This is the question that is on everyone’s mind. For savers and borrowers alike, interest rates are a key topic of discussion and a central ingredient of the economy. Should borrowers try and lock-in the loan at today’s rates? Should investors buy that bond at today’s rate? Before we get into more detail about interest rates, we think it is helpful to quickly review a few bigger items to keep in mind.Starting Line DiscussionsWe discuss your investment horizon quite frequently in our communications. The purpose is to establish base case scenarios for expectations related to cash flow and to investment …
Investing During International Conflict
First off, the idea that we can spend time discussing portfolio performance in a time when human lives are at stake is a fortunate position to be in. Lives will not only be lost, but many more lives will be changed forever. We are thankful for our safety, but also aware that many are not as lucky. Unfortunately, this is our current reality.Regarding investments, we think the following four points help clarify our thoughts as we continue to live in this uncertainty. It is natural for everyone to go into sensory overload when conflict strikes. What investors must be careful …
What is Going on with Inflation?
We have spoken about inflation the last few months. As expected, the topic continues to drive many conversations. Much like other investment decisions, the inflation data is only the start of the process. Just as consequential is the reaction to the data.Federal Reserve Goal Conducting monetary policy is one of the five key functions of the Federal Reserve System. Monetary policy is defined as “ promoting maximum employment and stable prices in the U.S. economy”.1 Both maximum employment and stable prices have an element of subjectivity. What is the correct employment number? What is the desired stable price? What is the …
Is Supply Chain Going Back to 2019?
Time is asymmetrical and flows in only one direction: forward. British astrophysicist, Arthur Eddington, developed this concept of “one-way” direction. He illustrated this concept by using an arrow. If by following the arrow you see more randomness, the arrow is pointed towards the future. If the arrow becomes less random, the arrow is pointed towards the past. This one-way direction also says something else. As each moment passes, things change. Once these changes happen, they are never completely undone. Some physicists have spent their careers researching this concept. Coincidentally, we see this concept all around our everyday life. Houses are …
The Illusion of Certainty
A New Year
People like certainty and they will go to great lengths to get it. During their “certainty” quest, people will come across many theories. All too often these theories are traps. These theories provide solutions when in fact there might not be one. Read All
Chasing the Puck
Investing is a constantly moving thing. Yesterday’s news is forgotten fast. What was important then is now quickly removed from the front page. Guessing the next big thing is a draw for many people and the news companies know that. Everyone seems to be in a hurry to get somewhere quickly. Read All
Stock Markets and Elections
We are less than three months away from another US Presidential and Congressional election. Much ink will be spilled (or data sent throughout the internet) regarding what the future will look like after Tuesday, November 3rd. Read All