Today we continue reviewing Ray Dalio’s latest book, How Countries Go Broke. If, like me, you fear that you may soon live in such a country, Ray’s work reads like a guidebook to the future. But in fact, this future is just the latest iteration of a well-known debt cycle, one that is almost natural in its regularity.
Read moreDebt is a curse that can also be a blessing, depending on how the borrower uses it. Sadly, human nature seemingly ensures we often use debt unproductively—and not just as individuals. Governments have their own special way of using debt to buy benefits (and votes?) today that future generations will pay for.
Read morePhysicists have a concept called “entropy,” which basically says systems will tend to move from orderly to disorderly over time. Entropy is central to physics, thermodynamics, and other fields of physical science.
Read moreMonetary policy is a balancing act. The Federal Reserve’s “dual mandate” requires it to promote both maximum employment and stable prices. Statutorily, neither is more important than the other. The Fed is supposed to seek both at the same time.
Read moreNo one wants to be a party pooper. It drives away friends and makes you generally unpopular. But if you are a monetary policymaker, ending the party before it gets too wild is quite literally your job.
Read moreWe have no scarcity of economic challenges. Price inflation is high on the list, in part because we saw so little of it for so many years. Inflation’s return in 2021–2022 brought back memories for those (ahem) who lived through the 1970s. And not the pleasant kind. None of our generation wants to see the reruns of That ’70s Show.
Read moreI was in Newport Beach two weeks ago doing several video interviews with David Bahnsen. At the end of the interview, he mentioned the importance of having a proper “philosophy of investing.” Time was running out so I didn’t have the ability to unpack that.
Read moreIf you are an investor, an economist, or really anyone who watches big trends, numbers are your friends. They help you understand events you can’t personally observe.
Read moreLast week I compared our jobs data, which is sometimes questionable, to World War II weather forecasts. Those were also questionable but necessary anyway. The generals needed them “for planning purposes.”
Read moreI remember when August was a slow month. School didn’t start until after Labor Day. Even in my adult days in the investment world, not much happened. People were either on vacation or coming back and getting ready for September. It’s hard to believe, but nobody really cared about Jackson Hole in the ’80s or ’90s. And it had several venues up until 1981 when it became “Jackson Hole.”
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