Many years back while living in New York an interesting situation took place in one of the tunnels connecting New Jersey to Manhattan that's stuck with me these many years later and taught me invaluable lessons on life and investing. A tractor trailer driver was attempting to cut out the traffic of the bridges and take the midtown tunnel which more or less was the more direct route to his destination. Unfortunately for the driver he didn't take into account the height clearance of the tunnel relative to his rig. Needless to say he at first screeched and scraped the tiles from the tunnel ceiling before eventually grinding to a halt. Now with traffic all backed up and the ever patient New York taxi drivers and civilians shouting helpful hints and leaning on their horns in order to help facilitate his escape the police and fire department turned up on the scene along with city engineers. One after another they circled and surveyed the situation seeking a possible solution to unclog the tunnel. One after another they'd toss out potential solutions and one after another they'd systematically be dismissed. Finally as a passenger vehicle was inching by a child yelled out, “why don't you let the air out of the tires”? Their vehicle was waved by and suggestion dismissed. Except by one engineer who had heard the child did exactly that freeing the truck. Which inched its way through the tunnel freeing up passage once again.
There are many lessons to learn here. I took with me the following:
These takeaways or skills seem most in need these days when parsing federal reserve Chair Janet Yellen's Fed speak along with the attempting to anticipate the trajectory and future direction of the markets. Investors both individuals and professionals alike are searching for clues in each and every headline from each and every country. We have to ask ourselves are we missing the forest for the trees. Are we looking too closely at Greece and whether they exit the Euro currency? Are we watching China's growth hitting stall speed of 7% growth? Are we that frightened the Federal Reserve may hike short term interest rates from the near zero percent all the way up to a growth crippling .25%? Can the costs of gasoline, heating oil, natural gas being cut in half be a bad thing for consumers? You get the point. Investors need to take a breath, step back and take a bigger and longer term view of where we are, which still appears to be more of the same, a good not great growth story with very accommodative Global Central banks offering very cheap and attractive financing. But first, let's see what our indicators are saying:
