Copyrights (and Wrongs)?

By | 2017-08-31T07:31:14+00:00 August 31st, 2017|Global Market Update|

Who owns your software? Photo: Viktor Hanacek. Source: Picjumbo It’s an important question. Because under Federal copyright law, software is like any piece of writing. The author of a line of code is the owner of the copyright to that code. The person who physically types out the words and symbols is the “author” and enjoys the same rights as most other authors – the right to copy the code, distribute it, post it, and modify it to create derivative works. This makes some [...]

Letting Profits Run

By | 2017-08-30T05:58:43+00:00 August 30th, 2017|Global Market Update|

“Let your winners run, and cut your losses quickly.” – Jesse Livermore Ancient Greek Runners from a pottery shard. Public Domain. Source: Wikipedia This is pretty good advice when it comes to investing. The legendary investor Jesse Livermore coined this “trading commandment” a century ago. But it’s hard to put into practice. Studies show investors fear losses more than they enjoy winners. When a stock goes up we take the gain, often too early, in order to eliminate the risk of losing it later. [...]

A Texas-Sized Mess

By | 2017-08-29T07:44:00+00:00 August 29th, 2017|Global Market Update|

What happens after big storms? Damage from the 1938 Hurricane. Source: NOAA The stories coming out of Texas are heart-wrenching: senior citizens being evacuated using their walkers through chest-deep water; overpasses submerged by overwhelming flood waters; livestock being swim-herded to safety. This hurricane / tropical storm has dropped more precipitation than any recorded storm in history – almost 10 trillion gallons so far, with another 5 to 10 trillion gallons expected. The economic loss is expected to be greater than $30 billion – with [...]

Valuable Questions

By | 2017-08-28T07:19:34+00:00 August 28th, 2017|Global Market Update|

Are stocks overvalued? Shiller PE. Source: Multipl.com A cynic knows the price of everything and the value of nothing. That’s what I keep reminding myself when folks trot out historical PE charts like Shiller’s calculation, which averages corporate earnings over the last decade and then compares the stock market’s total market capitalization to that average. And by that measure, stocks are now valued at almost 30-times their decade-long average earnings. That’s a figure that gives pause. It’s only exceeded by the levels of 1929 [...]

Getting to Growth

By | 2017-08-25T07:32:38+00:00 August 25th, 2017|Global Market Update|

Are there problems in the US economy? Source: St. Louis Fed Sure there are. Exhibit one is the rate of economic growth. Any way you measure it, real economic growth has slowed significantly over the past 30 years. The economy is a lot less volatile than it was in the ‘60s, and ‘70s, but the rate of economic expansion has gradually gotten slow and slower. The economy used to grow faster; now it’s growing more slowly. Whether we’re exporting jobs in order to buy [...]

Marginal Thinking

By | 2017-08-24T06:53:08+00:00 August 24th, 2017|Global Market Update|

What’s your marginal tax rate? Source: Healthcare.gov It’s an important question. The answer will determine whether it makes sense to buy municipal bonds, whether to put money into a Roth or Traditional IRA, and even whether to convert a Traditional IRA into a Roth. Let’s face it: almost everything we do has tax consequences. The government puts its finger into almost every financial pie – they’re our partner in almost every financial decision we make. But they’re a passive partner. It’s perfectly reasonable to [...]

Something Old, Something New, Something Shiny

By | 2017-08-23T06:52:10+00:00 August 23rd, 2017|Global Market Update|

How much is your car worth? Photo: Big429. Source: Carpictures.cc Probably less than you think. Car sales have been booming – rising for the past seven years, ever since the Great Recession. They’re almost as high as they’ve ever been. But with so many new cars rolling off of dealer lots, the market for used cars is glutted. That’s putting downward pressure on the price of used cars. In fact, the average used car lost 17% of its value in the past 12 months, [...]

The Crown Jewels

By | 2017-08-22T08:55:50+00:00 August 22nd, 2017|Global Market Update|

Should Britain sell the crown jewels? Queen Mary’s Crown. Photo: Public Domain. Source: Wikipedia It’s a fair question. Valued simply as jewelry and works of art, the collection is estimated to be worth around $15 billion. But the fact that they are the crown jewels of the British monarchy – with all their symbolism, history, and intrigue – means that they could easily sell for three times that sum. And in a country with a trillion dollar government budget and a $70 billion deficit, [...]

Eclipse Economics

By | 2017-08-21T07:04:39+00:00 August 21st, 2017|Global Market Update|

Will the eclipse be an economic boon? Source: NRK News Millions of people are planning to travel to see the coming eclipse. Cities and towns along the route of the 70-mile wide totality are racing to complete their preparations. Casper, Wyoming is building a new town square that will be the center of a week-long “Eclipse Festival.” The State of Wyoming expects its population to double. The “Great American Eclipse” web site has a web app that will deliver real-time traffic data – particularly [...]

The (Greater) Wealth of Nations (Part 2)

By | 2017-08-18T06:17:08+00:00 August 18th, 2017|Global Market Update|

Is trade enough? Source: Brookings Institute In order to understand the effect of trade on the global economy, it’s not enough to map out gross flows from one economy to another. Countries and companies are enmeshed in a complex web of relationships – called the Global Value Chain. Cars aren’t just built in Japan from Japanese steel and glass and plastic and then shipped to the US or Europe anymore. They might have Chinese steel and Mexican seats and a Canadian motor and software [...]