Easy Monetary Policy = Inflation?
One of the more persistent themes we’ve been hearing from forecasters, for quite some time now, is that the Federal Reserve’s easy monetary policy—starting with its move to drive the Federal Funds rate from 5.25 percent to zero—would inevitably lead...
Is The S&P 500 Actively Managed?
In Mebane Faber’s new book, “Global Value,” he states: “It is ironic that the largest and most famous index, the S&P 500, is really an active fund in drag. It has momentum rules (market cap weighting), fundamental rules (four quarters...
Are Some Bond Fund Prices Stale?
I have long been skeptical of how fair bond fund prices are — or more accurately said, the potential ability for knowledgeable investors to “game” bond fund prices — in fixed income asset classes where liquidity isn’t great. Two asset...
Star Fund Managers Lose Luster
It was a particularly hot summer weekend day in St. Louis, too hot to be outside. So I decided to use the time going through the collection of articles I keep for future use. I save these articles, to be...
Actively managed funds flop in Europe, too
For more than a decade now, Standard & Poor’s has been contributing to the debate over active versus passive investing by producing its S&P Indices Versus Active Funds, or SPIVA, scorecards. These twice-yearly scorecards evaluate the evidence concerning the performance...
Brain Tricks May Reduce Your Returns
What if you could create a forum for discussing the best way to invest in a responsible and intelligent manner? Who would you invite to participate in this debate? Here are my suggestions: There would be no shortage of candidates...
Investors, Listen to Einstein: Stop Repeating These Mistakes
If insanity is doing the same thing over and over and expecting different results, investors are insane. The way many investors manage their money seems to perfectly describe Albert Einstein’s definition of insanity: Doing the same thing over and over...
Learning to Shun the Instagram Life
“We should just move to the country and live in a tent.” I mention this idea to my wife every time I’m confronted with one of the realities of living in Park City, Utah. It seems like almost everyone here...
Americans Are Bad at Math, but It’s Not Too Late to Fix
When I lived in Las Vegas, there were billboards everywhere advertising different casinos. One of the most common was the type that promised “98 percent payouts.” I remember thinking how amazing that was. After all, 98 is a lot of...
Small Value Funds Not Equal, Part II
Smart investors begin their journey by developing an investment plan, or investment policy statement, that includes an asset allocation table. After the plan has been prepared, the next step is to select proper investment vehicles for providing the appropriate exposure...
