This and That: Zweig column, Kahneman interview and more…

July 18, 2013


Saving Investors from themselves

In an excellent column in The Wall Street Journal Jason Zweig says that though the market constantly changes, sound advice rarely does.

Daniel Kahneman Interview

In an interview with The Motley Fool behavioural economist Daniel Kahneman discusses his field, his book and how his insights could help investors.

Designing an ultimate portfolio

The article is aimed at US investors but this Paul Merriman’s article in MarketWatch offers a step-by-step process for designing what he calls an “ultimate buy-and-hold” strategy.

Is ‘Smart Beta’ all that smart?

An article in The Economist magazine wonders if the new trend towards “smart beta” — capturing excess returns than the market by deviating from traditional capitalization weighted indexes — will suffer the same fate as alpha seekers.

Say No to Postal Code Requests

An article in Forbes points out why it may not be wise to give out your postal code when stores request it for customer traffic analysis purposes.

Home Brew Beer

The weather is hot outside and one’s thoughts naturally turn to beer. Canadian Money Forum members shared their experiences with brewing beer at home.

It’s takes a thief to know one

Bernie Madoff who operated the largest Ponzi scheme in history for decades and is now a “communications director” at a US Federal Correctional Facility offers tips on keeping your money safe from the predators on Wall and Bay Streets.

Normal markets, not 2008

Money manager Cliff Asness tells Fortune magazine that either interest rates are going to head back down or economic growth is going to pick up and either scenario is good for stocks.

Things to never buy new

This video on Yahoo Finance says that buyers can save a ton of money by buying things like cars and jewelry second hand.

Dow 36,000 revisited

While admitting he was wrong, the co-author of the unfortunately titled and timed book Dow 36,000 says he is now more respectful of the role that bonds can play in a portfolio.

This and That: Money in a mattress, falling markets and more…

June 21, 2013


Stuffing money in a mattress literally!
From the “why didn’t I think of that file” here is an interesting story on Bloomberg TV about a mattress maker in Spain who is tapping into today’s mistrust of the banking system by selling a mattress with a built in safe.

Falling Markets are a good thing!
Stocks, bonds, REITs, commodities and even good old bonds are falling like nine pins lately. The Wall Street Journal’s Jason Zweig says that if you are going to be accumulating assets for the next little while, lower asset prices are good for you (though it might not seem that way).

Things to avoid at garage sales
If you are going to shop at garage sales this summer, Reader’s Digest offers a list of items to avoid. It seems to me that avoiding items on the list such as bike helmets are just common sense.

Frugal Disney World
A wag said that the true magic of Disney is the amount of money they can extract from your wallet everyday. Still, it looks like Canadian Money Forum members have tips on how to save money at Disney World.

No Irrational Exuberance
In an interview with CNBC’s Squawk Box, former US Fed Chair Alan Greenspan says that stock markets are “significantly undervalued” based on equity risk premiums (here’s a good explanation of ERP).

Why ERP should be used with care
In a blog post, Aswath Damodaran, a Professor of Finance, pokes holes in Greenspan’s comments and points out that historically an increase in interest rates has tended to reduce the equity risk premium (the return from stocks is risk-free rate plus ERP), so stock prices may not be so undervalued after all.

Bond Bear, Stock Bull
Fortune magazine explained why Greenspan’s comments that bond yields are going to rise and stocks are a bargain based on current equity risk premiums makes little sense.

I’d like to be a couch potato, but…
Michael James says that while many investors are convinced by the arguments in favour of indexing, true couch potatoes are rare.

Blogs as a business
Million Dollar Journey shares some insights into how much it costs to start and maintain a blog or website.

The Power of Denial
Here’s something completely different: CBC’s The Current ran a story on an intriguing theory that the thing that is so special about humans is… denial. That would explain a lot of why so many people still believe in active management (sorry, couldn’t resist it).

This and That: Million Dollars Nest Eggs, Commodities, and more…

June 13, 2013

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Million Dollars ain’t what it used to be…

A New York Times column points out that with bond yields low even retirees who have saved up as much do not have a lot to live on.

Commodities for the Long Run

What can we say about commodity prices over the long run? This paper provides fascinating insights into real commodity prices over 160 years. One example: prices of stuff that is grown have depreciated over time but prices of non-renewable resources have increased.

Another week, another alleged fraud

The Vancouver Sun reported on yet another alleged fraud in which a former financial advisor sold extremely risky securities to retirees and senior citizens.

Are Homes Investments?

The Wall Street Journal asked a panel of experts how a personal residence fits into one’s investment portfolio.

The knock against credit cards

This article says that credit cards are making us poorer and fatter. Are credit cards also responsible for global warming?

REITs down

With bond yields spiking up, the hunt for yield may be at an end says this Bloomberg article. One of the hardest hit categories is Real Estate Income Trusts, which have dropped sharply in the past few weeks.

The Hindenburg Omen

Hindenburg Omen is supposed to foretell a stock market crash. If you believe in these things, it probably will distress you that the Omen has reportedly occurred five times in recent weeks.

Effects of the housing bubble

A recent story on CBC’s The Current looked at the effect high housing prices are having on Canadians.

Housing Bubble or not?

Canadian Money Forum members weighed in on whether Canada is experiencing a housing bubble.

Stephen Harper, Funny Man

Here is a funny video of Prime Minister Stephen Harper mimicking Brian Mulroney, Joe Clark and Preston Manning. You can safely skip the video after the two minute mark.