This week's letter is from my good friend Ed Easterling of Crestmont Research in Dallas. Ed helped co-author a couple of Chapters in my book "Bull's Eye Investing" and that inspired him to write his own book. Ed's recently published, a must read book in my opinion, is called "Unexpected Returns: Understanding Secular Stock Market Cycles."
This article uses some of the insightful research in the book to examine current market conditions and why Ed thinks the "Four Categories" are pointing to a bear market decline in the near future.
Successful investing is all about recognizing and managing risk and not looking for the next home run. It is a lesson we all need to understand. I hope you enjoy this week's edition of Outside the Box.
John Mauldin, Editor
Outside the Box
State of the Markets: A Minsky Review
Judging from the level of complacency in the stock market, some of you may not care to make it to the second paragraph of this article--Hyman Minsky warned us about times like this! Those of you that stay until the end will find a compelling case that four indicators portend a significant decline in the stock market and a rise in…