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September 15, 2019 | Black Hole Investing

Scientists say the rules change in a cosmic “black hole” at what astrophysicists call the event horizon. How do they know that? Not by observation, since what happens in there is, by definition, un-seeable. They infer it from the surroundings, which say that the mathematics of the universe as we understand them change at the […]

September 8, 2019 | Dalio’s Analogue and Mauldin’s Commentary

“The best way out is always through.” —Robert Frost “History doesn’t repeat itself, but it does rhyme.” ―Mark Twain It will not shock you when I say we live in confusing times. Odd, seemingly inconsistent events and decisions don’t bring the expected results. Once-reliable rules don’t work. This makes it hard to chart a personal […]

September 1, 2019 | Volatile Year Coming

We have reached Labor Day weekend which, in the US, is a holiday for honoring work and workers. If you’re a Baby Boomer like me, you also grew up knowing school was about to start again. We didn’t do the mid-August thing back then. The first day of school was the day after Labor Day. […]

August 25, 2019 | Digging a Hole to China

Good news: The trade war is over. No, it’s getting worse. Or maybe it is ending but it could start again tomorrow. Confused? All of the above were true at various points in the last few weeks. Markets bounced around in reaction. And we are still no closer to knowing how it will all end. […]

August 18, 2019 | What I Learned at Camp Kotok

I am back from my 14th annual Maine fishing camp and the mood was decidedly different this year. The private event at Leen’s Lodge is generally called Camp Kotok in honor of David Kotok of Cumberland Advisors who started these outings many years ago. CNBC and others began calling it the “Shadow Fed” but it […]

August 11, 2019 | Larry Kotlikoff on The Big Con

I have a special treat for you. I’m at Camp Kotok, the annual economics/fishing retreat in Maine. Knowing internet connectivity would be scarce here, I asked good friend Larry Kotlikoff to be your guest writer this week. For those who don’t know, Larry is a Boston University economist whose work spans an amazing breadth of […]

August 4, 2019 | An Opportunity in the Chaos

One reason the economy is so fascinating is the way things just… happen. Growth blossoms if everyone just follows their own incentives and nothing gets in the way. The courage, vision and passion of entrepreneurs and those who risk their money backing them is one of the most inspiring aspects of modern civilization. Adam Smith’s […]

July 28, 2019 | Money of the Future

As I work on my book about the future, I think a lot about the ways possible events will affect our money. But I’m also thinking about something else: What kind of money will we use? The answer might seem obvious: dollars, euros, yen, all the government-issued fiat currencies that are the economic water in […]

July 21, 2019 | Recession Rumbles

I’m often asked if recession is coming, and for quite different reasons. Some people worry about their investments. Others are worried about their employment or their kids. Political types wonder if and how recession could affect the next election. To all those people, for quite some time now, my answer has been: “Yes, but not […]

July 14, 2019 | Ray Dalio – John Mauldin Conversation, Part 6

This is the final letter of the six-part series of my reply to Ray Dalio’s essays. Here are some links to help you wrap it all together. Ray’s original letter: Why and How Capitalism Needs to Be Reformed, Parts 1 and 2 His follow-up: It’s Time to Look More Carefully at ‘Monetary Policy 3 (MP3)’ […]

July 7, 2019 | Ray Dalio – John Mauldin Discussion, Part 5

“The belief that wealth subsists not in ideas, attitudes, moral codes, and mental disciplines but in identifiable and static things that can be seized and redistributed is the materialist superstition. It stultified the works of Marx and other prophets of violence and envy. It frustrates every socialist revolutionary who imagines that by seizing the so-called […]

June 30, 2019 | Ray Dalio-John Mauldin Discussion, Part 4

This week is the fourth in a series of five open letters responding to a series of essays by Ray Dalio, the founder of Bridgewater Associates. His original letters are Why and How Capitalism Needs to Be Reformed, Parts 1 and 2 and It’s Time to Look More Carefully at ‘Monetary Policy 3 (MP3)’ and ‘Modern […]

