Says David Snowball's Fund Alarm commentary this month:
"By the way, my sudden realization that the S&P500 has indeed returned less than a good money market account over the past decade is modestly horrifying."
He goes on to talk about the new D&C Fund, and concludes with a general D&C observation:
"All of the Dodge & Cox funds suffered in late 2007 and 2008 as a result of two factors. One is fallout from the sub-prime meltdown. None of the D&C funds directly owns any of the troubled derivatives or any company central to the problem, but its investment in financials and in industrial companies with financial subsidiaries (General Electric comes to mind) hurt it. The other factor was poor performance in the health care sector, which Stock overweights. Being disciplined, the managers took the broad weakness in the sector as an opportunity to buy at depressed prices. As a result, they boosted their health care exposure by nearly 80% in recent months. It’s far too soon to say whether they’ll be vindicated – though Balanced, Stock and International performed excellently in March – but the odds are stacked strongly in favor of folks who trust D&C’s discipline.
Bottom Line: Let’s be blunt about this. If this fund fails [i.e. DODWX], it’s pretty much time for us to admit that the efficient market folks are right and move (very quietly) into Vanguard ETFs.
And in an article in the NYT,
"Over all, 46,000 manufacturing workers were laid off last month, and 326,000 such positions have been lost over the last year, the Labor Department reported. Construction remained the focus of contraction, losing 61,000 jobs. Retailers eliminated 26,800 jobs.
Health care continued to be a rare bright spot, adding nearly 37,000 jobs. Restaurants and bars added 18,000 jobs. Professional and business services, which includes accountants, architects and management consultants, added 39,000 jobs."
No mention is made of the increase in government jobs (9,000 jobs) ; nor of the fact that although hourly rate went up a penny, weekly pay decreased $1.75 (fewer hours).
It's good to have more bartenders, burger flippers, and home/nursing home health aids; and they all do their part to making the employment figures good, which is what we want. And provide career opportunities for American youth as well as lesser qualified new citizens/visitors. After all, remember we need 150,000 new jobs each month just to stand still (population growth).
