Education

Perils of Index Investing

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Reading Time: 4 minutes In a previous article, we discussed the problems with investing in index funds. One of the most important points made in that article was that indexes ignore firms with negative earnings when calculating price to earnings (P/E) multiples. When you buy an index fund, you buy all the stocks. Ignoring…CONTINUE READING

What Role Does Gold Have in Today’s Markets?

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Reading Time: 3 minutes In modern financial markets, the list of securities you can place bets on is long indeed. In addition to traditional investments such as stocks and mutual funds, newer financial instruments such as derivatives and ETFs (electronically-traded funds) have become popular. There has even been an attempt recently to allow investors…CONTINUE READING

Seasonal Adjustment & Cost of Living Conspiracy Explained

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Reading Time: 5 minutes Many libertarian leaning people who follow Austrian economics consider themselves skeptics. That viewpoint stems from the idea that neither the left nor the right are advocating for their interests as well as the concept that the general media is deceptive. While it can be argued that misinformation is put out…CONTINUE READING

How The Federal Reserve Decides Policy

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Reading Time: 4 minutes The Federal Reserve has a dual mandate to form an economic environment which keeps prices stable and has maximum stable employment. The Dual Mandate Bullseye chart does a great job of showing the policy objective the Fed has. As you can see, the x axis has an unemployment gauge and the…CONTINUE READING

The Future of US Housing Market

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Reading Time: 4 minutes The housing market is one of the most important industries in the US, as was on full display during 2008 when it brought down the entire economy. Many industries touch housing such as banks, insurance firms, and home builders. A house is the biggest purchase most people make their entire…CONTINUE READING

Demographics Imply Interest Rates Rising

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Reading Time: 4 minutes Looking at the global economy in terms of demographics tells us a lot more than meets the eye if you know what to look for. The obvious narratives are that the emerging markets have young populations which are growing quickly (excluding China). This along with the inclusion of free markets…CONTINUE READING

Passive Investing: What Not To Do

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Reading Time: 4 minutes The biggest change in investing strategies in this cycle is that investors have moved to index funds in droves. With the power of the internet and the free flow of information, people realized they were getting fleeced by mutual funds who usually missed their benchmark. Investing used to be unfair…CONTINUE READING

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