When I started learning about the world of investments, I fully expected investing to be a problem that could be “solved” with analytics and rationality. The "dot-com" bubble of the late 90s, made it clear to me that there was something else going on. Those events led me to behavioral finance.
Tariffs have become a lightning rod for political and economic debate. From trade negotiations to campaign promises, tariffs represent a policy tool with passionate advocates and critics. Let’s examine both sides of this issue and, more importantly, what it means for your investments.
Charlie Munger, Warren Buffett’s right-hand man, passed away last November at the age of 99, leaving behind a legacy that will continue to inspire for generations. Known for his wit and unyielding adherence to principle, Munger was a brilliant investor whose influence shaped the strategy and success of Berkshire Hathaway (and me).
Whenever we transition into a new year, a slew of gurus come out of hiding to proudly share their projections for the upcoming 12 months. Although a good part of financial planning and investment management involves making some projections, I try not to join these gurus each year for two main reasons.
For more than 15 years, I’ve taught sessions in the local “It’s Your Money” program. As I recently taught their “Equity and Fixed Income Investing” course, I shared one of my favorite visuals about the perils of jumping in/out of the markets. There are several important takeaways.
Through the middle of this year, just seven stocks have driven 75% of this year's stock market performance. These stocks include Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla. Some are calling these stocks “The Magnificent Seven.” There are nice parallels between the classic Western movie and what we might expect from these specific stocks in real life.
Looking back through my older writing, I found an article I wrote in 2017. The article had an official-sounding title, “International Investing – What Investors Need To Know.” The article made the case for investing in stocks outside the US. How do I look at these markets now?
With this weekend’s (March 11, 2023) news about bank failures, I’ve received more than a few questions. I thought I’d share my answers to some of the questions I'm getting.
The University of Michigan’s US Index of Consumer Sentiment is currently at the lowest reading the survey has ever recorded. It’s clear that folks are concerned. There is a good possibility this is good news.
Last week we reached "correction" territory as the stock markets touched losses of 11.7% year-to-date. Stock and bond market losses are stressful. Big declines might trigger one of the following responses: Fight, Flight, or Freeze. I use a different strategy: Rethink. This has led me to three conclusions.
If I could only track one stock market measure, I would use the CAPE ratio. At the beginning of 2022, the CAPE ratio was roughly 50% above its 20-year average; this does not bode well for future stock market returns.
I’ve been a huge fan of Warren Buffett and his partner, Charlie Munger, for more than 25 years. For obvious reasons, the 2020 Berkshire Hathaway Shareholder meeting was available online. That meant I was able to hear from "Oracle of Omaha" while sitting in my home office. Unfortunately, my excitement was gone soon after the event started.