Looking Forward: Investing After the Great Recession

Europe is in disarray. Unemployment remains high. Bond yields are low, and stock prices have reached multiyear highs.

But what should investors expect from here? At the end of 2011, Morgan Housel, The Motley Fool's award-winning columnist, interviewed some of the country's top economists and analysts to find out. Here's what they had to say about the stock, bond, and real estate markets; Europe; and the general state of the economy. Watch now for this exclusive video presentation from The Motley Fool:

(Run time: 14:58)

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (28) | Recommend This Article (168)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 25, 2012, at 5:25 AM, drillerjim101 wrote:

    Morgan, you have produced a beautifully intelligent film for all serious long term investors to ponder.

    Many thanks,

    James Fregia DDS

  • Report this Comment On February 25, 2012, at 6:21 AM, WeWereWallStreet wrote:

    It's nice to hear some inspiration for a change. These guys put Krugman to shame. He not only doesn't admit Americans are resourceful enough to pull ourselves out of it, he says we're in a "Depression." http://www.WeWereWallStreet.com/Krugman's-Depression.html

    Shiller and Seigal usually agree. It's interesting to see them diverge a bit here. Shiller's on line Yale course is one of the best finance educations out there.

    Great video.

  • Report this Comment On February 25, 2012, at 9:03 AM, TMFMorgan wrote:

    Thank you James, glad you liked it! Although the credit for producing should go to the Motley Fool's Brian Richards, Mac Greer, Steve Broido, and Rich Engdahl. I just showed up and asked the questions :)

    -Morgan

  • Report this Comment On February 25, 2012, at 9:16 AM, ThePoulTrend wrote:

    I like this video. Agree with you all on the Housing Market continuing to drop. Unfortunately none knows the severity of this depression, and with all the books I have read on the Financial crisis, Depression, Bubbles, it will never be just one thing holding back the market and the economy as a whole now.

    The top 5 issues of concern that is easily possible in the USA

    1. Foreclosures LOAN MODIFICATIONS(allowing ones lower mortgage rates for the life or some to skip payments for several months.) The amount of homes on the Verge or about to be in Foreclosure is climbing going to sky rocket just wait and watch.

    2. Unemployment is HORRIBLE in America Right now, At or above 22% No Questions about it. (Small Business Owners are being KILLED by Corporate America.Young Americans have Masters, and can not find work, People 60+ are going back to college as they have plan for retiring as it is not possible with how expensive things are)

    3. College Loan DEBT - I am currently enrolled in college, and I took the WORK PART/FULL TIME PAY FOR SCHOOL MYSELF APPROACH. However there are millions, and millions who did not take this approach, some who owe $50.000, to 150,000.00. The facts are many will FAULT COMPLETELY ON THESE. Now with over 1 Trillion in College Loan DEBT this is a Major CONCERN!

    4. Immigration, If they are going to be here let them pay taxes. Everyone understands that the immigration is non reversible.

    5. Government Debt - The Government is on the Verge of FAILING......Which would be HORRIBLE, and WOULD RESULT IN UNKNOWN ENDLESS PROBLEMS

  • Report this Comment On February 25, 2012, at 12:45 PM, phileo72 wrote:

    well done. i'm not a huge fan of the video approach, but this was short and to the point. gracias MF.

  • Report this Comment On February 25, 2012, at 4:10 PM, Merton123 wrote:

    Great Work Morgan.

    The video made several good observations:

    1. The bond market outperformed the stock market over the last 30 years since interest rates trended down.

    2. At the low interest rates today the stock market is poised to outperform the bond market for the next decade.

    3. Housing should really not be considered an investment. It is a manufactured good which depreciates in value. I personally would add that depending on the location real estate could be a good investment from a capital gains perspective. The general consensus appears that inflation will come back because of lack of political will so owning your own house could be a shelter from inflation.

    4. The panel consensus appears to be that the middle class is becoming smaller. That the emphasis seems to be redistributing the pie versus growing the pie. My personal observation is that a person gets trained in a trade or profession that is in demand and is willing to relocate to where the work is that they should do well economically. The biggest challenge is learning how to live within one's personal means.

