Financial Literacy

Are Stocks Cheap Following October’s Correction?

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The concept of valuation is interesting because if you believe in the efficient market hypothesis, whenever stocks have multiple expansion or contraction it’s for a reason. This makes it impossible to outperform the market, in theory. Good thing we live in the real world. The more straightforward theory on investing,…CONTINUE READING

How Are Median Americans Doing?

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What makes economics more frustrating than investing is that the truth is never completely settled. When you buy a stock with the plan to hold it for 5 years, the price in 5 years is guaranteed to tell you whether it was a good investment or not. Economic analysis is…CONTINUE READING

Yields Increase Based On Wages

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The top two stories in markets in September are the rally in U.S. stocks to record valuations versus the rest of the world according to price to book value and the sell off in long dated U.S. treasuries. Regardless of whether you follow the price to book value, US outperformance…CONTINUE READING

Solution To Wealth Inequality

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Weakness in real median income is the backbone of the income inequality debate because if median incomes are increasing people don’t care as much about how well the rich are doing. If people have jobs and are getting raises, they aren’t willing to protest. If they are getting real pay…CONTINUE READING

Past & Future US Equity Performance

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Everyone knows the bull market is 9 years old; it is the longest bull market ever. However, the length of the bull market is largely irrelevant because it came very close to ending. It’s arbitrary to say a bear market is a 20% decline, but not a 19% decline. Returns…CONTINUE READING

The Myth Of Retiring Early

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Some of the most widely shared articles on the internet are on the concept of FIRE. Fire stands for Financial Independence Retire Early. The basic assumption is that you hate your job, so you will be happier by saving most of your money while you are working with the goal…CONTINUE READING

Are You Paying For Your Neighbor’s Vacation?

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Financial security and stability have immense value just like any product or service. It can become a product as is the case with insurance. It’s clear financial stability has value, but how do we pay for it outside of insurance? The two most prominent ways we pay are through delayed…CONTINUE READING

Are New Valuation Methods Valid?

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Some investors believe in maintaining the use of old models because they have historical precedence; new ideas can be risky to try. One example which comes to mind is when the 1990s tech firms were valued based on eyeballs instead of earnings. Believing in new models can easily turn into…CONTINUE READING

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