By 2 Cents on July 21st, 2011 | Category: Investing |  The conventional view serves to protect us from the painful job of thinking.
~J.K. Galbraith
A recent article in the Globe and Mail delivered the following advice to investors: Don’t Let a Fear of Bonds Infect Your Healthy Portfolio. The implications are clear:
1. Concerns about ultra-low interest rates eventually turning higher are overblown.
2. If you succumb to the paranoid people who think interest rates can actually rise above 0% – 3%, your portfolio will be unhealthy, damaged, infected. (The image with the article showed people in protective masks.)
3. And my personal favourite: Long term investors need not concern themselves with shorter term market movements because markets always rise over the long term – whenever that is.
So there you go. “Stop worrying so much about bonds.” All you have to do is put your desired allocation in bond mutual funds or [...]
Read on and enjoy … Yes, You Can Live Without Bonds
By 2 Cents on June 9th, 2011 | Category: Investing |  A bank is a place that will lend you money if you can prove that you don’t need it.
~Bob Hope
This is an excerpt of an article that was originally published on Seeking Alpha as premium content. You can read the entire article there.
The old joke from Bob Hope in today’s opening quote isn’t quite as true as it used to be. For one thing, we’re still recovering from a financial crisis that was sparked in large part by banks lending money to plenty of people without proof of, well, just about anything. For another, some think we’re not really recovering at all due to the fact that a lot of those bad loans are still hidden in the depths of bank balance sheets … or somewhere just far enough off the balance sheet to evade close scrutiny … or on government/central bank balance sheets, which [...]
Read on and enjoy … Is This a Good Time to Invest in Banks?
By 2 Cents on April 6th, 2011 | Category: Investing |  Most of us can read the writing on the wall; we just assume it’s addressed to someone else.
~Ivern Ball
Market and economic commentary over the past few months has contained numerous references to walls. Setting aside the irony of the fact that the seat of American capitalism rests on Wall Street, we’ve also heard about the wall of water that washed over Japan and subsequently complicated the global macroeconomic picture. Add that to the Wall of Worry.
There are 3 kinds of walls mentioned in a lot of market discussions these days. Each one seems to take its turn in the spotlight and ironically, bulls and bears alike seem to be able to use all 3 walls to build their case. The one left standing may determine your investment success over the medium to long term. In the short-term, of course, anything can happen.
I’m talking about [...]
Read on and enjoy … Investing: 3 Walls to Watch
By 2 Cents on December 20th, 2010 | Category: Money Psychology |  Get me through December A promise I’ll remember Just get me through December So I can start again
~ from the song “Get Me Through December“
Markets and economics, like life, move in cycles. The only sure thing about a very long up or down-swing is that it will inevitably reverse. December is a time when neither markets, economics or our lives may necessarily be at the peak or bottom of their cycles, but the end of the calendar year still makes us reflect on where we stand on all three.
The holiday season only adds to that effect. We (hopefully) have some time to see friends and family we may not see throughout the rest of the year, and take some time to stop and reflect on the year that was and the year yet to come. December finds many of us a little weary [...]
Read on and enjoy … Get Me Through December
By 2 Cents on August 4th, 2010 | Category: Investing | Put not your trust in money, but put your money in trust.
~ Oliver Wendell Holmes
Our financial system operates on trust. When you put your money into a bank, you trust that it will be there when you want to take it out. When you put money in the stock market, you expect ups and downs, but you also expect that over a 20 year period you will have more money to take out than you originally put in.
There have been a number of articles lately indicating that the average investor is pulling money out of the stock market, and there are also a number of theories on why that might be happening. We’ll go through a few of them here, and then I’d really like to get your thoughts on some key questions as it’s not all that clear to me that this disenchantment with the [...]
Read on and enjoy … Have You Lost Faith in the Market?
By 2 Cents on August 2nd, 2010 | Category: 20 Cents | Today is a Civic Holiday for many people in Canada. If you are one of those, I hope you’re enjoying your long weekend! Once again, I was amazed by the number of really great articles out there in July. Here are just 10 of my many favourites. Enjoy!
1. Brett Arends at The Wall Street Journal gets the top spot this month for pointing out Ten Stock Market Myths That Just Won’t Die. There are some real gems here. How many times have you heard these pearls of wisdom? (Sarcasm intended.)
2. Thicken My Wallet offered some ideas on Avoiding Overexposure to the Equity Market. This is a great look at some of the reasons we may come to have too much equity exposure and a few ways to avoid them.
3. The omnipresent Miranda Marquit wrote [...]
Read on and enjoy … 20 Cents from July 2010
By 2 Cents on May 20th, 2010 | Category: Investing | Pleasure can be supported by an illusion; but happiness rests on truth.
~ Sébastien-Roch Nicolas de Chamfort
Update: This post was included in the Money Hackers Carnival #117 posted at Engineer Your Finances. Thanks!
Monday’s post dealt with some of the ways in which today’s market climate is Not Business as Usual. I’d like to expand on that today with a bit more detail on some of the issues I mentioned. Many of the 5 challenges I’m going to address are double-edged swords. They can be productive market forces, but also have the potential to create enormous problems for our financial system.
5 Double-Edged Swords for Investors
Each of these factors is, in some way, interrelated with the others. Each one has been with us for quite some time and may persist much longer. Each [...]
Read on and enjoy … 5 Investing Challenges for the Next Decade
By 2 Cents on April 19th, 2010 | Category: Investing | Character is doing the right thing when nobody’s looking. There are too many people who think that the only thing that’s right is to get by, and the only thing that’s wrong is to get caught.
~ J.C. Watts
By now, you’ve probably read about the fraud charges leveled against Goldman Sachs by the SEC south of the border. I was watching news coverage on CNBC on Friday. I would normally prefer to get the Canadian angle from BNN, but our recent budget cuts mean that I can’t get that channel anymore.
Sue Herera is one of my favourite CNBC journalists as she seems to be one of a select few on that channel who has maintained some level of professionalism. She tends to address issues authentically, refusing to join in when her co-anchors shout down their guests and colleagues. Soon after the Goldman story broke, she [...]
Read on and enjoy … Is the Stock Market Rigged?
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