For the fallen heroes of 9/11, and their families and friends, on this, the 12th anniversary of that day, we remember… always.
Can I see another’s woe,
And not be in sorrow too?
Can I see another’s grief,
And not seek for kind relief?
–William Blake, “On Another’s Sorrow”
Central bankers don’t usually deliver insight on matters of portfolio management, but San Francisco Fed President John Williams bucked the trend in a speech on Monday. Discussing “Bubbles Tomorrow and Bubbles Yesterday, but Never Bubbles Today,” his focus, of course, is on monetary policy and what a central bank can and can’t do when Mr. Market suffers from an extended bout of irrational exuberance. It’s an old topic but a perennially relevant one since what we call “bubbles” are likely to stalk the market landscape for something close to eternity. Identifying these beasts in real time in the cause of distinguishing the general article from an imposter is tricky. But recognizing how the crowd has a habit of aiding and abetting misguided behavior on this front reminds us why the critical task of rebalancing is so hard for so many investors.