Blog

A Time for Remembering

I am constantly reminded of the uniqueness of America. Sure, every nation has days of remembrance for their fallen heroes. They too are special in their own ways and worthy of recognition. Yet, try as I might, I can think of no other...

Still Too Much Leverage

Markets have looked past the standoff in the Persian Gulf and concentrated on spectacular earnings, particularly in the United States. Yet, there is still too much leverage in the markets. FINRA margin debt did come down a little in...

The Hormuz Imbroglio

Markets continue to churn due to fears over the global oil supply resulting from threats to tankers in the Straits to Hormuz. I do not know when that problem will resolve itself, although it will be resolved.I do not see a global...

Epic Fury

I am not an expert on war. Neither am I an expert on the Strait of Hormuz. So, I shall limit my comments to subjects that I do know something about and that impact our clients' financial plans.Beyond its massive and direct human toll,...

Avoiding China

I heard the terrible news about Jimmy Lai while I was rummaging through the portfolios of potential overseas investments. For those who do not know, the self-made Hong Kong media mogul received a sentence of twenty years for his...

A Word About Iran

The current military operation in Iran is important from an ethical and political standpoint but should have little economic impact for the free world. Iran sells oil to China and weapons to the Russians so that they can kill...

All Men Would (Still) be Tyrants

I have very American sensibilities, a fact that became evident to me during my stay in London last autumn. From churches to crossroads, monuments celebrating inherited privilege and conquest are everywhere. Viewing them awakened my...

Puzzling Over Inflation

Each month, except during the recent government shutdown, I puzzle over the components of the Consumer Price Index (CPI). Overall, the 12-month change ended December 31 was 2.7%. Not great, but not terrible. What puzzles me the most is...

Our American Creed

The gentleman seated next to me on my flight to Toronto became visibly upset when I told him that "we are an Enlightenment nation." Perhaps, I should have said that we are what the great historian Gordon S. Wood calls a "creedal nation...

A Uniquely American Tradition

What do you think of when you think of Christmas? There is the obvious religious answer of course, but what memories spring to your mind from our popular culture? For me, it is Jimmy Stewart and Donna Reed, who were immortalized under...

Pedal to the Metal

Most Fed commentary that I see focuses on the federal funds rate, which is the interest rate at which banks trade federal funds overnight. The central bank cut rates for the third time by 0.25% on December 10. That brings the rate to...

Congratulations Angela & Diego

Life never gets simpler and our clients' needs have become ever more complicated. Handling trust accounts, retirement plans, beneficiary designations, and the multiple tax and estate complications that result from serving our clients'...

Happy Thanksgiving

I have few memories of the Pilgrim story from my childhood. I seem to vaguely recall making a turkey out of construction paper, but I am not sure. I don't believe that we ever had a First Thanksgiving play at any of the schools that I...

Thank You Veterans

What do we owe veterans? I have thought a lot about that lately. Our recognition of Veterans Day dates back to the Great War and the signing of the Armistice on November 11, 1919. Today, the US. Department of Veterans Affairs website...

An Enlightened Choice

It seemed serendipitous to me that the economic historian Joel Mokyr was awarded the Nobel Prize in Economic Sciences while I was in London several weeks ago. I have long been of the opinion that there are too many formulas and not...

The View From France

I have a particular fondness for oceanside resort communities in the offseason. Having spent half of my youth at the Jersey Shore, I love their uncrowded sidewalks and beaches, the warmth of the sun on a chilly day, and the unique...

Low Confidence

I have very low confidence in most of what I read about monetary policy lately, not because I doubt the authors, but rather because I am not sure that the traditional tools are meaningful now. Each month I review the Bureau of Labor...

Welcome Aboard Diego

The unfamiliar voice that you will hear when calling our office will be that of Diego Luna, our newest team member. Diego recently graduated with a Bachelor of Science in Business Administration from the University of Central Florida...

Some Thoughts on Labor Day

Labor Day is a peculiar holiday in America. Everywhere else in the world the May Day celebration has its roots in a mélange of pagan rituals and Soviet imagery. Here in the USA, Labor Day is when the fashion-conscious change from the...

The American Dream

Every once in a while, I realize that something I long understood to be true isn't. This happened to me recently while I was perusing data charts at the St. Louis Fed website (I know, I need a life). For years I have seen the following...

A Departure

After long and exemplary service, our head of tax and compliance, Halley Dillais, will be leaving us for other opportunities. We shall all miss her cheerful presence and diligent attention to our clients' needs. While she will become a...

Responsible Investing

My industry sure makes it hard to invest responsibly. I suspect that a big part of the challenge comes from the fact that few people with finance degrees and technical designations have ever studied history and philosophy in depth....

Green Shoots of Budget Consensus

That makes two. In last month's newsletter I highlighted the change of heart by Obama administration budget director Peter Orzag. Recently, former Biden administration chief economist Jared Bernstein made a similar public confession in...

NATO

In last week's newsletter I questioned European conviction to work together productively in the area of defense spending. After an interesting discussion with a longtime friend and client I decided to post some of the latest spending...

"The Time Hath Found Us"

On most Independence Days I make some reference to the Declaration of Independence and the courage of the Founders. As a nation born of the Enlightenment, we are truly blessed to have so many of civilization's most important and...

Fed Watch

I don't blame Chairman of the Federal Reserve Jerome Powell for being cautious. After holding rates steady from July of 2023 until September 2024, the Fed cut rates aggressively until the end of December. They have since held rates...

