Buffett Cut J&J Stake, Other Holdings in Fourth Quarter

Berkshire Hathaway has released the list of its holdings for the fourth quarter of 2008 — and it looks like Warren Buffett has made some substantial changes to his company’s portfolio. While Buffett has recently said he is “buying American” with his personal portfolio, the biggest news from Berkshire’s filing doesn’t involve new purchases, notes Alex Crippen of CNBC’s Warren Buffett Watch, “Instead of asking what Buffett has been buying,” Crippen says, “we should have… Read More

Hulbert: Signs of Investors Moving Back Toward Risk

In his latest column for MarketWatch, Mark Hulbert notes that a “dramatic reversal” is taking place in the bond market — and says it’s a reversal that could signal good things for the economy and the stock market. The yield spread between 10-year U.S. Treasuries and 10-year triple-A-rated municipal bonds has fallen significantly in the past month, Hulbert says. A month ago, those Treasuries were yielding 2.3% versus 3.53% for the munis. Given that interest… Read More

Grantham: There’s Risk in Value — and in Buy-and-Hold

Jeremy Grantham has released the second half of his fourth-quarter 2008 letter on GMO’s website, and in it he offers several intriguing points about why value investors got hit hard in 2008, where the economy is headed, and whether a buy-and-hold approach to stock investing makes sense. Calling 2008 “The Year of The Value Trap”, Grantham notes that the decades-long pattern of big market declines leading to great stock bargains and big recoveries did not… Read More

Growth vs. Value: Does It Matter Anymore?

Growth versus value: For decades, it has been perhaps the most widely asked question in stock market strategy discussions. But in Forbes’ most recent Intelligent Investing Panel, two top strategists argue that the growth/value debate is no longer the critical question it once was. Robert Froehlich, chief investment strategist for DWS Investments at Deutsche Bank, says that growth and value flat-out don’t matter anymore. Globalization, he says, has caused markets to become interdependent, which speeds… Read More

Tilson on Cognitive Dissonance, and a Shift in Strategy

In a column for the Financial Times, money manager and columnist Whitney Tilson — one of those who predicted the housing and financial crises — discusses the “tricky” process of trying to alter one’s approach based on the lessons of the past year, and examines some changes that he and another star manager have made. Tilson say that many investors are likely enduring some serious cognitive dissonance — that is, they are having trouble reconciling… Read More

Schiff: Any Stimulus Plan Will Be Disastrous

While investors are eagerly waiting to hear what the final economic stimulus package will include, author Peter Schiff, who predicted the recent housing and stock market collapses, has been issuing dire warnings about whatever version of the plan is approved In an interview with Yahoo! TechTicker’s Aaron Task, Schiff says passage of the stimulus plan will do “the exact opposite of what President Obama is saying,” referring to Obama’s statements about disaster following if the… Read More

Munger on Morality, Higher Taxes, and How The Founding Fathers Can Help Us Now

Charles Munger, Warren Buffett’s long-time sidekick at Berkshire Hathaway, offers some tough medicine for the U.S. in an editorial written for today’s Washington Post. Calling the current situation “dire”, Munger says that the current bust goes well beyond the normal boom & bust cycle, and measures should thus be taken to keep it from occurring again. “Should we opt for even more pain now to gain a better future?” he asks. “For instance, should we… Read More

Hulbert: Graham’s Approach Endures

In his latest MarketWatch column, Mark Hulbert wonders whether the recent market plunge has shown that “maybe Ben Graham isn’t old-fashioned after all”. Over the past couple decades, Hulbert says, the strict, conservative approach used by Graham — who is known as both the “Father of Value Investing” and the mentor of Warren Buffett — had fallen out of favor on Wall Street. But as the current downturn has dragged on, Graham’s approach seems quite… Read More

Hot List: How to Combine Strategies to Minimize Risk, Maximize Returns

In my new book, The Guru Investor, I detail ten of the best-performing stock-picking strategies of all-time. These guru-based approaches are a great way to get a leg up on the market, but, as I’ve found over the years, having a proven stock-picking methodology is just one part of the path to market-beating returns. Stock investors also must deal with a number of portfolio management questions, such as, “Which strategy is best for me?”, “How… Read More

PIMCO Boss: A New Take on Asset Allocation

In this month’s Kiplinger’s magazine, PIMCO CEO Mohamed El-Erian offers some interesting insights into diversification and risk management in an economic world that is in great flux. According to El-Erian, the old rules of diversification have changed in a couple different ways. First, with other countries catching up to the U.S., he says investors shouldn’t have as much of their portfolios in U.S. stocks or bonds as they have in the past. U.S. stocks should… Read More