Wednesday , October 27 2021
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Tag Archives: Most Recent Stories

Get The Fed (and Government) Out of the Stock Market

The Federal Reserve has announced a sweeping set of strict rules to prohibit its employees from owning individual stocks, holding investments in individual bonds, holding investments in agency securities, or entering into derivatives. This is fantastic news following last week’s reports of rampant trading by Federal Reserve officials in recent years that create, at a minimum, the appearance of a conflict of interest. But these law changes do not go nearly far enough as the Fed remains far...

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Did Bitcoin Kill Gold’s Monetary Utility?

I’ve always loved Harry Browne’s Permanent Portfolio. The concept is so simple and clean – own equivalent ratios of assets that protect you in an “all weather” fashion: 25% stocks for growth/expansions 25% bonds for income/deflations 25% cash/t-bill for liquidity/recessions 25% gold for inflation hedging This portfolio is a close approximation of a Global Market Portfolio. It’s simple, diverse and covers all the bases that we might expect to encounter across an economic cycle. It’s also...

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R.I.P. – The Money Multiplier

Well, it took me 10 years to kill it, but I finally did it. I killed the money multiplier. I kid of course. I didn’t do it on my own.¹ It was a mass murder thanks to many of us. But regular readers will know that I have been on a sort of personal crusade to destroy this narrative for over a decade now. I have to admit. It put up a good fight and it was harder to kill than I would have expected. But it’s officially dead according to the Federal Reserve: It’s a weird feeling being so happy...

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Three Things I Think I Think – Long-Term Trends

Here are some things I think I am thinking about: 1) Stocks are more like bonds than we want to admit. Eddy Elfenbein had a great post titled “What if the stock market were a bond?” I’ve talked about this concept in the past. This is by no means a new concept. Warren Buffett has described stocks as perpetual bonds. And William Bernstein has described stocks as having duration-like properties that make them similar to super long duration bonds. Now, you have to be careful with this topic...

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Three Things I Think I Think – Not Nice

Here are some things I think I am thinking about: 1) Class warfare – Nice or Not so Nice? Here’s a California Assemblywoman telling Elon Musk to “f$ck” off earlier this year: And here’s Elon Musk f$cking off right over to Texas by moving both the Tesla HQ to Texas as well as his new state of residency. I really don’t understand this class warfare thing. I know that inequality is a problem and I can understand the sentiment that the wealthy should pay higher taxes. But I really don’t...

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Three Things I Think I Think – Myths that Never Die

Here are some things I think I am thinking about. 1) The government is running out of money – NOT. It’s hard to kill old myths. Really hard. I’ve spent countless hours trying to debunk the idea that the US government is “running out of money”. But here we are having another debate about the “debt ceiling” and this fake idea that a government with a literal printing press is somehow going to run out of money because we imposed a fake credit limit on it. I’ve explained the absurdity of the...

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The Zoom Climb Glide Path & Why the Age in Bonds Rule is Wrong

In aeronautics a “zoom climb” is when an aircraft accelerates at a very high rate of speed and then ascends sharply at a very steep rate. It’s often performed with the aircraft moving at a high rate of speed at a low altitude and then shooting higher in a nearly 90 degree angle. I know nothing about aeronautics, but I know some stuff about money and I am going to explain how this concept can be applied to retirement planning and potential future glide paths. I also think this is a useful...

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Three Things I Think I Think – Dangerous & Terrible Stuff

Here are some things I think I am thinking about: 1) Are target date funds “terrible”? Here’s Peter Mallouk, CEO of Creative Planning, on Twitter saying that target date funds are “terrible”: I asked him to elaborate: Peter’s a great follow if you use Twitter. Just a super practical thinker and all around good guy. And I think he’s touching on something important here. Personally, I am a huge fan of any investment strategy that I would categorize as a Discipline Based Investing approach....

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It’s Time to Break the Debt Ceiling

Another year, another debt ceiling debate. I think it’s been over 10 years since I first talked about how ridiculous this all is. For those of you who have been paying attention all that time – you know the story. The way this works is simple: Congress establishes a “debt ceiling”, a fake limit on how much national debt we can issue. Then Congress approves legislation that will require new debt in the future. That new legislation causes a breach of the debt ceiling. Congress pretends...

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Three Things I Think I Think – Not So Grande Stuff

Here are some things I think I am thinking about: 1) So, not so grande, eh? China Evergrande, the Chinese real estate developer has everyone worried these days about the second coming of Lehman Bros. The company has shrunk by about 90% so they’re not so grande anymore. Get it? Did you catch that joke? Geez, I am hilarious. Maybe they should call themselves Nevergrande? Get it? Did you catch that joke? I’m here all day folks. This sort of thing has happened a few times in the last 10 years...

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