By 2 Cents on June 30th, 2010 | Category: Investing | It’s better to stir up a question without deciding it, than to decide it without stirring it up.
~ Joseph Joubert
Update: This article was included in the Carnival of Financial Planning #150 posted at Military Finance. Thank you!
I’m going to try to raise some of the key issues that might affect interest rates over the second half of 2010 and beyond. Like most of the economic and market analysis we undertake here, these will just be the observations of an interested amateur. They are designed to be food for thought, and not definitive investing advice.
Interest Rate Drivers
On Monday we looked at inflation and deflation. Getting the call on that debate right will likely determine the relative success of any portfolio over the next decade or so. It will also have a profound effect on interest rates. [...]
Read on and enjoy … Interest Rates: 2010 Mid-Year Review
By 2 Cents on June 28th, 2010 | Category: Economics | Inflation is when you pay fifteen dollars for the ten-dollar haircut you used to get for five dollars when you had hair.
~ Sam Ewing
Will we have inflation or deflation? This is probably the most important question facing investors right now. There are plenty of smart people who argue convincingly for each. All of them make very good points. But who is right? If you asked me if we should be worried about inflation or deflation, I would probably answer as follows: Yes.
Inflation & Deflation Defined
You know you’re going to have a hard time answering a question correctly when the experts can’t even agree on the basic definition of the terms of the problem. Not only is there a huge and varied debate in the financial community about whether inflation, deflation, both, or neither is a threat, many [...]
Read on and enjoy … Inflation or Deflation: Which Is It?
By 2 Cents on June 25th, 2010 | Category: Investing | The seeds that delivered that crop – the global financial crisis – there’s more of those seeds than ever. They’re bigger than ever.
~ Rob Arnott
Update: This article was included in the Carnival of Financial Planning #148 posted at My Wealth Builder.
I’ve got a really interesting video link for you in today’s Friday Food for Thought. I found it via Preet Banerjee at Where Does All My Money Go. It’s an 8 minute clip of Rob Arnott of Research Affiliates in which he discusses his outlook for the economy and the markets. If you’ve been reading Balance Junkie for a while, you will likely recognize some of these themes as I’ve written about many of them quite often.
Mr. Arnott does not believe the financial crisis is over, but that the problems that caused [...]
Read on and enjoy … 3D Hurricane: Are Your Finances Prepared?
By 2 Cents on June 23rd, 2010 | Category: Life Balance | You must have control of the authorship of your own destiny. The pen that writes your life story must be held in your own hand.
~ Irene C. Kassorla
Update: This article was included in the Carnival of Money Stories: Spending Wisely Edition posted at Sweating the Big Stuff. Thank you!
Women aren’t very good with money. Men aren’t very good with children. Children aren’t ready to learn about finance. These are just a few of the stereotypes that various forms of media might try to sell us. All women are supposed to be interested in the latest lipstick, not the latest financial headlines. All men are supposed to be interested in beer and sports, not wine and symphonies. Are you buying it? Did you know you have a choice?
It’s pretty easy to get wrapped up in stereotypes, even if we [...]
Read on and enjoy … Stereotypes: Toss the Rule Book & Write Your Own
By 2 Cents on June 21st, 2010 | Category: Money Psychology | Why do children want to grow up? Because they experience their lives as constrained by immaturity and perceive adulthood as a condition of greater freedom and opportunity. But what is there today, in America, that very poor and very rich adolescents want to do but cannot do? Not much: they can “do” drugs, “have” sex, “make” babies, and “get” money (from their parents, crime, or the State). For such adolescents, adulthood becomes synonymous with responsibility rather than liberty. Is it any surprise that they remain adolescents?
~Thomas Szasz
Update: This article was included in the Carnival of Personal Finance #263 posted at Suburban Dollar. Thanks!
Friday’s Financial Wisdom for Father’s Day post touched on the idea that many of our modern social and financial mores represent a rejection of the ideals of those who came before us. A lot [...]
Read on and enjoy … Have We Become a Society of Financial Adolescents?
By 2 Cents on June 18th, 2010 | Category: Financial Literacy | When I was a boy of fourteen, my father was so ignorant I could hardly stand to have the old man around. But when I got to be twenty-one, I was astonished at how much he had learned in seven years.
~ Mark Twain
Update: This article was included in the Carnival of Personal Finance #262 posted at Personal Finance Journey. Thanks!
The financial habits of society at large over the past few decades have been, in some ways, reflective of the attitude of the 14-year-old in the opening quote. In an article entitled How Did We Get Here? I pondered the progression of social and financial values from the 1950s to the present era. I speculated that the Baby Boomers’ rejection of their parents’ social mores gave birth to some great new ideas, but that we may have allowed the pendulum [...]
Read on and enjoy … Financial Wisdom for Father’s Day
By 2 Cents on June 16th, 2010 | Category: Saving | My problem lies in reconciling my gross habits with my net income.
~ Errol Flynn
Update: This article was included in the Festival of Frugality: Summer Edition posted at Where’s My Rolling Pin? Thanks!
I recently received a request from a doctoral student to fill out a short questionnaire on savings methods. The survey was directed at personal finance bloggers. Two different savings approaches were explained, and then respondents were asked which they would prefer, and to what degree. I wasn’t quite sure if I completely grasped the spirit of each approach, but I answered the questions to the best of my ability.
The two approaches proposed by the doctoral student are the circular savings method and the linear savings method. I’m going to outline both of them as explained by the author here, and I’d be
interested in your thoughts on [...]
Read on and enjoy … Which Is the Best Way to Save Money?
By 2 Cents on June 14th, 2010 | Category: Money Psychology | I don’t like money, actually, but it quiets my nerves.
~ Joe Louis
Update: This article was selected for the Best of Money Carnival #56 posted at Free Money Finance. Thank you! It was also included in the Carnival of Financial Planning #147 posted at The Skilled Investor. Thanks!
Money, or the lack of it, can cause a lot of stress. It can lead to tremendous personal or family strife and even wreck marriages. This issue has really come to the forefront during the financial crisis of the past couple of years. A lot of folks have really struggled with financial, psychological, and physical health problems as a result of excessive debt levels, employment issues, and insufficient emergency funds. A lack of money is undoubtedly stressful.
But how do you explain the fact that wealthy people can experience a great [...]
Read on and enjoy … Does Money Reduce Stress?
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