    5. One of the panelists made the comment that the average life expectancy moving forward could be 95 years. My observation is that most retirees will probably have to work part time to avoid outliving their pension/assets. However, this is not a bad thing. Retirees could choose to work for a non profit helping humanity for less pay since they hopefully will not be raising a second or third family at that time of their lives.

    Morgan you should start contributing articles to the Wall Street Journal. You should branch out with your writing skills to a larger audience in my opinion. I look forward to your next articles

  • Report this Comment On February 25, 2012, at 9:29 PM, JSergeant wrote:

    Nice collection of interviews Morgan. I have enjoyed your many articles on the economy.

    Thanks,

    JSergeant

  • Report this Comment On February 26, 2012, at 12:00 PM, AvianFlu wrote:

    Very interesting and nicely produced! I think Schiller was the most appealing overall. However, they kept referring to the "free economy" here in the US. I submit that our economy is not so free...at least not like it was during most of our countries history. So failures that we will be experiencing will most likely reflect inept governement planning and regulation and should not be considered a failure of free markets.

  • Report this Comment On February 26, 2012, at 12:45 PM, jordanwi wrote:

    This is a great video. You're so good at your job, Morgan.

  • Report this Comment On February 26, 2012, at 1:07 PM, PinotPete wrote:

    Morgan,

    Good video: long enough to cover the main topics, short enough to avoid 'click-away' and a nice mix of back and forth with the interviewees.

    Question: did you pick folks who had this positive outlook or was this a consensus? I know there are others in the opposite camp who make some good arguments. Have you read James Rickards "Currency Wars"? It would be helpful to see how these economists and strategists respond to his propositions.

    Thanks again for the well done video,

    Pete

  • Report this Comment On February 26, 2012, at 5:59 PM, JackCaps wrote:

    In the "Observations & Advice" section, Chrystia Freeland - Editor of Thomson Reuters Digital states the following from 11:52 to 12:40 of this video.

    Cut #1:

    “For the first time in a long time in America [nonsensical already, but it gets worse], how the pie is distributed probably has a bigger impact on the standard of living of the ordinary American family than growing the pie. I think that is devastating and poisonous to the political debate. Right? Where it’s much more fun [I’m not making this up, her opinion is “more fun” than the un-fun alternatives] and ultimately productive for us collectively [“#1 “collective variant] to be part of a collective [#2 “collective” variant], you know, to make things better. <big smile>

    Cut#2:

    For the American middle class, for the past couple of decades, the fact that the pie itself has been growing hasn’t help them. And so the issue of distribution [she’s not talking about UPS or FedEx here], people are right to be focusing on that.

    That was well said comrade Chrystia.

  • Report this Comment On February 26, 2012, at 9:12 PM, joaquingrech wrote:

    I'm liking more and more Robert Shiller through these interviews.

  • Report this Comment On February 26, 2012, at 9:57 PM, Merton123 wrote:

    Thankyou Jackcap - I was wondering who the lady was in the video. Chrystia does bring up a good point that the middle class is becoming smaller.

    Why is our middle class becoming smaller?

    Maybe as our population doubles in size every

    twenty years - the middle class is not also doubling in size?

    Should we take the Chinese approach and have an official policy of one child per family? Or will crime be the means of population control? From Motley Fools perspective this trend means that personal security business should have the wind at their back

  • Report this Comment On February 27, 2012, at 5:42 PM, Rover3321 wrote:

    Morgan

    Thoughtful presentation with balance and nuance. As a foolish investor I am constantly researching differing view and opinions but ultimately I earned the money so I retain the final decisions on how I allocate my portfolio. The weakness in the piece if there is one is that there is no single answer for investors. Each stage in life causes a restructured viewpoint. I would have liked to hear more on investing from various age group standpoints

  • Report this Comment On February 27, 2012, at 7:05 PM, alvidovich wrote:

    To MF folks including Morgan, Brian Richards, Mac Greer, Steve Broido, and Rich Engdahl.

    Thank you! I enjoyed the video. I think it was well done.

