Steven Romick is Worried About What People ‘Aren’t Discussing’

Steven Romick, CFA, managing partner of First Pacific Advisors LLC, has released his investor letter for the fourth quarter of 2012. The letter comments on the fund's 2012 performance, and looks ahead to investment opportunities in 2013. The major point of the piece, however, is that investors are currently taking on more risk than they are willing to admit, and this might lead to serious problems in the future.

The problem, according to Romick, is embedded in the Federal Reserve's attempt to solve the economic woes of the United States. The...