The commercial real estate market is getting hammered by rising costs. Not only are higher interest rates scaring away potential buyers, but high insurance costs are also killing demand. Konrad Putzier reports in The Wall Street Journal: Commercial property owners, already struggling with high interest rates and rising vacancies, face exploding insurance costs that keep hitting new highs. Natural disasters, inflation and a shrinking reinsurance market have pushed insurance premiums to record levels, echoing the surge in home insurance rates for much of the U.S. That leaves many landlords … [Read more...]
Wellington and Wellesley Funds Not Managed by Vanguard
In my conversations with you, we talk about the virtues of being a balanced investor. You can achieve this through a mix of blue-chip dividend payers and laddered bonds. To illustrate, I’ll use as a proxy Fidelity Balanced, Vanguard Wellington, and Vanguard Wellesley funds. In that order, they have roughly the following stock/bond allocation mix: 70/30, 60/40, or 40/60. (Note: Wellington and Wellesley are managed by Wellington Management in Boston, MA, not the Vanguard Group.) For more, read the P.S. below. With the Federal Reserve deciding to hold rates steady yesterday—they’ve made … [Read more...]
Will the Fed Hold Up Its End of the Bargain?
Looks like the Fed wants to keep interest rates higher for longer. Great. I’ll take it. But let’s not forget about some unforeseen black swan swooping in on their party, ruining their comfy projections, leading to rate cuts. Because in the real world, with live bullets flying overhead, you need to act knowing the Fed is an emotional beast. It could change course without warning. Be prepared. Look, we don’t need to go back too far to see how the Fed gutted rates after the financial crisis and during Covid saving (temporarily?) the stock market. What will it take for them to jump ship on a … [Read more...]
Don’t Ask Me When to Haul Your Boat
Your Survival Guy tried to reason with Hurricane Lee and lost. It never made landfall in my neck of the woods or sea. Just lots of wind and rain. No more boating this season. Thank you, Tom Sawyer, for another great one. It’s bittersweet. Because in my conversations with you, we talk about a feeling of relief when the season’s over, whether it’s boating or gardening. There’s comfort in knowing you don’t have to worry about not using the boat enough or if the garden’s going to float away from too much rain (a big problem this year). There’s always a punch list. Which brings us to … [Read more...]
GREENWASHING: What’s in a Name?
“What’s in a name? That which we call a rose, By any other name would smell as sweet.” — Juliet Capulet What's in a name? It turns out the SEC demands that the names of funds be descriptive of at least 80% of what the fund is doing. This new rule was adopted after many funds added language to their names suggesting they were part of the ESG movement but didn't follow up by changing their portfolios to match the strategy. This is a technique known as "greenwashing." The SEC has had enough of the practice, and has acted to purge the misnamed funds. Douglas Gillison and Michelle Price report for … [Read more...]
Americans Are Not Happy with Bidenomics
In a poll released by Quinnipiac last week, 60% of Americans indicated they were unhappy with Joe Biden's handling of the economy. You, dear reader, are not surprised by this news, as you have read about the shortages and inflation in America since nearly the day Joe Biden set foot in the White House. Obamacare Is Now Bidenflation SHORTAGE: Biden Shortages Hit Kids’ Medicines Bidenflation Is Back at the Pump MAJOR WARNING ON FOOD SHORTAGES: Businesses Prepare for Violence DOWNLOAD: FOOD SHORTAGE: Crazed Hoarding Is not Preparing Bidenflation Has Eaten Up Americans’ Pandemic … [Read more...]
“Oh, That Wasn’t So Bad”
UPDATE 9.19.23: The economists at the OECD have predicted that global GDP growth is going to slow next year. Bloomberg's William Horobin reports: The world economy is set for a slowdown as interest-rate increases weigh on activity and China’s pandemic rebound disappoints. Growth will ease to 2.7% in 2024 after an already “sub-par” expansion of 3% this year, according to the latest OECD forecasts. With the exception of 2020, when Covid struck, that would mark the weakest annual expansion since the global financial crisis. “While high inflation continues to unwind the world economy remains … [Read more...]
Prepared for When the Next Black Swan Swoops In?
UPDATE 9.19.23: Have you thought about preparing for a Black Swan event since you read this piece I posted on August 3? Since then, the world has only gotten riskier. As readers of my monthly RAGE Gauge (sign up for my monthly alert here) know, risk is high. Africa has been threatening to break out into a multinational war, now Armenia and Azerbaijan are near to fighting, and nothing seems resolved in Ukraine. Wars aren't the only Black Swan events, but they certainly increase risk in the world. If you aren't preparing already, now is a great time to start. In my conversations with you, we … [Read more...]
Investing Mistakes to Avoid: #1 Y-O-U
Having dinner last night, my father-in-law Dick Young asked, “Survival Guy, what’s investing mistake #1?” “I don’t know yet,” I said. “Let me tell you about living off your portfolio. It’s hard,” he said. “I’ve been writing about this my entire adult life. I didn’t expect how tough it would be to generate income. It’s expensive staying at Le Bristol, so you better figure out a way to make it work. I’m just getting comfortable. How’s your dinner?” … Part of my inspiration for this series came from reading past issues of Richard C. Young’s Intelligence Report. Each issue was packed … [Read more...]
Just a Few Problems I See with AI Portfolios: Part I
How much Artificial Intelligence do you want in your portfolio? Your Survival Guy doesn’t want it anywhere near mine. But AI is already in the sports pages with a recent Ohio high school football recap written with the heart of a Tin Man. How much longer until we have ivory tower dwellers and woke politicians writing the rules for investments? What could possibly go wrong? Here’s some I’ve come up with. “Dear AI: Your Survival Guy wants a diversified portfolio.” How would AI interpret this? Your Survival Guy wants “an eclectic mix of dividend paying stocks.” How would AI interpret … [Read more...]
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