Grant’s Conference – Notes and Ideas (and one related buy, so far)

Several ideas sounded compelling to me at the conference this year, and one was compelling enough that I was inspired to buy its biggest competitor

By Travis Johnson, Stock Gumshoe, March 22, 2017

In how many areas of life can you be guaranteed to get average results even if your abilities are inferior? That was one of my favorites quotes from the presentation by Ed Wachenheim at the Grant’s Conference: “People with inferior abilities can get average results with an index fund, which is remarkable.”

But, of course, that presumes that you know that you have inferior abilities. Not many of us are honest about that. I enjoy investing too much to settle for the certainty of average results… though in some years I would certainly have been better off in an index fund than in my portfolio.

What else stuck in my brain after this conference? I generally find Grant’s to be a great counter to market ebullience, and it’s one of the few newsletters that I’d be happy to actually pay for (and do pay for), though I wouldn’t say that I’m paying for stock picks or investment advice — I’m paying for a great read and some perspective. As I mentioned to a fellow I met at a different conference recently, “Grant’s is a great way to counter your own ebullience.”

And interestingly, for someone like Jim Grant who has been a big fan of gold as an investment in “monetary disorder” over the years, I don’t remember gold being mentioned even once at this latest conference. I wonder if that’s a contrarian indicator for gold…

Jim Grant started things off with some musings on investing in the world of Trump… including these quotes that summed it up pretty well for me:

“President Trump is prickly enough in victory… imagine him and his twitter feed in adversity.”

“The stock market hates uncertainty… but loves this uncertain man.”

The market is trading at 22 times earnings, and was at 20 times earnings when candidate Trump called it a “bubble,” though of course now that he’s in office he considers it to be a celebration of himself, not a bubble at all.

Still, stock surge higher — margin debt on the New York Stock Exchange was at a record at the end of January… and yet, the VIX indicates that the market perceives little risk.

“The avatar of tail risk has somehow managed to crush the VIX”

I always like Grant’s turn of phrase… and I think that’s how I’ll refer to our president from now on, “The ...

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