You just can't keep a good market down.
UPDATE 1-Legg Mason's Miller: "Bottom's been made" in stocks
Wed Dec 3, 2008 3:07pm EST
(Adds comment on Miller's record, quotes)
By Jennifer Ablan and Herbert Lash
NEW YORK, Dec 3 (Reuters) - Legg Mason's (LM.N: Quote, Profile, Research, Stock Buzz) Bill Miller, a celebrated investor whose stock picking is far off the mark this year, said on Wednesday the "bottom has been made" in U.S. equities.
He recommends that the Federal Reserve buy stocks and bonds to avert a deeper financial crisis.
Speaking at Legg Mason's annual luncheon for media, Miller said that all long-term investors believe that stocks today are cheap, but credit markets must regain health before equity markets can rally.
It "looks as if the bottom has been made" in U.S. stocks, he said.
Miller told Reuters the year has been "terrible, a disaster and awful," yet he held out his past performance in down markets as a reason why he should not be counted out.
"We've performed in most of the financial panics that we've had -- the last one being the three-year bear market ending in 2002 -- we outperformed all the way through that," he said.
"So even though we lost money, we lost a lot less money than the market did," Miller added.
However, Miller acknowledged that his performance has been worse than in past downturns.
"When you're underperforming and losing more money than the market in a down market, then that's a much more problematic situation. We've performed far worse than I would've predicted we would," he said.
For the year, Miller's flagship Value Trust LMVTX.O fund was down 59.7 percent as of Tuesday, compared to a 41 percent decline in the reinvested returns of the S&P 500 index, according to Lipper Inc., a unit of Thomson Reuters.
Performance over the year-to-date, one-, three- and five-year periods for Value Trust put it at the bottom of the barrel among its peers, Lipper data shows. (Reporting by Jennifer Ablan and Herbert Lash; Editing by Jan Paschal) |
