Are you familiar with the FIRE movement? You should be, and you will be shortly. And I’m not talking about a fire where, for example, a tree falls in your backyard onto power lines, ripping them down along with a transformer and nearly burning down your house on a quiet afternoon in Newport, RI. (You can read about that here). The FIRE I’m talking about stands for—Financial Independence, Retire Early—and it’s a big-time movement especially with Millennials. Because more and more of them, are disillusioned with a life working for “the man” and not “working” enough, i.e.: saving, for … [Read more...]
Archives for June 2019
Are You Setting Yourself Up for a Retirement Disaster?
In 1999, most equity investors thought they couldn’t go wrong. Anything they bought simply gained in value. Easy, right? Not so fast. Soon, many Americans were facing a retirement disaster of their own creation. In July of 2004 I wrote: You’ve Lost 37%… Treasuries are boring! Right? You may be in the boring, boring camp, as are many investors. I hear Treasuries described as boring all the time. And yet I wonder what it is that is just so boring about a security that has no credit risk, no stock market risk, and offers a steady flow of cash. Furthermore, the U.S. government 100% guarantees … [Read more...]
Is Bitcoin a Better Investment than Facebook’s Libra?
As I wrote to you on Wednesday, Bitcoin and Libra are two different animals. One is a digital asset and one is digital cash. Bitcoin being the asset, Libra being the cash. But is Bitcoin an asset worth investing in? As I’ve written to you in the past, I love the idea of blockchain’s trustless ledger. But with my money or your money? No. Are Today’s Bitcoin Investors Making the Same Mistake as Isaac Newton? Beyond Bitcoin, Has Crypto-Boredom Set in? Can Bitcoin Ever Really Be a Currency? Emergency Cash: Bitcoin or Dollars? What do I think of Bitcoin? Part I Paul Singer … [Read more...]
Is Harvard Looting or Litigating?
In what seems to be a never-ending search by endowment funds for alternative investments, Harvard has joined a strategy that "invests" in lawsuit plaintiffs, and then reaps a share of any settlement. The so-called "litigation finance" business has raked in an estimated $9 billion from investors, according to Bloomberg. Despite the odd ethics behind funding a lawsuit against someone, the strategy has been successful. Bloomberg's Michael McDonald writes: “We see ourselves as providing the capital for the Davids to take on the Goliaths,” said Andrew Saker, chief executive officer of IMF Bentham, … [Read more...]
Will Iran Retaliate with a Digital Pearl Harbor?
In this U.S. Naval Institute Blog, Commander Brent Spillner, talks about “Preparing for a Digital Pearl Harbor” weeks before the United States completed its cyber-attack against Iran. Will we be ready if Iran decides to attack us? It’s important to look back. Spillner writes: A front-page headline in the 7 December 1941, New York Times boldly declared “Navy Is Superior to Any, Says Knox.”[ii] The next four years would prove the Secretary of the Navy correct, but nevertheless the bombers that would hand his superior Navy its worst-ever defeat were scrambling for takeoff just a few hours after … [Read more...]
E-Cigarettes Face First Ban in San Fran
On Tuesday, San Francisco's Board of Supervisors voted to ban sales of e-cigarettes. That may be hard to imagine in a city with its own "Cannabis Tourism City Guide," but welcome to 2019. The city supervisors were ostensibly worried about the explosion of teen use of e-cigarettes. San Francisco based Juul, a leader in the e-cigarettes industry, will be hit by the ban. CNBC's Angelica LaVito reports: San Francisco on Tuesday became the first city in the country to ban e-cigarettes after city officials approved an ordinance that prohibits selling nicotine pods or devices that haven’t been … [Read more...]
Some companies are very good at managing their working capital. Among the best are PepsiCo, HP, and Lennar. Each year from 2011 to 2018, those companies are part of an elite few that have improved their cash conversion cycle each year. The Wall Street Journal's Mark Mauerer explains further, writing: The top-performing companies paid suppliers almost three weeks slower in 2018 than typical companies and collected cash from customers almost three weeks quicker—while holding less than half the inventory, data showed. The amount of funds trapped in inventory fell for the first time since 2012 … [Read more...]
Three Dangerous Traps Investors Face
There’s a lot you can’t control when you’re investing. Putting your money in securities necessitates some risk taking. You probably aren’t managing the companies you own, or the governments you lend to yourself, so you have to trust managers and politicians to do that. And you’ll never direct consumers and taxpayers, so revenue streams are completely out of your control. There are though, things you can do to put yourself on sounder footing. In July of 2004 I wrote: Compound Interest and You Here’s a compound interest story that should help you and your spouse. Let’s assume a hypothetical … [Read more...]
What Facebook’s Libra Means to You
Facebook’s entry into cryptocurrencies with Libra is a shot across the bow for banks. Over time you will be the winner with lower transactions fees or friction, but will it gain traction? At the heart of Libra is trust. Do you trust Facebook? Do you trust Facebook to take care of your personal financial information? What’s different about Libra compared to Bitcoin for example is that you still need to have trust. Facebook will use blockchain technology to track your exchange of dollars, euros, or yen, for example, into Libra. But the ledger will be private. It will be controlled by … [Read more...]
Trade War Cooling Chinese Demand for American Housing?
For some time now Chinese demand for American real estate has accounted for a big part of the buying in some markets. Now, with a trade war escalating between China and the United States, it appears that some Chinese buyers may be pulling back. CNBC's Grace Shao reports: Chinese home buyers last year ponied up much less cash in the U.S. as the trade war continues to escalate between the world’s two largest economies. As President Donald Trump and President Xi Jinping prepare to meet this week, there are worries that decline in spending could extend further. U.S. property sales to … [Read more...]
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