I encourage everyone to read anything by John Templeton, whose track record spans over half a century. Templeton was the eternal optimist, but also had great contrarian instincts. For example, he pulled the plug on Japan in the late 1980s (early) after being a long-time bull. He bought after the Asian crisis of the late 1990s. He actually shorted tech stocks in 2000. Etc., etc.
As an investor, you have to have multiple arrows in the quiver and know which one(s) to pull out. “The futility of timing,” “the futility of macro forecasting,” and “don’t fight the Fed” are all rationales currently held in wide esteem. And there is still far too much optimism, despite what appears to be the onset of a serious deleveraging. People who dismiss macro forecasting – like Warren Buffett – are currently rock stars… perhaps a sign that we should be using this arrow right now.
~ Kevin Duffy, Bearing Asset Management, May 23, 2008