Most Recent Stingy News
|
|
The Fartcoin stage of the market |
02/01/25 5:46 PM EST | Markets |
"I can't believe I'm saying this, but the current meme coin mania makes the bubble of 2021 seem like a relatively sober exercise in rational valuation. At least back then, Roaring Kitty talked about earnings, and crypto enthusiasts rhapsodized about use cases. They might have been delusional, but at least they were delusional about the right things." |
More Markets: There is no fear priced into anything |
A recession is coming |
|
Shameless robber barons |
02/01/25 5:43 PM EST | World |
"If swindling pays, then it will not stop. The definition of the good society is one in which virtue pays. I can now add a slight variation to this; you cannot have a good society unless virtue pays." |
More World: International stocks |
Explaining international valuations |
|
International stocks |
02/01/25 5:41 PM EST | World |
"This is why some have argued that U.S. stocks are experiencing DotCom Bubble 2.0. The euphoria surrounding AI today parallels that of internet companies in the late 1990s. While I see the similarities, the difference is that the earnings are much bigger this time." |
More World: Explaining international valuations |
Stuck at home |
|
The inflation gamble |
02/01/25 5:39 PM EST | Behaviour |
"we find that high inflation lowers risk aversion, strengthens skewness preference, and increases demand for investments that resemble lotteries. Due to increased gambling demand, lottery-type stocks become more overpriced and earn lower returns in the future. This negative relation is stronger for lottery-type stocks that have greater sensitivity to inflation and are harder to arbitrage." |
More Behaviour: Taking center stage |
Seven pillars of market bubbles |
|
There is no fear priced into anything |
01/27/25 7:13 PM EST | Markets |
"Valuations tell the tale. The current market's price-earnings ratio is top decile for last few decades. Credit-spreads are near record tights. There is no fear priced into anything at the present moment." |
More Markets: A recession is coming |
Valuation indicators to ignore |
|
Tariffs will not make america great |
01/27/25 6:30 PM EST | Taxes |
"Unfortunately cutting taxes and replacing them with higher tariffs simply will not work. The only fiscally sustainable way to reduce the tax burden on working Americans is through spending cuts. Hiking tariffs in order to slash other taxes will do nothing to improve the plight of ordinary Americans and will almost certainly exacerbate their problems. Tariffs did not make America great and they will not make America great again." |
More Taxes: Trading arguments |
Norway shrugged |
|
Explaining international valuations |
01/27/25 6:06 PM EST | World |
"Were a larger percentage of the valuation gap explained by fundamentals, we'd expect such a gap to persist. But given that the valuation gap is primarily explained simply by the location of listing, we think there's a strong reason to expect a convergence - and therefore to favor international over US-listed stocks, despite their terrible relative performance over the past decade." |
More World: Stuck at home |
Misleading indicators |
|
Taking center stage |
01/27/25 6:04 PM EST | Behaviour |
"It's the one asset we're all born with, and it pretty much defines our financial life. I'm talking here about our human capital, our ability to pull in a paycheck. That paycheck - or the lack thereof - drives our ability to save, service debt and take investment risk. It also dictates our insurance needs and how much emergency money we should hold. Put it all together, and our human capital should arguably determine how we manage our money over our lifetime." |
More Behaviour: Seven pillars of market bubbles |
Why we struggle |
|
A recession is coming |
01/27/25 5:41 PM EST | Markets |
"The 1960-61 and 1990-91 recessions are missed (although a 10yr-2yr disinversion might catch the latter), while a recession is predicted for April 2025. Of course, if the inversion failed to predict the 2024 recession, is there reason to believe the disinversion will predict well?" |
More Markets: Valuation indicators to ignore |
2024 in factors |
|
Valuation indicators to ignore |
01/19/25 4:08 PM EST | Markets |
"Here I review four commonly used measures of market overvaluation that you can safely ignore. All four measures say the U.S. stock market is overvalued today. The market might well be overvalued today, but these measures are not good reasons to say so." |
More Markets: 2024 in factors |
Stock market history, illuminated |
|
Wealth or inflation |
01/19/25 4:06 PM EST | Value Investing |
