By 2 Cents on September 29th, 2010 | Category: Investing |  Advice to children crossing the street: damn the lights. Watch the cars. The lights ain’t never killed nobody.
~Moms Mabley
As adults, we often remind our children to watch the traffic lights when crossing the street. That seems like good advice, but it won’t necessarily guarantee that our kids will be safe. If the drivers on the road don’t pay attention to the signals, if they make a mistake, or if the signals malfunction, crossing on a green light or “walk” signal will be of no help whatsoever. In the end, we need to actually look at the reality on the street. You don’t walk into oncoming traffic – no matter what the lights say.
If you’ve been reading Balance Junkie for a while, you’ve likely become accustomed to my bearish leaning on the markets and the economy. I have consistently remained cautious on both due to the huge [...]
Read on and enjoy … The End of Free Markets: A Great Reason to Buy Stocks
By 2 Cents on September 27th, 2010 | Category: Spending | Nothing diminishes anxiety faster than action.
~Walter Anderson, The Confidence Course, 1997
Update: This story was included in the Carnival of Money Stories #74 posted at Sustainable Life Blog. Thanks!
When we had our home built 7 years ago, we went with a rental for our hot water heater. I realize now that this is not the norm everywhere, although it seems to be the route most people here in Ontario choose. It seemed, at the time, like a good call.
Renting a hot water tank means that your up-front costs are zero, and you just pay a monthly rental fee of $15 – $30. Service is covered for as long as you rent the tank, so you don’t have to worry about unexpected expenses. A couple of years ago, a sensor went on our hot water heater. A technician showed up the [...]
Read on and enjoy … Hot Water Heater: Rent or Own?
By 2 Cents on September 24th, 2010 | Category: Planning | Now, a clever man would put the poison into his own goblet, because he would know that only a great fool would reach for what he was given. I am not a great fool, so I can clearly not choose the wine in front of you. But you must have known I was not a great fool, you would have counted on it, so I can clearly not choose the wine in front of me.
~ Vizzini, from the movie The Princess Bride
Update: Thanks to Jackie at Money Crush for choosing this article as the #1 pick for the Best of Money Carnival #71!
As I was writing about biflation and the various investment approaches we might take this week, I couldn’t help but think about how difficult these choices are. For every good argument for a [...]
Read on and enjoy … Financial Wisdom from The Princess Bride
By 2 Cents on September 22nd, 2010 | Category: Investing | Life is the sum of all your choices.
~Albert Camus
Update: This article was included in the Carnival of Wealth #6 posted at Personal Dividends. Thanks!
Many have described the current economic and investing environment as uncertain and confusing. Indeed, individual investor sentiment as tracked by the AAII survey has flip-flopped from decidedly negative at the end of August to extremely positive during the latest survey. The Investor’s Intelligence survey, which tracks the sentiment of investment advisors, is not quite so bullish. Pragmatic Capitalism compared the two.
Many investors may be shifting their sentiment based on whether they believe inflation or deflation is the primary economic influence. As we discussed Monday, however, there is a distinct possibility that we may experience biflation for some time. That means commodities and services may experience inflation even as prices in real estate and [...]
Read on and enjoy … Investment Strategies for Biflation
By 2 Cents on September 20th, 2010 | Category: Economics |  There’s an alternative. There’s always a third way, and it’s not a combination of the other two ways. It’s a different way.
~David Carradine
Update: This article was included in the Carnival of Financial Planning #159 posted at The Skilled Investor. Thanks!
When I last wrote about inflation vs. deflation, I was trying to figure out which one would prevail and how best to position our money. At the time, I felt like we would likely see deflation first, with a bout of inflation down the road at some point. We could even see hyperinflation if global central banks devalue their fiat currencies in a race to the bottom. A couple of wise readers (Kevin from Invest It Wisely and Kevin from Out of Your Rut) pointed out that we are actually experiencing both inflation and deflation, but [...]
Read on and enjoy … Are You Ready for Biflation?
By 2 Cents on September 18th, 2010 | Category: BJ News | Expectant of greater things, We try climbing – Higher And Higher; An effort that costs us much, Leaving us short of breath To find only The ground below is much prettier
~Phillip Pulfrey, “Mountains” Love, Abstraction and other Speculations
Last Friday I posted a review of the book Consumed: Rethinking Business in the Era of Mindful Spending. The 4 paradigms of embracing substance, rightsizing, growing up, and seeking purposeful pleasure seemed to really resonate with a lot of readers.
As usual, I numbered the comments (not including my own and those of Ann O’Reilly) and had my son pick a number. The lucky winner was JudyAnn. Congratulations! I hope you enjoy the book as much as I did!
By 2 Cents on September 17th, 2010 | Category: Economics | Just because everything is different doesn’t mean anything has changed.
~Irene Peter
Last Sunday afternoon the Group of Governors and Heads of Supervision, which is the oversight body of the Basel Committee on Banking Supervision, announced the finalized version of Basel III. The committee, meeting in Basel, Switzerland, is composed of representatives of the top 27 global central banks. Basel III was supposed to require banks to raise capital ratios in the hopes of preventing another financial crisis. Will these increased capital requirements make the financial system safer? I guess, as always, it depends on who you ask.
Today I thought we might look at the Basel III regulatory changes through the eyes of a few key constituents. But before we do that, let’s take a quick, if oversimplified look at what’s in Basel III, quoting from a Wall Street Journal article that described the [...]
Read on and enjoy … What Does Basel III Mean to You?
By 2 Cents on September 15th, 2010 | Category: Investing | Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as though nothing had happened.
~ Winston Churchill
Update: This article was included in the Canadian Personal Finance and Investing Carnival #6 posted at Investing Thesis. Thanks Arjun!
We are swimming in deficits globally. Many governments, financial institutions and consumers have been spending more than they take in for decades. For a while, it even became fashionable. It’s not anymore. But for all of the ink and pixels spilled over the lack of money, it seems to me that we are facing a few deficits that are a little more ominous, a lot more disturbing, and stubbornly pernicious.
For all of our political correctness, civilization, and progress, we still seem to exhibit massive deficits in responsibility, accountability, and perhaps most elusively, integrity. Our entire financial system [...]
Read on and enjoy … Market Integrity Should Not Be an Oxymoron
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