Tweedy Browne annual report to shareholders is out. Below is a brief excerpt followed by the full document in scribd:
Global equity market returns over the last year of approximately 14% in local currency‡ could perhaps best be summarized by the phrase, “who would have thought?” …especially in the face of a drumbeat of concern about the breakup of the euro, political gridlock in the U.S. over how to resolve government deficits, fears over what a slowdown in China might mean, and a “flight” to safety in which“investors” (however that term is defined) crowded into debt securities to the point where ten-year U.S. Treasuries yield less than 2%, and Swiss banks began charging customers for deposits.* Many of the most recognized observers on the state of financial markets did not mince words when it came to discussing the prospects for the future. Some were very pessimistic, a few very optimistic, and even fewer saying it’s just not clear what’s going to happen. One well-known weekly featured an article entitled, “Why Stocks are Dead,”while others argued economic growth in the developed world is all but over. An interesting paper written by Robert Gordon, an economic historian at Northwestern University,entitled, “Is U.S. Economic Growth Over?” seemed to capture much of this thinking, at least insofar as the U.S. economy is concerned.