The Mideast Conflict

I shall not be joining the army of newly minted experts on war or the economy. Instead, I need to point out that we are no longer living in the 1970s and that our reliance on oil from the Persian Gulf is greatly diminished since then....

It Depends

I am reading more and more about taxes in the press lately, much of it mistaken. Personally, I am an agnostic when it comes to federal tax rates. Some people believe that we need higher marginal rates to reduce the deficits while...

Father's Day

Each day I am surrounded by boats or photos of boats. Actually, I am surrounded by boats and photos of my family on boats. There are pictures of Dad from about 1939 on the deck of a magnificent twenties-era Chris-Craft speedboat. There...

Investing in the Future

From time to time, we hire a promising young college student as a summer intern. This year we have Dylan Alexander Kolnick working with us. Dylan is about to enter his senior year in pursuit of a Bachelor of Finance in Business degree...

Congratulations Ryan

All of us at Treasure Coast Financial Planning are delighted to announce that our latest addition to the team, Ryan Fink, has passed the last of four Certified Public Accountant certification exams. Way to go Ryan! After the required...

A Message From Rouge Bouquet

Memorial Day letters are hard for me. Those who died in war deserve to be remembered even as our unique day of remembrance springs from a desire for reconciliation and brotherhood. As a boy, I saw it as a holiday that marked the...

A Message of Gratitude

I don’t know what I would have done had not the draft ended the year that I graduated high school. I had a lottery number, and it was very low as I recollect. What I do know is that many of our best clients served bravely and with...

The Market Is More Than Domestic Stocks

I suppose that we shall find out if what we learned about tariffs in Econ:101 is true. In the meantime, we lack sufficient data to make unequivocal pronouncements. Nowhere is this more certain than in the current spat over interest...

The Bond Market

The financial press (I reluctantly include television personalities in this description) continually refers to the “bond market” without any distinction. Bonds went up or bonds went down. Sometimes accompanied by the explanation that...

Hold Fast

None of it was true. When Vladimir Putin invaded Ukraine, experts told us that a global recession was imminent. Europeans would freeze in their houses because building the infrastructure to provide natural gas would take years. We...

Be Careful About Digital Assets

The following question now appears on IRS forms 1040, 1041, 1120, 1065, and 1120-S. “At any time during 2024, did you: (a) receive (as a reward, award, or payment for property or services); or (b) sell, exchange, or otherwise dispose...

The Train Has Arrived

Every day brings a new opportunity for me to disabuse myself of the belief that “nobody gets hit by a train they see coming.” Apparently, some people do. Social Security is one such train, so too are the current presidential tariffs....

Easy Pickings

I know that she meant well. When Anthony went to a county office this week a helpful clerk suggested that he send a copy of a personal check by email. No wonder there are so many scams lately. It is a marvel that anybody commits...

Oh Canada, Oh My

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Happy Presidents' Day!

I don’t know about Presidents’ Day. Sure, everyone loves a three-day weekend, but all presidents are not the same and some merit little in the way of celebration. If we are going to elevate any presidents, an idea that fits little with...

A Few Words on Tariffs

I do not expect our current tariff spat with Canada or Mexico to last very long. Neither do I anticipate that we will return to an unpopular nineteenth-century tariff regime. Rather, I expect Canada and Mexico to make concessions on...

Review Your Plan Now

Now is the time for those still in the workforce to review their retirement plan options. For those who have earned income and do not have a plan, there is no better time to consider starting one. Here are the changes for 2025. If you...

Less Taxes - More Charity

America has long been the most charitable nation in the world. According to the World Giving Index, we held that title from 2009-2018.5 The pandemic lockdowns knocked us down to fifth, but 76% of Americans still helped a stranger, 61%...

How to Create a Housing Shortage in One Picture

US Housing Starts v. US Population % Change 1/31/1959-11/30/2024 * Source: YCharts

Kick the Football Charlie Brown

Once again, the joke is on me. I knew better. I know what the Circumlocution Office is. I read Kafka. I know that Lucy always yanks the football away right before Charlie Brown can kick it. Yet, I wrote in the July newsletter that “the...

Opportunity

We fight so much amongst ourselves that one would think that life in America is terrible. True, inflation hits the most vulnerable the hardest and many of our neighbors are needlessly suffering. Yet, we are doing much better than our...

In Testimony Whereof

People react to tragedy in different ways. Some people sink into deep depression and a doom loop of recrimination. Others adapt and sometimes thrive as they find inner strength and meaning. A now deceased client taught me this when his...

Cryptomania Redux

Once again, the news media is breathless over the price of cryptocurrencies. The last time we saw a preoccupation with highly speculative investments came during the height of the Covid pandemic. Many of the same names are now once...

In Union There Is Strength

Why do Americans go to war? I pondered that question this weekend while reading a small pamphlet produced for soldiers about to debark for France during World War II. In a nutshell, Americans fight for universal human rights....

Our Newest Team Member

Treasure Coast Financial Planning is happy to introduce you to the latest member of our team. Ryan Paul Fink, MBA, MSAFF will add to the scope of our financial expertise through his in-depth knowledge of accounting and financial...

Thank You

My first response to the tornado is a profound sense of gratitude. Despite the destruction of our homes and the serious damage to our buildings, the generosity of our clients and friends is moving and humbling. One couple came to my...

Happy Birthday Mr. President

Happy Birthday Mr. Carter! Jimmy and Rosalynn caught me napping that day. The former president and first lady came to Hawk’s Cay Resort, where we kept our sailboat at the time, to shake hands with dolphins and promote an educational...

