Global Value Investing

[ratobranco]

Top 5 market gurus. Of all the commentators out there, these guys seem to have the deepest understanding of what is actually happening in the global economy and markets, as well as the strongest track record for being right in their analysis and predictions, in *both* directions, bullish and bearish. Not coincidentally, they are usually in agreement with each other, though they may frame concepts in different ways.

1) Jeremy Grantham – hedge fund manager, GMO. A good clip on his world view:

Website w/ quarterly letters: http://www.gmo.com/America/

2) David Levy – economist who uses "profits perspective" (inspired by Jerome Levy and Hyman Minsky) to gauge future direction of economy and markets.

Where Profits Come From: http://www.levyforecast.com/assets/Profits.pdf

Uncle Sam Won’t Go Broke: http://levyforecast.com/recent-publications/

Clip On US Debt Debacle:

Clip on US Private Economy Contraction: http://www.bloomberg.com/video/77484178/

3) Mark Dow – hedge fund manager, Pharo Capital. Very good global, "big picture" analysis, makes interesting tie-ins to behavioral economics and evolutionary psychology, highlights a lot of situations where market players are right, but for the wrong reasons (that is, situations where market players embrace an explanatory model that is factually false, but that leads to trades that work for completely unrelated reasons. Classic example: dollar debasement theories of Austrian economists such as Peter Schiff. Shorting the dollar has been the right secular trade for past decade, but not because anyone is debasing it. See article below).

Most Recent Clip on Euro Debt Crisis:

Dollar Debasement and Other Short Stories: http://blogs.reuters.com/great-debate/2011/05/03/dollar-debasing-and-other-short-stories/

Twitter: http://scribe.twitter.com/#!/mark_dow

4) Lakshman Achuthan (ECRI). Uses complex system of leading-indicators developed by Geoffrey Moore to forecast business cycle shifts. Extremely reliable. ECRI hasn't made false recession alarm in something like 40 years:

Calling for Recession, Sep 2011: http://finance.yahoo.com/blogs/daily-ticker/going-lot-worse-ecri-achuthan-says-recession-unavoidable-141929160.html

Calling for Recession, April 2008: http://www.businesscycle.com/news_events/event_details/1493

Also called the end of the last recession, timestamped call from April 2009.

Website: http://www.businesscycle.com

5) Andrew Smithers - The world's greatest authority on stock market valuation. Extremely thorough and data-oriented, tends to notice very subtle but important factors driving markets that no one else notices:

Aug. 24, 2011, SPX @ 1152, Stocks to Rally 10%, Corporations to be only net buyers of stock, Use as selling opportunity:

Nov. 2011, just had 10% rally from that level, CNBC now reports that Corporations have been only net buyers of stocks: http://www.cnbc.com/id/45402485

Website: http://www.smithers.co.uk/

Honorable mention: John Hussman. http://www.hussmanfunds.com His work is a weekly must-read IMO, however, his moral attachment to the bearish view on stocks (a view which I happen to share), makes him a bit less reliable in terms of predicting what will actually happen. He sometimes lets the question of what "should happen in a rational market" interfere with the far more important question of what "will happen given that the economy often is not rational."