20
Mar
2017
A Fund Struggles and I Can’t Look Away
There are a fair number of reasonably well known investors that I keep my eye on even though I know that we won’t ever invest in their funds. One of the most fascinating investors in my opinion is Bruce Berkowitz, manager of the Fairholme Fund (ticker: FAIRX). Berkowitz caught my attention at an investment conference bank shortly after the 2008 financial crisis because he had a booth that was swarmed… Read More
13
Mar
2017
Meet the Fed’s FOMC
The Federal Reserve will obviously be in focus this week and we talk about the Fed and its members a lot and I suspect that not everyone quite knows how the Fed works. Today is a quick primer. The Federal Reserve System was created by the Federal Reserve Act in 1913 to serve as a formal lender of last resort to banks during panics and times of a liquidity crisis…. Read More
6
Mar
2017
How to Think About the Market’s Valuation
The stock market since the election has brought all of the major indexes to fresh all-time highs. I also noticed last week that the Shiller PE ratio is about to cross 30, which is far from an all-time high, but is still notable since the only two times in history this ratio has been so high was in the Roaring 20s and during the Tech Bubble. For those of you that… Read More
2
Mar
2017
What About The Bonds?
Almost all of the focus on the Federal Reserve lately has been concentrated on the future path for the fed funds target rate. After the false start in December of 2015, the FOMC hiked rates again in December of last year and now stands poised to actually turn things into a steady campaign of rate hikes. However, the other piece of their emergency level of monetary policy accommodation – the… Read More
27
Feb
2017
The Words of Warren Buffett
Warren Buffett released his annual letter to shareholder on Saturday and, as always, it was a delight to read. You can find the entire letter here; but today, I thought I would share some of the highlights. *** One word sums up our country’s achievements: miraculous. From our standing start 240 years ago – a span of time less that triple my days on earth – Americans have combined human… Read More
21
Feb
2017
The High Cost of Healthcare for Retirees
A study by the Employee Benefit Research Institute (EBRI) released in January estimates how much savings people need just to cover out of pocket healthcare expenses. (You can see the entire study here) Like our retirement planning software, the EBRI conducted Monte Carlo simulations to estimate the effect of varying mortality rates and portfolio returns. The EBRI found that for a 65 year old man to have a 50/50 shot… Read More
6
Feb
2017
What is a Border Adjustment Tax?
Most of the time, the topics that I choose for Daily Insights are things that I think I know a lot about. Sometimes, I write about a topic in an effort to learn more about it. That’s the case today: I had never heard of a border adjustment tax until a few weeks ago, wanted to know more and thought I would share what I’ve learned. Some of you undoubtedly… Read More
30
Jan
2017
A Quote to Consider from Sir John Templeton
I am continually amazed by the huge number of thoughtful and apropos quotes that concern investing. I’ve been writing and editing our quarterly newsletter, Portfolio Insights, for more than 15 years and I can still find plenty of great quotes without too many repeats. While I enjoy a great quote, I can’t say that any of them rise to the level of being an investing philosophy to live by, except… Read More
27
Jan
2017
2017 Forecasts: Part V
This is the last in a series of forecasts for 2017 and the last few questions are all about politics. What will happen in Washington with taxes? Corporate tax rate is cut to 25 percent or lower. Top personal rate is reduced to 33 percent or lower. Estate tax is limited. Carried interest loophole is eliminated. None of the Above. Maybe I’m mixed up, but I think that this… Read More
26
Jan
2017
2017 Forecasts: Part IV
So far, you all aren’t getting tired of these forecasts (guesses), but before we start, I want to make a quick note: yesterday’s stock related forecasts made heavy use of Morningstar’s discounted cash flow (DCF) models. I don’t want you to get the impression that we use these models so heavily in our stock selection process since that just isn’t the case. At some point, I will offer more details… Read More