The lessons of 2008

It is time to look back and learn something from the 2008 lessons:

- it was definitely a terrible year for analysts. The volatility made the forecasts look ridiculous. A lot of gurus lost their fans.

- the business cycle turned dramatically, as we never thought that it could turn down - from record profits till collapse there were no more than several months. What is the value of DCF analysis for example, when the whole cycle is turning 180 degrees.

- it was the year when all the stand alone investment banks dissapeared. An entire old business model just vanished

- many pretend they saw the financial tsunamii coming. But let's face the facts: nothing was done against! Otherwise, some of the investment banks would have survived. They were in the middle of financial markets, filtering all the information and oppinions available, but they could do nothing to prevent it.

- there is no such thing like portofolio diversification. As GS said yesterday in their quaterly report (announcing their first ever loss), the prices for all asset classes dropped. With no exception! Commodities, houses, equity, bonds (except few sovereign bonds), even gold.

.... to be continued