James Altucher had a great post this week that I enjoyed quite a bit: "10 Reasons You Should Never Own Stocks Again". This was one I found myself truly laughing out loud.
Why?
The inherent contradiction that has always been there with the stock market. In the USA we have made it so easy for the pedestrian investor to get into so much trouble.
Why?
Every market needs a bid and an offer.
We are now in a low return environment. No bond yield and flat equity returns. So what do we need? A bid. Smart money is running for the mattresses. What do we do? Give "un-smart" money a loaded gun (remember Joe Kennedy's shoe shine boy?)
How?
Let the retail investor buy pre-IPO companies. That's right. We had regulatory and legal issues when companies IPO'd and giving access to retail. Even with a public/liquid ticker the layman has issues. So, what do we do? Let them buy pre-IPO companies. Why not? Let them double down on something else they know little about.
If we look at the advent of some of the VC plays at hand, many of them are predicated on providing the consumer with the tools/methods for their own destruction. Without any fiduciary or curation.
Who else does this? Las Vegas.
We gave all the keys to Citibank a while back and reversed that course. That shouldn't mean we go 180 degrees in the opposite direction.
I have 25 reasons why I am worried. And one person knows it better than anyone: Janet Yellen.
This Fall we will have our first interest rate increase.
Dont fool yourselves. We haven't quantified what this will do to the economy. Ours and the rest of the world.
James gave you 10 reasons to stay away from stocks. I think my 25 may be even more concern.
In the interim: GO BID!