Michael Farr is President and majority owner of Farr, Miller & Washington, LLC. He is Chairman of the Investment Committee and is responsible for overseeing the day to day activities of the firm. Prior to starting Farr, Miller & Washington, he was a principal with Alex, Brown & Sons.
Mr. Farr has appeared on The Today Show, Good Morning America, NBC's Nightly News, CNN, Bloomberg TV, Reuters, and the Nightly Business Report. Mr. Farr is heard on Associated Press Radio, CBS Radio and National Public Radio. And he has been quoted in The Wall Street Journal, Forbes, Fortune, The Washington Post, Businessweek, USA Today, and many other publications. His market blogs can be found on HuffingtonPost.com and Politico.com.
He is a member of the Economic Club of Washington, DC, National Association for Business Economics, The World Presidents' Organization, International Atlantic Economic Society, and The Washington Association of Money Managers.
Mr. Farr is an award-winning author of three books. The first,"A Million Is Not Enough," was published by Hachette Book Group USA in 2008. That was followed by "The Arrogance Cycle," released in September 2011 by Globe Pequot Press. His third book, "Restoring Our American Dream: The Best Investment," was released in March of 2013 by Headline Books Inc.
Mr. Farr is currently Chairman of the Sibley Memorial Hospital Foundation and a Trustee of Sibley Memorial Hospital and of Sewanee, The University of the South. He is a current Director of Goal Financial, LLC and Atlas Financial Services Group, Ltd. He has formerly served as Vice Chairman of the Salvation Army, Chairman of the Travelers Aid Society, and Trustee of Ford's Theatre; Nation's Capital Progress Foundation; the Paul Berry Academic Scholarship Foundation; and Neediest Kids.
Mr. Farr is a graduate of the University of the South in Sewanee, Tennessee. He is married and has two children.
We remain cautious in this environment. High quality blue chip stocks remain reasonably priced, but investors aren't buying these stocks. We have not seen the type of rotation into high-quality, defensive companies that we usually see when the economic backdrop becomes clouded.
The market's reaction to the Tepper interview seems to us to be another in a long series of overreactions based solely on short-term catalysts, not long-term fundamentals. Investors have become obsessed with turning quick profits by getting in and out of positions at the right time.
The fact that so much supply continues to exist even in an environment of 4.5% mortgage rates is an extremely concerning issue. If sellers can't sell without dropping prices now, what will happen to prices if mortgage rates rise? But ah, we know the government won't let that happen.
There are a few things that may bring the retail investor back into the market in the near term: the elections may deliver a Republican majority in Congress, we are likely to get more clarity regarding the new bank regulatory landscape as the Basel Committee delivers their recommendations over the next few days/weeks and we are likely to get a report on the causes of the "flash crash" that has instilled fear in many a retail investor.
Yes, I know that bond holders have been among the precious few investors to have enjoyed positive returns over the past ten years. Yes, I know that equity guys usually favor equities. I begin with these two disclaimers because of the intense criticism readers send in whenever I caution against buying bonds.
We know that jobs aren’t being added and that consumers have their saving hats on. Neither offers much encouragement for speedy recovery. But pay attention to stocks.
We continue to believe (and the Fed appears to agree) that a stabilization in housing is key to any self-sustaining economic recovery. Therefore, it should not come as a major surprise that the Fed changed course and decided to maintain the size of its portfolio.