David Rosenberg Illustrates The Most Dangerous Thing Investors Can Do
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In the latest Breakfast with Dave, Gluskin Sheff's David Rosenberg writes "the most dangerous thing anyone can do is extrapolate the most recent experience, as enduring as it may seem, into the future."
People, he says, don't ever see an existing situation coming to an end. Furthermore, in three - five years they will be talking about new issues and a new bear or bull market.
He calls this tendency to take an existing condition and "superimpose it on the future", the "magazine cover" syndrome. And to illustrate this he highlights magazine covers from recent bubbles and crises including the tech bubble and the Great Recession.
First up, the front covers from 1996 - 2000 during the tech boom. "The 'road to rich' was paved with fiber optics. Sure thing," Rosenberg writes.
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