Crying Over EU

Posted on Posted in Market Commentary

The clock is ticking as the June 23rd European Union (EU) referendum approaches. Should the UK stay or should it go? Britain’s decision to leave the EU boils down to questions of migration. Foreign born residents in the UK and Wales have doubled, from 7.3% to 13.4% of the population, in 20 years. The UK has an average of 500 people added to its population every day. A vast number of UK citizens are growing tired of the open borders of their country. These people make up the “leave-camp”. Departing the EU would result in an immediate cost savings, as […]

The Secret to Success

Posted on Posted in Personal Financial Planning

I would like to start off this month’s commentary by encouraging you to live the highest quality of life you can.  Let’s take risks, face fears and make the most of every day. We need to take control of the things within our control, stop worrying about the things outside of our control, make purposeful choices and live a wonderful life. But let’s face it: some days are just plain ol’ bad. Other days are just average. Every day can’t be extraordinary and that is alright. Every minute can’t be about living life to the fullest, in fact that sounds […]

Hot Stock Tips from a Roman Emperor

Posted on Posted in Personal Financial Planning

Stoicism is a practical philosophy that aims to help us live well. As Stoics, we learn to focus on what is within our control. We ask ourselves, “What can we do to create a good life, no matter the circumstances we find ourselves in? What is required of us as human beings and what prevents us from living up to our full potential?” These questions could not be more pertinent to investing and meeting our financial goals. How to Meet the Markets We can reflect on the markets with a general reflection used by the Roman Emperor, Marcus Aurelius, a […]

Race to the Bottom: Financial Lessons from Antarctica

Posted on Posted in Personal Financial Planning

Matters of life or death. The decisions that matter most in life are often the ones we are least prepared to make. Life offers few opportunities to train for decisions where the consequences of a poor choice are meaningful and difficult to reverse. High-stakes decisions are fraught with high levels of uncertainty and complexity. Clear solutions appear due to the intensity of the situations. Because of this, it is important to study and learn from extreme examples. Such examples are as relevant, if not more so, in our daily lives, where the problems and solutions are sometimes opaque. The following […]

Retirement Planning: A First Look at Accumulation and Distribution of Wealth

Posted on Posted in Personal Financial Planning

Preface: Retirement planning is not something that can be feasibly fleshed out in one 2,500-word memo, therefore consider this part one of a multi-part series on retirement (the number of parts to be determined at a later date). In Book X of the Odyssey, the wind god Aiolos gave Odysseus a bag of wind, to use sparingly as he and his crew sailed home to Ithaca. With Odysseus dispensing small breaths of wind from the bag, ten days passed and the crew neared home. Ithaca was clearly in sight, but the job was not quite finished. Quoting Homer: “now on […]

Dovetailing the Moving Parts of 2016

Posted on Posted in Market Commentary

Dovetailing the Moving Parts of 2016 “So goes January, so goes the year[?]” – Wall Street Axiom (question mark, mine) If this holds true, we can expect Mr. Toad’s Wild Ride this year. However, predicting the next few days is a futile exercise, so predicting the next year is wildly unrealistic. We can expect only the following: The long run average real return (data from 1802-2015, thanks to Jeremy Siegel): You’re likely thinking, “these return numbers are irrelevant to me, unless I end up like Fry from Futurama.” While this is likely true, long run average return numbers are still […]

An Ounce of Prevention

Posted on Posted in Personal Financial Planning

“I never think of the future. It comes soon enough.” – Albert Einstein Retirees are questioning the sustainability of Social Security, rising healthcare costs, and freezing of private pension plans. Despite a heightened sense of urgency, savings rates have only mildly improved and most Americans remain unprepared for retirement. The chart below shows the decline in personal savings rates since 1947. From 1947 until 1975 personal savings increased, peaking at 15% in June of 1975. Thereafter the rate declined, reaching a low of 2.5% in 2005. The rate has since increased back to 5.2%. Moreover, savings rates seem to be […]

Rise of the Mega Cap

Posted on Posted in Market Commentary

The world is an ever changing place. As we become more globalized and interconnected in the 21st century, corporations have ballooned into the age of the “mega-cap”. The first release of Apple’s iPod in 2001 marked the beginning of something great for the company. Apple shocked the world with the first generation iPhone in 2007, with its slogan “This is only the beginning”. It made headline news when Apple’s market capitalization overtook that of Exxon Mobil’s in August of 2011, only a year after the release of the iPad. The dawn of a new age of colossal technology has come […]

Currency and Volatility

Posted on Posted in Market Commentary, Personal Financial Planning

“Be fearful when others are greedy and greedy when others are fearful.” -Warren Buffett The third quarter certainly showed much to fear, with China and Syria topping the list. Market participants sold risk assets in anticipation of poor growth out of both China and multinational corporations’ China strategy. Both the Chinese economy and the American economy are essential to global growth. The Chinese economy is not falling off a cliff, instead its growth is merely slowing down, much like our own growth rate, which has slowed over the past 20 years. As the pool of capital becomes larger and the […]

China and Other Stories

Posted on Posted in Market Commentary

August has been a particularly nasty month for risk assets. This period appears to be more serious than the brief market correction we saw last October. News of problems in China, particularly of a shrinking in their manufacturing sector has caused investors to indiscriminately sell equities, purchase government bonds, and raise cash in money market accounts. Markets seem to decline quickly in recent years only to bounce back nearly as swiftly. Corrections have been short-lived non-events since 2011. Despite being in a bull market, in recent years the VIX (measure of market volatility) has seen shocking intraday rises. On Friday […]