless news, information, and investment advice that
bombards them
* Describes the epidemic of market speculation that gradually
infects feverish investors
* Details how investors can spare themselves the emotional
devastation and accompanying paralysis resulting from shocking
financial losses
Investors are still reeling from the instability in the market.
A Decade of Delusions: From Speculative Contagion to the Great
Recession provides the information investors need to achieve
safety, liquidity, and yield.
Autorentext
FRANK K. MARTIN, CFA, founded Martin Capital Management in 1987 after twenty years of experience in municipal finance and, later, mergers and acquisitions. Martin's post-secondary degrees are from Northwestern University and Indiana University. He resides in northern Indiana with his wife, Marsha. He has three adult children. Additional biographical information can be found at www.mcmadvisors.com.
Zusammenfassung
The proven strategies rational investors require for success in an irrational market
When the dot-com and real estate bubbles of the 1990s and 2000s burst, few were spared the financial fallout. So, how did an investment advisory firm located in Elkhart, Indianaone of the cities hit hardest by the economic downturnsnot only survive, but also thrive during the highly contagious speculative pandemics. By remaining rational. In A Decade of Delusions: From Speculative Contagion to the Great Recession, Frank Martin founder of Elkhart, Indiana's Martin Capital Management offers a riveting and real-time insider's look at the two bubbles, and reflects on how investors can remain rational even when markets are anything but.
- Outlines strategies the average investor can use to wade through the endless news, information, and investment advice that bombards them
- Describes the epidemic of market speculation that gradually infects feverish investors
- Details how investors can spare themselves the emotional devastation and accompanying paralysis resulting from shocking financial losses
Investors are still reeling from the instability in the market. A Decade of Delusions: From Speculative Contagion to the Great Recession provides the information investors need to achieve safety, liquidity, and yield.
Inhalt
Foreword xi
Preface xvii
Chapter 1 Lead Us Not into Temptation 1
May Reason Prevail 2
Patience and Persistence 6
The Dean of Wall Street Revisited 12
The Investor's Dilemma 19
It's a Numbers Game 20
The Supremacy of Earnings 22
Stealth Compensation 36
Conclusion 42
Chapter 2 Techno Babble, Techno Bubble 43
A Tale of Two Markets 45
Back to the Future? 53
Warren Buffett on the Stock Market 58
Is the Internet the Answer? 65
What's a Long-Term Investor to Do? 68
Investment Redefi ned 69
Chapter 3 Pop!!.com 75
Risk: No Longer an Afterthought 76
Investment Strategy: Is It Time for Technology? 83
Is There a Snowball Rolling Our Way, Gathering Mass and Speed? 87
The Art/Science of Managing Risk 88
Baby Boomers: Whither Goest Thou? 99
The Internet and IPO Frenzy 100
Fool's Gold 101
Goliaths Slain 102
Chapter 4 Swimming against the Current 113
Prelude to Our Investment Strategy 116
Interest Rates: It Had Better Be Uphill from Here 127
The Power of Popular Delusions 131
The Mind of Crowds 139
Investment Consultants: The Great Middleman Myth 142
Chapter 5 The Greenspan Put . . . Again 145
Investment Strategy 146
The Reckoning 149
Sober in the Morning 151
Micro versus Macro 151
The Margin-of-Safety Paradox 153
Waiting Patiently for Those Hanging Curves 154
Chapter 6 Only Fools Rush In 159
The Rogues Gallery, 2003 Vintage 160
Making Progress in the Post-Bubble Environment 164
How Did We Get Here in the First Place? 171
The Apogee of the Mutual-Fund Boom 181
The Great Abdication of Fiduciary Responsibility: The Defined-Contribution Plan 188
Where the Buck Really Stops 192
Chapter 7 Expanding Concern: A Bigger Bubble? 197
Maybe the Markets Are Not Random? 200
A Short History of Financial Euphoria 218
Fully Deluded Earnings: Penance (?) in the Cuff-Links Cooler 222
Run for the Roses: Of Pawns, Guinea Pigs . . . and Retail Investors 231
Swing, You Bum! 242
Marathon Endurance 247
Chapter 8 What History Teaches 253
Free Markets: Popular Delusions and the Madness of Crowds 254
Aspiring to Rationality by Overcoming Heuristic Biases 257
Today Is Not Tomorrow: Cycles and Differing Opportunity Sets 259
Inverting the Traditional High-Risk/High-Return Paradigm 260
The Inevitability of Regression to the Mean 261
There Are No Called Strikes in the Investment Ballgame 263
Focus on the Important 264
The Malevolent Mathematical Mystery of Modern Money Management (a.k.a. MPT) 264
The Absurdity of the Collective Wisdom of Individual Irrationality 265
Diversification and the Myth of Safety in Numbers 266
The New-Era Error 268
Chapter 9 Contagious Speculation 269
The Means to the End 271
The Perfect Storm? Viewing the Vista through the Lens of History 272
The Blossoming of the Financial Economy: The Cataclysm in the Creation of Credit 281
Bubbles Are Indigenous to the Financial Economy 299
If Housing Prices Roll Over 306
A Remarkable Story of Risk ManagementRun Amok 310
The Perfect Storm Redux 325
Capitalism: When Financial
Overwhelms Commercial 329
Minsky: A Prequel? 332
The Evolving History of Economics and Finance: Reflections 334
Chapter 10 The Tipping Point 339
Excerpt from Quarterly Capital Markets Review, July 2007 341
Draft of Letter to MCM Clients, July 2007 342
Quarterly Capital Markets Review, October...