How you invest in stocks and bonds, in other words, your asset allocation can mean more to your investment success than what you invest in. Let me explain. When you look at risk/reward as measured by my efficient frontier, you can see by the fish hook how having your eggs in one basket can mean more risk. Obviously, 100% in stocks will be riskier as measured by a portfolio’s ups and downs or standard deviation. But what’s not always clear is that having 100% in bonds can be riskier than a mix of, say, 20% stocks/80% bonds. As you see above, this efficient frontier is a combination of … [Read more...]
Middle Manager Job Cuts Rise More than Thirty Percent
Jo Constantz of Bloomberg reports that among white-collar workers, middle manager job cuts have risen to more than 30% of laid-off employees as companies such as Meta preach a culture of efficiency. She writes: The latest corporate buzzword is efficiency, and that hasn’t been good for much-maligned middle managers. If you’ve got direct reports, you should probably be looking over your shoulder. “It’s always been a joke with my peers that middle management is the most dangerous position to be in,” said Cody Sandell, who lost his job late last year as a director of product management at a … [Read more...]
Cocoa Futures Doubled in Less than Three Months
Ryan Dezember of The Wall Street Journal reports prices for cocoa, the key ingredient in chocolate, have surged to records. He writes: Cocoa prices have climbed past a record set nearly a half-century ago, costing chocolate makers, bakers and aficionados alike. The sharp climb in price for chocolate’s main ingredient started with bad weather in West Africa, where much of the world’s cocoa is grown. Speculators piling into one of the hottest trades outside of artificial intelligence have added fuel to the rally. Cocoa futures rose another $1,105 a metric ton over Thursday and Friday to … [Read more...]
Where Are All the Distressed Office-Building Sales?
Carol Ryan of The Wall Street Journal reports that only 3.5% of offices sold last year came from a distressed seller, thanks to optimism and forgiving lenders. Ryan writes: If offices are in such hot water, where are all the forced sellers? Office-building owners have been under pressure since the Covid-19 pandemic hollowed out their buildings in early 2020. According to data from real-estate consulting firm Colliers, the U.S. vacancy rate has risen from 11% in late 2019 to 17% today, higher than at any point in the 2008 global financial crisis. But forced sales are still … [Read more...]
“And I’ve Never Forgotten,” His Nephew Told Me
You never know when you’re going to pick up a nugget of wisdom. Wisdom that can last a lifetime. In a world loaded with information, wisdom is in short supply. Don’t confuse the two. Your Survival Guy was speaking with a client this week. He’s in his early sixties, and he’s ready to retire in a year or two. We talked about his portfolio, his savings, his 401(k) that he’ll roll over to Fidelity, his asset allocation, and how we’ll transition it when he needs to begin drawing from it. “You know how I feel about asset allocation and the efficient frontier,” I said. “I know you’ve been … [Read more...]
Somali Pirates on the Move Again
The Associated Press reports that the EU maritime force says it is shadowing a Bangladesh-flagged ship seized by pirates off the Somali coast. They write: The 23 crew members of a Bangladesh-flagged cargo ship boarded by pirates off Somalia this week have been taken hostage, and a European Union vessel is tracking the ship as it heads toward the coast, the EU’s maritime security force said Wednesday. The hijacking of the MV Abdullah, first reported Tuesday by the British military, took place nearly 700 miles (1,100 kilometers) east of Somalia’s coastal capital Mogadishu. An EU ship … [Read more...]
Who’s Going to Pay for New Big-Rig Charging Plan?
Paul Berger of The Wall Street Journal explains that the Biden administration envisions a phased-in nationwide rollout of electric-charging and hydrogen fueling stations for heavy-duty trucks, but who is going to pay? Berger writes: A new federal initiative aims to speed up and better coordinate the rollout of charging and refueling stations for zero-emission big rigs. Industry officials say questions over how much the buildout will cost or who will pick up the tab still need to be resolved. The Biden administration this week released the strategy laying out where and when battery-electric … [Read more...]
Your Retirement Life: Walk Like a Modern Day Warrior
Looking over your shoulder is no way to live. Wondering who's behind you. Wondering if you're safe. Feeling uncertain. Uncomfortable. It's scary. Instead, walking with your head up, eyes forward, and shoulders back is the stride of the modern-day warrior. You never tire. You have the same confidence tomorrow as you do today. You're comfortable with who you are. You don't worry about the other guy. You stick to your game. We make enough tough decisions in a day to keep our lives too busy. Take figuring out "what to watch tonight?" for example. It can shake one's confidence. Then, finding … [Read more...]
Meet the World’s Largest Cargo Plane
Jennifer Hiller and Brian McGill of The Wall Street Journal report that Radia Inc., a unicorn startup, plans to use rocket science to overcome one of the wind power industry’s biggest hurdles with a giant cargo plane. The plane has a massive 261-foot wingspan and a fuselage volume of 272,000 cubic feet. They write: An aerospace engineer thinks he knows how to transform renewable energy: by building the world’s largest plane. Mark Lundstrom, an MIT-trained rocket scientist and Rhodes scholar, has spent more than seven years with an engineering team designing the WindRunner, a gargantuan … [Read more...]
Car Makers Turn to Teamwork to Compete with China’s Cheap EVs
Arjun Neil Alim, Patricia Nilsson, and Peter Campbell of the Financial Times report that German carmakers are looking at sharing costs to counter the wave of cheaper cars produced in China. He writes: Volkswagen is considering partnering with other carmakers to produce cheaper electric vehicles to help it compete with a coming wave of lower-cost rivals from China. The world’s second-largest carmaker plans to decide later this year how to produce an EV costing less than €25,000, chief executive Oliver Blume told a press conference in Berlin. Chief financial officer Arno Antlitz said it was “so … [Read more...]
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