The Total Economy Portfolio

The profits of publicly-held companies comprise less than half of all business profits earned in the U.S., according to Bureau of Economic Analysis’ (BEA) corporate profit measures.  The other half of the economy is represented through private businesses.  This means the stock market in its entirety is an incomplete reflection of economic activity. By making [...]

Why Other People Can’t Time Markets

Why do so many people believe they can tactically time markets when it’s obvious they can’t do it?  It’s just not humanly possible to know when to make correct decisions with enough consistency to earn a profit. I realize that some people have guessed right enough times that they have made money, but that’s luck, [...]

This Decade’s Biggest Investment Challenge

Every decade has its big investment challenge. We saw raging inflation in the 1970s, a market crash in the 1980s, irrationally high stock valuations in the 1990s, and two difficult bear markets in the 2000s. What is this decade’s investment challenge? You might be thinking historically-low interest rates. They are a concern, but not the [...]

Thrown Under a Bus with Model ETF Portfolios

Many investment advisors are switching their clients’ investments from traditional actively-managed mutual funds to model ETF portfolios. After decades of claiming that active managers can pick winning securities, they’re now saying that active management does not add value on the fund level − but the prudent timing of ETFs does. That’s unlikely to happen. There’s [...]

“F” Words for the Market

Unexplained market volatility occurs because investors vacillate among three “F” words: fear, fantasy and fundamentals. At times, we’re scared to death; at times, we become irrationally exuberant; and at times, we actually invest in fundamentals. More than 20 years ago, Robert J. Shiller of Yale University concluded that price volatility was far greater than could [...]