As a result, last Tuesday's closing high of 10,889 was the highest close of the week, despite the fact that the Dow ventured toward 11,000 later in the week, before ultimately ending the 5-day trading session at 10,854.
Does this feeble trading action portend the denouement of a magnificent year-long rally? Is the Dow's dazzling 70% advance off the lows of March 2009 finally coming to an end? It feels that way to your editors here at The Daily Reckoning. But, be forewarned, we've been wrong once or twice before.
We are not rooting against the best stock market of 2011, of course. We simply have a hard time conjuring up enthusiasm for pricey stocks for 2011. It feels like the stock market is in need of a good, long rest - also known as a correction.
But do not despair; there are always selective top stocks to buy, even when the overall market is pricey. And furthermore, long-term investors can (usually) afford to ignore intermediate-term volatility. Fortunes typically accumulate over years, not over months or weeks.
This observation leads us to the topic that inspires today's edition of The Daily Reckoning: What are the best stock investments to own or to avoid during the next few years. What, in short, is the "Trade of the Decade?"
In the January 4th edition of The Daily Reckoning, Bill Bonner offered his new Trade of the Decade: Sell long-dated Treasury bonds, buy deep- value Japanese stocks for 2011. Your California editor agrees wholeheartedly with the first half of this trade, but has a different suggestion for the second half...and he shared these views in a recent presentation to the Investment University Conference in San Diego, California, which occurred on St. Patrick's Day.
What follows is a lightly edited transcript of that presentation...
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