The Crash That Will Bring Down the Entire Galaxy

Ben Carlson had a little fun poking fun at the regular calls from Jimmy Rogers predicting the worst crash in our lifetime and other sensational headlines like the one for this post that is hopefully amusing. Ben found a headline like this attributable to Rogers going back every year to 2011. He says these extreme predictions offer no value. John Hussman has an interesting approach to this sort of thing. While Hussman’s concerns have come nowhere close to manifesting in equity prices there is still value to be had. He frames it in terms of whether market conditions are relatively risky at the moment or not. An easy way to think about this is there is a lot less risk of a crash or bear market immediately after a crash or bear market. Markets are less likely to double after they have just doubled. Agree or disagree with Hussman, it is a simple way to view the world. Where I diverge with Hussman is concluding “oh, the market is overvalued and sentiment is too bullish so I must get out now” which is how I take Hussman’s approach and I think his fund’s results bear that out. Over the course of an investing lifetime it is not crazy that you might get a market top or bottom exactly right and Rogers of course has made some great calls but Carlson’s point for the average investor (or advisor) not allowing being right on a couple of big calls to lead to over estimating the ability to make those calls (Dunning Kruger). As someone who has read Hussman for ages, I...

The Hike Everyone Was Expecting

The weekly market update was posted and includes the following; The FOMC met last week and of course hiked rates to a new range of 1.00%-1.25%. The move was widely expected, built into Fed Funds futures pricing but seems to be widely derided as well. Barron’s made the argument that the policy group is underestimating the downward pressure on prices from creative destruction seen in things as mundane as unlimited data plans getting cheaper and cheaper. Please click through and read the entire update. I was in San Diego last week to speak at the Pershing Insite Conference on asset allocation and managed to take in a Padres game. The Padres are one of my favorites (after the Red Sox of course) and I love the stadium. On the way to San Diego I stopped at a couple of fire houses  for some pictures including Congress, AZ. And Imperial County, CA in Palo...

Retirement Reading Roundup

My latest post for Alpha Baskets is up and includes the following. Maybe less related but still a good read is from the Charlotte Observer, weighing in on how far $1500 will get you retiring in Ecuador. This is a fun topic to write about. It is interesting to many people on some level even if not a serious consideration for many. My thought on how this might work has evolved. As opposed to planning to leave forever, I could see this being a temporary thing for young retirees who maybe have not accumulated as much as they would have liked, going for five or maybe ten years. Please click through to read the entire...

The Dark Knight Passes

The title as a nod to the passing of Adam West, the weekly Market Update has been posted at Alpha Baskets and includes the following; The action in emerging market exchange traded funds bears mentioning. The larger ETFs are up 15-20% this year after years of relative misery. As a building block of understanding, most investors would accept that a diversified portfolio would have exposure to foreign markets including emerging. The last few years of underperformance likely breeds impatience with the idea but it is important to remember that between foreign and domestic equities one must outperform the other in a given year and while someone could guess which will outperform this year, guessing is akin to hoping and hope makes for a lousy investment strategy. Please click through to read the entire update. From Monument Valley last October LA County Fire in Malibu (it really surprised me how much I like the LA County rigs) Rat rod bike of...

Monetizing A Hobby

One of the long running themes of this blog has been to monetize a hobby as part of a retirement planning solution. I last touched on it a month ago. The context is simple. If you enjoy doing something enough that you spend a lot of your time doing it then you are in a good position to know whether or not your hobby can in fact be monetized. Success in this regard, like most things, requires putting in time in terms of getting better/more knowledgeable and figuring how to actually monetize the thing you do. Over the last couple of weeks I embarked on an attempt to monetize my interest in photography. I had about a dozen pictures put on canvas, two on metal and then a bunch of regular pictures made and participated in my first show over the weekend. I got a banner made at Vista Print, had to get a couple of business/tax documents and pay for a spot at the show which was at the Courthouse Square in downtown Prescott. Some of the shows like this on the square cost $400-$500 which makes no economic sense for what I am doing. The charge for vendors at this one was $125. I am scheduled for the Walker Day Art Show (the fire department’s big annual event) and that one is only $25. My all in is about $700. A while back I mentioned that one of the fire department board members is quite successful selling wood carvings; he’s in three galleries and occasionally does shows like the one I did over the weekend. He said...