Quick Update

I normally don’t discuss the markets in the weekly blog, but current conditions warrant an exception. The Fed’s optimistic projections for interest rates are bullish for stocks. Offsetting this benign environment is the uncertainty of...

A Message from Jerome

The crystal ball worked this month. On September 4th I wrote that “the Fed may send a message with one 0.50% cut,” which is exactly what they did this week. The largest rate reduction in 16 years is Fed chairman Jerome Powell’s attempt...

Celebrating Our Constitution

Living in a constitutional republic is something that most of us take for granted. After all, the signing of the U.S. Constitution took place on September 17, 1787. Few other people can claim such an enduring legacy. The British can...

The Fog Lifts

That didn’t take long. Since our September 4, newsletter, Vice-President Harris has broken with the President on her proposed increases to the long-term capital gains (LTCG) rate. Under her new plan, the gain on assets held more than a...

Labor Day

I have a complicated relationship with Labor Day. Growing up at the Jersey Shore, the holiday marked the end of summer and the return to school. Surfing and hanging out with friends gave way to alarm clocks, school buses, and homework....

Turn, Turn, Turn

How do we know when to let go? Parents devote years of their lives to their children with the goal of creating independent and competent adults. Doctors, lawyers, entrepreneurs, and even presidents of the United States work tirelessly...

Pigs Get Slaughtered

We are in the middle of a long-anticipated correction in global stocks. The proximate cause is the surprise hike in interest rates by the Bank of Japan last Wednesday. The bank raised rates to support the yen. The result has been to...

Lincoln

I have thought a great deal about the upcoming newsletter, but I do not feel right about prattling on about interest rates and markets in light of recent events. My heart is just not in it. I beg everyone’s indulgence as I return once...

Politics and Investing

Does investing according to your politics make any sense? Financially, probably not. Yet, I am once again hearing “experts” on the radio who claim that they can determine the direction of the markets and the sectors to invest in...

The Consent of the Governed

America’s audacious ambitions make it difficult for others to understand us. True, we are not the only country that has dared to challenge a military superpower, even though breaking with the British qualifies Independence Day as...

A Canadian Gift to America

Generously, the administration of Canada’s Prime Minister Justin Trudeau is helping America solve its doctor shortage. Thanks to him and Deputy Prime Minister Christia Freeland, highly educated and competent Canadians are moving to the...

Gridlock

Those pesky voters. Just as I extolled the improving fundamentals of the eurozone, European markets sold off due to the results of what normally are obscure European Parliament elections. France’s Emmanuel Macron magnified the market...

Europe Catches Up

The European Central Bank (ECB) and the Bank of Canada (BOC) cut their key rates this week. This leaves room for the Federal Reserve (FED) to reduce rates this summer as well. These events are the result of a general convergence of the...

Sayre's Law

The inflation debate reminds me a lot of Sayre’s Law. The Wall Street Journal in 1973 attributed to former Columbia University Professor of Political Science Wallace Sayre the observation that “academic politics is the most vicious and...

We Remember

Memory is a funny thing. I can still remember the Bible verses that I recited at my confirmation and the complete text of the Gettysburg Address that I memorized in grade school. I recall puzzling over the meaning of four score, but I...

A Month is Not a Trend

One of the great things about the United States is the ample quantity and quality of information that is available for free. Seated at my breakfast table, I can feed my inner geek with statistics and graphs from the Bureau of Labor...

Stagflation Anyone?

A lot of people panicked when Gross Domestic Product came in at 1.6% in the first quarter versus the 2.4% expected by The Wall Street Journal economists. * The Bureau of Economic Analysis (BEA) reported that “compared to the fourth...

The Cruelest Tax

Where are the economists today that understand the lives of ordinary Americans? Those that I read tend to dismiss the distress among regular folks as due to misperceptions or a lack of sophistication. My own observation of inflation is...

The Coming Government Windfall

Now that tax season is almost over, I have a prediction. The federal government will collect a lot more in taxes. This will not be because of any politician’s policies, but because interest rates are higher. Clients are paying more in...

The Invisible Hand

While having drinks at a hole-in-the-wall café, a friend said to me that “those greedy oil companies should stop charging so much for gas.” Knowing that she had just sold her house, I asked her if she had lowered the price. After all,...

Harebrained Schemes

No, inflation is not caused by greedy corporations. Inflation is caused by too much money chasing too few goods. Of course, the possibility exists that corporations are schizophrenic, sometimes deciding to raise prices and sometimes...

Out of Touch

I do not know if it is I who does not understand politicians or if it is politicians who do not share my concerns. I am a financial planner. I want people to be able to save money for retirement. I believe that it is an injustice that...

Tulipomania

I have been thinking differently lately about the Dutch tulip mania of the seventeenth century. Yes, I know, that makes me a bit of a weirdo. Most people know of the tulip bubble from Charles Mackay’s Memoirs of Extraordinary...

Presidents' Day

This Presidents’ Day I am chucking precedent and recognizing the achievements of Eleanor Roosevelt. In 1945, President Harry Truman appointed the former first lady to the United States delegation to the newly created United...

Jerry's Dilemma

Fed chairman Jerome Powell surprised investors, but I don’t know why. Powell is engaged in a tug-of-war with the federal government. Remember, the Fed has more than one means to stimulate or slow the economy. One is by raising...

