As a boy, my hero was Davey Crockett, who famously defended the Alamo in 1836, using the butt of his rifle after his ammo was exhausted. As a teenager, my hero was my father, who was part of the Normandy Invasion during World War II and spent his first night on French soil sheltering from falling debris, under a German jeep with the corpse of…
Bitcoin and cryptocurrencies are misnamed. Those names give the impression that they are actual currencies and can therefore be valued the same way as traditional currencies, like the dollar, the euro, the yen, etc. Of course, the ever-present supply & demand for the cryptocurrencies is the final determinant of their value, but it doesn’t reflect balance of trade, balance of accounts, reserve status, trade treaties,…
Economists are a cantankerous lot. Most don’t even like each other, but there is one thing they agree on: Presidents — ALL presidents — get too much credit when things are good and too much blame when things are bad. Like aircraft carriers, the economy is huge and changes directions slowly . . . very slowly!
What are you gonna believe — economics or statistics? Today, the Bureau of Labor Statistics released their monthly employment report for May. Economists were expecting another 8 million workers lost their jobs and that the rate of unemployment would rise from 14.7% to 19.5%. Instead, according to this report, 8 million workers did NOT lose their jobs. In fact, 2.5 million workers got hired. That’s…
Readers know my description of bitcoin has always been that it is an elegant solution to a non-existent problem. One of the supposed benefits of bitcoin is that it was a store-of-value during a crisis. Well, during this crisis, the price of bitcoin has fluctuated over a wide range between $13,208 and $6,320 during the first quarter of this crisis. On the other hand, gold…
Normal or “retail” investors are not permitted to invest in some of the most profitable/risky opportunities. Those opportunities are normally referred to as private placements and were limited to investors with a net worth (excluding home value) of $1 million or annual income above $200 thousand ($300K for couples). These investors are called Accredited Investors. With the current bull run in the stock market, more…
Classical economists teach “If you want more of something, subsidize it. If you want less of something, tax it.” Theoretically, if you subsidize something, the price will drop and customers will buy more. If you tax something, it costs more and customers will buy less. Does that mean, if you tax wealth, you’ll have less of it? At least three of the Democratic candidates have…
Coming from a religiously conservative family, my Army experience helped me to see other perspectives. Eventually embracing existentialism, the world started to make sense again. Not surprisingly, existentialism has flourished following World War II, with a brief resurgence after both Korea and Vietnam. As a refresher, existentialists believe that society obsesses over death, which is important but not very. They tend to see absurdity, where…
It was March 21, 2017 that I predicted Donald Trump would not serve a full 4-year term. I didn’t expect him to leave by impeachment, but by resignation, like Richard Nixon. That opinion reflected the thinness of his skin, but I was wrong. Constant attack normally encourages resignation. However, the chaos around him only seems to encourage him. If our electorate was calm and peaceful,…
Larry Summers is a former Secretary of the Treasury and a former President of Harvard. Republicans don’t like him, even though he agrees with President Trump that current interest rates are too high. Democrats don’t like him, because he is as arrogant as the President. But, he has been discussing an interesting new concept – a monetary black hole. The idea is that very low…
I was opposed to the impeachment of Bill Clinton, and that didn’t make me a Democrat. I am opposed to the impeachment of Donald Trump, and that doesn’t make me a Republican. Negating an election because somebody lied about a sex act was stupid and nonsensical. Negating an election when the charges are too nuanced to be understood by most voters is equally nonsensical. While…
Most people recognize that physical health, mental health, and emotional health are three quite different types of health. We learn about physical health in elementary school, learning the importance of exercise and good nutrition. Later in life, we learn about mental health, learning the importance of stimulation and sleep. Since the 1995 publication of Emotional Intelligence by Daniel Goodman, we have started learning about emotional health,…
Now that Special Counsel Robert Mueller has completed his study, I thank him for his service over the past two years. And, I congratulate the President and his family on surviving that Inquisition. Having said that, in August of 2017, I wrote about the problem of writing, when Donald Trump has any tenuous link to the story. His powerful personality “sucks the oxygen out of…
Which American company do I trust the least: Cigarette companies which merely peddle death or Big Tech, like Facebook or Google, which merely shred privacy. Cigarette companies have labels admitting their product may cause death and misery. Facebook and Google don’t admit there are any bad effects from selling personal information about you to strangers. At least, the cigarette companies are more honest and upfront.…
In 1893, the closed-end fund (CEF) was invented, and financial advisors said “this is better than sliced bread.” In 1924, the mutual fund was invented, and financial advisors said,”this is better than sliced bread.” In 1984, the exchange traded fund was invented, and financial advisors said “this is better than sliced bread.” Recently, “mass personalization” was invented, and financial advisors are holding their breath. In…
I am confident that, if my family depended on it, I would find a way over or under or around or thru any fence. (Of course, I still remember how to use C-4 plastic explosive, as well as “bangalore torpedos.”) Assuming that is mere bravado or over-confidence on my part, then a wall on Mexican border might make sense. However, if I was Nancy Pelosi,…
