5 Investing Challenges for the Next Decade

By 2 Cents on May 20th, 2010 | Category: Investing | 12 comments

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

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Today's Markets: Not Business as Usual

By 2 Cents on May 17th, 2010 | Category: Investing | 2 comments

We are too busy mopping the floor to turn off the faucet.

~ Author Unknown

Update: This article is included in the Carnival of Personal Finance #258 at Money Relationship. Thanks!

This time is different. Experts often say that these are the four most dangerous words an investor can utter. The expression refers to the tendency to extrapolate current trends far into the future. Usually, people who expect trends like the dot com boom of the early 2000s or the recent housing bubble to persist forever pay dearly when the trend inevitably reverses.

This Time Is Differentis also the title of a frequently referenced book by Ken Rogoff and Carmen Reinhart that examines “eight centuries of financial folly”. One of the things they found in their research is that banking crises like the one we had in 2008 are [...]

Read on and enjoy … Today’s Markets: Not Business as Usual

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