Look, I know a lot of you own Mutual Funds and ETFs, especially if you’re wrapped up with an advisor where you invest, he wins. Today, there’re maybe a handful of funds I’d put my own money into, and the same probably applies to yours. The problem is, once you set sail, it’s hard to change course. I get it. But don’t be fooled by past voyages. Mutual Funds and ETFs are sold to you based on past performance. That’s like loading up the boat before a hurricane thinking, “well, the last trip went just fine.” Looking through the rearview mirror isn’t how you drive. But it’s absolutely how funds … [Read more...]
Archives for September 2021
A Case Study in Dividend Success
At Young Research, when we look for dividend stocks for the Retirement Compounders, we favor companies with strong balance sheets, stable businesses, a healthy dividend yield, and a history of increasing dividends. What does that look like in practical terms? While the ideal company financial position for the RCs can vary by industry and sector, Procter & Gamble serves as a nice case study in dividend success. A Strong Balance Sheet We look for companies with strong balance sheets because financial strength provides flexibility during tumultuous times in the business cycle. Procter … [Read more...]
ACHTUNG! Highest German Inflation of Euro-Era
Germany's inflation has climbed to a 29-year high of 4.1%. That's higher than at any point during Germany's participation in the euro currency bloc. This is perhaps most startling because of Germans' traditional aversion to inflation, which is understandable after having undergone one of history's worst hyper-inflations. Martin Anrold reports in The Financial Times: German inflation hit 4.1 per cent in September, its highest level for 29 years, prompting some economists to question whether central bankers are right to assume the surge in prices is only temporary and will disappear next … [Read more...]
BACKFIRE: China’s Australian Coal Ban Causes Shortage
After banning coal imports from Australia in a diplomatic row, China has shot itself in the foot, sending it scrambling to source coal from other parts of the world to feed its own demand. Nathaniel Taplin reports for The Wall Street Journal: China’s latest efforts to improve conditions in its dangerous, fragmented coal mining industry have contributed to weak supply growth and skyrocketing coal prices. This has also spilled over into the liquefied natural gas market. The situation is reminiscent of late 2016, when a recovering Chinese economy collided with government mine closures, resulting … [Read more...]
Is This a Buying Opportunity? Of Course, It Is
If you’re a serious investor and you’re wondering what to do with your lazy cash, then stop what you’re doing and listen. Contrary to what you might believe, no one’s going to force you to do anything about that good for nothing lazy cash sitting in your favorite chair. Your lazy cash may tell you all the news of the day, but what does it really know about earning a living, never mind investing? Well, Your Survival Guy is here to help because we all need someone who will do the dirty work like a Hollywood fixer. Why get your hands dirty? As if it’s not annoying enough to listen to the … [Read more...]
Never Underestimate the Power of Central Bank Interventions
In the Financial Times, Mohamed El-Erian warns readers to "never underestimate the power of central banks intervening in market pricing." He's referencing the recent turbulence in treasury market yields, and the Fed's role in causing it. He writes: The combination of extremely low and relatively stable US government bond yields has confounded many market watchers for quite a while now, also challenging traditional economic analyses. This has made the move up in yields over the past couple of weeks particularly notable, raising interesting questions for markets, policies and therefore the … [Read more...]
HOUSE PRICE SOAR: “This Has to Stabilize at Some Point”
The Case-Shiller home price index shows prices for housing have risen 19.7% since last year. According to Oxford Economics economist Nancy Vanden Houten, “This has to stabilize at some point.” But when will that be? The Wall Street Journal reports: Home-price growth climbed to a new record in July as buyers continued to compete fiercely amid a shortage of homes for sale, but there are signs the market frenzy might be starting to ease. The S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas across the nation, rose 19.7% in … [Read more...]
Run Away: Fleeing Big Blue Cities and States
Is it any wonder Americans are fleeing big blue cities and states? Look no further than sitting Governor of New York Kathy Hochul’s come to Jesus moment, asking New Yorkers to be her vaccine Apostles. You can imagine how this is going to go for those who refuse. Actually, it’s scary how many Americans are compliant and seem just fine being told how to live their lives. Well, Hochul and the like aren’t stopping with the vaccine and will carry this beyond the point of telling you how to run your family. That’s why Americans are fleeing states and cities where politicians want to tell them … [Read more...]
Democrats Carve Out Tax Loopholes for Friends
Democrats in Congress are writing up some of the biggest tax increases in history, but not before making sure they protect their friends with loopholes and carve-outs. If they really want to soak the rich, why isn’t taxing municipal bonds, which are the exclusive province of the wealthy, on the table? The tax rate on muni bond interest is 0%. The existing tax rate on capital gains for high-income investors is 23.4%. The Wall Street Journal examines Democrats' actions, writing: The House Ways and Means Committee section of the $3.5 trillion tax and spending bill includes myriad tax carve-outs … [Read more...]
The Time Peter Thiel Outsmarted Elon Musk
In The New York Post, Eric Spitznagel tells the story of PayPal founder, Peter Thiel, with an interesting vignette on Thiel's interactions with Tesla CEO Elon Musk, when the two were building PayPal. Spitznagel writes: Thiel, who turns 54 next month, is one of the most cutthroat financiers of his generation. With a fortune of $4.3 billion, according to Forbes, he’s difficult to pigeonhole — having gone from hedge-fund trader to Silicon Valley entrepreneur to data-mining surveillance capitalist — and almost impossible to understand. “He is self-created, a Silicon Valley Oz, who has, through … [Read more...]
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