Flash kraschen 2010, Seth Klarman om björnmarknader.

Vilken annorlunda marknad. Synen av greker på gatorna och en högfrekvenshandel som löper amok leder till det största fallet sedan 1987. Fallet blev förstås inte lika långvarigt som fallet 1987. Förhoppningsvis kommer vi kunna se denna volatiliteten igen.

Ett ganska komiskt klipp från flash kraschen 2010

https://www.youtube.com/watch?v=ppEJ8r7bQ2o

"They are gonna probably halt trading! WE can`t stop the selling! Even Cramer does not know what to think!

Ja vad tyckte Jim Cramer egentligen? Svaret finns i nästa video längre ner på sidan.

Bild stulen från okänd källa

Klipp NEDAN, Förslagsvis ser man mellan 02.00-05.40

02.00: Direktsända bilder från Grekland piggar inte upp marknaden.
03.00: Marknaden börjar kapitulerar.
03.30: "Reportrarna" stirrar i misstro på spektaklet.
04.30: "Reportrarna" talar om ett Lehman scenario i Europa (inte helt osannolikt).
05.00: Som mest är Procter and Gamble nere 30%.
05.40: Marknaden börjar återhämta sig.
https://www.youtube.com/watch?v=86g4_w4j3jU

Framtiden får utvisa vad som sker, men förutsättningarna för att vi någon gång ska se stor volatilitet är goda, förutsättningarna för att se extrem volatilitet är också relativt goda. Man kan bara hålla tummarna för att "feel good" klimatet ersätts av något betydligt mer positivt, panik.

Bilden är från Fairfax årsmöte.

Belåningen på den amerikanska börsen justerad för inflation. Röd linje anger belåning, blå anger S&P 500 index.

När denna volatilitet uppstår igen kommer det inte vara särskilt enkelt att ta positioner, inbillar man sig något annat lurar man förmodligen sig själv. Risken finns alltid att man börjar köpa alldeles för tidigt i en nedåtgående marknad och den bör ej negligeras. Man bör köpa disciplinerat och i omgångar för att på så sätt kunna dra nytt av fortsatta fall. Nedan kommer lite tankar från Seth Klarman om björnmarknader:

“In capital markets, price is set by the most panicked seller at the end of a trading day. Value, which is determined by cash flows and assets, is not. In this environment, the chaos is so extreme, the panic selling so urgent, that there is almost no possibility that sellers are acting on superior information. Indeed, in situation after situation, it seems clear that fundamentals do not factor into their decision making at all.” – Seth Klarman, under djupet av finanskrisen i ett brev till investerare

Some investments in bear markets become cheaper than you ever thought possible. It will actually seem like more stock or bond certificates have somehow been printed than actually exist. In other words, you won’t believe the prices, but you won’t believe the volumes either. You can buy all you want, but whether you actually want to be a buyer will be tested and re-tested.

In a protracted bear market, you will be unique if you aren’t questioning yourself. Everything you thought you knew starts to seem wrong. Everything you bought thinking it was a bargain will appear, at least for the time being, not to have been a bargain at all. Now, at a lower price, the stock may indeed have become a bargain, but do you like it as much as you thought you would now that its price is lower? Or are the facts worse than you thought, the earnings and cash flow eroded, the “compounder” blemished, or are other bargains now simply more appealing? Whereas you once may have said that you would “back up a truck” at such discounted prices, you may find that you imagined wrong, and you have neither the desire nor the capital to add to positions as they hit new lows. Even with market prices scraping bottom, corporate managements that repurchased a company’s stock at higher levels suddenly suspend the program. Expected buildup of corporate cash flow fails to materialize. Debt that seemed inconsequential compared with total enterprise value may now seem large compared with a shrunken market cap that limits recapitalization alternatives.(Klarman)

“In past bear markets, I have noticed some of our analysts self-censoring when they come across new investments. Analysts, especially those with less experience, may come to doubt themselves as a bear market deepens, when everything they recently thought and said may suddenly appear wrong. It’s hard to buy when the message from the market is that everything is going to go much lower. Under such pressure, the most important thing for an analyst is to remain engaged and in conversation…If we didn’t own it already, would we like it at this price?… Amid losses, it’s more important than ever to remain fully rational while assessing and re-assessing price versus value, which is really the only thing that matters.”

Seth Klarman: For years, when someone asked me what my biggest fear was as an investor in managing my portfolio, my answer was that it was buying too soon on the way down from often very overvalued levels. I knew a market collapse was possible. And sometimes, I imagined that I was back in 1930 after the market had peaked the year before, and then dropped 30%. Surely, there would’ve been some tempting bargains then. And just as surely, you’d have been crushed by the market’s subsequent plunge over the next three years — down to below 20% of 1929 levels. A fall from 70 to 20, and from 100 to 20, would feel almost exactly the same by the time you hit 20. Sometimes being too early becomes indistinguishable from being wrong.

Klarman: Of course, getting in too soon as the market falls involves great risk for all investors, including value investors. Certainly, when a few securities start to get cheap even as the bull market continues, a value-starved investor will step up and buy them. Soon enough, many of these prove to be no bargain at all, as the flaws that caused them to be rejected by the bulls become more glaringly apparent when the world gets worse. After a stock market has dropped 30%, there’s no way to tell how much further it might have to go. It’d be silly to expect every bear market to turn into the Great Depression. But it would be equally wrong to expect that a fall from overvalued to more fairly valued couldn’t badly overshoot on the downside.

Klarman: So when individual stocks reach levels where they are truly undervalued, what are value investors supposed to do other than to buy them? Anything else is market timing. Investors live in real time — not in several year intervals, but in months, days, hours and even minutes. Because we cannot know the future — and cannot see in the middle of the cycle its end, and not even necessarily its beginning — we will be bombarded by apparent opportunity as the market descends. We will see tempting bargains and value imposters, false rallies and legitimate recoveries, smart bottom fishers and mindless buy-the-dippers — and we will never know until after the fact how low things might go. We can become macro forecasters, predicting 10 of the next two recessions, or we can ignore the macro economy, buying bargains that cease to look cheap as the economy deteriorates and credit contracts and the tide goes out on all marketable securities.