Gross Domestic Product

The economy grew by an unexpected 3.3% in the fourth quarter. I say unexpected because the numbers came in above economist’s predictions. Readers of our blog and newsletter know that we were not on board with those expectations....

The Tragedy of the Driven Man

If we do not know what is important, we will focus on the wrong things. Nothing reinforced this fact for me more than the realization that it is possible to attend the funerals of both fathers and children for the same reason. As...

Lessons From the Greeks

The example of Greece gives me new hope for America in 2024. Throughout my life Greece has been plagued by tragedy, poor governance, poverty, military coups, bailouts, and dictatorship. The World Factbook points out that “from...

"God Bless Us, Every One!"

Dickens’ A Christmas Carol could easily be the source of a financial planner’s creed.  “No space of regret can make amends for one life’s opportunity misused” is great advice. Those who don’t...

A Christmas Powell

Is there now a Powell Put? Many clients will remember the famous Greenspan Put of the 1990s. Investors became so enamored of then Fed Chairman Alan Greenspan’s talents at managing the economy that they felt comfortable buying...

Retirement Aristocrats

Call it Manichaeism or 180ism, binary thinking is the source of many an intractable problem. I noted this in a really great book on Social Security, Medicare, and Government Pensions (also the title) that I read for my continuing...

The Mystic Chords of Memory

I never associated Thanksgiving with the Pilgrim story. I still don’t. For me Thanksgiving Day will always be tied to the desire for national unity shared by Abraham Lincoln and Sara Josepha Hale. It is Hale who lobbied Lincoln...

Betsy Trotwood

The new interest-rate environment means that many investors will have to reevaluate what performance means. The adoption by the Fed of artificially low rates combined with a similarly artificial shortage of fixed-income investments...

No Good Deed Goes Unpunished

Does anybody remember Andrew Left? I do, and his story should serve as a reminder to everyone who does business with the Chinese Communist Party (CCP) that they are risking everything, especially if they believe in the importance of...

Long Haul - A Very Long Turn

Sometimes a little history helps us anticipate what might happen in the future. We are living in a time that is in some ways similar to that which led up to the Great Recession. One big difference is that we are not in a credit-driven...

Over There

Global events paused the rise in longer-term interest rates. Whenever there is uncertainty, we experience a flight to safety. This pulled the 10-year Treasury Note yield back to under 4.8%. We saw the same flight to safety when Silicon...

Where We Stand

It has been said that western civilization stands on two legs. One is in Athens and the other in Jerusalem. The values that we cherish today are the result of these two pillars. The Universal Declaration of Human Rights states that...

Fear & Dominance

I have great respect for The Economist. During the midterm elections they called the results with amazing accuracy. Of course, I love opinions that are backed up with statistics and lots of graphs. No, I never had a pocket protector,...

Cryptomania

I think of it as the crypto indicator. While there are many ways to measure how overvalued or undervalued markets are, crypto seems to me to be the purist. Many measures of valuation use some sort of comparison between the interest...

Do I Feel Lucky?

Do you have any favorite Clint Eastwood movies? Mine are Pale Rider and Unforgiven, which I feel permanently placed Eastwood among America’s greatest actors/directors. However, it is Dirty Harry that provides his most memorable...

Education

By a ratio of about 6:1, clients requested that I post my third and last blog about how my family came to America. This is the result for those who are interested. Jeanne Renée Charlotte de MONDION alone charted the course of my...

Pirates & Privateers

Next week I shall return to writing about finance, taxes, and financial planning. For those who are interested, below is blog number two of my Biarritz adventure. Let us know if you would like me to send my third and final post on the...

Coming to You From France

I shall be writing from the southern French city of Biarritz for several weeks because of Jeanne Renée Charlotte de MONDION. More accurately, I am here because of a letter she wrote on the first of March 1815. Jeanne (which I...

Hooray! Johnny Got a D

Not failing is a good thing. Now that earnings season is at an end, most companies beat analyst’s earnings expectations. Hannah Miao of The Wall Street Journal explains that the 79% beat rate is due to reduced expectations. Ms....

CPI July

It seems inescapable to me that much of our continuing inflation difficulties result from Vladimir Putin’s evil assault on Ukraine. At the same time, I believe that much of the improvement in the Consumer Price Index (CPI) is the...

Maybe

Maybe inflation is tamed and maybe interest rates will fall soon. That better happen for the traders who are excited about the latest inflation report. I am not so sure. For those who may have missed it, the Consumer Price Index (CPI)...

Happy Bastille Day!

Bastille Day is a good time to reflect on the importance of free speech to a prosperous and dynamic society. Almost a fifth of the infamous Bastille prison’s occupants, including free-speech advocate Voltaire, found themselves...

Dangerous Words

Is it different this time around? Renowned investor Sir John Templeton famously said that “this time is different’ are among the most costly four words in market history.” That is because there are always good reasons...

The Inverse of P/E

Most investors understand what a price-to-earnings ratio (P/E) is. A measure of value, P/E is nothing more than a stock or index price divided by earnings. When we buy a business, we do so in the hopes of sharing in that...

Energy to the Rescue

Declining energy prices gave the Federal Reserve a reason to pause rate hikes this month. May consumer prices for all items, not seasonally adjusted, came in at a moderating 4%. Almost all this moderation can be attributed to declining...

Coupon Clippers

Do you remember when widows enjoyed respectable retirements from the income provided by “gilt” securities? I do. Yet, many people today do not. At a business conference that I attended recently, a young representative told...

