When I’m in a casino I tend to do two things: I bet conservatively when I’m winning I bet aggressively when I’m losing. This is not consistent with rational behavior, but evidently I’m not alone. This affliction runs rampant in our species. Economists reviewed more than five hundred thousand online poker hands and looked at…
Animal Spirits: I Will Say This
Today’s Animal Spirits is presented by YCharts Mention Animal Spirits to receive 20% off (*New YCharts users only) Stories Discussed Killer Vees The father of millennial socialism American domination Should you prepay your mortgage? The guy who wrote the book on how to detect fraud Imagine moderating Facebook all day? The law says markets are efficient The…
Just A Little Bit More
Chris Bosh, two-time NBA champion, was recently on the Bill Simmons podcast talking about the unhappiness of today’s superstar. Wait, what? It’s hard to imagine how a 23-year old kid who signs a five year, $127 million deal could be anything other than giddy all the time. This type of thing is possible because the 23-year old…
These Are the Goods
Articles The economists of the early 20th century did not foresee that work might evolve from a means of material production to a means of identity production. By Derek Thompson Socialism is the symptom, but the underlying problem is cronyism By Barry Ritholtz The 401(k) was supposed to be an extra savings account and nothing…
The Market Gapitalization
A report that I look forward to reading, okay skimming, every year is the Credit Suisse global investment returns yearbook. One of the more remarkable statistics in the new release can be found in emerging and frontier markets. These countries account for 40% of world GDP and 68% of the world population, yet they represent just 12%…
Killer Vees
The S&P 500 just rocketed 18% higher in only 44 days. A bounce of this magnitude makes a mockery of risk management. This is the ninth time stocks have experienced a killer vee bottom since 1970. I refer to them as killer vees because they suck for everyone. It makes buy and hold investors sweat…
Numbers Are Not Reality
One of the more unsettling realities of investing is that we cannot rely on data from the past to guide us in the future. It’s important that investors learn about market history and have a basic understanding of math, but beyond that, less might actually be more. In Enough, Jack Bogle wrote: Numbers are not…
Animal Spirits: The Rich Man’s Disease
On today’s Animal Spirits, we discuss: Desks were not meant to be our altars Wealthy and miserable Berkshire letter This guy actually put $10,000 into Microsoft at its IPO More credit card debt than emergency savings A survey I don’t trust A different look at sequence of returns Inheritances Cell phone addictions Listen here Charts…
Regret-Adjusted Returns
According to a recent Morningstar report, “shareholders of major U.S. stock market index funds have about 40% foreign exposure, as measured by corporate revenues.” Does this mean that U.S. investors already have plenty of overseas exposure, eliminating the need to diversify into international stocks? Let’s go to the scorecard. The S&P 500 destroyed international stocks since 1970,…
These Are the Goods
Articles Where’s the Venn diagram overlap between why writers write and why readers read? By Meb Faber Think of the U.S. stock market as one holding company named USA, Inc By Ehren Stanhope Investors do not like to bet on underdogs By Ryan Krueger How many thousands of quarterly investment letters have gone out to…
