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Pragmatic Capitalism

Practical Views on Money & Finance

‘Most Recent Stories’

Let’s Try this Again: Ending the Passive vs Active Distinction

My recent post on the Efficient Market Hypothesis brought about the usual pushback from “passive” index fund advocates. As an advocate of low fee indexing I find this debate incredibly frustrating and it appears as though years of industry misinformation has muddied the waters here. Passive indexing advocates tend to argue that I am just moving… Read More

The Economics of John Nash

John Nash, winner of the Nobel Memorial Prize in Economic Sciences and the equally prestigious Abel Prize in mathematics, died alongside his wife in a tragic car accident this week. Nash rose to popular fame due to Russell Crowe’s portrayal of his life in the Oscar-winning A Beautiful Mind, but his fame within economics needed no such Hollywood treatment to be assured.

The Easy Way vs the Hard Way

Excuse this short break from the usually nerdy commentary to discuss something important, but a bit off topic. I was directed to this amazingly hilarious Tweetstorm by the Kentucky Fried Chicken account: “It is comparatively easy to prosper by trickery, the violation of confidence, oppression of the weak, sharp practices, cutting corners—all of those methods that we… Read More

Why The Efficient Market Hypothesis is Useless

I noticed Noah Smith and John Authers on Twitter discussing how great the Efficient Market Hypothesis is because it explains why indexing works. I responded saying that the EMH really has nothing to do with why indexing works. They didn’t seem to see my point of view so let’s try this again and see if we… Read More

Fun With Charts, Part Deux

Paul Krugman has an explanation on his site for why he truncated the chart that he says proves that housing starts and interest rates are correlated. My original post went a little viral (as far as nerdy econ posts go) and got picked up by a number of other outlets. Some of the readers implied… Read More