June 23, 2019 | Ray Dalio Is Kinda, Sorta, Really Wrong, Part 3

Two weeks ago I started a mini-series in the form of an open letter responding to a series of essays by Ray Dalio, the founder of Bridgewater Associates. I wrote here and here that he was kinda, sorta wrong in Why and How Capitalism Needs to Be Reformed, Parts 1 and 2 but really, really wrong in It’s […]

June 16, 2019 | Ray Dalio Is Kinda, Sorta, Really Wrong, Part 2

Last week we started a mini-series in the form of an open letter responding to a series of essays by Ray Dalio, the founder of Bridgewater Associates. I wrote that he was kinda, sorta wrong in Why and How Capitalism Needs to Be Reformed, Parts 1 and 2 but really, really wrong in It’s Time […]

June 9, 2019 | Ray Dalio Is Kinda, Sorta, Really Wrong

“The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually slaves of some defunct economist.” —John Maynard Keynes […]

May 26, 2019 | Why Debt Won’t Spark Inflation

  Modern technology was supposed to make travel less necessary. We can meet by phone, video, and now in virtual reality. But we’re still traveling more than ever. I certainly am. The reason is simple: Technology can’t yet replace face-to-face conversation, and especially group conversations. It is genetically hardwired in our species. We spend more […]

May 19, 2019 | Takeaways from the SIC

There are these two young fish swimming along, and they happen to meet an older fish swimming the other way, who nods at them and says, “Morning, boys, how’s the water?” And the two young fish swim on for a bit, and then eventually one of them looks over at the other and goes, “What […]

May 12, 2019 | Your Pension May Be Monetized

One difficulty in analyzing our economic future is the sheer number of potential crises. When so much could go wrong (and really right, when the exponential technologies I foresee get here), it’s hard to isolate, let alone navigate, the real dangers. We are tempted to ignore them all. Ignoring them is usually the right response, […]

May 5, 2019 | Time to Change Strategy

My recent letters described what I think the future will look like. I hasten to add, it isn’t what I think the future should look like or what I want to see. Almost the entire developed world has painted itself into a corner. It won’t necessarily be terrible. I don’t expect another Great Depression or […]

April 28, 2019 | How I Learned to Love the Debt

The US, Europe, and most of the developed world on are the road to Japanification. Like I wrote last week, we will see financial repression, ever increasing deficits, slower growth, etc. Essentially, the rest of us will begin to look like Japan with its astronomical deficits and ultra-dovish monetary policy. I tried to emphasize this […]

April 21, 2019 | The Rules Will Change but That’s (Probably) OK

“But the emperor has nothing at all on!” said a little child. “Listen to the voice of innocence!” exclaimed his father; and what the child had said was whispered from one to another. “But he has nothing at all on!” at last cried out all the people. The emperor was suddenly embarrassed, for he knew […]

April 14, 2019 | Japanified World Ahead

Regular readers may have noticed me slowly losing confidence in the economy. Your impression is correct and there’s a good reason for it, as I will explain today. The facts have changed so my conclusions are changing, too. I still think the economy is okay for now. I still see recession odds rising considerably in […]

April 7, 2019 | Capitalism Gone Wild

Recession is coming. We can debate the timing, but the economy will turn decisively downward at some point. My own analysis, looking at the data available on April 4, says recession isn’t likely this year but unfortunately looks very probable in 2020. In addition to when it will happen, there’s also the question of how […]

March 31, 2019 | Recession Signs Everywhere

This month, the Federal Reserve joined its global peers by turning decisively dovish. Jerome Powell and friends haven’t just stopped tightening. Soon they will begin actively easing by reinvesting the Fed’s maturing mortgage bonds into Treasury securities. It’s not exactly “Quantitative Easing I, II, and III,” but it will have some of the same effects. […]

March 24, 2019 | No Free Lunch, Part 2

Matching the stock market’s long-term average returns sounds like it should be easy, if you’re patient enough. But in fact it is remarkably difficult. In last week’s letter, Ed Easterling and I showed you why it is a longshot bet in almost every market environment. Returns over a decade or two are usually well above […]

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