You’ve almost certainly seen the chart below over the years – it shows the purchasing power of the US Dollar over time. It looks terrifying. And it’s constantly cited by hyperinflationists and other people trying to convince you that the world is quickly coming to an end thanks to the “fiat monetary system” and all the… Read More
* This is part 1 of this post. Please refer to this link for part 2. If there was such a thing as an indexing purist that person would simply buy all of the outstanding available financial assets in the world and call it quits. In other words, they would “take what the market… Read More
I was reading this very good piece by Matthew Klein at FT Alphaville when I came across this line: “The only kinds of money that reliably hold their value are the ones explicitly backed by a strong government*.” This is an interesting point and one I don’t completely agree with. I go into this in… Read More
I’ve made my opinion on valuations and the use of CAPE pretty clear – these sorts of metrics don’t tell us much about the macro environment because the whole idea of ” value” is dynamic and evolving. If I am right then trying to calculate a market “value” through these types of metrics is likely to… Read More
I really liked this piece by Ben Carlson on commodities and how they might fit into your portfolio (I like Ben’s piece primarily because he agrees with my views so you’ve been warned in advance! ). He goes over the historical performance of commodities and concludes that commodities are best used as trading vehicles… Read More
There’s been a lot of talking in the econ blogosphere about “artificially low interest rates”. This is a concept that’s often expressed by people who are promoting the “Fed as manipulator” view of monetary policy. And they’re basically right even if they overstep in the way they communicate the point. I think Noah Smith’s article… Read More
Last week, other bloggers and I provided favorite reads for Tadas Viskanta and his terrific site, Abnormal Returns. There are a lot of good and helpful suggestions offered there. But I am seldom asked about books in a broader context — books that changed my overall thinking and thus necessarily changed how I view investing and the markets. The ten books shown in the gallery below did just that. They were (and are) particularly illuminating. I highly recommend them.