“If you’re very stupid, how can you possibly realize that you’re very, very stupid? You’d have to be relatively intelligent to realize how stupid you are.” John Cleese, Actor Imagine a school where the students, who were on the verge of failing, believed they should be on the honor roll and were infinitely smarter…
July 2016
If Banks Are so Friendly, Why Do they Chain Down the Pens?
“If history repeats itself, and the unexpected always happens, how incapable must Man be of learning from experience.” – George Bernard Shaw If history teaches us anything, it is that nobody seems to learn anything from it. Amazingly, a book published in 1914 outlined how to prevent the catastrophic banking crises of both the Great…
In Two Minutes, The Work of Centuries was Overturned
“In two minutes the work of centuries was overturned. Palaces and houses destroyed, churches overturned, their vaults torn asunder.” — Louis-Sebastian Mercer, French writer, 1789 227 years after the Storming of the Bastille, reactionary forces are still trying to impose brutal repression in Europe. Last week’s horrific terrorist attack in Nice, France occurred on the…
Why are Investors so Tribal?
Investors are often no better than a pack of chimps protecting their banana supply from their rivals. Six million years of history has ingrained this behavior in all of us. “Beware of hostile groups” runs through our veins just as much as flowing blood. The Nurture Assumption, by Judith Harris, gives a brilliant description of…
What High-fee Funds Can Learn from the Curse of the Cubs
High-fee, actively managed mutual funds are sold, not bought. Like the Chicago Cubs, their long-term record of achieving top performance is abysmal. The million-dollar question is: Why do people still stick with these different versions of atrocious track records? Thankfully, for long-suffering Cubs’ fans, things are changing for the better; but not so much for…
Funding an Expensive Goal with a High-Cost Product is a Bad Idea
Annuity salespeople are being threatened by the new regulations on retirement accounts; this is forcing them to expand their hunting grounds to prey on parents trying to fund college costs. Unfortunately, college savings accounts are not covered by the new rules. According to Troy Onink, many parents are being instructed by unscrupulous salespeople to cash…
Extractive Institutions Eventually Crumble
Most high-fee hedge funds and broker-dealers have one thing in common: They are large extractive institutions that will eventually fade into the dust bins of history. In the brilliant book by Daron Acemoglu and James Robinson, Why Nation’s Fail, the authors define extractive institutions as “those who empower and enrich the few at the expense…
Politics Makes Financial Markets Seem Sane
2016 may be looked back upon as the year the political crazies were allowed to board the ark. The cast of global characters this year blur the relation between farcical Onion headlines and reality. From Nigel Lafarge and Boris Johnson in the U.K., to Marine Le Pen across the channel, the global political circus…
Learn More
The Retirement Pyramid
Listen to Our Podcast
