Remembering the Risks of “The Smartest Guys in the Room”. We recently put out a two-part summary of Bethany McLean and Peter Elkind’s brilliant book The Smartest Guys in the Room. In an earlier piece, we quoted legendary financial historian John Kenneth Galbraith, who quipped that investors’ memories last “...at a maximum, no more than 20 years.” The KCR team agrees.
2021 has been a terrific year for KCR. For like-minded investors who believe in buying high-quality companies at reasonable prices, 2021 was a much-needed reprieve. We would like to offer our deepest thanks to all of our subscribers and wish you a happy and healthy New Year!
*The chart shows the rolling 10-year period returns since 1800 *Where available we show the Shiller PE peak and trough valuations *The chart shows a reasonably consistent pattern of 10-year runs followed by dismal decades...
This week’s “Chart for the Curious” follows up on our CFTC from last week and our piece on Andrei Shleifer’s legendary book on Behavioral Finance. In those pieces, we discussed how investors piled into Gold after the GFC implosion, which ended up being precisely the wrong time to do so.
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