Memory

Louis Manesca’s tombstone stands out amidst my other ancestor’s decaying and illegible monuments. Its mirror finish and clear writing are accompanied by an American flag that marks it as the resting place of one of...

Lend Me Your Ears

If TINA is really dead, I shall not mourn her. Yes, she was the life of the party, and many people will miss her. Although I never expected the blowout to last for 14 years, we all need to sober up eventually. After all, not everyone...

The Burden

I still have the scar on my left shin. Without saying a word, my brother and I had the same idea to play chicken while riding our bikes. Predictably, the two skinny front wheels of our English Racers collided with a precision that we...

Fast & Slow Events

Some market events happen slowly while others come from out of nowhere. The failure to distinguish between the two can destroy our plans.The Covid pandemic is an example of a sudden event that cannot be anticipated. The same is true of...

Slaying Inflation

Many equity bulls have convinced themselves that the Federal Reserve (Fed) will cut rates by 1% before the end of the year. I don’t think so, even though I understand how anyone born after 1960 has been conditioned to expect a...

Resurrected

Finance reporters love to declare the death of reliable rules of thumb. I understand this, coming up with things to write about is not always the easiest thing to do. Yet, I have had to debunk the death of these useful guides...

Never Fall for the Schtick

A friend of mine had a saying that I always detested for its cruelty. Whenever we had a market reversal, he would tell me that “money always returns to its rightful owners.” Unfortunately, there is an element of truth to...

Famous Rich People

We took our annual family trip to Park City recently, so I wrote my blogs ahead of time. Then Silicon Valley Bank failed. Now I am writing my fourth blog post on banks. So much for “be prepared.” I need to address the...

Banks & Clearing Firms

A clearing firm, such as Pershing, is different from a bank in very important ways. Banks refer to their depositors as customers. In most ways, they are not. Customers are people who pay a person or a firm. Bank depositors are...

The Uncool

We are not trendy at all. Treasure Coast Financial Planning has no debt. During the Great Recession, we did not lay anybody off as our big competitors axed staff while using government money to give themselves multi-million-dollar...

The Silicon Valley Twist

What we are seeing in California is a traditional bank run with a Silicon Valley twist. I do not believe that Silicon Valley Bank is representative of the banking industry today or that we are witnessing a...

Supply & Demand

The law of supply and demand is an incredible thing, too bad that we have so many politicians who ignore it. I bring this up for personal reasons. Due to a lack of housing in Canada, the Trudeau administration has banned foreigners...

Allocations

Are you investing as if you were just starting out in life? Many people are. For most of us, our first stock-market experience comes when we become eligible to participate in our employer’s 401(k) or 403(b) plans. These deferred...

Bear Streams

I first heard about the run on Northern Rock bank in September 2007, while playing ping-pong on a terrasse high on a hill overlooking the Mediterranean Sea. A British physician said to me “you’re the financial guy, should I...

Donor-Advised Funds

Donor-advised funds (DAF) are public charities into which we can make a charitable gift today and disperse the funds to the causes we support in the future. Many people value the flexibility of a DAF when incorporating charitable...

Gifts

Donating to charity is not a tax dodge. Yes, giving to charity can reduce our taxes, which may provide leverage for our gifting plans, but the money we lose in making a gift is usually more than the taxes we might save by giving our...

Mission Statements

January is a great time for all of us to review our written goals. If you do not have them, now is the time to begin. Writing down what we want forces us to distinguish between momentary desires and those things that are truly...

Our Charitable Missions

Do you ever feel guilty about not giving to a friend’s charitable cause? I do. This is especially true in December when we tend to think about those in need and feel grateful for what we have. After all, Scrooges and Grinches are...

Washington Follies

Once again, Congress has rewritten the retirement-plan rules between Christmas and New Year’s Eve. I am sure that this is only done with the well-being of the American people in mind, that no favors were exchanged, and that...

Wishing You & Yours Happy Holidays

May all the joys of the holiday season gladden your heart. Enjoy every single moment of it with the family and friends you hold close to in life. Happy holiday, and a wonderful New Year!

The Seen and The Unseen

I think way too much about dead economists. I probably think too much about live ones as well, but that is another subject. Lately, I have been pondering Frédéric Bastiat, the French economist who in 1850 wrote his famous...

The Producers

It happens every year at about this time. Clients receive calls from a stockbroker or insurance agent telling them about time-critical actions that need to be taken. Often, there is a mutual fund or annuity that they just have to have...

Thanksgiving - A Proclamation

Contentious midterm elections are over and Thanksgiving is upon us.  Now seems an appropriate moment to reproduce Abraham Lincoln’s original 1863 proclamation creating a national day of gratitude. By the President of...

Magic Carpet Ride

How do you explain the impossibility of a thing? This question brings to mind an inconsequential conversation I had with a childhood friend many years ago. Upon his return from a trip to Iran shortly before the abdication of Mohammad...

The Great War for Civilization

I nearly brought my grandfather’s Victory Medal with me when I went to France last summer. I thought about using it to ward off the war-monger accusations that invariably come from Europeans when I take classes in France. I have...

A Word to the Wise is Enough

How good are personal finance books? Yale economist James Choi * thought he would find out and read several best-sellers only to discover “how at odds some of the advice was with what we as economists thought was the right thing...

Live Long and Prosper

Education and intellect do not protect us from our psychological blind spots. There is no Mr. Spock who is a flesh-and-blood-computer devoid of emotions. Even if we were, it wouldn’t help us. Those who regularly read our...

