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Pragmatic Capitalism

Practical Views on Money, Finance & Life

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Investing is not the Same as Gambling

strategy

It’s the Monday following the second leg of the Triple Crown and a whole bunch of people lost money betting on the Preakness. Like the stock market, the allure of gambling is strong because many people think that having more money will solve most of their problems. And while there are some similarities between investing… Read More

Why Helicopter Drops Would Work

macro

Here’s John Kay in the FT arguing that helicopter drops don’t work. He says: “even if the lucky recipients of the helicopter drop went straight down to the pub to celebrate their good fortune, the publican would return the cash to the banking system by the end of the day, and the notes would end… Read More

Three Things I Think I Think – Hump Day Edition

macro

Sorry for the radio silence over the last week or so. Life and travel got in the way. I’m in NYC this week if any readers happen to see this and enjoy spending time with nerds….Anyhow, here are some things I think I am thinking about:

Would Donald Trump Crash the Stock Market?

strategy

Mark Cuban says a Donald Trump victory would cause a huge stock market correction: “I can say with 100% certainty that there is a really good chance we could see a huge, huge correction,” Hmmm. “really good chance” doesn’t mesh with “100% certainty”, but let’s think this through a bit more. First of all, Trump… Read More

Hedge Funds – Misunderstood, but Still not Worth it

strategy

Cliff Asness has a wonderful new piece on Bloomberg View discussing hedge funds.  He basically argues that: Hedge fund criticism has been unfair largely due to false benchmarking. Hedge funds should hedge more. Hedge funds should charge lower fees. These are fair and balanced statements. And they’re worth exploring a bit more. The first point is… Read More

A Larger Deficit Won’t Cause Hyperinflation

macro

We’re now 7 years out of the grand monetary experiment and there’s still no inflation on the horizon. In fact, we seem to be coming to an increasing consensus that monetary policy and QE just hasn’t done much. These are all things I expected from the start of QE – it wouldn’t cause high inflation, wouldn’t… Read More

Trump is Wrong on the National Debt

macro

Donald Trump made some controversial comments the other day regarding the national debt. First, he said: “We’re paying a very low interest rate — what happens if that interest rate goes up 2, 3, 4 points?” he said. “We don’t have a country. We have tremendous debt, tremendous.” Second, he said: “I’ve borrowed knowing that… Read More