Economy

Thoughts on 2018

I hope the new year is starting out good for you and you had a good winter break holiday.  I am writing to both share some data points on the financial markets from 2018 as well as some thoughts about it going forward.  

Oct 2018 Market Update

Just wanted to drop off this note that I just wrote quickly to give you a general update on the market.
 

My Take on Bitcoin 5 Years Later

I thought it would be appropriate to sit down and write this article given all the frenzy and talk behind Bitcoin, and the growing interest and seemingly mania like environment around it.

Trump era vs. Reagan era

Both pre and now post Donald Trump's election an often mentioned narrative was and still is being pushed suggesting that his presidency will usher in an era similar to the 1980’s when Ronald Reagan was the president. 

The Media Noise can be Deafening

Most people would argue that living in a digital world, with instant access to an endless stream of information has made us smarter and more self-empowered than past generations. Investors believe that it has “leveled the playing field”, enabling them to make investment decisions based on the same information once only available to the investment pros.

8 Tips for Paying High Medical Bills

Next to the IRS, the most formidable and intimidating institutions people will face are the insurance companies and the medical care complex. Both are at the root of increasing medical costs and both are intent on making sure their bottom lines are forever expanding. Never mind that high medical bills are the number one cause of bankruptcies in the U.S.

Managing Investment Risks

In my opinion, it is impossible to predict future stock market returns. Investment models can produce hypothetical returns but they can’t account for future events. So, in my opinion, investors who manage their investments based on market performance or what they perceive as opportunities for better returns have very little control over the outcome.

Shift from QE to forward guidance

In case you missed it Kevin Warsh was on CNBC this morning. Again he made some great points including highlighting one of the downfalls of QE which he suggests has led to a misallocation and “malinvestment” of capital as oppose to hyperinflation which many doomsdayers have been harping on since the beginning of Fed’s Zero Interest Rate and QE policies.

Fed bogey may change

Research work done by economists at IMF as well as work done by Goldman Sachs economist Jan Hatzius are beginning to suggest that the Federal Reserve may be planning to change the threshold for its Zero Interest Rate Policy (ZIRP) from their original 6.5% unemployment rate and 2.5% inflation rate to perhaps a lower rate of unemployment such as 6.0% to even 5.5% rate.

How The Economic Machine Works

In this video Bridgewater’s Ray Dalio explains how in his view the economy is like a machine.   Suggesting that many people don’t understand it – or they don’t agree on how it works – and this has led to a lot of needless economic suffering.

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