What We Know & What We Don’t Know

History repeatedly shows we place far too much value on the information we have, and little value on the information we don't.

Collectively, we need to recognize that the crowd is both a lousy predictor of the future and not the contrarian voice.

The waters have become so muddied that even the term "contrary" from its rampant overuse can no longer be appropriately defined in the crowd's eye.

By example, you may have heard the joke: A speaker stands before the podium at an investment conference and asks the crowd: "Who amongst you invests with a contrary model in mind?"  And everyone raises their hand!

Or how about the one about the wife who is startled awake after having a nightmare?
Her husband wakes to find her shaking all over and asks: "Honey, what's wrong?" 
She replies:  "A nightmare," and says, "I dreamt you and Brat Pitt were fighting over me!"  With a chuckle, the husband asks: "Why is that so bad?"

And she replies: "You were winning."

I digress with that last bit.

The Information Gap

The market has indeed started the year on a more positive note.

Only 48 or so more weeks to go!  The point?

"Sometimes you are ahead, sometimes you are behind, and the race is long."

I would suggest pacing yourself as the news reel is about to get a bit more heated.  I would not be at all surprised to see some setback, though I would welcome it as a positive note.

I would also use it to add values for the long-haul, just as stated during every window of red ink since last spring.

Technicals would suggest we could use a rest and volume has not been as heavy as one would like, BUT, that is not at all terrible.

The bigger surprise is that when a bull market is finally ready to flex its muscles, all of the tools we've been trained to use over time suddenly stop working.

Just as in school, once training is completed, there tends to be a new set of lessons to be learned.

So do NOT be surprised if we are witnessing just this type of issue unfolding now.

Rest assured it would be the last thing anyone would be expecting.  That is both information you don't have and completely contrary.

Capitalism Funding Socialism

At a time when our lives are advancing at record pace and change is all about, we may mistakenly assume the change is bad.

We are hearing from our leaders that we should be ashamed if we become successful after years of hard work.

The record will show that charity, social programs and taxes to pay for those social needs come from high income earners and tax revenues.

In fact, it is the ONLY way those programs can be paid for - ever.  So let's say we stop with the idea that being successful is a bad thing.

To wit: less success = less funding for social needs.  And more hurdles to becoming successful = slower growth of revenues to pay for social programs.

So let's consider the idea that we must find a way to have more people become massively successful so that this success can support more needs in the social arena.

Seems such a simple thing, right?

Mike Williams is President of Genesis Asset Management in Manhattan, N.Y.