Fact or Fiction?

A good process follows the data, plans for different outcomes

Having a rooting interest can be tough. Take the Knicks, for example. Cast into the NBA wilderness for 20 years, thirsty, hoop-starved fans (maybe even some writing this note) elevate the current team’s success out to be the next big thing. Can Brunson be the MVP? Can we win it all next year? Our desire to see the things we have dreamed about for so long finally come into focus creates a loss of objectivity. And that’s OK. We’re fans. But in markets, we call this bias. And it is terrible for stock picking, portfolio construction, and/or developing any kind of viable investment thesis.

The current market environment - periodic high spikes in volatility owing to higher-than-normal uncertainty around fiscal and monetary policy decisions - has created a bonanza for the bias creation business.

This can puzzle folks that rely closely on data to make portfolio decisions.

The focus today is on one big bias carved into our psyche so indelibly that it is hard to shake, but shake we must:

The bias: Tariffs will take us to crazy-town!