With all the buzz surrounding the recent increase in U.S. tariffs, a discussion regarding the nature of tariffs is timely. We often hear commentators opine that higher tariffs are certain to be a drag on the U.S. stock market. However, a brief review of the nature, purpose, and history of American tariffs, and the current […]
Understanding Rates of Return
Will Rogers once quipped: “It is not the return on my investment that I am concerned about; it’s the return of my investment.” In all seriousness though, calculating a rate of return; also known as “return on investment”, or ROI, is useful because it allows investors to compare various investments, regardless of the amount invested […]
The Risk Illusion
As emotional beings, we are susceptible to illusions and phobias. Never mind that the snake under the bed turned out to be a sock, or that the monster in the closet was a hat and overcoat. At times our irrational fears seem so real that no amount of reason can calm us. At the same […]
Spring 2017 – Is Economic Growth a Reliable Indicator of Future Equity Returns?
We recently learned that the US economy has grown at a 2.1% annual rate since the recovery began in 2009. This pace of expansion has been the weakest of any in modern times: It seems to make sense to treat economic growth as an indicator of future equity returns. However, the relationship between economic growth […]
Online Sites at Financial Plan, Inc. – Winter 2017
After inquiring with our clients, it seems that many are not particularly active in logging on to our various online sites. Most are not interested in following their investments on a frequent basis; rather, they use our annual review meeting as a “deep dive” into their portfolio and their financial plan. Others are concerned about […]
Please Welcome The Newest Addition To Our Company: Justin Gross
The history of our firm and our clients has been one of success, and as a result we have experienced a gradual growth in clients and employees. In recent years we have been on a pace to add one employee per year. We understand that in order to provide world-class service, we must not allow the […]
Trailing by One Point. No Time on the Clock. Two Free Throws. – Summer 2016
The market decline of early 2016 was not anywhere near the magnitude of a bear market such as we experienced in the year 2000 or in 2008. Yet it had some of the same feel as past events. Times like that are never easy for investors, who must confront their concern that maybe this time […]
Stock Market Performance and the Weather – Winter 2016
Belling-hamsters know what it is like to wait out a long winter. A down market can be like that; gloomy, day after day. It’s not pleasant, and there is nothing we can do about it. (Well, OK…I like rain and down markets, because both are necessary for growth, but I’m odd that way). Our dislike […]
Negative Interest Rates: Coming to a Bank Near You?
In recent months, several of the world’s central banks have conducted a highly risky experiment with negative interest rates. For example, the Bank of Japan has a rate of minus 0.1%, the European Central Bank has a deposit rate of minus 0.4%, and Switzerland’s bank rate is a minus 0.75%. German government bonds with maturities as long […]
Should You Buy Life Insurance From An Agent?
Most insurance agents are happy to reassure you they’re selling you a great policy, but there’s no getting around the conflict of interest. Confessions Of A Former Agent At the beginning of my career as a financial planner, I made my living selling various investment and insurance products, which gave me personal experience regarding the […]