Alternative thinking on unreasonable expectations, bad content models and the election

“Have you lost your @!$%X# mind?”

Meb Faber hits the ball out of the park with a piece in Institutional Investor (it’s behind a paywall at first, but it will display if you refresh it) on the unreasonable expectations that we touched on yesterday.

In a piece subtly titled “Institutional Investors are Delusional,” Faber points out that the mean expectations in a poll of investors on net returns is 13%. That would require a gross return of 20%. Just 1% of more than 400 respondents (so just four people) are rational.

Faber says that any CIO in the other 99% should be fired.

Meanwhile, ValueWalk answers an important question about what pensions funds plan to do in the event that hedge funds fail to meet the existing expectations. Here’s the key findings.


“It feels as though 1.5% is the new 2% in fees.”

That’s Robert Chambers of BNY Mellon.

A survey by the firm indicates that 78% of respondents in the hedge fund community are open to slashing their fees. Here it is.

Can we also stop using the words “is the new?”


“If you are a dumba--- there will be consequences!”

That’s Kase Capital manager Whitney Tilson.

He has a message… to a graduating class of ninth grade boys.

Tilson refers to his quote as the “No. 1 Immutable Law of the Universe”

Consequences like what?

You can end up a policy adviser on critical foreign policy matters in Washington D.C. to the most powerful people in the world?

It’s actually a very good speech…and maybe one that should be repeated at the start of every school year.

He rails against bad habits that might hold a person back from becoming the person they want to be. “If you want to get ahead,” he says, “you have to start by not falling behind.”

Most important, emphasizes hard work and determination.

"I’ve thrown a lot at you here, so let me quickly summarize: defense wins championships, work hard, and be nice,” he said. “If you do these things, I promise you that you’ll lead a long and rewarding life, filled with love, laughter and happiness. It’s yours for the taking."


“A further 20.9% said they would not vote for either candidate.”

That’s from Reuters/Ipsos.

Following Hillary Clinton’s staged awkward acceptance speech last night on being the Democratic nominee, a new poll shows her blowing out Trump by 10%, all while the latter argues that Clinton ran the State Department as her own hedge fund.

But the 44% to 34% spread in the Reuters poll is overshadowed by the fact that roughly 21% of voters don’t want either candidate.

Looks like Jamie Dimon’s “Think for yourself” message is already working.

Is Rex Tillerson available for an independent run?


“Individual investors love to check out what the pros are doing.”

Finally, that’s The Street.

In another example of all that is holy and wrong with financial reporting.

There’s a promise of five stocks that hedge funds are dumping…and asks a valuable question that never seems to get definitively answered: Should you too?

Here’s a headline followed by six slides, ad videos screaming from your speakers randomly, and a long-winded built up. There has got to be a better advertising and content model than this. It costs the reader their time.

Here’s the companies are:  Amazon.com, Citigroup, Gilead Sciences, Wells Fargo and Valeant Pharmaceuticals.

There, you save five minutes and countless browser interruptions.