While I would not do any business with Wall Street giant Goldman Sachs, I do have great respect for their research and just read their 2019 outlook. In a word, they are quite bullish on December of this year but not very bullish on 2019, predicting a 5% rise in the S&P, mostly in the first half of the year, before economic growth slows to…
It is not news that bad news is piling up. The good news of improving corporate earnings is burdened by the growing geopolitical problems worldwide. For the U.S., we have clearly entered a “recession” but NOT the type we fear. It is a “growth recession,” the rate of growth is receding, not the size of the economy. Earnings growth this year has been about 15%…
The Bureau of Labor Statistics issues their monthly “Jobs Report” on the first Friday of each month. It is arguably the most watched report on Wall Street. Today, before it was released, Dow futures indicated it would open up 250 points. As soon as the report was issued, it dropped to 180 points. It was a good jobs report, with 250 thousand new jobs created…
Most of us realize that it is unhealthy to watch too much TV news. Years ago, I declared my Saturdays as a news-free day. It is important to recognize the toxicity of TV news, be it Red-tinted or Blue-tinted. Both are toxic. After the bitterly contentious news coverage on the elevation of America’s only available Republican lawyer to the U.S. Supreme Court, I decided an…
We think of cancer as a terrible disease, destroying bodies and ravishing families. We don’t think enough about how stressful it is, especially with regard to financial decisions. Over one-third of cancer patients fully deplete their savings, 24% borrow against their retirement savings, and 37% of cancer patients cut back on groceries — imagine cutting back on groceries for you and your family. It is…
In the aftermath of the Great Recession, politicians felt a strong “never again” feeling among voters, and they vowed to prevent the next global financial crisis. Then, they passed the “Dodd-Frank” bill, which required more capital – real capital – in banks. This was good and really made both our banks and our economy safer. Unfortunately, it also contained over a thousand pages of regulations. …
There were no winners in the Kavanaugh – Ford reality show yesterday. This national embarrassment continues. However, there was one clear loser — the New York Stock Exchange, where the trading volume dropped 50%, as traders were glued to the show. Productivity declines when workers watch trains collide.
Many times, I have written about the “bad rap” that globalization has been receiving, recalling the Clinton-Gingrich push through Congress. At that time, numerous economists talked about the benefits of globalization but reminded the Congress that there would be losers. Numerous Congressmen promised job re-training and even relocation benefits for those workers, whose jobs were transferred overseas. Of course, Congress grabbed the benefits and forgot…
“I will not do business with any financial advisor who does not use an independent third-party custodian!” The Feds just broke up yet another Ponzi scheme. This one caused a $364 million loss from 230 innocent investors. If anything is unusual about this particular Ponzi scheme, it is that some financial advisors actually fell victim. They should have known better! It must have been some…
Obama was right. Trump is wrong. Stockbrokers are very different from registered investment advisors (RIAs). Stockbrokers can charge all sorts of hidden fees and follow the “suitability” standard, which allows them to put mutual funds into a client’s portfolio that pay kickbacks to the stockbroker. They even increase the price of bonds and make the client pay the increased price. RIAs do not follow these…
1. Call me shallow, but I enjoy watching NFL football games. 2. Color me patriotic, but I think the First Amendment is fundamental and is actually worth defending. 3. Paint me pointy-headed, but I believe race relations are still incredibly and inexcusably poor. 4. Thus, I defend the right of NFL players or anybody else to protest the poor state of race relations in this…
Economists have flunked and have let America down! All we have done is provide the intellectual ruse that the two political parties use to indulge their worst impulses. For the Republicans, we have provided “supply-side” economics, which argues that all tax cuts improve the economy at all times and under all circumstances. For the Democrats, we have provided “Keynesian” economics, which argues that increased spending…
I was deeply moved by the death of John McCain, whom I respected deeply for his heroics in standing up to his captors and standing up to his own political party when he thought proper. Oddly, I am also moved by the death of Bert Reynolds but for very different reasons. McCain aspired to a life of honor, while Reynolds aspired for nothing more than…
I have often written that investors are less fearful of economic recessions. There is ample research that “buy and hold” makes sense during such recessions. It is impossible to predict the exact top or exact bottom. The level of cash can be adjusted, but only so much that a person can sleep at night. Likewise, I have often written that investors should be more fearful…
Let’s say I want to control my group or tribe or nation. I could use charisma, or I could use force, or I could use religion. I may not have the needed charisma, which is a fickle thing anyway. I could use force, but killing is just wasting those economic assets known as humans. But, I would probably use religion, which seems to come natural…
During long walks in First Landing State Park, I enjoy listening to the podcasts of Freakonomics by Stephen Dubner. He uses economic reasoning to focus on mundane subjects and always interviews experts on the subject. Today, it was the question of “choking” or failing to perform when under pressure. It was not surprising that intelligent people are more likely to “choke” than less intelligent people. It…
If you need another reason to be disappointed at our form of government, remember this: Back in the early 1990’s, Congress was considering the proposed North America Free Trade Association (NAFTA). A steady stream of economists testified in many different hearings before Congress on the benefit of globalization in general and the principle of comparative advantage in particular. However, virtually every single one cautioned there…