May 25, 2020

Charlie Munger on How To Outperform the Market

Charlie Munger discussing how to outperform the market over the long-term. It is not about being smart like many fund managers try to be, it is about doing the right thing a few times in your life. On why index funds outperform the majority, well that is statistics, don’t get confused by that. Index funds outperform active due to fees, active outperform individual investors when looking at averages. The key is that you do what is best for you!

Why Americans prefer real estate v. the stock market

Gallup is out with some new data on American views toward investment markets that I think is worth discussing. Overall, about 55% of US households have some investment in the stock market (through either individual equities or mutual funds), which is unchanged from two years ago but below the peak of 63% from shortly after the turn of the millennium. The fall from 63% to 55% doesn’t sound like much...Read more  

Is inflation around the corner? History says “yes.”

From the article: “Policymakers have repeatedly called the battle against the novel coronavirus a war. As in wartime, federal expenditures are rising sharply while tax revenues are being hit by the lockdown. Both World War I and World War II—and, indeed, the Vietnam War—were followed by nasty bouts of inflation. If that happens again, policymakers today being cheered for their swift, decisive action will instead have to answer for their grave lack of foresight.”

Will the fed save the day?

I don’t think there’s an investor out there that would like to know where the stock market is going. Has it hit bottom, and if not, when will it? Will the market then come back fast or slow?

In short, no one really knows. But Ben Carson over at “A Wealth of Common Sense” has a pretty good theory.

Basically, the market has matured since the great depression. And we have come to a point where an aggressive fed has taken some of the risks out of the market by playing a larger role in the economy and management of the financial system, and in turn, assets.