18 Dec 2017

The Tax Overhaul Details (In English)

Late Friday evening, Congressional Republicans released the final version of their tax reduction and simplification plan. ¬†Although many elements match the House and Senate versions, there are some differences worth noting. I should point out, though, that the following is a broad summary – I haven’t read all 1,100 pages of the proposed law. ¬†Furthermore, this summary only covers the changes for individual filers, not corporations or partnerships. Lastly, you… Read More

11 Dec 2017

Efficient Markets Fact and Fiction

For almost 50 years, one of the most controversial ideas in finance is that markets are efficient, as presented by Gene Fama’s Efficient Market Hypothesis (EMH) in 1966. Let’s start with a simple definition of EMH: Current market prices incorporate all available information and expectations and are the best approximation of intrinsic value. In some ways, it’s such a simple statement that it’s a little surprising that it’s so controversial…. Read More

4 Dec 2017

The Crazy Thing? Stocks Could Go Much Higher

Long time readers know that I’ve been cautious on US stocks for some time, calling them overvalued in 2014. Last year, I referred to a quote from Sir John Templeton, who famously said that ‘Bull markets are born on pessimism, grow on skepticism, mature on optimism and die in euphoria.’ I said then that I could see the rally continuing on for years but that we were probably moving from… Read More