The editors of The Wall Street Journal explain the perilous state of the Texas electric grid, writing: Summer is two months away, yet the Texas power grid is already swooning. On Friday the Electric Reliability Council of Texas (Ercot) asked power generators to postpone scheduled maintenance early this week “to help alleviate potential tight conditions” as temperatures rise into the not-so-sizzling 80s. The grid typically has excess power-generating capacity in the spring owing to mild weather. There’s also an abundance of solar and wind power. This is why plants go off-line for repairs in … [Read more...]
“Happy I Found Richard C. Young’s Intelligence Report”
“Happy I found Richard C. Young’s Intelligence Report all those years ago,” you told me yesterday. “Because we wouldn’t be talking this morning about investing if I hadn’t. Your father-in-law’s monthly letters kept us on track. He kept us focused on saving and compound interest.” That wasn’t the first time I’d heard that. And what many of you tell me is how much you loved the opening paragraph and how that kept you interested. I know how much time and effort Dick and Debbie put into the opening because I was around the house when they were working on it. It was usually said with excitement, … [Read more...]
Want to Make and Keep Generational Wealth?
Want to make and keep generational wealth? Read this from Daniel Rasmussen in The Wall Street Journal, who writes: After the spectacular blowup of his hedge fund in 1998, Victor Haghani spent years studying the question of controlling risk. In “The Missing Billionaires: A Guide to Better Financial Decisions,” he and James White offer a smart and sophisticated primer on quantitative risk-management techniques. Today the authors are principals at Elm Wealth, a multibillion-dollar wealth-management practice. They argue forcefully for a broader adoption of the “Merton share,” named after the … [Read more...]
Fight Food Inflation with Gold
Simple. Fight food inflation with gold. Don’t want to lug it to your car, pay storage fees and insurance? There are plenty of ETFs that will do the heavy lifting for you. Costco has been selling up to $200 million worth of gold bars a month. The Daily Mail's Neirin Gray Desai reports: Costco is now estimated to be selling up to $200 million worth of gold bars a month - but have Americans who bought them made a profit? Those who bought them last year or earlier this year before gold jumped in price will have made a profit, DailyMail.com research shows. Those who bought them more recently … [Read more...]
Your Retirement Life: A Living Income from Savings
You want a forward-looking indicator? Look at the stock market or 10-year Treasury bond—both flashing warning signs this week. But how about years from now? What will the decades ahead—your retirement life—look like? What if we’re going back in time? You and I, we’re in the business of patience. With so much attention paid to what the market did this week or who won last night’s game, it can be difficult to remember that investing is an endeavor in b-o-r-i-n-g. At least until you have enough to retire on, and then it’s fun. Saving money takes time. Every day you’re taking baby steps … [Read more...]
Don’t Underestimate Government’s Ability to Get it Wrong
In October of 2001, Under Secretary for Domestic Finance at the Treasury Department, Peter Fisher, explained that the United States would stop issuing bonds in 30-year maturities because short-term debt was so much cheaper. At the end of Q3 2001, 30-year Treasuries had a yield of 5.42%, while 10-year bonds yielded 4.6%, and and the government could borrow for 12 months at 2.49%. The spread between 30-year and 12-month Treasuries was 2.93%. CNN Money reported at the time: NEW YORK (CNNmoney) – The U.S. government said Wednesday it no longer will issue 30-year Treasury bonds because they don’t … [Read more...]
What to Do with Higher Mortgage Rates?
Prospective homebuyers are asking themselves, "Will rates come down?" Inflation has pushed rates higher, and some buyers are giving up hope. Rachel Wolfe and Imani Moise report in The Wall Street Journal: Prospective home buyers are giving up hope that interest rates will come down soon. They are changing their life plans accordingly. An engaged couple that had sold stocks to fund a down payment now expects to rent for another five years. A family that was looking to trade up is considering building an extra room instead. An investor plowing ahead on a purchase is scaling back his profit … [Read more...]
Get Paid During Your Golden Years
With the 10-year treasury at 4.5%, retired and soon-to-be-retired investors are seeing rates they can sink their teeth into for longer—don’t let inertia keep you down. How high will they go? Not my concern. What I am concerned about is that you get paid during your golden years with some cold, hard cash from interest payments. Consider a mix of stocks and bonds. Run your finger along my efficient frontier and understand it’s not necessarily what you invest in but how you invest. In other words, are you diversified? How about your CDs that are maturing? Pay attention because … [Read more...]
Investing for the Hidden Inflation in Your Home
With housing costs rising, why not invest in areas that offset them? You know how high insurance premiums, utilities, and home repair costs are. That’s why I like to have a mix of stocks that operate in these specific areas. I want you to get paid too. In The Wall Street Journal, Nicole Friedman discusses the hidden costs of homeownership that are skyrocketing. She writes: Darren Gondry has owned his four-bedroom home near a golf course in Louisville, Ky., since 2004. He and his wife, Lori Gondry, paid off their primary mortgage in 2021. That hasn’t stopped other bills associated with … [Read more...]
Your Survival Guy Likes 5% on Money Market Rates
With interest rates rising, don’t miss the boat with your lazy cash stuck on the beach. BofA strategists say, "History suggests redemptions won’t begin until a year after the Federal Reserve starts cutting interest rates." You still have plenty of time to consolidate with my favored Fidelity Investments and enjoy money market rates of around 5%. Farah Elbahrawy reports for Bloomberg: Investors are still flocking to cash funds, and Bank of America Corp. strategists say history suggests redemptions won’t begin until a year after the Federal Reserve starts cutting interest rates. Money-market … [Read more...]
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