Morgan Housel is one of our favorite financial writers. He recently published a longer article entitled The Big Lessons From History in which he offered up four important lessons from history that repeat the same story again and again. One of the lessons entitled Calm Plants the Seeds of Crazy is the inspiration for this week’s post.
Given recent performance, and for the reasons above, our confidence in intermediate-term trend following as an effective risk management discipline for stocks has been severely shaken. While this doesn’t change our dedication to and belief in proactive risk management, we are deciding to put this particular “tool” back in the bag, at least for the time being.
Refinancing a mortgage is about as fun as doing your taxes or getting or getting a flu shot. But even though the process is long and laborious, significant savings can be gained for those willing to take the plunge. We often are asked if it is a good time to refinance and our typical answer is the very unsatisfying “it depends.”
Today, the same hubris that mankind showed for hundreds of years in chasing after a perpetual motion machine is being manifest in the stock market through a relatively new strategy we will call the perpetual money machine.
Heading into this year if you would have described everything that would transpire to this point, there is simply no way we would have thought it possible for the broad equity market indices to be in positive territory - let alone for the Nasdaq to be up over 30%!
The COVID-19 data has kept us all on our toes, with the curve seeming to have flattened before turning back up over the past two months as lockdown measures have been relaxed. The economy remains bound up in uncertainty, although there are clear pockets of strength and much of the data has come in better than the direst expectations.
Two weeks ago we described how the global reaction to the coronavirus had begun sending shockwaves through financial markets. The situation has continued to evolve rapidly since then, and although the continued spread of the virus was more or less expected the fallout in financial markets has been more severe than anyone could have anticipated.
Yesterday and today were bad days for the global stock markets with all three major US stock indexes down over 6% cumulative. The coronavirius has been making news for over a month now but during that time most major stock indexes have continued to climb to new record highs. So what changed yesterday and to a lesser extent on Friday and today?
In last week’s post I explained why Amazon pays little to no federal income tax even tough their profits have continued to rise. This has become a hot topic on both sides of the isle who have used Amazon as the poster child for why our current system of economics is so broken. But is Amazon really doing anything wrong?
Few would argue that one of the most disruptive companies in recent history has been Amazon. Founded a little over 25 years ago the venture has grown to be one of only a handful to crest $1 trillion in market capitalization. But lately the company has been receiving attention for a different kind of achievement – its $0 Federal income tax bill.
As is common around this time of year, many people are making resolutions to better themselves in some form or fashion including money related goals. Over the years we’ve written a number of posts about personal finance including several on the importance of building financial freedom through budgeting. In today’s post, we’ll take a new look at this important and timely topic.
The efficacy and ethics of corporate buybacks have been the subject of debate for decades, but the growing tension over wealth and income gaps are elevating buybacks in the public discussion – especially as the 2020 presidential race heats up.