Bill Gross Investment Outlook – Most ‘Medieval’

Bill Gross Investment Outlook – Most ‘Medieval’

In days of old
when knights were bold
and ladies most beholden Bill Gross
straw seemed like silk
and water, milk
and silver almost golden

Not so sure about that limerick – it was probably a cruel world – those days of old. Yet much of it was fascinating and in some cases surreal. The relationship of “man” and God, for instance. Or better yet … “man,” animals and God. Unlike today, when most believe that animals were put on this Earth for humanity’s pleasure or utility, most people in the Middle Ages believed that God granted free will to Adam, Eve and all of His creatures. Animals were responsible in some strange way for their own actions and therefore should be held accountable for them.

Accountable? Well yes, animals were actually put on trial for their misdeeds. They might actually be considered “evil.” Beetles that munched on church pews, pigs that dined off of late evening drunkards, locusts that ravaged harvest wheat – all were viewed in a similar fashion much like their human counterparts – thieves, adulterers and murderers alike. Sometimes the animal would be brought before an actual court, sometimes (as with insects) tried in absentia. In the case of ravaging pigs, for instance, there might be a full judicial hearing with a prosecutor, defense and a robed judge who could order a range of punishments, including probation or even excommunication. No bad little piggies went to heaven, it seems. Often, there would be an actual execution with a hog being hanged by the neck until it was dead. The pork chops followed shortly thereafter, I assume. There was no Humane Society in 1500. Somehow I thought those “medieval” times needed a more reality-based ditty than the one cited above, so here’s a modern-day “Chaucer’s” attempt:

In days of old when pigs were bold
and people very prayerful
a locust might be canonized
and drunkards had to be careful.

Now on to the world of investing, me Lords and Ladies, which by the way is full of little piggies feeding at the trough, scaredy “cats” afraid of their own shadow, and ostriches sticking their heads in the sand. And too, history will record that capitalism and its markets are a dog-eat-dog world. If so, we’ve currently got a menagerie to rival anything in those “days of old.” But let’s stick with the piggies for the following Investment Outlook. Hopefully the prose will be better than the previous poetry.

I find it fascinating the number of ways that investors approach the “value” of securities and other investments such as commercial real estate or homes. Many of them are legitimate and form a solid foundation in academic research or even common sense. “Natural” interest rates, P/E ratios, cap rates, risk and liquidity premiums, and even real estate’s “location, location, location” are ways to fundamentally price an asset. Add to that the emotional influence of human nature and you have a pretty good idea as to why prices go up and down; not necessarily a pretty good idea as to when they will go up and down, but at least the why part is partially visible.

Full article here.


Saved Articles

The Life and Career of Charlie Munger

Charlie is more than just Warren Buffett’s friend and Berkshire Hathaway’s Vice Chairman – Buffett has actually credited him with redefining how he looks at investing. Now you can learn from Charlie firsthand via this incredible ebook and over a dozen other famous investor studies by signing up below:

  • Learn from the best and forever change your investing perspective
  • One incredible tidbit of knowledge after another in the page-turning masterpiece of a book
  • Discover the secrets to Charlie’s success and how to apply it to your investing
Never Miss A Story!
Subscribe to ValueWalk Newsletter. We respect your privacy.

Congrats! Are you a smart person?

We have an exclusive targeted for being a sophisticated and loyal reader.

Welcome in the new year by signing up up for ValueWalkPremium today and get our exclusive content for 40% off. This is our second biggest discount ever!!

Use coupon code VIP20 or click on the button below

Limited time offer only ENDS 1/31/2019 or after next 30 23 subscribers take advantage whichever comes first – please do not share this discount with others