When What You Know Isn't So

I have never actually written down and numbered what has come to be known in the office as Guyisms. One of these is that “nearly everything that you think you know for certain is probably wrong.” I thought about this when I...

500/hour Pilots

The subject of why I believed a few months ago that it was too early to ramp up risk and go bottom fishing came up in a conversation with my brother recently. The answer is simple enough. I have been through this before, which reminds...

Things Can Turn on a Dime

This week provided the perfect example of why we should not allow ourselves to come under the sway of either the “house money effect” or the “snakebit effect.” Monday and Tuesday’s rallies were among the...

To Do or Not to Do

We know from studies of investors in the United States, Europe, and Asia that we are all prone to psychological traits that cause us to make the same investing mistakes. The first is the “house-money effect.” When markets...

The Lost Boys - Part II

I am paying close attention to the recent market volatility. We shall be rebalancing accounts accordingly and have already begun locking in some of the rates that this turmoil has provided us. We are not completely there yet, since the...

The Lost Boys

Wisdom doesn’t feel as good as I thought it would. In my youth, I unquestioningly believed that the fall of the Iron Curtain meant a new age of peace, understanding, and cooperation. Free trade would make old-fashioned military...

A Quick Note on the Markets

I shall follow up with my posts on the labor market soon, but right now I want to comment on recurring volatility by quoting Warren Buffet. In 1973, he told the Sunday Journal and Star o*f Lincoln, Nebraska that “in the short run...

Labor in America

It is appropriate that America honors workers in September and not in May. The discovery of the New World turned the relationship between owners and workers on its head, a condition that continues to the present day. Europe always had...

The Oncoming Train

Bumper-sticker slogans prevent us from achieving our goals. You know the ones that I mean, the ones that come in 140 characters or less. Behaviorists refer to these as availability heuristics and they are often non-sequiturs. They...

Salman Rushdie

I learned of the attack on Salman Rushdie while reading On Liberty by J. S. Mill. There is nothing surprising about the coincidence. I have a strong interest in the subject of liberty of expression and few have ever made a better...

Lottery

They are always so happy when they make the terrible mistake. I am talking about people who win the lottery or suddenly come into money. The quotes are something like “we gave all of it to the kids” or “we bought...

The Triumph of Hope

They always let me down. Every time I see a headline about a big breakthrough in renewable-energy production or energy storage, it turns out to be nothing more than a press release or evangelism. This is not to say that we are not...

A Rose by Any Other Name

We spend an awful lot of time talking about the need for new sources of energy. The words we use are imprecise and often contradictory. We say renewable and clean energy as if they are the same thing. Wood and ethanol are renewable,...

In the Course of Human Events

We are today in the midst of human events that challenge the assumption that anything is self-evident. I write these words on a continent where, only 1,200 miles away, a brutal land war is raging. The small village where I am staying,...

Letters from France - Politics in France

Imagine that the Republican and Democratic parties suddenly disappeared. That has nearly happened here in France. Unlike our system, French elections take place on Sundays and occur in two rounds. In the recent presidential elections,...

Reevaluating the Fed

I thought that it was a pretty good time to start a business the last time that the Federal Reserve raised rates 0.75%. Bill Clinton was president and Newt Gingrich led the first Republican congress in four decades. Fed chairman Alan...

Patience

Here we go again. When people realized that we were in a real pandemic two years ago, I decided to send a letter every Monday advising people not to panic. I cautioned people about changing their objectives or going to cash. Markets...

Letters From France - Global Inflation

The most obvious sign of inflation in France is the price of gasoline. My Ukrainian cabdriver explained to me how difficult life has become as the result of unrestrained inflation. Electric chargers dot the streets, but so far, I have...

Letters from France

The great statesman Georges Clemenceau famously fled France to avoid being sent to the Devil’s Island penal system in French Guiana. His crime was defying his governments censorship policies. From the secure city of New York, he...

Martyrs of the Race Course

Abraham Lincoln was not wrong about a lot of things, but he was wrong about one thing. In his dedication of the cemetery at Gettysburg, Lincoln assured his listeners that “the world will little note, nor long remember what we say...

The Value of Nothing

Riding the Jet-Star

Quantitative Tightening

On the Other Hand

Where Goes Europe?

Irrational Exuberance

The Wisdom of Arthur Schlesinger, Jr.

Complicated

Myths

The Barrier of Negativity

Manpokei

Motivation

Everybody Knows

Canada Protests

Still Not Time to Panic

Interest Rates

Catching A Falling Knife

Volatility

The Season of Scammers

When to Sell

If They Win The Election

The Investment Premise

Au Revoir Mes Amis

"Gonna Find Out Who's Naughty or Nice"

Celebrating The Universal Rights of Man

Planning & Procrastination

The easiest problem to solve is the one that never happens. Yet, we spend a lot of time and money fixing things that could have been avoided. Sometimes, unnecessary difficulties are the result of procrastination. Other times, they are...

Our End-of-the-Year Plea

Every year at this time we receive last-minute requests that are time-sensitive. Year-end finances are always a challenge, but the ongoing disruptions caused by the pandemic magnify them. Many back-office personnel are still working...

Reality Check

For many months we have recommended that investors lower their long-term return assumptions. Very simply, when asset prices are high, we can expect future returns to be lower than average. Conversely, when asset prices are low, we can...

Thank You Veterans

There are many aspects of what we do that are very satisfying. We are in one of the helping professions, which provides us with the sense of purpose necessary for ongoing enthusiasm and commitment. We are grateful for that, but it does...

