A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the World Wide Web.
Richard Bernstein Advisors measured the performance of the average retail investor over the past 20 years and the results are shockingly awful. According to the data, the average investor generated returns that were not just below the U.S. equity market, but well below the ten year bond and even below three month Treasury bills. It's been so bad, even adopting Marketwatch's tongue-in-cheek method of consulting palm readers for stock tips could be an improvement.
The findings provide a blunt reminder of the near-limitless number of bad habits and poor techniques that we've all fallen victim to at one time or another. They also present a compelling argument to read and re-read Psy-Fi blog's explication of the main psychological biases that limit investor returns, so we can avoid them in the future.
"Reminder: You are 'shockingly' terrible at investing" – Business Insider
"The latticework" – Psy-Fi
"We asked a palm reader and a financial adviser how to handle our money" – Marketwatch
The Wall Street Journal makese a compelling case that the global economy is slowing rapidly. The euro zone, Japan, China and Latin America are all posting weak growth numbers that are putting downward pressure on commodity prices. A continuation of this pattern will see all economically-sensitive market sectors, not just resources, underperform.
"Will a global slowdown blindside bulls?" – Wall Street Journal
"Copper slumps on Chinese demand concerns" – FT Commodities
"Oil prices tumble as demand flags " – WSJ
I spent years believing Twitter was merely a place where celebrities posted pictures of their lunch but now I couldn't function without it. Pick your followers carefully, and Twitter can provide the quickest high quality market analysis to be found anywhere.
This is a good day for investors who haven't used Twitter to sign up and test drive the free service. The Journal has presented a long list of twitter feeds from major research firms that can guide investment decisions. In addition, of course, to @SBarlow_ROB.
"The WSJ guide to useful finance/econ stuff on Twitter" – WSJ
I believe agriculture is one of the most compelling long term investment themes, and news out of China supports my contention. The expected increase in Chinese pork consumption alone will require an annual 240 million tonne increase in grain by 2022, according to the United Nations. And that's just one country, and just pork.
At the same time, persistent drought conditions and poor water management are increasingly limiting China's efforts toward self-sufficiency. The WSJ's China Realtime blog reports, " Nearly every year, drought conditions pop up somewhere in China, often accompanied by an official warning that it's the worst in 50 years or even a century."
It's likely too early for investors to jump into the investment theme, however. Currently, fertilizer stocks are expensive and profit growth slow. Deere & Co., the largest provider of large agricultural equipment, just reduced sales forecasts so that doesn't look promising yet either.
"Cloud-seeding can't save China's farmers from serious drought" – WSJ, China Realtime
See also: "Can the world feed China?" – Earth Policy Institute
Tweet of the Day: from @leftoutside: "Today's awkward lesson from my office: Send flowers express, if you don't they may arrive after you've been dumped. Awkward for everyone."
Diversion: Photos of Paris taken in the 1860s and 1870s. Public restroom facilities were, um, different. – The Retronaut
Follow Scott Barlow on Twitter @SBarlow_ROB
Scott Barlow