Efficient Frontier
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William J. Bernstein

Where I've Been the Past Year

All right, Efficient Frontier readers, enough with the cranky emails. Yes, it has been nearly a year since my last piece and, indeed, we do seem to have reached The Dark Side of the Moon. The bad news is that thereís a whole lot more risk out there. The good news is that the laws of gravity and finance still seem to operate: apples still fall to the ground, and the risk premium is larger than at any time since I wore bell-bottom pants. All that an intelligent investor needs at this point is a healthy appreciation of Pascalís Wageróin plain English, donít bet the farm on anythingóand the renewed appraisal of oneís risk tolerance that the markets administered in 2008.

The reason Iíve been absent from these pages for awhile is simple: sometime in Julyóitís all a haze at this pointóa cabal of hedge fund managers kidnapped and kept me under armed guard at a Super-8 near Greenwich. Each weekday a half hour before the close, Iíd play one of them a round of paper/rock/scissors. Although I wasnít told so until I was released, paper meant "buy," rock meant "sell," and scissors meant "back and fill." I can now reveal that this was why all hell broke loose at 3:30 most afternoons last fall.

So it was all my fault: it was the increased market volatility, and not the recent economic calamities or the collapse of Lehman, that caused equities and bonds to be drastically repriced.

While being held incommunicado, however, I was allowed to turn out some pieces for Money magazine:

Take a Deep Breath. Now Stick to Your Plan.
Why stock picking is a losing game
Train to get into financial shape

(To my fashionista friends, Iím not discriminating enough to ever buy that cool blue shirt, which was supplied by the Money-hired clothes stylist.)

Most recently, Iíve been engrossed in writing a new personal finance book, due out this fall, tentatively titled Investing for the Ages. I have also begun work on another big-picture history title, which will hit the shelves in 2012 or so.

That said, you can expect fewer articles on these pages. With this new book, I may have now written most of what I need to say about finance. And since I donít like repeating myself, unless we have another thirty-year flood, I wonít have nearly enough stimulation to warrant many new pieces.



Copyright © 2009, William J. Bernstein. All rights reserved.

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