Boiled Frogs

We closed out 2012 filtering through seemingly unlimited quantities of Wall Street’s Year-End Market Outlooks with the intent of publishing a “Best Of” series for investors.  If nothing else, this is terrific material to gauge current consensus sentiment, entering the New Year. Unfortunately, we did not find a lot to get excited about.  So instead, we’ll kick off 2013 where we finished 2012, with a quote from one of our favorite market sages, James Grant.

“Sin comes first, always. If we suffered before we sinned, we wouldn’t sin. If the pleasure and pain of monetary overstimulation were coterminous, there would be no inflation, no fast-climbing public debt and no exploding asset bubbles. The cost of over-cranking the presses would be just as obvious, and just as immediate, as the thrill induced by the monetary pick-me-up. As it is, the pleasure is immediate, the pain prospective.”

“Looking back at today’s ultra-low interest rates, investors will think of the fable of the boiled frog and belatedly realize that they were the duped amphibians.”