January 2010 was a bad month for investing. Markets fell from equities to credit to commodities. The USD was strong by default. Fears of a sovereign default by Greece was blamed for the general de-risking.
Markets fluctuate. The almost constant rise of risky assets since March 2008 has muted volatility and confounded the sceptics and perma-bears. [...]

If investment strategy was easy in early 2009, its because it was. Valuations of equities relative to cash or treasuries was at an extreme low making equities highly attractive. Equities were highly unattractive on the basis of their earnings yield gap in the periods 1981, 1983, 1987 and the early 1990’s. Equities have been attractive [...]

It sounds like a plan. President Obama in an effort to address what is widely believed to be a flawed banking model has decided to ressurrect the Glass Steagall Act 1933. Glass Steagall 1932 had already been effectively revived, extended and implemented in 2008 as the Fed rode to the rescue of a banking system [...]

Hedge Fund Performance Table 2009:

Outlook 2010:
Managed Futures:
Investors flocked to CTA’s at the beginning of 2009 relative to other strategies for the outperformance of the strategy in 2008. Performance in 2009 was -1.99%. Trend followers tend to create a synthetic long volatility profile (just as mean reverters create a short volatility profile) and the mean reversion [...]

In 2009, the HFRI Equity Market Neutral Index was up 1.69%. The HFRI Index of all strategies was up over 20% and the equity long short index was up over 26%. Equity long short hides a multitude of sins, like a chronic long bias and market timing. Equity market neutral, however, is fairly specific. (We [...]

 
Developed market (US say) GDP rises prompting a reversal of quantitative easing, interest rate and fiscal policy. Domestic equities could rise or fall depending on sentiment at the time. Rates rise. The impact on emerging markets many of which operate a dirty float is that monetary conditions tighten substantially causing emerging markets to fall sharply.
Developed [...]

Post Mortem:
At the beginning of 2009 I wrote down my investment expectations and outlook. Why I do that at the beginning of the year I don’t know. It’s just an arbitrary point in time. Be that as it may, I am hereby repeating that irrationality by coming up with my expectations for 2010.
2009 was a [...]

 
The SEC and the FSA are some of the most sophisticated and well resourced regulators in the world. They have to be, they deal with the nice people over on Wall Street and the City. These days that’s extended to Connecticut and Mayfair respectively. Yet the number of frauds and bad things that seem to [...]

2009 was an interesting year in a different way that 2008 was an interesting year.
In 2008 we thought that financial markets would disintegrate. In 2009, equities rallied, credit spreads tightened, the TED spread and LIBOR tightened while commodities recovered and emerging market sovereign bonds saw robust demand. Low risk developed world government bonds fared less [...]

Jeremy Grantham of GMO in a recent letter writes about a number of interesting points:

Bernanke missing the housing bubble and its bursting, the potentially disastrous implications interactions between lower house prices and new financial instruments (MBS, CDOs), and international distribution of the associated risk.
Other Teflon Men: Larry Summers, encouraging deregulation and lighter regulation and not [...]