Pragmatic Capitalism

Practical Views on Money, Finance & Life

‘Most Recent Stories’

3 Big Flaws in “The Market” Portfolio


I get a lot of emails about the Global Financial Asset Portfolio, which is the only true “passive index” of the world’s outstanding financial assets (you can see a basic depiction of it here using 4 Vanguard funds). This is a fine portfolio, but I always like to emphasize that the thing I find most interesting… Read More

Helicopter Money Policy Formulation


The following is a guest post from fellow Monetary Realism contributor JKH An important aspect of helicopter money is just how a central bank would obtain the authority to undertake such a policy. Eric Lonergan is a leading proponent of HM. As he points out, the resolution of this issue could depend on the institutional… Read More

The Alpha Paradox


Here are a few things we know about the financial markets: Beating the market or obtaining “alpha” (excess return) is extremely difficult as evidenced by the annual SPIVA Scorecards. Alpha doesn’t exist in the aggregate because we all hold what sums to one portfolio wherein we earn the after tax and after fee return of… Read More

Why You’re Probably a Libertarian Keynesian


In a recent post I said that my political views are independent. But if I was forced to describe them more specifically I’d probably say they’re consistent with Libertarian Keynesianism. Yes, I know that’s a totally made-up thing, but it just describes someone who’s socially liberal and fiscally conservative within the boundaries of understanding the… Read More

Auto Loans Aren’t a Repeat of the 2008 Financial Crisis


John Oliver had a provocative piece on last night’s show about US auto loans referring to it as the next 2008 subprime crisis. Specifically, he compares it to the “medium short” as opposed to the “big short” because the auto loan market is small relative to the total economy. But this comparison is still overstating the… Read More

Money – The Window to Understanding the Economy


We live in a monetary economy. That is, unlike a barter system we have created “money” which serves as the medium by which we exchange goods and services in our economy. Therefore, to understand the economy you must understand money. You must define it, understand where it comes from and understand how it impacts the… Read More

How They’ll Sell you Higher Fees


The paradox of lower expected returns is that investors get scared investing their own money so they turn to professionals. In doing so, they’re often hiring high fee advisors or portfolio managers who might actually manage these assets better than they can on their own, however, what the manager puts in one pocket with better behavior… Read More