Saturday , August 17 2019
Home / Tag Archives: Recommended Reading

Tag Archives: Recommended Reading

F.I.R.E. – Ignited By The Bull, Extinguished By The Bear

Do you remember this commercial? The Etrade commercial aired during Super Bowl XLI in 2007. The following year, the financial crisis set in, markets plunged, and investors lost 50%, or more, of their wealth. However, this wasn’t the first time it happened. The same thing happened in late 1999. This commercial was aired 2-months shy of the beginning of the “Dot.com” bust as investors once again believed “investing was as easy as 1-2-3.” Why this trip down...

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The One Lesson Investors Should Have Learned From Pension Funds

Just recently I ran a 3-part series on the variety of things individuals believe about saving and investment which is either erroneous or misunderstood. (Part 1, Part 2, Part 3) The feedback I get when challenging some of the more commonly held beliefs is always interesting. In almost every single case, the arguments against “mathematical realities” comes down to either: An inability, or unwillingness, to sacrifice today to save more for the future, or; A “hope” that markets will continue to...

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Everything You Are Being Told About Saving & Investing Is Wrong – Part 3

This assumption on expanding inflationary pressures later in retirement is correct, however, it doesn’t take into account the issue of taxation. So, let’s adjust the chart and include not only the impact of inflation-adjusted returns but also taxation. The chart below adjusts the 8% return structure for inflation at 3% and also adjusts the withdrawal rate up for taxation at 25%. By adjusting the annualized rate of return for the impact of inflation and taxes, the life expectancy of a...

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Everything You Are Being Told About Saving & Investing Is Wrong – Part 2

In Part I, we discussed the problems with the “savings” side of the equation as it relates to building wealth. It is always interesting reading article comments as they are generally full of excuses why saving money and building wealth can’t be done. The general thesis is that as long as you have social security (which is threatening payout cuts over the next decade) and/or a pension (which only applies to 15% of the country currently,) then you don’t need to save as much.  Personally,  I...

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Everything You Are Being Told About Saving & Investing Is Wrong – Part I

Let me start out by saying that I am all for any piece of advice which suggest individuals should save more. Saving money is a huge problem for the bulk of American’s as noted by numerous statistics. To wit: “American have an average of $6,506 in credit card debt, according to a new Experian report out this week. But which expenses are adding to that balance the most? A full 23% of Americans say that paying for basic necessities such as rent, utilities and food contributes the most to their...

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One Trick Pony: The Fed Is Pushing On A String

Last week, I discussed the Fed’s recent comments suggesting they might be closer to cutting rates and restarting “QE” than not. “In short, the proximity of interest rates to the ELB (Effective Lower Bound) has become the preeminent monetary policy challenge of our time, tainting all manner of issues with ELB risk and imbuing many old challenges with greater significance.   “Perhaps it is time to retire the term ‘unconventional’ when referring to tools that were used in the crisis. We...

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For The Average Investor, The Next Bear Market Will Likely Be The Last

Just recently Anna-Louise Jackson published an interesting article asking if “The Financial Crisis” still haunted your investing. To wit: “This month marks the 10-year anniversary of the current bull market’s beginnings. Yet, many Americans remain reluctant to invest in the stock market, a scary hangover from the 2007-09 recession. From October 2007 to March 2009, the S&P 500 plummeted nearly 57% and it took more than five years for the index to recover. But the share of Americans with...

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The Definitive Guide To Investing For The Long Run

Written by Lance Roberts, Michael Lebowitz, CFA and John Coumarianos, M.S. of Real Investment Advice This complete set of articles discusses the fallacies of always owning stocks for the long run (aka “buy and hold” and passive strategies). Given markets cycle over time, it is important to understand how markets and investing actually work, the impact on your wealth, and what you can do about it. This series of articles will cover the following key points: “Buy and Hold,” and other passive...

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After Two Of The Greatest Bull Markets In U.S. History, Why Are Boomers So Broke?

Last week, Jeff Desjardins of Visual Capitalist wrote in a post: “While it’s true that putting your money on the line is never easy the historical record of the stock market is virtually irrefutable: U.S. markets have consistently performed over long holding periods, even going back to the 19th century.” This goes back to Wall Street’s suggestion of “buy and holding” investments because over 10- and 20-year holding periods, investors always win. There are two major problems with this myth....

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The Interview: Why Another 50% Correction Is Possible

I recently sat down with Peak Prosperity’s Chris Martenson to discuss an article I wrote last year on why another 50% correction is possible. I have attached a link to the original article below the interview along with a the chart and explanation of the RIA Economic Composite Indicator I discuss with Chris. Notes To Interview: “During a bull market, prices trade above the long-term moving average. However, when the trend changes to a bear market prices trade below that...

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