Permanent Asset Allocation
Short run Intermediate Long Run Nominal Real Nominal Real Nominal Real Stocks + – + small – big + 0 Bonds – 0 0 0 + 0 Cash + – + – + – Gold 0 – + small – + – Short run...
Read MoreAuthor: David Merkel
Stock Prices versus Implied Inflation
Eddy Elfenbein wrote a good post recently on the stock market versus inflation expectations. When I read it, I said to myself, “Wait, is the relationship between nominal and real rates really 1:1, or is it more...
Read MoreSearching for the Not-Romney
Over the last six months, I have described the Republican nomination to be the search for the not-Romney. The average Republican does not want Romney, but they don’t know who they do want, among the midgets that are...
Read MoreOn Insurance Stock Indexes
I’m still toying with the idea of starting an insurance-only hedge fund. I own a lot of insurers, and I think that I get the better of that market.Where I have a harder time is with what to short. Shorting is tactical not...
Read MoreGoodbye 2011
I tried to think of a post where I would bring out the best of 2011 economically, but the best I could some up with was, “It could have been worse.” That doesn’t convey much fondness. 2011 was characterized by...
Read MoreThe Rules, Part XXVII, and, Seeming Cheapness vs Margin of Safety
The market takes action against firms that carry positions bigger than their funding base can handle. Temporarily, things may look good as the position is established, because the price rises as the position shifts from being a...
Read More2011 Financial Report of the US Government
There is little to no fanfare for the release of this report, (why do they release at such a distracted time of year, where people will ignore it?) which strips away a lot of the malarkey that the US Government delivers by...
Read MoreLife With Wife
My wife has only given me financial advice twice in my life. She was totally right both times. Now, she doesn’t have a financial bone in her body. She was raised in a household where she never lacked anything, with...
Read MoreReturns on Equity Amid the Financial Crisis, Response
I appreciate constructive criticism. I particularly appreciate comments at this blog, regarding my long article on how return on equity changed during the financial crisis. The reviewer said, In a world in which I didn’t...
Read MoreRisk-Based Liquidity
When there is financial failure, it comes as a result of illiquidity. Now, truly, these parties are insolvent, because they took the risk of not being able to pay cash when it was due. Illiquidity and insolvency are really the...
Read MoreFree E-Book
TraderPlanet’s Quick Guide to Candlesticks