Howard Beale

I saw the film Network in 1976 with my future wife at the Arnold Theater in Point Pleasant, New Jersey. Beyond being blown away by Faye Dunaway’s portrayal of someone akin to Mary Tyler Moore’s evil twin, I realized...

The Problem of the Driven Man

I do not want to benefit from the misfortune of others. Unfortunately, some of our best clients are the widows of driven men, although lately we are seeing the misfortune of the driven woman. This is not progress. Typically, a person...

Aging

People spend an amazing amount of time worrying about things that they cannot control. For example, we worry about what the stock market is going to do today, or this week, or this year. Yet, we have no control over what the markets...

To Boldly Go

Did you know that 2021 began with 50% of US senators and 32% of US representatives being 65 years old or more? Chuck Grassley and Diane Feinstein had reached 87, while 21 senators were between 70 and 80 years old. Recently, William...

Zenki Koreisha

More and more of our clients are living into their hundreds. Many of our clients today are still active in their nineties. This can be a wonderful thing, as long and healthy lives can also be joyful and meaningful. We have the...

The Three Pillars

Few disciplines require advanced goal-setting skills more than competitive sports. Natural ability is fine, but athletes are competing exclusively against others who possess natural ability. Success requires the identification of the...

The Perfect End

The ancient Greeks understood that the purpose of life is to achieve happiness. From the Greek perspective, all things have a perfect end. The perfect end of an acorn is an oak tree. Anything that interferes with the perfect end is bad...

Now What?

A couple of weeks ago we discussed the ways we spend money and the opportunity costs we accept when making those choices. You can read the post here. We now know the basic principles for spending money with the goal of sustainable...

Sacrifice

I loved going to all of the musical events when my children were young and always felt that we made a good decision in choosing a school that did not neglect the arts. The board should have made a plea for funds immediately after any...

Happy Labor Day

Have you ever been to the Park City Museum in Utah? I make it a point to go there every time we take our annual family ski vacation. The museum is housed in the old City Hall, which also housed the Police Department, the Fire...

The Long Commute

We frequently encounter people who decide to buy a house that is far from where they work. Typically, a larger and more beautiful home, probably with a pool, can be purchased where land costs are a small part of the price. Often, a...

The Road Not Taken

The simple fact is that we cannot do everything. When we choose to do one thing, we are also choosing not to do something else. In economics, this is called opportunity cost. Because neither time nor resources are limitless, we need to...

The Timeline of Happiness

The best way to gauge the happiness bang for the buck is to reflect on our own lives. What memories do you have that make you feel happier just by recalling them? When you think about it, you will certainly find that the memories that...

Spending For Happiness

Many, or possibly most, people do not know how to spend money for maximum and sustainable happiness. Worse, too many people spend money in a way that is destructive to their ability to achieve their goals. Lack of familiarity with the...

Guess Watts

Answers: Answers Citation: Gates, Bill. Essay. In How to Avoid a Climate Disaster: The Solutions We Have and the Breakthroughs We Need, 58. Alfred A. Knopf, 2021.

Cinderella

We all know the story of Cinderella, whose mother died and whose father got remarried. When Cinderella’s dad passed away, Cinderella became a servant in her own home. Do you think this is a fairytale? Unfortunately, stories very...

To Trust or Not to Trust

After careful consideration, you may decide that you wish to establish a plan that provides for the management of your affairs while you are living, avoids probate, and ensures that your assets are distributed according to your wishes...

Who is an Executor?

In an earlier post, I explained that assets that are solely in our names, or held as tenants in common and community property, will pass to our beneficiaries through the probate process. Some trusts will also pass via probate, but that...

How Assets Transfer

The sad fact is that too often our estates do not go to our intended beneficiaries. This is not to say that we have not done all of the right things. We went to the attorney, often several times. We participated in a formal signing...

What is Estate Planning

Among the first questions we ask people during our first meeting is “have you done any estate planning?” The response is usually “I/we have a will.” Sometimes we hear “we don’t need that” or...

Planning & Future Posts

Among the most important services that we provide is the ongoing coaching that clients need in order for their plans to succeed. We never want to see the time, effort, and money invested in planning go to waste. We believe that...

Memorial Day

My first recollection of “Decoration Day” is watching a parade from the window of our apartment in Queens, New York. Soldiers carrying rifles and uniformed veterans of the First and Second World Wars marched to a small...

Step-Up

How to tax capital gains is a topic of much discussion today. Yet, we find that many people do not understand how we tax gains on assets. Generally, we tax long-term gains (assets held more than a year) at preferred rates. Assets sold...

Protecting Our Disabled Children

We all have an obligation to make life as healthy, fulfilling, and safe as possible for those who may have physical or mental conditions that make life especially challenging. Fortunately, we have tools available to us to improve...

Congratulations Anthony!

The primary reason that we involve ourselves in tax preparation is that an in-depth understanding of taxes is crucial to providing quality financial-planning advice. This is why we are so proud that Anthony has successfully completed...

Living in a Republic is Tricky

The fact that we share a common language and have constitutionally-protected rights to interstate trade and travel can sometimes make us forget that each state has its own laws, courts, and legislatures. In our very mobile society,...

The 'Unsecure' Act

Congress and the Federal Reserve acted with necessary haste last year to implement rules and policies designed to prevent economic collapse. Among those changes is the suspension of Required Minimum Distributions from retirement plans....

Happy New Year!

