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Hussman Strategic Growth (HSGFX)


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  • Last year, one of the posters on this board repeatedly joked about HSGFX having a target price of $6.66 and would cease business on the day it first closed at this price. Well, the future is here. HSGFX has spent the last few weeks trading either a little above or a little below this price, and on Friday closed at $6.66 exactly. Unfortunately, John Hussman is too much of a scam artist to uphold his part of the deal and close up shop, in spite of this fresh evidence of his gross incompetence managing HSGFX. Instead, he continues to bilk gullible investors by collecting large management fees for the privilege of watching their investments lose money. Come on, Doc. Do the honorable thing and close the fund. You've had your chance and failed. Give your investors their remaining money back and allow them to invest with a fund manager who at least has a chance to make a profit.
  • The amount of money Hussman has cost investors is mind-boggling, and he's enriched himself in the process--the very definition of a con artist. He has been so wrong, so often, and for so long.

    His fund was up and beating the market in 2008, while everything else was down, but then he turned mildly bullish when he should have remained bearish, then turned bearish in 2009 when he should have remained bullish, and he's been wrong and losing ever since.

    What most people don't know about Hussman is that before he started his fund in 2000 he published a market-timing newsletter, and during the 1990s he completely missed the raging bull market that led to the stock market bubble (the bursting of which allowed him to clobber the market in his fund's early years by hedging as the bear market he'd wrongly been calling since 1994 finally arrived). Had you followed his market-timing advice in the '90s, you would have completely missed the greatest run-up in stock market history--the beginning, middle, and end.

    I've seen a quote from him in which he claims to have only missed the very end of the 1990s rally. That's false. He missed the entire 1995-1999 rally. I know because I remember--he and I had a mutual friend who always relayed his views ("Huss says the market is about to tank")--but also see quotes below.

    Sure, he's a smart guy, but so what? Often with investing, the less you know the better.

    from GordonX's "Hussman's Greatest Hits" (the '90s hits)

    Deseret News, The (Salt Lake City, UT) - June 12, 1994

    NEWSLETTER SAYS STOCKS ARE A BEAR

    Hussman Econometrics (34119 W. Twelve Mile Road, Farmington Hills, Mich. 48331), which The Hulbert Financial Digest has called "the most promising newcomer among investment newsletters'' after its first three-year performance doubled the market's return, has turned bearish on stocks. "The market is beginning to display the classic traits generally associated with bull-market tops. The time to buy stocks is in the middle of a recession, not when an expansion..."

    ---------

    A Couple of Bears Tell Why They're Still Growling
    Pay-Per-View - Los Angeles Times - ProQuest Archiver - Mar 3, 1995
    It's not the end of civilization, Hussman says: "Stocks are just due for a natural, normal, run-of-the-mill bear market." ...

    --------

    Analyst unimpressed by Pyxis rival
    Pay-Per-View - San Diego Union - Tribune - ProQuest Archiver - Jul 30, 1995
    John P. Hussman of the Michigan-based newsletter Hussman Econometrics is not bullish on the stock market now...

    ---------

    BusinessWeek: May 15, 1995
    Adds John P. Hussman, a money manager and investment newsletter writer based in Farmington Hills, Mich.: "There's a likelihood of slipping into a bear market at any time."

    -------

    S&P'S 500 DIVIDEND YIELD IS 2.66%, LOWEST OF CENTURY
    $2.95 - Deseret News - NewsBank - Jun 18, 1995
    "The stock market has left itself no room for error,'' observes Hussman Econometrics (34119 W. Twelve Mile Road, Farmington Hills, MI 48331). ...

    -----------

    Published on March 26, 1996, The Washington Times

    Market's total value points to bad times

    There have been five times this century when the size of the stock market (total capitalization) relative to the size of the economy (nominal gross domestic product) exceeded 75 percent, as it does today, observes Hussman Econometrics (34119 W. Twelve Mile Road, Farmington Hills, Mich. 48331)

    "Each instance coincided with a Standard & Poor's 500 dividend yield of only 3 percent or less, as is also the case now. Each marked the peak of a major bull market."

    ------------

    Mr. Bear and Mr. Bull
    By Mark Hulbert, 02.10.97
    Forbes

    The bear is John Hussman, editor of Hussman Econometrics, and adjunct professor of economics at the University of Michigan. What sets Hussman apart from the other bears isn't his focus on the market's fundamental extreme overvaluation. That's something he shares with virtually every other bear. What makes Hussman's bearishness noteworthy is his compelling explanation of the mistakes he made several years ago when he and the others turned prematurely bearish.

