9
Dec
2014
Forecasting Oil Prices
After falling interest rates, the biggest surprise of 2014 is the dramatic selloff in oil prices. One of the great things about having a Bloomberg Terminal, is that you can go back in time and look at forecasts as of some date in the past. So, I entered my time traveling machine to see what the professional forecasters had to say about what oil prices might do in 2014. Spoiler… Read More
8
Dec
2014
Jim Cramer Gets Burned in Lightening Round
I love Wall Street soap operas. I’ve written about Bill Gross’ departure from PIMCO two times (here and here) and, for me, it’s the gift that keeps on giving. There was another long exposé on Bloomberg yesterday but I decided not to write about it hoping that you aren’t afflicted by the schadenfreude that sometimes gets me. Yesterday, it was reported that an activist investor is going after Jim Cramer,… Read More
4
Dec
2014
Perpetual Income
The question about when interest rates will rise has been a big question around here for several years, and we still don’t know. Most investors are worried about rising interest rates and most people, including me, have been very surprised this year to see the yield on the 10-year US Treasury note fall from 3.00 percent to 2.29 percent, as of yesterday. The direction of interest rates matters when you… Read More
3
Dec
2014
We Are the World: Global Investing
The good news is that the S&P 500 is up almost 14 percent this year through yesterday. The bad news is that no other equity asset class is doing nearly as well. Most clients that I’ve been talking to understand why we diversify, but a few of them have said something along these lines: ‘Dave, I hear what you’re saying and you’re probably right, but shouldn’t we do something different?… Read More
2
Dec
2014
Using Donor Advised Funds
After shopping-centric Black Friday and Cyber Monday, it’s refreshing to know that today is Giving Tuesday. Giving Tuesday is actually a relatively new effort – the first one was in 2012 and it is actually part of November’s nonprofit awareness month. But giving in the US is not new at all. In fact, the US is one of the most generous countries on earth. Here are some of the facts… Read More
1
Dec
2014
A Surprisingly Efficient Market
I heard a wonderful example of a surprisingly efficient market the other day on NPR’s Planet Money blog. The post (found here), titled ‘Textbook Arbitrage: Making Money Off Used Books’ tells the story of two entrepreneurs that sell books, t-shirts and other assorted goods on Amazon. A little while back, they noticed that the price of college textbooks were more volatile than they would have expected. Better yet, the prices were… Read More
25
Nov
2014
Investing at All-Time Highs
A friend of mine came into some money recently and said that he was wary about actually investing the funds because the market is at an all-time high. He said that he knew he wasn’t supposed to time the market, but wanted to get my thoughts before pulling the trigger. I told him what I tell everyone: as long as your time horizon is sufficiently long, it’s okay to go… Read More
24
Nov
2014
Why Invest in Commodities?
I was emailing a friend who works in the industry on Friday about asset classes that are giving us trouble this year. We both have diversified portfolios for our clients and when you’re truly diversified, something is always giving you a headache. For us, for example, micro cap stocks as measured by the Russell Microcap index are a real aggravation this year, down -1.85 percent this year through Friday compared… Read More
21
Nov
2014
A Look Inside Superior Performance
On Wednesday, I met with a client that I’ve worked with for more than 10 years. In fact, we signed the new account paperwork the night before my second daughter was born. As you might expect, my wife was not thrilled. In the late 1980s, this couple made a substantial investment with an extremely well known investor – someone I grew up watching on Wall Street Week with Louis Rukeyser…. Read More
20
Nov
2014
How to Get a $200 million IRA (no joke)
When Mitt Romney ran for President in 2012, he was required to disclose information about his net worth, which was around $250 million. The most interesting element to me, though, was that he had more than $100 million in his IRA. IRAs are an important element of our clients IRAs and some have large balances, but nothing, obviously, like Romney’s. I don’t begrudge Romney and have no interest in getting… Read More