The oft-repeated phrase for almost every family road trip in recorded history—“Are we there yet?”—is also appropriately asked by investors experiencing stock and bond markets in 2022. Although we’re not traveling together in the back of a wood-paneled station wagon to grandma’s house halfway across the country, we are all experiencing an uncomfortable journey of volatility. Questions that I hear and questions I’m asking myself along this investing volatility voyage include: Have stocks ... [Continue Reading]
Articles and resources related to Economy.
In what is one of my absolute favorite financial books of the past decade, The Psychology of Money, Morgan Housel introduces us to the concept of “appealing fictions.” Housel defines an appealing fiction as follows: Something you desperately want to be true because of potential huge upside.Is backed up by limited or no data, observation, or reasonable common sense.Polarizing in nature drawing people into factions or tribes. He goes on to describe these “extremely powerful” narratives ... [Continue Reading]
What a difference a year can make. Last April, we were discussing the uncertainty and unprecedented events of the early pandemic. The daily headlines seemed to rotate between record unemployment claims, increasing infection rates, a locked down economy, and a wildly volatile stock market. In contrast, our attention today is focused on millions of new jobs being added to payrolls, ever-higher vaccination rates, an economy that is opening up, and one of the strongest one-year stock market returns ... [Continue Reading]
The American Rescue Plan Act of 2021 has been signed into law by President Biden. The $1.9 trillion bill includes increased funding for COVID-19 vaccination programs and testing, state and local governments for economic relief, K–12 and higher education schools to assist with re-opening, and certain industries, such as restaurants and airlines, that have been hit especially hard by COVID-19. The bill also includes several temporary, but significant, tax-relief provisions, which we highlight ... [Continue Reading]
Reflecting on a year gone by is often, at least to some extent, an exercise in revisionist history. This isn’t necessarily a bad thing; many of the differences between our memories and experiences are minor and inconsequential. In some cases, the variations in these realities can help us persevere and move out of the past and into future endeavors. But as investors, revising the memories of the past can be problematic and potentially hinder future success. Behavioral finance is the study of ... [Continue Reading]