I caught Vanguard’s John Bogle on a recent Bloomberg interview discussing his simple formula for estimating future stock market returns: I have a reasonable expectations kind of formula that I’ve been using for 25 years and it’s worked the whole 25 years almost perfectly. There’s some decades where it doesn’t work as well as it…

GMO’s Jeremy Grantham and Lucas White came out with a report entitled An Investment Only a Mother Could Love this past week laying out the prospects for natural resource equities. Here’s the executive summary of their findings and thoughts: We believe the prices of many commodities will rise in the decades to come due to…

There is a new Robert Cialdini book out this week — Pre-Suasion: A Revolutionary Way to Influence and Persuade. I have it on my Kindle but have just started reading it. I’m sure I’ll have more to say when I finish it in the coming weeks. The reason I’m so excited about this new effort…

Pundits are notorious for using phrases and cliches that make them sound intelligent but don’t really tell you anything. Many of these cliches have been used for decades now so I thought it was time for some updates to reflect the sentiment during the latest cycle. For example, ‘It’s a stock-picker’s market’ can now be…

Long Term Capital Management is a perfect example of how hubris can derail even the most brilliant of investors. The hedge fund was filled with PhDs and Nobel Laureates, but was highly leveraged while relying far too heavily on quantitative risk models that didn’t factor in the potential for unexpected events to occur. When Russia defaulted on…

“History is defined by people who don’t really understand what they are defining.” – Chuck Klosterman I’ve been reading Chuck Klosterman’s work for well over a decade now. His early books — Killing Yourself to Live: 85% of a True Story and Sex, Drugs and Cocoa Puffs: A Low Culture Manifesto — had me hooked on his eclectic thoughts and…

The markets have a way of making investors fearful whether stocks are up (they can’t rise any further can they?) or down (surely the worst is yet to come, right?). It’s always something which is what makes the markets equal parts fascinating and gut-wrenching. There was a great post at The Monevator this week where the pseudonymous…

A few things I’ve come to realize about money as I recently hit the mid-point of my 30s… 1. A successful financial life comes from increasing your career prospects and saving the difference, but that doesn’t happen with lifestyle creep. Most personal finance experts talk about how much you can save from cutting back, but very…

“Averages and relationships and trends and graphs are not always what they seem. There may be more in them than meets the eye, and there may be a good deal less.” – Darrell Huff There was a study a number of years ago that split a number of people into two separate groups. One was…

There are a lot of brilliant investors out there, but very few brilliant investors who are also brilliant communicators. It’s rare to find someone in the investment industry who has the ability to explain complex topics about the markets and investing in a way that a wide audience can understand. That’s why investors are constantly quoting…