2015 Investment Themes

“If it ain’t broke, don’t fix it,” says my friend Gary Shilling as he kicks off today’s Outside the Box. He’s referring to his investment themes for 2015. He first gives us 11 reasons to continue favoring long Treasury bonds. That’s an obvious play for him if you know his view, but it’s nevertheless a compelling one this year and one that you should think through, given the specter of deflation about in the world, the firing up of QE in Japan and Europe (which gives folks money to buy … Treasurys), and the safe-haven status of the US dollar.

Gary’s reason #9 for buying Treasurys is that “The odds of a near-term Fed rate hike are receding. He sees any Fed rate increase being pushed out “as the deflationary effects of the oil price plunge sink in and investors – and the Fed – realize that foreign central bank stimuli amount to Fed tightening [in relative terms].”

Gary’s remaining themes for 2015 include some other clear winners like the US dollar and Japanese equities (no surprise there), but also some interesting defensive plays like consumer staples and foods and what Gary calls “small luxuries.”

Be sure to see the special offer for Gary Shilling’s INSIGHT at the conclusion of the letter.

An interesting thing happened last week. I get a lot of email from readers and do try and sift through them. I got a very kind note from one reader who thanked me for the introductions we do for Outside the Box – he said they compel him to read the articles, which he finds useful. Of course, that one made me feel good. Then less than an hour later I got a polite note from another reader who complained about my introductions, because he prefers to just jump right in, without my stealing any of the author’s thunder. Both comments made me think more about the process of bringing OTBs to you, which is also good. Sometimes we just do things out of habits that have accreted over time, and I may need to be more aware of what I am actually presenting. I really do appreciate your feedback, positive or constructive.

This has been an extremely busy week, as the entire Mauldin Economics team has been in my home for the past three days, sharing ideas, shooting videos, making plans. That means I get a little behind on some things, but being with smart, creative people really gets my juices flowing.

Tonight is sushi with even more guests (and Neil Howe is in town). More planning and meetings and more things that get added to my to-do list. But it is all fun and exciting.