Mr. Market
A Market Update - October, 2008

Benjamin Graham (a mentor to Warren Buffett) often used a metaphor that might help explain investor psychology during these periods of extreme volatility. In reference to the stock market, he wrote of a mysterious individual he called “Mr. Market.” As Graham explains it, Mr. Market will call you every day and try to entice you into trading. The only problem is that Mr. Market exhibits schizophrenic, manic-depressive and bi-polar disorders. When he gets happy and optimistic, he goes way beyond what is appropriate and tries to entice you to join him buying stocks and bonds after they have made big runs. When he

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The Elephant, the Donkey and the Markets

By Sean Casterline, CFA

Politics is a game that I find hard to get my arms around. The more debates I watch, the more I realize that neither candidate has a real grasp on how economies and markets work. I find myself really hoping our next President has a strong group of advisors. Regardless of what they know, you have heard and will continue to hear multitudes of rumors about what will happen if this candidate gets elected or what will happen if that candidate gets elected. Should you bail out of the stock market if a labor-friendly Barrack Obama trumps a pro-business John McCain? Seems like the natural move, doesn't it? It does except for the fact that we were faced with this same choice sixteen years ago, and if you sold out of the markets, when Bill Clinton took the White House, you would have missed out on one of the greatest Wall Street bull runs ever, a threefold gain over eight years. As well, if you bought the S&P 500 when George W. Bush won the presidential

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