I’ve been studying some new research out of Brigham Young University, of all places.  As you know, the world of stocks is divided into the stock of small companies, middle-sized companies, and large companies.  Those stocks are called small-cap, mid-cap, and large-cap. Stocks are further dividend into two “styles:”  growth or value.  Growth stocks have … Continue reading Correct . . . until it is not

One of the main reasons I retired from banking was that it seemed the bank’s most “difficult” customers were usually assigned to me.  So, when I started my own practice after retiring, the first rule was “No jerks allowed!”  If I didn’t like a client personally, they could not be my client.  The downside is … Continue reading Godspeed, Chuck!

One of my favorite fictional non-persons is Count von Count on Sesame Street.  He has obsessive-compulsive behavior and must count everything, e.g., the number of blades of grass in a yard or trees in a forest or clouds in the sky.  He should have been an economist, who try to measure everything and explain only … Continue reading A Migraine for the Count

As expected, resolution of the Cypriot crisis went down to the wire, and disaster was just barely averted.  In addition, the widely-anticipated shutdown of the U.S. government scheduled for this Wednesday has also been averted, but only to increase the importance and risk of the next debt ceiling increase in a few months.  The European … Continue reading Crisis du Jour

It was a clear, pleasant summer day on June 28th, 1914 as Archduke Ferdinand and his wife were being driven in their open car in Sarajevo, when he was assassinated by young Gavrilo Princip.  A month later, Europe plunged into World War I.  That assassination was the burning match thrown into the gasoline. Not to … Continue reading Who Spilled the Gasoline?

Like all human beings, existentialists are complex, but the most obvious characteristic is their dispassionate disrespect for death.  Seeing death as a normal part of life, existentialists think of death . . . like Peggy Lee thought of love — “Is that all there is?” Through the haze of religious Faith and the passage of … Continue reading Are Existentialists “Born This Way” ?

In 1992, I was in Switzerland on business, staying at the elegant Hotel des Bergues in Geneva, where I met a man who wanted me to invest with him in starting a bank in Cyprus.  More amused than interested, I listened to him explain an almost wild-west environment for banking in that tiny island nation. … Continue reading Russia’s Cypriot Subsidiary?

I don’t need any meddlesome busybody from New York City trying to run my life for me.  So, Mayor Bloomberg is not on my “best-friends-for-life” list.  He is trying to violate MY personal options, by outlawing super-large sugary drinks, like Coke. Last Friday night, my wife and I enjoyed a night out on the town. … Continue reading Their Choices vs My Money

Let’s see . . . I could just shoot my foot with a pistol, but that’s not very innovative.  Maybe, I could use a rifle to ricochet off a rock before hitting my foot.  No, let’s be really stupid!  How about taking a machete and chopping off 9.9% of my foot? That is how the … Continue reading Innovative Stupidity

The stock market has been very bullish since Christmas.  Maybe, it is too bullish and needs to “bump along” for awhile before resuming its climb? It has behaved relatively normal since its March, 2009 low.  Compare it with some other market rallies: You’ll notice the current rally most closely tracks the rally following Nasdaq’s dot.com … Continue reading Even Bulls Should Rest

One of our speakers this week said there is a difference in the way older clients use the term “asset allocation” and the way financial advisors use that term. Older clients use the term to reflect their risk appetite.  A client with a high appetite for risk might have 90% of his portfolio in stocks, … Continue reading Speaking The Language of Risk

There are two types of stock analysts on Wall Street, i.e., buy-side analysts and sell-side analysts.  If an analyst works for a mutual fund, he is looking for good stocks to buy and is called a buy-side analyst.  If he works for a brokerage house, he is probably looking for good new stocks to sell … Continue reading Talking His Book . . . or not?

Sometimes, another person’s real-life experience can make a theoretical concept understandable.  Today, I attended a lecture in Orlando and listened to a person describe such an experience. (Truth In Blogging:   Modern Portfolio Theory is the most widely-accepted theory of investment management, but I have written numerous times about my reservations with this theory.  His … Continue reading Wisdom From The Birds of Hell

How can a haircut be memorable?  Last week, I got a haircut from a new barber.  Everything was fine, until she asked if I had heard about the young child who was fully cured of HIV, the first person to actually be cured.  Of course, I was aware of it and told her I was … Continue reading An Ayn Rand Haircut

Real estate prices are rising again!  Wall Street is rising again!  The net worth of America has been restored! The global financial crisis that began six years ago wiped out about $16 trillion of our collective net worth.  The good news is that we are once again worth a whopping $66 trillion. The bad news … Continue reading The Joy of Spin

A “short-seller” is a type of investor who bets that the value of something will decrease.  It is a very risky investment technique that I NEVER use, because you can lose — not only the amount you invest — but also EVERYTHING you own. One of the most famous and most successful short-sellers in the … Continue reading Snakes in Planes . . . Or, Farmers in Condos

We’ve all heard that sequestration will be bad for the economy.  Therefore, you would expect financial advisors would be opposed to it.  You would be wrong! A survey last week found a whopping 66% of us were in favor of it.  Bring it on!  We’re in favor of it, despite the fact that 74% thought … Continue reading Rooting For Sequestration

It has been a long, hard four years since the Dow touched its low on March 9th, 2009, before bouncing back almost 118% to close yesterday at its new all-time high.  Yes, I’m happy about it!  Who wouldn’t be happy about a graph like this? But, I would be more happy if this graph was … Continue reading 14,253.77 Is Just Another Number

I don’t understand why investors do business with banks.  Except for checking accounts, what good are they?  They don’t make loans when customers need them.  They put their customers in all sorts of “goofy” investments.  And, they charge all sorts of hidden fees. Did you read this article on the front page of Sunday’s Wall … Continue reading The Freedom To Be Honest

During my first year in the Army, I was trained in the strategy and tactics of conventional warfare.   During my second year, I was trained in unconventional warfare.  I’ve always felt that this one-two approach to almost any subject has served me well. According to Wikipedia, conventional wisdom is “the body of ideas or … Continue reading To Re-Balance Or Not To Be

Readers will recall my tongue-in-cheek New Year’s Resolution was to become chairman of the Republican National Committee (RNC) in order to save the party from its extremists.  America needs the Republican Party, the Grand Old Party, but it is being abused by extreme purists. The sequester is expected to decrease 2013 GDP by 0.6%, according … Continue reading Don’t Look Behind the Curtain

The media pays a lot of attention to the fact that the U.S. stock markets are near multi-year highs, they ignore the fact that we are still lagging China, England, Japan, Switzerland, even Argentina and Dubai.  Take a look at this graph: The two best performers are both emerging markets, which are usually considered more … Continue reading A Little Fresh Air