No Chance to Win?

Happy Friday!

Last week Kirk Kerkorian passed away. If there’s anyone who understood risk and reward, it was surely him. (He was one of the builders of modern Vegas.) In reflecting on what made him a great investor, I was drawn to this comment he made back in 2006 when he decided to cash in his chips on his investment in GM. (Recall what happened to that “blue chip” in 2008.)

Amen of the Week

"I like to gamble. But I stop gambling when there's no chance to win."

- Kirk Kerkorian, Entrepreneur and Investor Wall Street Journal, Dec. 2, 2006

Might some, if not most, of today’s artificially inflated markets share this same dynamic?

Chart of the Week

With Kerkorian's comments in mind, I built the following chartto illustrate how the upside/downside of investing in long-term bonds has changed so meaningfully over the years, especially after 2008.

Who wants to bet that Kerkorian’s estate was holding a lot of long-term bonds? Not me.

Yours in the Field,

Frank Byrd, CFA

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