If you frame the world in the context of long-term financial trends, you may see a world without change. Thirty five-plus year bull markets for stocks and bonds are where we have been and where we currently are. Not only have interest rates fallen from all-time record highs in the early 1980’s to all-time record lows lately, but the prospect for lower interest rates longer is the consensus for as far as the eye can see.

Market moves of this historic magnitude are what books are made for, not a monthly letter. After thirty five-plus years, what’s another one year, or five years? The consensus is lower longer. In other words, the consensus is for no change.

Yet the conditions for change continue to swell. Some people are angry, very angry, about our economic situation. Sure we have had one of our worst rebounds from a recession possibly ever. Some young people are asked to assume more and more debt while facing an insecure economic time. But angry?  We are discovering the business model for pension funds is not working.  Older workers, increasingly teachers, police, firefighters and other municipal workers are becoming increasingly aware how the ongoing lower longer outlook will impact them dramatically. (more…)