Investing in industries that enjoy significant subsidies may carry additional risks.  Subsidies, typically granted by government to support desired public policy, can also be revoked or materially altered. For example, home solar panel systems have seen considerable growth, particularly in states that have mandated large payouts to residents who generate more renewable energy than they … Continued

According to Wikipedia, the term saber-rattling, was based on an incident in Chilean history that took place on September 3, 1924, when a group of young military officers protested against the political class and the postponement of social measures by rattling their sabers within their scabbards. The term is now applied generally to cover an … Continued

The world is awash in irresponsible borrowing.  Governments, companies and individuals borrow money without a clear path to repayment.  In addition, governments and companies commit to long-term obligations, primarily in the areas of retirement and health care, without appropriate funding.  Unfunded liabilities are, for all practical purposes, debt. This tendency has been exacerbated by unusually … Continued

Attempting to predict the stock market can be hazardous at best and usually unsuccessful.  However, there is an old, and frequently accurate, adage that suggests that the market tends to fool most of the people, most of the time. In that regard, data recently published by LPL Research, suggests that there are fewer bulls today … Continued

Most consumers’ interest in better vehicle fuel economy is limited to saving money at the gas pump and the environmental damage associated with burning fossil fuels.  With significantly cheaper gasoline, the economic incentive to reduce fuel consumption is materially diminished.  The environmental issues remain the same. With average U.S. fleet fuel efficiency approximating 25 miles … Continued

The administration has proposed a $10 per barrel tax on oil producers to fund a sweeping set of green transportation initiatives.  The tax would be phased in over a period of five years and is being billed as part of the fight against climate change. Investors should note that this is, in effect, a $0.25 … Continued

California’s drought conditions continue to reflect the effectiveness of conservation measures and increased precipitation.  The state’s second snow survey indicated that the snow pack was at 130% of average at the measurement point in the Sierra Nevada.  Reservoir levels are up, but still well below desired levels.  El Niño-fueled storms have delivered January rainfall at … Continued

The following phrase is taken from then Secretary of Defense Donald Rumsfeld’s response to a question during a news briefing on February 12, 2002. “Reports that say something hasn’t happened are always interesting to me, because as we know, there are known knowns; there are things we know we know.  We also know that there … Continued

This excerpt from S. T. Coleridge’s “Rhyme of the Ancient Mariner”, while generally an apt description of coastal areas like California, doesn’t have to be true. California’s water shortages have made the national news with increasingly severe restrictions on water usage.  The State’s problems stem from increasing population, natural fluctuations in precipitation and other factors. … Continued

Investors would be well served by carefully considering dollar announcements relating to auto industry results and activities in the context of the industry’s size. For example, GM and Lyft recently announced an alliance and a $500 million investment by GM.  Lyft management has stated that the partnership reflects a common view on a number of … Continued

The political class seems to think that a household income of $250,000 per year is middle class.  What do you think? Even a rudimentary familiarity with the realities of incomes in the U.S. would recognize that household earnings in that area are near the top of the range.  The most recent Census Bureau data showed … Continued

I thought one of my favorite quotes would be very timely today by Dr. Martin Luther King, Jr., “Darkness cannot drive out darkness; only light can do that.  Hate cannot drive out hate; only love can do that.” Whether discussing political issues, personal challenges, or economic and market forces this quote provides great perspective. Fear … Continued