I stopped into the RT studio in DC yesterday to let my head do some talking. You can see the interview here, but if you’re not interested in seeing my ugly mug you can just see the summary below:
- Why the current slide in oil prices isn’t a concern like the price declines in 2008. That is, the driver of this price decline is a supply shock and not a demand shock as we saw in 2008. Therefore, the current price decline is likely to boost consumer spending in the coming months.
- Why the student loan issue is increasingly problematic as college graduates are burdened by debt, but unable to obtain the income necessary to pay off the student debt. However, this isn’t a repeat of 2008. The mortgage market is magnitudes larger and more important than the student debt situation.
- Why the aggregate financial markets are likely to generate lower returns going forward. That is, with bonds yielding little income a balanced portfolio won’t perform nearly as well as it has in the past. Unless, however, stocks perform much better thereby increasing the inherent risk of most portfolios.
- Why there are structural issues that will likely dampen inflation in the coming 5-10 years.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.