I’m entering my annual post-SIC decompression period. I say that only half-jokingly. The last two weeks were my version of a dive deep into the sea, where you see shocking things and endure crushing pressure. The weeks of preparation are fun, but the sheer volume of information creates its own kind of pressure. You don’t just shift back into normal life after that.
The latest run of unchecked optimism might just be over.
This week is part two of our conversation about alternative investments. As I pointed out last week, this space has evolved into a distinct asset class of its own. I believe investors need to understand the good, the bad, and the ugly aspects of investing in alternatives.
Today, we look at the world of “alternative investing.” I put it in quotes because this was originally a somewhat pejorative term. Back in the 1960s (and maybe before?), brokers sold you stocks and bonds, saying that was how smart people invested
Have you seen the price of natural gas lately?
This week continues our series on dividends and dividend growth stocks. This is one part of my strategy to try to get through what I see as a coming crisis by the end of the decade with as much of my buying power as intact as possible.
Over half of Gen Z and Millennials have a side hustle or some kind of gig work to supplement their income. The numbers show that nearly two-thirds of workers are living paycheck to paycheck.
Apple makes around 90% of iPhones in China. From a supply chain perspective, this is better than where Apple stood a few years ago when it made all its iPhones there.
A critical question is how do we get as much buying power as possible from the beginning of the crisis through to the other side? Part of the answer is Warren Buffett’s admonition to never bet against America. Better to do as he does, investing in specific parts of America.
Gold started this week at an all-time high. It’s up about 10% since the start of the year. That’s roughly on par with the S&P 500. All of this while inflation is trending down (with some bumps).
Leaders take a lot of criticism. In fact, that’s part of the job. Presidents, governors, CEOs, football coaches, other top decision makers and even your humble analyst all have to answer for what happens on their watch—even when it’s not their fault.
If, like me, you’re old enough to remember the 1990s internet bubble, today’s AI excitement might be giving you flashbacks. The parallels are unmistakable.
Earlier this week, I shared my thoughts on a ban or forced sale of social media platform TikTok. The Chinese Communist Party can use it to surveil and manipulate Americans, and we should ban it immediately. Many of you sent thoughtful feedback, which I appreciate.
Last week, the House passed a bill that would require ByteDance, the Chinese company that owns TikTok, to sell within six months or face a ban. Now the bill faces an uphill battle in the Senate.
You may have noticed the stock market rising lately. Much of the gain isn’t so much “the market” as a handful of mega-cap stocks. Nonetheless, the bulls are clearly in charge. The question is how long they will stay there. History suggests longer than many market bears think.
The idea that “market expectations” tell us anything about the economy’s future is – or should be – in serious doubt. That’s not to say the market is wrong. It just changes its mind so often as to be useless. And most of the time, it changes its mind after the fact.
India’s growth story is unprecedented.
Today, we have a different kind of letter. I’ve been in California for some rather innovative and hopefully life/health span-extending medical treatment.
Recently I saw a T-shirt for sale that said, “Science Doesn’t Care What You Think.” I used a similar metaphor recently, observing how many experiments show that jumping off a cliff will send you rapidly downward. If you want to test that theory, please add me to your will first.
NVIDIA’s spectacular quarter and forecast are dominating headlines this week.
If you’re a parent or grandparent, you may know of the “Choose Your Own Adventure” storybook series. Written in second person, they make “you” the hero.
We are in the early days of an AI-driven productivity boom.
One of the more fascinating and mysterious parts of watching the Federal Reserve is the ongoing dialogue between Fed leaders and Wall Street. We imagine private meetings held in great secrecy. Those may in fact occur, but I’m not sure they are even necessary.
After the great financial crisis, China’s appetite for commodities and technology fueled a global economic recovery.
Modern economies, even small ones, are unfathomably complex. The number of variables is far more than any human can comprehend or any model can track. It’s really no wonder so many forecasts are wrong.
In thinking about the 2020s, I often find myself looking back to the 1920s. That decade began with a deep recession/depression and ended with a stock market crash. While we now see the 1920s as a kind of “in between” period, people at the time didn’t know another depression and war were coming.
“Two is better than one” is a nice saying, but it really depends on what you’re describing. Two hurricanes or earthquakes aren’t better than one. Just one disaster at a time will suffice, thank you very much.
The “magnificent seven,” Amazon, Alphabet, Apple, Meta, Microsoft, Nvidia, and Tesla, soared 112% (equally weighting each). They outperformed both the SPDR S&P 500 ETF Trust (SPY), which is weighted by market cap, and the Invesco S&P 500 Equal Weight ETF (RSP), which weights each stock equally.
Having now spent almost six months describing the historical cycles and massive debt that surround us, I find myself looking for an “easy” exit.
It’s forecast season again, the time when people like me tell people like you what will happen this year. Sadly, we are often wrong.
It's that time of year when we start thinking about the old and envisioning the new. This has always been a special season for me, perhaps because of my unusual quirk of really wanting to divine the nature of the future—not just an investment in economics but in general.
First, let me wish you Merry Christmas, Happy Holidays or your favorite personal form of greetings for this time of year.
If you really want to reduce the federal debt, you don’t have to convince Congress of anything. You can just write a check. The Treasury Department gladly accepts gifts from anyone so inclined.
One thing you learn when writing about the debt problem, as I have been in recent weeks, is that many people think it’s not a problem at all.
Back in the Great Financial Crisis era, someone quipped that the federal government had become a giant hedge fund with an army attached. That wasn’t far off. Various agencies and entities were absorbing all kinds of risky assets to stabilize an overleveraged system.
Thanksgiving brings to mind not only turkeys, family, and friends, but also should help us recall the remarkable ideas and philosophies that helped shape, and indeed were, the foundation for the United States of America as a Republic.
The federal government starts a new fiscal year every October 1. In a rational world, Congress would fulfill its responsibilities by passing bills before that date to authorize spending in the various agencies and programs.
A movie that I’m quite fond of is 25th Hour, a Spike Lee joint about three friends in post-9/11 New York City. One of them, played by Barry Pepper, is a bond trader.
Exploring federal budget data is a journey through endless rabbit holes, some of which are eerily close to Alice in Wonderland insanity. Countless variables interact in unexpected ways. Seemingly small changes can cascade into billions of dollars within a few years.
Identifying problems is great. Identifying solutions is even better, especially when the politicians who are supposed to be solving our big problems don’t even try.
I have always had an affinity for short-term interest rates, and it is from my days as an index arbitrageur.
The ancient Greeks had a word κάθαρσις, which in English we now spell as “catharsis,” although it’s pronounced basically the same. It originally referred to purifying religious ceremonies, medical treatments, and so on.
We have been looking at big historical/economic/political cycles for the past two months.
When your system, whatever it may be, is working extremely well, we used to say it’s “firing on all 8 cylinders.” What does that mean?
One mark of true brilliance is the ability to make complex ideas seem simple. I think this is why so many of us fondly remember our early schoolteachers.
Intermission is over. Today we resume my series on the global cycle theories that, probably not by coincidence, all point to major change unfolding in the next few years. Finishing it may take some time since I keep finding new material.
I’ve been writing financial newsletters for 15 years. I have seen a few cycles. There have been good times and bad times, thrills and spills.
Last week we began exploring the details of my personal portfolio. This week we will finish and then move back to our discussion of various cycles.
Over the last 100 years, the US equity market has returned about 9% annually. What will it return over the next 100 years?
Today, I am going to do something that I've never done. I am going to start a two-part series describing what is in my personal portfolio and why. Let me start by offering two caveats: This letter is in the “do as I say and not as I do” category.
