market folly

This next investor letter from Peter Thiel's global macro hedge fund Clarium Capital is an addendum to the letter we posted last week. In their previous letter, Clarium outlined market commentary. In this letter, they address 'A Macro Framework for Equity Valuation.' In this unique piece, they examine a valuation derived from two analyses. They have first examined the fundamental process derived from Benjamin Graham's book Security Analysis (a staple in our recommended reading list). Secondly, they determine whether a given year is experiencing "positive liquidity" or "negative liquidity" (a concept explained in the letter).

It's a very fascinating read and we highly recommend you digest their commentary, both in the form of their investor letter and the addendum listed below. We definitely consider Clarium to be at the forefront of global macro thinking, especially in a 'new generational' sense. RSS & Email readers may need to come to the blog to view the embedded document.

In the past, we've covered Clarium's (scarce) equity portfolio, as well as their February 2009 performance numbers in depth. Without further ado, the letter: