New interview with Howard Marks (H/T ZeroHedge)

Howard Marks, chairman of the U.S. investment firm Oaktree Capital, sees more room to run for stocks. But at the same time he warns that from now on, a higher level of caution is appropriate.

The heat in the equity markets is back on. This week, the S&P 500  reached all time highs. Howard Marks thinks that stocks have more room to run. But at the same time he warns that from now on, a higher level of caution is appropriate.
As reason for his optimism about stocks Marks cites the growing popularity of the equity market and still pretty fair valuations. Nevertheless, he’s uncomfortable with the super easy monetary policy of central banks like the Federal Reserve which forces conservative investors like him to take on more risk.

Mr. Marks, next week Wall Street will celebrate the fifth anniversary of the end of the equity bear market. What are your thoughts when you’re looking back to the dark days of the financial crisis?
Because people play an important role in determining the course of the financial markets, stock prices move like a manic-depressive. Of course, there were some severe fundamental problems in the years 2008 and 2009: The economy was bad, capital markets were closed, and Lehman Brothers and other financials firms went bankrupt. But most people exaggerated that into a belief that the world was ending. In line with that, asset prices were ridiculously low. Therefore, five years ago the key to making money was to have money to spend and the nerve to spend it. In other words: To do the exact opposite of what most people were doing erroneously at that time.

And what’s your take on the stock market today, half a decade later?
Around the beginning 0f 2012 it was clear that a lot of recovery from the crisis had taken place. The economy, investor psychology and the price of credit investments had recovered, and pro risk behavior had started to return to the markets. Because of that, our mantra at Oaktree Capital for the last few years has been: «move forward, but with caution».

Full article here http://www.fuw.ch/article/in-the-end-the-devil-usually-wins/