? Relief at Disappointing Retail Sales? |
| The Hierarchy of Decisions ?
August 16, 2005
That 70s Show
Are we stuck in the 70s? Diane Jaffee, a managing director at Trust Company of the West, and one of the portfolio managers of the Laudus Balanced MarketMasters Fund (SWOBX), says she's been experiencing a sense of deja vu.
In the 1970s we had Vietnam War, Watergate and an energy crisis. Today we have the Iraq War, political crisis (in the form of contested elections) and spiking oil prices.
She commented on the parallel at a conference this morning, not just to be a downer (the 70s was a terrible decade for the stock market), but rather to bolster her theory that value names are likely to outperform growth.
She thinks the markets are in for the same kind of "extended value cycle" we saw in the 70s. Even though there will be pockets where growth outperforms value -- such as the second quarter of this year --she urges investors to look for underpriced large-caps. Her current stock selections: ConocoPhillips (COP), HCA (HCA), and Hewlett-Packard (HPQ).
TrackBack URL for this entry: