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Pragmatic Capitalism

Capital for Living a More Practical Life

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Your Best Investment

Tadas is continuing his finance blogger wisdom series all week so don’t forget to go back and check them all out. Yesterday’s question was one of my favorites: Question:  If you could (magically) impart one piece of wisdom to all investors what would it be? I said: “Your best investments are likely to be made… Read More

1,000 Years Worth of Market Data

I love this post by Tadas at Abnormal Returns asking the following: “If we had a 1,000 years of market data what kinds of things would get validated? What things would lack support in the data?” There are so many good responses in there. But here’s what I said: “1,000 years worth of market data… Read More

Chart of the Day – The USA is not a Corporation

Mary Meeker is out with her annual “Internet Trends” presentation and she continues to promote this very misleading view of the US government as a corporation. For instance, here’s a chart showing the “income statement” of the USA: Okay, let’s cut to the chase. Governments are not corporations. Corporations exist to increase shareholder value by… Read More

In Defense of Vanguard

Here’s an article criticizing Vanguard. I guess we need to get used to this. As low fee indexing continues to eat the world the high fee alpha salesman are going to have to step up their game or they’ll all go out of business. But this “takedown” is particularly bad. Let me explain. The article… Read More

Why Do People Like Balanced Budgets?

Here’s a great question from Joe Weisenthal’s morning update: I’ve spilled a lot of ink over the last decade talking about debt, deficits and sectoral balances. My broader points have been largely proven right over that time: The US government does not operate like a household or business and operates with an inflation or currency… Read More

Why I am an Optimist

If you spend enough time managing money you learn that extremist views are extremely dangerous. Being a permabull is usually right in the long-term, but can expose you to getting crushed at times along the way. Being a permabear will look very right on rare occasions, but will crush you consistently in the long-term. And… Read More

The All or Nothing Bias

Have you ever done something where the outcome turns out much better than expected and you said to yourself “man, what if I had only bet more on that outcome?”  Of course this has happened to you because it’s happened to us all. Whether it was buying a single stock that did really well, placing… Read More

Let’s Talk About the VIX (Again)

I’m getting a lot of questions these days about the low volatility we’re seeing in the stock market. So, step into my office and crack open an ice cold Bud Light. Just kidding, I don’t give people Bud Light in my office. I give them Coors Light.¹ Anyhow, a few years back I said that… Read More

QE, Stock Buybacks and Other Stuff

Did QE work?  That remains one of the most common questions in finance and economics. My answer is simple – it depends! I know, that’s not a super helpful answer, but hang around and let me explain in more detail. I want to use a simple analogy to analyze how QE works and whether it… Read More