estate (1)

The Fiscal Cliff Doesn't Matter

So the markets now are driven by the fiscal cliff.  What will happen?  If they don't do something, the markets will plunge.  If they come to some sort of agreement, the Dow would be up 1,000 points. 

Nobody wants to be long on a failure to come up with a solution, and nobody wants to miss the boat on a 1,000 point Dow rally.   OK, 1,000 points is not much.  Maybe I should say 2,000 points.

In any case, this reminds me of a recent Howard Marks interview where he talked about the European situation.  He says there are three things he can say for certain about the situation:

  1. He doesn't know what will happen in Europe
  2. Nobody knows what is going to happen in Europe
  3. If you ask an expert what they think will happen and take their advice, it would be a mistake.


So to apply this to the current situation:

  1. I have no idea what will happen in Washington with the fiscal cliff
  2. Nobody knows what will happen in Washington with the fiscal cliff
  3. If you ask an expert what they think will happen and take the

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