The whirlwind that the pandemic unleashed on the world can dampen our appreciation of the amazing technological strides that we made last year. I need to remind myself how miraculous it is that via my iPhone I can listen to live radio...

Bear Traps

Years ago, when we went camping at Anastasia State Park, one of our children had the brilliant idea of making a bear trap to protect us as we slept. This ingenious contraption consisted of strings tied to sticks hammered into the...

Happy Holidays

If we have learned anything from the events of 2020, it is to remind ourselves of what is truly important in our lives. This year has reinforced for us how much a sense of purpose is essential to living a fulfilled life. The simple...

Fooled Again

It hardly seems like 49 years since the song Won’t Get Fooled Again by The Who became a big hit. Every election the song comes to mind as I ponder how we do allow ourselves to be repeatedly fooled. We read newspaper articles and...

Driving A Nail With A Wrench

We can drive a nail with a wrench and we can unscrew a nut with a pair of pliers. When we lack the proper tools that is better than nothing. Still, we should always use the right tool for the right job. This is also true with our...

The Movie Jaws As A Metaphor

Anybody who grew up in a northern tourist town can relate to the movie Jaws. For the fictional community of Amity Island, the season bookended by Memorial Day and Labor Day represents life or death for the tiny village. The killer...

Rockets

A small group of strangers gathered on Memorial Island at 4:00 AM on February 8, 2010 to watch the last space shuttle pierce the night sky over Florida. Following the launch, we quietly shared our mutual sense of having lost something....

The Tough Challenges of Caring for Our Families

By far, the most rewarding aspect of this job is helping clients deal with the challenges in their lives. Helping people work through emotional decisions or a family crisis is especially important in making our jobs meaningful. Asset...

Economy and Innovation

As a teenager, I had the wonderful opportunity to attend the New Tamiami Air Race, which took place here in Florida. My luck came about because, during high school, I hung around a local airfield owned by the renowned polar explorer,...

Human Innovation

So much of what we read purports to tell us what the future will bring. Among the most common admonitions is that we should not expect things to ever be the same. Things are never the same, nor should they be. Extreme challenges drive...

Now The Hard Part

Now for the hard part. The disruptions in the financial markets have been largely soothed by the extraordinary efforts of the Federal Reserve. Forward-looking market participants are following the adage “don’t fight the Fed...

Planning Charitable Gifts - DAFs

This shall be the last of my discussions of developing human capital and charitable planning, for a while at least. Once families have developed their charitable mission plans, they will need to determine the best way to make their...

A Marriage Made In Washington

What happens when the interests of insurance-company lobbyists and politicians converge? The answer is called the Setting Every Community Up For Retirement Enhancement Act (SECURE). For many years, insurance companies have fretted over...

New From Congress - S.E.C.U.R.E.

For the first time in many years, Congress has made consequential revisions to the rules governing Qualified Retirement Plans. The Setting Every Community Up For Retirement Enhancement Act of 2019 (SECURE) effects many of our clients...

Investing In Human Capital

We spend a lot of time focused on certain metrics or benchmarks because they are easily measured. Whether we are counting the number of steps we take in a day or our investment performance relative to an arbitrary benchmark, we use...

Planning For College

Did you know that how much student debt a person is likely to have varies greatly depending upon which state you live in? According to the Institute for College Access and Success, the highest level is in Connecticut, where the...

The Problem With China

Perhaps it is wisdom that has allowed me to recognize the fallacy of so many of my youthful beliefs. I truly thought that the economic liberation of the People’s Republic of China, under Deng Xiaoping, foretold a future of...

Somebody Should Do Something About That! PART 2

I want to thank all of our clients who responded so well to our water-bottle initiative. Discovering how many of our clients are concerned about the natural beauty of their communities is gratifying. One client alerted us to the...

Somebody Should Do Something About That!

My wife and I love to go sailing in the ocean off of Fort Pierce Inlet during the months of May, June, and July. The water turns that magnificent turquoise color that we see on the Chamber-of-Commerce calendar. The seas tend to be low,...

Tip Of The Month - Lowering Our Cable Bills

If you have ever considered ditching your cable bill, you are not alone. In the first quarter of this year, Comcast lost 121,000 pay-TV subscribers while AT&T lost 544,000 pay-TV customers. That means nearly 700,000 “cut the...

Economic Well-Being In The United States

Anyone who attends our public presentations knows how much we value all of the quality information that is free to us as Americans. We are much better off than the citizens of Canada, who struggle with terrible gaps in necessary...

April 15th, Carpe Diem!

Some people view tax day as a cause for regret. We think that tax day is the perfect day to rethink our goals and to prepare for the future. This is the first year under the Tax Cuts and Jobs Act of 2017 (TCJA) and some of the...

What Are You Retiring To?

Most retirement planning focuses on the search for the most efficient means to save enough money for something called “retirement.” In other words, retirement planning is planning to quit our jobs. We plan to retire from...

Reactive VS Proactive Tax-Planning

During the tax preparation process, clients often ask us what they can do to lower their tax bill. Unfortunately, as many of you have heard, “April is too late for tax planning.” While we work diligently with clients to...

Having The Talk

Having The Talk Recently, we presented to a group of clients our new template for crafting letters of instruction to their heirs. We are gratified by the kind and positive feedback from everybody who attended. While still a work in...

When is it appropriate to adjust your investment objective?

When is it appropriate to adjust your investment objective? One thing is for sure; it is never when we are emotionally swept up by market exuberance, or conversely, when we are in the grips of widespread panic. Instead, our objectives...