As you may have heard, US stocks are expensive. You may even think you know what that means. Personally, I have no idea. I buy organic milk. Organic milk costs more than milk from corn-fed antibiotic cows. In other words, it's "more expensive." I buy t-shirts made by union workers in downtown Los Angeles. They cost more than t-shirts made in … [Read more...] about What should stocks cost?
I've written elsewhere about the Robinhood app and Robinhood margin accounts (branded as "Robinhood Gold"). One issue raised on the Saverocity Forum was that Robinhood's margin interest rates were high compared to those offered by Interactive Brokers, generally considered one of the cheapest sources of margin credit for retail investors. I … [Read more...] about All-in margin account rates at Robinhood and IB
Finance, like many professions stocked with men trying to impress each other, has accumulated a plethora of cliches like barnacles on the hull of a ship. Among the hoariest is the admonition, "don't buy the dividend." Since I, personally, love dividend-paying stocks, not because of their "outperformance" or their "value" but simply because they pay dividends, I decided to … [Read more...] about No, you still shouldn’t buy the dividend
While it's a cliche to say that investors have short memories, I'm frequently surprised to realize just how short most people's memories are: I'm old enough to remember when the United States was running a budget surplus and the chairman of the Federal Reserve endorsed a tax cut because of the risk of the debt falling too low. I'm old enough to … [Read more...] about What would you do if the risk-free rate was 7%?
A spectre is haunting the United States — the spectre of pension crises. Since "the pension crisis" is on the lips of policy-makers around the country, I think it is well worthwhile taking a moment to discuss what is, what might be, and what is not a pension crisis. For additional details I recommend this recent Haas Institute paper on public … [Read more...] about What is, or might be, a pension crisis?