Irresponsible Lending

With major defaults looming for Greece and Puerto Rico, and concern regarding Illinois and numerous U. S. cities, much has been made of profligate borrowers.  All of this coming after the major collapse in the U. S. residential mortgage market. How about irresponsible lending?  Did anyone really believe that lending money to homeowners, without adequate … Continued

The Law of Unintended Consequences

The Chinese stock market has drawn world attention from the recent sudden, sharp, and violent drop in share prices.  Yesterday, the China Securities Regulatory Commission announced prohibitions from certain investors selling shares of stock.  The objective, of course, is to stem the selling pressure which is causing stock prices to plummet.  The desired effect is … Continued

The Supreme Court and Public Opinion

Does the Supreme Court look at public opinion polls?  This is not a new question, but recent decisions may reflect, in the opinion of some, an increased awareness of the “big picture” as opposed to a literal reading of the constitution. This is a question that is not likely to be resolved, but will probably … Continued

Fighting the Last War

We often criticize governments and armies for getting ready to “fight the last war.”  To some degree, they all do it.  It is inevitable and reflects a mistaken assessment of what the next war will be like.  And this is likely to continue until someone comes up with a reliable method of predicting the future. … Continued

Settled Science? Things Change

Legal scholar, Walter Osborn, was recently quoted in The Wall Street Journal regarding the FDA’s ban on trans fats.  He points out that from the 1950s on, dietary reformers promoted trans fats as a safer alternative to animal fats and butter.  Public health activists and various levels of government hectored consumers and restaurants to embrace the … Continued

The Sticky Spending Theory

The Sticky Wage Theory is an economic hypothesis that describes how the pay of employed workers tends to respond slowly to changes in the economic environment.  Employers are slow to increase wages during an economic expansion, so as to not get caught off guard by a subsequent downturn.   On the flip side, wages tend to … Continued

Q.E.D.

Wikipedia defines Q.E.D. as an initialization of the Latin phrase quod erat demonstrandum, originating from the Ancient Greek, meaning “that which had to be proven.”  Perhaps a better translation would read, “The very thing it was required to have shown.” Why is this important to investors? With the ever expanding volume of financial news, there … Continued

The Jobs Dilemma

Monthly unemployment data suggests that the nation is enjoying a solid economy with a positive outlook.  On the other hand, work force participation remains at historically low levels of approximately 63% and the latest job openings data stands at the highest level since this metric began in 2000.  What is going on and why should … Continued

Go With the Flow?

Over the last several weeks, there have been several articles discussing Google’s autonomous cars’ penchant for being involved in an above average number of accidents.  According to Google, none of these accidents have been the fault of the autonomous car.  If Google’s claims are correct, we have an interesting paradox, Google’s cars have more accidents … Continued

Is Your House Part of Your Financial Plan?

If it isn’t, it probably should be.  Properly managed, a home can be a shelter and part of a long term financial plan.  For many people, the purchase of a house is their largest and earliest significant foray into the world of finance. Finding the right home, obtaining a mortgage and then managing the monthly … Continued

The Environmental/Climate Change Fossil Fuel Dilemma

While the entire issue of climate change, the use of fossil fuels and recycling are very complex and controversial, I was recently able to observe the breadth of the dilemma while standing in one place in the parking lot of my hotel on the shores of Lake Powell. Behind me was a collection of refuse … Continued

Sometimes the Government Gets it Right

It’s easy to criticize the government and sometimes the criticism is deserved.  But sometimes the government does something really well, and as a frequent critic of government efforts, it seems appropriate to give credit where credit is due. I recently spent a week touring several of our National Parks and related facilities, specifically Grand Canyon, … Continued