“Do not trust financial market risk models. Despite the predilection of some analysts to model the financial markets using sophisticated mathematics, the markets are governed by behavioral science, not physical science.”
- Seth Klarman
The Through Line: In recent days, we have been in the field a lot, connecting with clients and colleagues for a temperature check. (It’s tempting to prognosticate from a desk – but much more instructive to gather first-hand insights.) Instead of the upbeat mood we typically expect after two months of persistently rising markets and sturdy economic fundamentals, we found widespread anxiety about a variety of issues. There were too many factors to cover in one go, so this week we tackle the most pressing fears related to equity markets.
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