    Al

  • Report this Comment On February 27, 2012, at 7:52 PM, Chocilla wrote:

    Enjoyed the video. Very educational with some real heavyweights. However, this information is contradicted by dozens of other respected economists. In fact, it's contradicted by some of the info generated by the Motley Fool (which by the way is now so far away from it's original mission). There are now, what, 10 different newsletters? People have information overload and the fact is, no one really knows for sure. No one. And if things are positive, why does our government continue to intervene with zero percent money. It does not add up.

  • Report this Comment On February 27, 2012, at 9:56 PM, neuRx1 wrote:

    Interesting that these notable economists made little if any mention of the burden of US debt and worse, the unfunded liability hanging over the neck of the US economy like a guillotine. Is there a realistic economic growth rate that leads us out of it? Tax rate? Corporate? Inidividual? Of course, there is no mention of liklihood of attaining political will necessary to make the simple changes needed to maintain solvency. Does it take the next crisis to change. Economist hate thinking about realistic stuff like this.

  • Report this Comment On February 28, 2012, at 3:02 AM, SPARTANBURG wrote:

    Loved the way these well known investors/gurus amplified Fool's larger picture and value investment. In fact it was great to listen to them speak in very simplistic terms which I believe is how most people and organizations perceive investments. Of course there are many issues to consider such as tax, debt , employment and many others but the overall picture seems to be looking brighter.

  • Report this Comment On February 28, 2012, at 4:43 AM, thedubliner wrote:

    what surprised me the most was the concept that the home you live in may turn into your WORST investment ever.

    This is eye opening and it makes perfect sense: currently I myself are betting the VAST majority of my financial resources into my own home....for zero "dividend" return...on an asset that may depreciate in value in real terms.

    I have been thinking of selling my home, rent in a much nicer place and actively manage my own money using fool.com suggestions (which I have been doing for the past 9 months and produced me a nice +21% so far).

    I have a "psichological" barrier though: will i be good enough to manage so much money?

    I really liked this video, it was just what I was looking for. And this morning I have already called 4 real estate agents to put my home up for sale.

  • Report this Comment On February 28, 2012, at 9:40 AM, mikecart1 wrote:

    These people in the video are way too pessimistic about everything I wonder how they buy anything or even live. These are supposed to be the 'experts' at investing and the markets yet you have some of them saying they are afraid to monitor their investments everyday and some of them only have 20% of their money in stocks? Wow. Would probably never take their advice on any investments. The others would rather put their money in an index aka mutual fund than go manual and invest in stocks that are good. Makes no sense at all.

  • Report this Comment On February 28, 2012, at 11:31 AM, Davemuse wrote:

    I am shocked by the strong upbeat tone of the video, and by the feel-good endorsements from most of the comments. Our American society is in trouble, and our economy is struggling in its recovery from the Great Recession.

    We have millions of workers who are unemployed and there are few jobs for them. That is in good part due to the demise of manufacturing in the U.S., as now 75% of our manufacturing jobs have gone overseas, and principally to China. Bigger and more automated farm machinery means we need fewer people working on our farms. Industrially, many companies are systematically lowering wages/benefits in an effort to be competitive, and retail trade is doing its best to follow suit. Seniors in recent decades were content to retire, but now significant numbers of them are deciding that it is not safe to quit work because Social Security and Medicare are on the chopping block. Thus unemployment is unlikely to start rising again in the near term.

    The demand for government bodies to balance their budgets has and will continue to result in slashes to programs (as tax increases are deemed unacceptable). This leads to slashes in support for the poor and elderly, and job layoffs for government workers. Or in the alternative, we are cutting wages and benefits for those workers we still wish to retain, which in some cases are 20-30% reductions. These kinds of actions will both increase unemployment and reduce income to workers in these sectors.

    In the private sector, continuing threats to go off-shore produce employee concessions resulting in lower pay. Plus, companies are finding ways to be lean and mean, by eliminating certain jobs or by re-arranging work assignments so that fewer workers are needed. And unless there is a particularly skill that is hard to find, the wage rates are stagnant. This can help companies bottom lines, but it the aggregate, it produces a smaller American economy. (I read an article that suggested the middle class is getting smaller, and a reader responded saying this couldn’t happen because there is always a middle class [as like a middle third]; however, the article was suggesting that the number of people with middle class income and a middle class lifestyle would be declining, and the evidence indicates that this is what our weak economy is producing.)

