Dec 24, 2024
This is a mash-up of previously broadcast show audio, from
Wednesday (12/4) and Monday (12/9):
Periods of extreme leverage and speculation are not new, and the
outcomes have consistently been painful for unprepared investors.
The late 1990s dot-com bubble serves as a prime example.
Speculative bets on internet stocks drove valuations to
extraordinary levels, with investors leveraging margin accounts and
options to chase gains. When the bubble burst, the Nasdaq lost
nearly 80% of its value, leaving leveraged traders especially
vulnerable to devastating losses. On being Contrarian: Markets have
not rewarded those so inclined. Yet. Does not necessarily mean to
be super-bearish. On being "out of consensus; the current set up is
good for recession. What will cause it, we don't know. Lance
looks at cycles vs trends (Lance's first bank job). Cycle context &
psychology. Most cycles are too long to be practical. "We must
invest for the time frame in which we have control."
Trend-following is better than cyclical tracking. Lance's 60th
birthday, cursive writing, and Phoenician writing. The impact of
not saving each year: Time frames are critical.
3:17 - Why Sentiment-driven Indexes are Up
14:37 - Lessons from History - What Excessive Leverage Teaches
Us
30:25 - The Fallacies of Diversification
30:26 - On Being Contrarian
44:42 - Cycles vs Trends
Hosted by RIA Advisors Chief Investment Strategist Lance
Roberts, CIO, w Senior Financial Advisor Jonathan Penn, CFP, &
Senior Financial Advisor Danny Ratliff, CFP
Produced by Brent Clanton, Executive Producer
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Articles mentioned in this report:
"Leverage And Speculation Are At Extremes"
https://realinvestmentadvice.com/resources/blog/leverage-and-speculation-are-at-extremes/
"Extreme Speculation Has Returned"
https://realinvestmentadvice.com/resources/blog/extreme-speculation-has-returned/
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The latest installment of our new feature, Before the Bell,
"Diversification Isn't What You Think" is here:
https://www.youtube.com/watch?v=rmN8a-6Yr5g&list=PLwNgo56zE4RAbkqxgdj-8GOvjZTp9_Zlz&index=1
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Our previous show is here: "Extreme Speculation Has Returned"
https://www.youtube.com/watch?v=HIfTDuPmsQs&list=PLVT8LcWPeAugpcGzM8hHyEP11lE87RYPe&index=1&t=2s
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