    ----------

    Published on July 1, 1997, The Washington Times

    Sky-high prices may warn of stocks' fall

    Historically, when the price-earnings ratio on the Standard & Poor's 500 has been above 20-to-1, as it has been recently, it has always been because earnings are depressed, observes Hussman Econometrics (34405 W. Twelve Mile Road, Farmington Hills, Mich. 48334).

    "This is the first time in history that we've seen a P/E over 20-to-1 on record earnings. The only two times the P/E exceeded even 19-to-1 on record earnings was in 1964 and 1972.

    --------

    Published on June 3, 1997, The Washington Times{PUBLICATION2}

    As dividend yields sink, how far can stocks rise?

    "The extremely high returns on stocks over the past 14 years have been the result of a decline from the highest dividend yield in two generations, 6.7 percent in August 1982, to the lowest dividend yield in history, now well below 2 percent," notes Hussman Econometrics (34405 W. Twelve Mile Road, Farmington Hills, Mich. 48334).

    "It seems unlikely that the dividend yield can fall much from current levels. So it seems equally unlikely that stocks can rise..."

    ------------

    Nov 7, 1997

    Stocks have never been this highly valued when earnings were at record levels, notes Hussman Econometrics (34405 W. Twelve Mile Road, Farmington Hills, ...

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    Economist: U.S. might already be in recession

    The San Diego Union - Tribune - San Diego, Calif.
    Author: DON BAUDER
    Date: Oct 30, 1998

    He's John P. Hussman of Sunrise, Fla.-based Hussman Econometric Advisors, and he says the markets are already giving off clear recessionary signals: The interest rate spread between corporate debt and Treasury debt has widened, indicating growing fear of credit risk, while the spread between long- and short-term Treasury instrument interest rates has narrowed considerably, suggesting the market expects a very sharp growth slowdown.

    Combine these so-called "forward-looking" indicators with other similar ones, such as the stock market decline, the drop in consumer confidence and the National Association of Purchasing Managers Index suggesting that manufacturing is contracting, and "the signal says, `Hey, we're expecting very slow growth, probably recession,'" Hussman says.
  • Wow. How is this man still allowed to manage money?
    What is wrong with people?
  • Hussman should listen to Buffett & Munger. Listen to the first half of this. Buffett could be looking Hussman straight in the eyes while saying these words. But Hussman wouldn't listen. One of the heros of value investing, Jeremy Grantham, just popped Hussman's bubble so much so that Hussman felt the need to try to "correct" Grantham's view in his most recent Weekly Commentary.

    https://finance.yahoo.com/news/warren-buffett-everything-valuation-gets-back-interest-rates-140328844.html

    Warren Buffett: One metric tells me the most about the future
    Stock market valuation metrics like CAPE appear to signal trouble for the stock market. Warren Buffett is among the experts who argue that valuations must be considered in the context of interest rates.
    finance.yahoo.com
  • Market up, Crushedman down. Market down, Crushedman down.

    In the last six trading days the SP500 is 3-3. HSGFX is 0-6. He has made losing money into a fine art.
  • He continues to lie and lose. Still claiming it was "stress-testing" when his own commentary from August 31, 2009 says:

    "So if, in hindsight, our economic difficulties are behind us by now, and we're off to the races, then it's clear that our measures missed an uncharacteristically large portion of the initial advance, and our concerns about economic fundamentals will have been misplaced.
  • More lies in the December, 2016 semiannual report.

    The only skill that Hussman has actively worked on improving during his years at the helm of HSGFX is lying to his investors. I see a fresh example in the most recent semiannual report, which contains a clear case of lying through omission. In previous reports, Hussman has taken great pride in bragging about how his hedged approach protects his investors from the 50%+ losses experienced by other stock market investors. Guess what? It's not there any more. Of course the reason for this is that HSGFX itself now has a 50%+ loss. Including 2016's 11.49% loss and a 3.09% loss early in 2017, I calculate that HSGFX has now lost 50.59% from its peak (with dividends reinvested).