    It was announced this week that Europe is now officially into recession, and now the bigger question is depth to which Greece and Italy and Spain and such places will pull the other more stable parts. And since Europe is such a huge trading partner of the United States, difficulties on that side of the Atlantic will certainly damage United States exports, and all businesses associated with producing and transporting American goods to Europe. The atmosphere is likely to dampen tourist traffic to Europe, even if costs come down in places like Greece. European decline will have a significant impact on the U.S.

    The attacks on Obamacare, Medicare and Medicaid in this current election cycle seem likely to succeed and result in disaster for our health care system, which relies on government payments for about half of its income. Cuts in funding will likely lead to reduced patient care as many more people will be unable to pay for medical care. That in turn will lead to more miserable lifestyles and untreated illnesses leading to increased death rates. The entire medical system will be thrown into upheaval as it downsizes to meet the reduced financial income stream, or as it tries to rapidly increase costs to those still with insurance.

  • Report this Comment On February 28, 2012, at 12:56 PM, Rolin4ward wrote:

    Why do so many people keep saying recession? It's a DEPRESSION caused by the recent dismantling of financial laws put in place after the first depression to prevent just this, another depression! Until people call it what it is, a DEPRESSION, the spear point techniques to get the United States back on it's feet will be elusive.

  • Report this Comment On February 28, 2012, at 3:30 PM, cackywon wrote:

    Very good interviews, yet nothing was mentioned about geopolitical risk, e.g. Iran, Israel, which I believe is on par with the Eurozone issues. Also, teh title of the article assumes the Great Recession is over or close to it. Is it?

  • Report this Comment On February 28, 2012, at 11:17 PM, Occamsboon wrote:

    One comment that struck me was the gal who said, "I don't look at my stocks......even every quarter." Really? Then to go on and mention day trading. I personally do not believe that looking at your stocks at week's end makes you a day trader. And the comments by the wealth re-distributionist was mind numbing.. I am diversified, but I am not sure that is a good thing. I should be focused on energy more than I am.

  • Report this Comment On February 29, 2012, at 8:46 PM, jfrankh57 wrote:

    On February 26, 2012, at 9:57 PM, Merton123 wrote:

    Thankyou Jackcap - I was wondering who the lady was in the video. Chrystia does bring up a good point that the middle class is becoming smaller.

    Why is our middle class becoming smaller?

    Maybe as our population doubles in size every

    twenty years - the middle class is not also doubling in size?

    Should we take the Chinese approach and have an official policy of one child per family? Or will crime be the means of population control? From Motley Fools perspective this trend means that personal security business should have the wind at their back

    How about making people responsible to pay their own way and the way of their children...You would have fewer out of wedlock children and fewer people entering the lowest levels of society! I am willing to help out someone who has fallen on bad times, but why help many people who have kids and never make it out of the poor or lower class and instead create a lifestyle dependent on others?

  • Report this Comment On March 02, 2012, at 6:43 PM, tylee100 wrote:

    Morgan,

    I enjoyed the video. You have put a real face to Jeremy Siegel who is one of my favorite writers.

    However, I was very disappointed not to see you on the video. Even on 60 Minutes they show the interviewer. Next time show yourself asking the questions. Thanks.

    Patrick

  • Report this Comment On March 05, 2012, at 1:00 PM, gamblegold wrote:

    Morgan, i've not always agreed with your opines but this was a most excellent video montage. supreme production values. makes me want to work for you . . .

  • Report this Comment On March 07, 2012, at 11:15 AM, DJDynamicNC wrote:

    "I am willing to help out someone who has fallen on bad times, but why help many people who have kids and never make it out of the poor or lower class and instead create a lifestyle dependent on others."

    I'm interested in what criteria you use to distinguish between somebody who is deserving of your help and somebody who is not.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1790404, ~/Articles/ArticleHandler.aspx, 11/23/2014 8:39:08 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement