HYBRID VIGOR: VOL 3 ISSUE 40 "Best and Worst"

If alien life forms ever thought about spending a week or so in our United States of America, hoping to see the best and worst of our country, they could not have picked a better time than the present.

Our national pastime could not be doing better. Two long-suffering franchises and their fans are reaping the rewards of patience and loyalty. This is one of those World Series where nobody loses—sure, one side will be disappointed, but history has its eyes on both.  The national desire was almost palpable for the Cubs to win last night and force at least one more game. I bet a lot of Indians fans secretly wanted that too, to prolong this great series and perhaps see their players win at home.  Hardly anyone is ready for the season to end. Bring on November baseball.  The aliens would see the best in the world at their craft, sportsmanship (one of Cleveland’s players applauded his rival after an outstanding catch), competitive energy dedicated to positive ends, and, let’s not ignore, outstanding managers.

Thankfully, November also means that this terrible, horrible, no good, very bad presidential election is almost upon us.  Just when you think it can’t get uglier, it does.  Let’s start with the contrast:  the Cubs and Indians are putting the best in the world out there on the playing field, while the Democratic and Republican parties have done anything but. I support Hillary Clinton and agree that she’s as qualified to be president as anyone who’s sought the office.  But I can understand why people don’t like and don’t trust her.  As for Donald Trump, well, the less said, the better.  Suffice it to say that with at most one or two exceptions, anyone in the field running against him in the primaries (let alone at least one excellent Republican who did not run) would have been a better choice, more qualified, more thoughtful, and more temperamentally fit.  The country is probably strong enough to survive a Trump presidency—probably.  The aliens watching would be justifiably disgusted.

Where would the aliens be advised to invest the interplanetary currency they converted into dollars?  They’ve been told about these things called stocks and bonds.  They’re nervous about stocks—they’re hearing that a Trump victory could bring all manner of orange uncertainty, undermining the market’s confidence, and these aliens understand that stocks are worth nothing more than what somebody else is confident enough to pay for them. But they can’t help noticing how little they can earn with bonds, even though they’ve noticed these bond prices coming down during their brief stay here.  They like the idea of not losing principal, but only up to a point.  They don’t want to just hold cash, after all, because they plan to return to Earth and the United States again. They want to see a lot more World Series—and they know that World Series tickets have gotten a lot more expensive over time.

If those aliens happen to be reading Hybrid Vigor, I hope they’ll take my advice and consider buying some convertible bonds.  They’re seeing the best and worst of American culture, but they can get, within reason, the best of both core investment classes we offer.  They hear that convertibles are dying, that people are leaving the market.   To this I ask them:  hasn’t your species been around for millions of years? This is just a blip.  Even lower-for-longer in the rate world is still a relative blip. Get to know convertibles, my alien friends.  They’ll help you pay for a lot more Series tickets.

(This is the cover letter for the subscription-based weekly Hillside's Hybrid Vigor newsletter. For a complete copy, please contact John Anderson at + 1 (646) 712-9289 x 107).