    If Hussman were an honest man, he would have no problem admitting that his hedged approach exposes investors to the same magnitude of losses as unhedged investments - after all, that's what the data shows. But lies and excuses have become second nature to Hussman during his tenure at HSGFX, so the truth has disappeared from his semiannual report, now that it only serves to expose the failure of his methods.
  • How are #$%$'s "extreme crash signatures" doing? I think he posted them 7-8 weeks ago. Of course he stopped mentioning that idea since it didn't pan out.
  • WARNING: STAY AWAY FROM THIS FUND! The fund manager is completely incompetent, an incessant liar and con artist, and likely has serious mental health issues. His performance on every level has been horrible: 1 year, 3 years, 5 years, 10 years, you name it. He never stops losing shareholder money, never. Learn from his many victims (former shareholders).
  • The NOT over priced market has legs.....get it together John.....Jermery Siegal....at Wharton school of business is the guy to follow.....has been bullish since 2009......His whole point is EVERYTHING relates to options.......when you have a 2.5% 10 year and a forward PE of 20 on stocks.......then stocks have an earnings yield of 5%,,,,,which is better?......and BTW with rates bottoming 2 TRILLION of long bond money is about to hit stocks.....that and 5 TRILLION Trump is borrowing to give industry....TAKE THAT JOHN!!
  • Another low for Crushedman. Will his clients ever get tired of losing money with this fool? He says share prices are obscene. No, John your losses are obscene.
  • Why is he overhedging? It appears he is 150% net short and 100% long? Why not just 100% long and 100% short using derivatives?
  • Hussman has failed over and over again -- disastrously for his shareholders. Where are the Board of Trustees to shut him down from doing more harm? They should definitely be sued for negligence and fiduciary irresponsibility.
  • Only down 20% in last 2 years (from 12/31/14). That "new and improved" mumbo jumbo doesn't seem to be working. Maybe Hussman should concoct a "revised, new and improved" mumbo jumbo for the next 2 years. Can't really do much worse.
  • The following was written by a team at Bain - often very smart folks, almost certainly smarter than John Hussman - in 2012.

    "Rethink hurdle rates. A prolonged period of capital surplus will be characterized by persistently low interest rates, high volatility and thin real rates of return. ... To get into sync with these new conditions, all investors will need to ratchet down their market interest rate expectations... Without these adjustments, they may end up keeping their capital on the sidelines indefinitely while waiting for higher-return opportunities that will not materialize."

    http://www.bain.com/publications/articles/a-world-awash-in-money.aspx

  • Everyone interested in Hussman should read the most recent quarterly letter from GMO's Jeremy Grantham. Grantham is a very well-respected value investor who shares much in common with Hussman, but has multiple, significant advantages. Grantham is older and wiser. He has an excellent team to collaborate with. He and his firm have done incredible analysis of asset bubbles over the very long-term (hundreds of years). Most importantly, he and the firm are quantitative at heart, but are not ruled by their models - they understand that models are the beginning, not the end.

    Anyway... Grantham a) does not think the U.S. equity market is in a full bubble, just over-extended and over-valued and b) he thinks it is more likely that this overvaluation will correct over a decade or more of mostly sideways action. That outcome will presumably grind Hussman's funds into oblivion! No matter what Hussman says, he *needs* a steep and deep decline in stock prices to recover some relative performance and rescue some asset value.
  • The bottom line is that Hussman's approach depends *completely* on the future looking exactly like the past. The outcomes that follow certain "signals* *must* match those in the past for his approach to work. Otherwise, as we've been witnessing for nearly a decade, his approach, whether "stress-tested" or not, falters badly.
  • I invested in HSGFX 4 years ago and now 40% down. No matter where market goes this J Hussman loses money. This is one of those cases where this guy is so paranoid of losing that he sees darkness in very single geopolitical event that happens and he wastes investor's money in hedging. I am so sick of reading his #$%$ that he posts on his site. The fund has 1%+ expense ratio which is high. This guys is making money for himself by spreading his childish paranoia and fear which he tries to justify his headging on. This guy needs to be sued and prosecuted for telling this non-existent gloom and doom and for creating fear to lure investors in. Folks please start the movement. I need my money back. Well at least I don't want him getting paid. Prosecute John Hussman.
  • The market may go up or down but Hussman continues to lose. An island of stability in a world of uncertainty. See, I can say something positive about our boy.
  • I noted that Yahoo shows the address as:
    Hussman Investment Trust
    5136 Dorsey Hall Drive
    Ellicott City, MD 21042

    A couple of things:
    First, it looks like the office is at least a mile from the devastating floods that hit the city.
    Second, use Google street view to tour around - you need to turn off the main road into an office park. Unlike other businesses there, Hussman puts up no sign. What should jump out is that this little office park is all little "hang a shingle" / mom-and-pop businesses - a few individual attorney offices,a little gallery, a pilates studio, etc. We are talking about really small offices for really small businesses. I wonder if there are any employees left other than John Hussman at this point anyway.

    (Also, if you turn the view around you can see a cop with lights flashing tailing the Google street view car!)