Hey! I’ve Got A Great Stock Market Investment Tip For You

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If there is one really important thing that I’ve learned in more than 25 years of Wall Street and business reporting it’s what I don’t know.

I haven’t got a clue where the stock market is going next.  And despite all the outrageous claims made by investment professionals neither has anyone else.

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Now I’ve got heavyweight support for this argument from no less than the winners of this year’s Nobel Prize for Economics.  Eugene Fama, Robert Shiller and Robert Hansen “laid the foundation for the current understanding of asset prices,” said the Royal Swedish Academy of Sciences in its announcement.

And what did these 3 economists conclude?  Um,  that  it’s nearly impossible to figure out where markets are heading in the short run, and that therefore stock picking is a fool’s game.

Their research studied the psychology of bubbles and how many of us behave in times of financial stress.  In her fine piece of reporting this week explaining the Nobel award, Heidi Moore of The Guardian wrote that these 3 guys are “men who care what happens in the real world.”

“Economics has a reputation as wonky, nerdy discipline that loves theories that are pure and distant from humanity,”  said Moore. “This year’s Nobel prize in economics is finally, a victory for the study of human nature.”

And human nature can be pretty whacky.  Financial forecasting is at best a dismal science.

But that hasn’t stopped “experts” from trying.  Some make confident  sweeping predictions about what will happen to your money in the next few months, while other far-fetched forecasts go for broke,  playing on the well embedded human propensity for fear and dread.

Ignore them all.

While it is true that over the long term the stock market has consistently out-performed bonds and money market investments, the overwhelming majority of highly paid mutual fund managers do not  beat the market most of the time.  Their failure predict the end of the tech stocks bubble in 2000 and the 2008 financial crash were proof of that.

Often I’m asked by friends and colleagues what’s the next hot stock?

Sorry, I haven’t got a clue.

And if you really want to know the sorry truth, the worst performing part of my 401k savings plan is the stock portfolio that I picked myself.  Despite a considerable investment of time and emotion returns have been pathetic.

The index funds that I put money in and forgot about are doing just fine.

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Pope Francis: Truly Radical

London –

There ‘s nothing quite like travel to change my mind.

One of the joys of being over here in England is to read the British press (there are at least 9 daily national newspapers) and listen to the BBC.  The art of conversation is highly prized and a crucial part of a rich and very old tradition of rhetoric and dialog.

What’s striking is how many parallels there are between what Americans are talking tabout and what’s front and center in this green and pleasant land.

One example is the buzz about the new Pope. Although most Brits gave up on organized religion years ago there is great chatter about the new guy at the Vatican. Suddenly The Church is relevant again.

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(photograph by Catholic Church England and Wales)

Catholics are going through a remarkable time of change, brought on by a man who was elevated to the papacy by one of the most conservative electorates of modern times: the College of Cardinals.

Without actually breaking yet with any  outdated Church doctrines, Pope Francis has utterly altered the conversation.  His latest splendid salvo came this week in the Italian town of Assisi, where his namesake, Saint Francis, lived in the 12th Century.

“The Roman Catholic church, from the lowliest priest to the pontiff himself, must strip itself of all vanity, arrogance and pride and humbly serve the poorest members of society,”  The Guardian reports.  What a switch from the pomp and certainty of the recent past.

“There is a danger that threatens everyone in the church, all of us. The danger of worldliness. It leads us to vanity, arrogance and pride,” the Pope said in the place where Saint Francis stripped naked, turned his back on his wealth and possessions, and vowed to serve the poor.

“He has also said that Catholic convents and monasteries that are empty should be opened up to house migrants and refugees,” said The Guardian.

This new Pope with his emphasis on personal humility and financial transparency at the Vatican appears to be setting the Church on the course of meaningful reform.

He is a radical in the best sense of the word.

Many years ago my own father, during one of our many arguments over politics and morality reminded me of what that word really means. The dictionary definition, often forgotten in today’s feverish debates, is “going to the root or origin: fundamental.” Thanks Dad.