For the second time this week, we find ourselves responding to some extraordinary developments in the financial markets. It is clear to us that this week’s action was not about earnings, dividends, oil prices, bad management, mismanagement, or even GDP. There is nothing efficient in the way this market is operating, either in terms of pricing or the very market mechanism itself.

For all of us here – including the many seasoned veterans – this is probably the most difficult time we’ve confronted together with our clients. That said, being trampled by a frenzied crowd leaves us with only two real choices: turn and join them, letting fear lead us to take flight and sell in the face of circumstances completely out of our control; or, stand aside as best we can and let the mob run past us towards a decision we know they will ultimately regret once the danger and uncertainty subside.

To continue reading this issue of Research Notes, please click here.