Tag Archives: Most Recent Stories

Share the post "Modern Finance is (Still) a Rip-Off"I’m going to tell you a secret that most of my industry doesn’t want you to know – modern finance is a rip-off. We call it “modern” finance, but the only thing that’s modern is the technological advancement. The fee structure remains antiquated. Yeah, it’s true – expense ratios and costs are falling rapidly. For instance, equity mutual funds have seen a 31% decline in their average expense ratio in the last 15 years.¹ But that has comprised...

Share the post "Don’t Get Trumped in 2017"The holiday parties are over and I’ve recently awoken from a white chocolate sugar cake induced coma to think back on the many investing discussions I always get bombarded with at this time of year. While I was attempting to win an award for mass carbohydrate consumption I was repeatedly interrupted by people who seem to think I am a financial “expert”. This conversation usually went like this:Random person: “Cullen, how about those markets this...

Share the post "The Best Value Vacations this Winter"My general view on foreign exchange is that no one can really predict the short-term movements of currencies.¹ They are zero sum games with fairly high frictions with so many moving parts that they’re virtually impossible to predict. So trading foreign exchange is usually a bad decision.  There’s one exception to this – foreign travel. And when it comes to foreign travel I don’t just rely on trading foreign exchange rates I do it almost...

Share the post "The Global Financial Asset Portfolio is DOWN Since Trump Won"Ah, the market. We hear this term all the time. And we’re rarely specific about “the market” we’re referring to.  After all, what “market” are we talking about when we hear that the market is up or down?  Your local apple market? The stock market? The bond market?  What stock market? What bond market? One thing we keep hearing in recent weeks is that “the market” really likes Donald Trump’s policy ideas. Which is...

Share the post "Did the Failure of Orthodox Economics Contribute to Trump’s Win?"Here’s a provocative piece from the Institute for New Economic Thinking declaring that orthodox economics has been dealt a “mortal blow” by the Trump victory. Sanjay Reddy writes:“Trumpism is a crisis for the most prestigious methods of understanding economic and social life, ennobled and enthroned by the metropolitan academy of the last third of a century. It has caused mainstream ‘social science’ to fall like...

Share the post "A Lesson from the Market’s Overreaction to Trump’s Win"There were many dire predictions about the stock market in the wake of Donald Trump’s victory. These predictions even looked credible in the moments after his win when the S&P 500 immediately collapsed 5% on the evening of the election. Then, miraculously, the S&P 500 bounced right back and is up about 2% since election day. Global stocks haven’t budged much in the aggregate and emerging market stocks are actually...

Share the post "Curating a Social Media Feed to Make Better Decisions"One of the most common problems in economics and finance is the fallacy of composition. The fallacy of composition occurs when you fail to understand the entirety of an argument. As an example, a common fallacy of composition in finance includes the cash on the sidelines myth. The cash on the sidelines myth is the myth often repeated on financial TV regarding the “cash” on the sidelines that will come into the market and...

Share the post "Understanding the Art of Doing Nothing"Most of what we end up doing in our lives is determined not by what we decide to do, but by what we decide NOT to do. In the course of any given day we decide not to do millions of things. Eliminating all of these actions results in a direction that determines how we end up acting out our day. For instance, at lunch you might think you’re choosing to eat a baloney sandwich. But you didn’t really choose to eat the baloney sandwich. You...

Share the post "What Does President Trump Mean for the Economy & Market?"“President Trump”. Crazy, huh? Well, not that crazy. Part of me is shocked and part of me is not. I first predicted a Trump win in my 2016 annual predictions and then later thought he’d lose due to his divisive commentary and failure to pivot to the center. As it turns out, I was wrong and he didn’t need to pivot at all. But I’m no political polling expert (and based on the disaster in election polling forecasters,...

Share the post "The Failing Pursuit of the Truth…"A little over 8 years ago I started writing this blog about the financial crisis. The website became surprisingly popular and within a few months was generating millions of page views per month. It was a scary time and I noticed an obvious trend in my writing – writing about scary things attracted a lot more attention than anything else. But as the years unfolded the world became less scary to me. By 2010 I was fully in the “recovery” camp...