Equity markets are extremely overvalued with the median stock even richer now on a price/revenue basis than at the 2000 peak. Stocks are not only overvalued, but they are trading here on record profit margins.
Once again managed futures found itself in a difficult environment and, although the Barclay CTA Index was negative for a record third consecutive year, there were many traders able to navigate the rough waters to find profitable trading opportunities.
Dever included several insightful and amusing anecdotes regarding the irrationality of traditional investments and flawed analysis. My favorite — one I have heard before — is how people would not invest with his commodity fund because commodities are risky.
The MF Global debacle was really a slow motion car crash. There were numerous red flags going back a year and the bottom line is that according to the initial bankruptcy filing, there was capital within MF Global Holdings to cover the shortfall in customer segregated funds but the appropriate regulatory authorities did not demand those assets