The First Sign of Weakness in Corporate America

Our bullishness over the last several years regarding US equities has been primarily based on the strength in US corporate profits. Whereas the overall economy had a rather tepid recovery, the US corporate sector had one of its strongest receoveries in history. Corporate profits now compose the largest proporation of national income in post-war history.

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Financial Times - Why the 'Risk-On' Rally Will Not Last

The recent rally in global markets has been led by what most investors are now calling "risk-on" assets. Their counterparts, risk-off assets, have lagged. We question the longevity of this risk-on trade. Indeed, we believe that the secular investment theme remains off.

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The Importance of Beta Management

2008's bear market has led investors to increasingly focus on absolute returns rather than relative returns. However, investors continue to judge manager performance based on relative performance despite the change in their performance goals. That seems inconsistent and self-defeating to us.

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2011: The U.S. Year

The market generally proves the consensus wrong, and 2011 certainly adhered to that historical precedent because the consensus "must owns" at the beginning of 2011 generally underperformed during the year. What is somewhat startling to us, however, is that conviction has yet to be shaken. The consensus continues to favor commodities, emerging markets, and "any-bond-but-treasuries".

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USA Today - 15th Annual Investment Roundtable

Experts agree: get over your fear and get back into stocks. Originally published in USA Today on December 17, 2010.

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Barron's - New Gig, Old Approach

Interview with Richard Bernstein about his new firm, and the newly launched Eaton Vance fund. Originally published in Barron's on December 6, 2010.

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Four Things you probably don't know

We continue to believe that we are in the earlier phases of a much more normal bull market than most investors realize. By our reckoning, stock markets have four phases:


1. Denial: The bull market can’t happen. Shouldn’t be happening. Won’t continue.

2. Acceptance: Fear of missing out leads investors to increasingly participate.

3. Brainwashing: New investment world. The bull market is never going to end.

4. Bear market: The end of investing as we know it.

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Eleven Themes for 2011

Here are our eleven investment themes for 2011. Each of these is either specifically or generally embedded in our investment strategies.

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