"Assuming financial assets remain inflated, we expect more companies will discover the rewards associated with higher-margin premium offerings. As businesses shift their mix to accommodate the higher end, we believe wealthy consumers will increasingly become the economy's price setters. Moreover, additional gains in household financial assets could lead to further increases in home prices and shelter inflation. If the bond market didn't have enough to worry about, we believe the days of booming asset prices coexisting with tame consumer prices are long gone. Asset inflation is leaking." |
More Value Investing: Simple formulaic investing |
Bargain, value trap or something in between |
|
Problems with passive investing |
01/19/25 4:04 PM EST | Indexing |
"Passive investing has absolutely revolutionized the investment landscape for individual investors. Not only has it dramatically lowered the costs of asset ownership, but it has done so while delivering strong returns. What began as a radical idea to buy the overall market without worrying about picking the winners now accounts for 57% of all equity fund assets and over $13 trillion." |
More Indexing: Bet on low costs |
Disappearing index effect |
|
2024 in factors |
01/19/25 4:02 PM EST | Markets |
"Looking at some of the biggest drivers of returns, the global equity factor had higher returns and lower volatility versus the historical average. Similarly, the large size factor, high-investment (AI-driven), and high turnover (lots of trading activity) all did quite well for style factors. Momentum and quality did well but were largely in line with history while value lagged." |
More Markets: Stock market history, illuminated |
How big is the equity risk premium? |
|
Trudeau was a poor steward |
01/13/25 4:32 PM EST | Government |
"The fact is, no one seems to really know what's behind Canada's low productivity growth. Observers agree that low rates of corporate investment, including investment in R&D, are the problem, but no one seems to have a good explanation for why companies aren't investing. And no one seems to know whether Canada's especially bad performance since the pandemic is just an exacerbation of the existing negative trends, or whether some new problem has cropped up in addition." |
More Government: Negative trading in congress |
Making life worse one bulb at a time |
|
Seven pillars of market bubbles |
01/13/25 4:20 PM EST | Behaviour |
"Charles Mackay wrote the lurid bestseller Extraordinary Popular Delusions and the Madness of Crowds, which discussed many historical bubbles. Despite publishing his book in 1841 decrying bubbles, in 1845 Mackay himself was caught up in the British railway bubble and advocated buying shares." |
More Behaviour: Why we struggle |
Self defense |
|
Spending it |
01/13/25 3:53 PM EST | Retirement |
"Retirees can pick from a host of withdrawal strategies, including the five popular choices listed below. You'd likely fare just fine with any of the five strategies - but that doesn't mean you shouldn't pick carefully." |
More Retirement: Before you quit |
Jonathan Clements' financial plan |
|
Stock market history, illuminated |
01/13/25 3:43 PM EST | Markets |
"What particularly interests us is that - until the last decade - European and US stock markets behaved very similarly over many, many years. Given that many constituents in both markets are global businesses selling many similar products and services multi‐nationally to similar regions, countries and customers, this made sense." |
More Markets: How big is the equity risk premium? |
Chasing past performance |
|
The TSX's gains over almost 69 years |
01/13/25 3:40 PM EST | Stingy Investing |
"When pondering the future, I like to set my expectations by looking to the past, because it offers clues to the rewards, and risks, associated with investing in stocks." |
More Stingy Investing: The Globe 250 for 2025 |
The Megastars for 2025 |
|
Looking back from 2035 |
01/05/25 1:49 PM EST | Fun |
"Well, sitting here in the year 2035 and looking back at our endowment's returns for the last decade is not a pleasant task. World markets have been subpar and our performance relative to world markets has been simply terrible. Hard times are never pleasant." |
More Fun: Worth repeating |
Pauper's grave retirement plan |
|
Simple formulaic investing |
01/05/25 1:47 PM EST | Value Investing |
"Schwartz and Hanauer demonstrated that simple, easy-to-implement, systematic formula-based investing can still generate market outperformance, providing investors with efficient exposure to well-documented factor premiums." |
More Value Investing: Bargain, value trap or something in between |
Growth is from Mars, value is from Venus |
|
Why we struggle |
01/05/25 1:45 PM EST | Behaviour |
"Why do some financial situations scare us, while others leave us unperturbed? Why do we spend time and money in ways we later regret? Why do we find our bad habits so difficult to change? Why do we admire some folks, while being jealous of others?" |
More Behaviour: Self defense |
Ignorance of the crowd |
|