Lessons from March for the Fallen

On September 28th, 2019, I had the privilege of participating in March for the Fallen (#MFTF), an event that honors military soldiers who lost their lives defending our country and our freedom. Participants in the event—which takes place at the Pennsylvania Army National Guard base in Fort Indiantown Gap—can choose a 5K run or a 14-or 28-mile march. Everyone is free to set their own pace and take as much time as they need to… Read More

Business Ownership in the Age of the Public Corporation

A recent article in The Washington Post criticizes the recent announcement by the Business Roundtable—an organization of corporate CEOS– that its members are “redefining the mission of their companies ‘for the benefit of all stakeholders.’ “ The article argues that the new policy reflects a lack of faith in capitalism, asserting that “capitalism done well will benefit the so-called stakeholders, but they are not its purpose.” The article cites the example of Warren Buffett’s purchase… Read More

Risky Economic Doctrine is Becoming Hot Idea

The type of stimulus that used to be taboo—one in which central banks take a more junior role and collaborate with governments—is gaining appeal. This according to an article in Bloomberg. While such a shift could pose a risk to the “independence from politics that monetary policy makers prize,” the article says, the threat of deflation is leading to an emerging consensus that “the next downturn may need to be fought with direct and permanent… Read More

Robert Shiller Says a Data Revolution is Coming

Nobel Laureate Robert Shiller says we are facing a revolution rooted in a “huge acceleration in the amount of data available to researchers,” which he discusses in his new book Narrative Economics: How Stories Go Viral and Drive Major Economic Events. This according to an article in Barron’s. Shiller, who reportedly predicted both the dot-com bust and the events that led to the 2008 financial crisis, argues that the last time there was a data… Read More

Swedroe: Private Equity Hurts Investor Wealth

While private equity has made some wealthy, recent studies have shown that regular investors have not been the beneficiaries of this wealth. This according to an article by Larry Swedroe in Advisor Perspectives. Swedroe writes that the research concludes, “private equity has not outperformed publicly available mutual funds on a risk-adjusted basis. And that does not even account for the liquidity that private equity investors forfeit.” He cites one paper by Harvard University’s Erik Stafford… Read More

The Rising Bar for Active Management

By Jack Forehand, CFA (@PracticalQuant) Active managers as a whole have always been pretty bad at their job. Depending on what data source you use and what time frame you look at, somewhere north of 80% of active equity managers underperform their benchmarks after fees over long periods of time. When building Validea, we’ve tried to key in on those individuals and strategies that have a long term record of success, but the number of… Read More

Private Equity Maybe Be Ripe for Disruption

The decreasing number of public companies and high fees in private markets are creating “the perfect conditions for a passive player to upend private equity,” according to an article in Institutional Investor. The article cites comments from a report by Willis Towers Watson’s investment think tank that suggests the current model of private equity, “which essentially involves putting leverage on a company, improving it operationally, and then selling it in a short period of time—has… Read More

A Trick for Better Investing

A recent article in Morningstar discusses how investors can use the laws of psychological distance to their advantage. Psychologically, the article explains, “things that feel close take up more mental space and involve more detail, while things that feel far off are fuzzier less formed and contain fewer details.” It cites a study conducted by a team at UCLA regarding the effects of this concept on personal savings that suggests, “the closer you feel to… Read More

Ken Fisher to the Fed: Cutting Interest Rates Will Hurt Economy

In a recent article for USA Today, investment expert, author and columnist Ken Fisher wrote, “Hey Federal Reserve Board: Pay attention!” adding that the central bank’s plan to cut short-term interest rates represents “demand-side thinking” and ignores the “bigger basics.” Instead, Fisher argues, the Fed should “dump all those bonds you idiotically bought under your ill-conceived ‘quantitative di-easing (QE) programs. Get real.” Fisher contends that the Fed should be concerned with the inverted yield curve… Read More

Bill Gates’ Simple Investment Strategy

In an interview with Bloomberg Television, billionaire Bill Gates explained how he has managed to add $16 billion to his net worth this year (bringing it to $106 billion): “The strategy that’s been used on the investments is to be over 60% in equities.” On the Bloomberg Billionaires Index, this puts Gates only behind Jeff Bezos, the article reports, “even as his charitable donations have topped $35 billion.” The article notes that the Gates fortune… Read More