News

No Picture

Weekend Reads

Some fun reads and shameless self-promotion I take the L on high yield A discussion of taxing bitcoin.  Isn’t avoiding tax part of the point of an anonymous currency? Bill Nye may have had his face ripped off by Hollywood accounting Shocker: A third of high-end real estate deals may be shady Babylon’s nerds went base 60 – this is super cool The Northeast Ohio PKD walk is coming up soon.  Share my son’s story! Please send thoughts and prayers to those in the path of Hurricane Harvey, too.


Second Grade

For William’s First Day of Second Grade

Today’s post is a departure from the norm of investment news and snark.  I’m going to share a bit about my son, William, and ask you to spend a minute of your day to think about his cause. William was born in 2010 with Autosomal Recessive Polycystic Kidney Disease, or ARPKD.  We spent his first days with him in the neonatal intensive care unit (NICU).  He was in a plastic box and a machine was helping him breathe.  These were critical days.  We couldn’t hold our son.  He was cradled by a tangle of tubes and monitoring cables.  Most of all, the sounds will stick with me.  The beepbeepbeepBOOP alert of his pulsox unit, the inflating of the blood pressure cuff every 15 minutes, and assorted klaxons and pings haunt me.  You wonder if this alert is the big one.  What’s wrong?  And we were powerless to do anything, wondering if…


Argentina and the Frog

Argentina and the Frog

Like many classic fables, the story of the frog and the scorpion can be traced back to many cultures, each with their own twist.  Aesop’s version is here. A scorpion and a frog meet on the bank of a stream and the scorpion asks the frog to carry him across on its back. The frog asks, “How do I know you won’t sting me?” The scorpion says, “Because if I do, I will die too.” Argentina was once the rising star of the global economy.  By 1913 it was the world’s 10th wealthiest country per capita owing to abundant natural resources and governance that emphasized economic growth.  After a military takeover in 1930, Argentina experienced constant political change.  From 1930 to 1983, the country averaged a new president every two years.  Argentina defaulted on its international debt in 1956, 1989, 2001, and 2014.  The 2001 default resulted in a highly…


Major Award

It’s a Major Award!

Walk into certain advisors’ offices and you’ll see plaques lining the walls with titles like ‘Chairman’s Roundtable’ .  Have they been honored for their investment prowess?  Perhaps their trustworthy nature?  It certainly sounds important – like a major award.  In reality, it’s a sales award.  That’s not something you’d generally find in a fiduciary’s office.  The same goes for many publicized rankings of advisors.  One of the most widely touted (from a prestigious publisher!) factors in revenue (ie what they were able to sell their clients over the last year) as a measure of advisor skill. Our Own Horn That’s part of what makes it feel so good to be listed on the Financial Times Top 300 Registered Investment Advisors.  The list isn’t an advertisement.  It’s based on assets under management, AUM growth rate, years in existence, compliance record, industry certifications, and online accessibility.  It’s not a ranking and they…


thank you

Two Years

I set up this website two years ago with no particular goal in mind.  I just wanted to see how difficult it was to buy a domain and start a blog.  It turns out that the set up was the easy part.  The writing is harder.  For the first year, I wrote sporadically.  In this second year, I have tried to post something every week.  I have had varying degrees of success!  Thank you for sticking with me as I continue to figure this whole process out! My two most popular posts of the last year are also my most popular posts of all time, in no small part to being included in the Abnormal Returns daily links (Thanks Tadas!): Pick Good Funds – The latest marketing from American Funds suggests that bad active managers are pulling down the whole group relative to the S&P 500 and all investors need to…


News as drama

News As Drama

Children have trouble focusing their attention.  To get my son to turn all his attention to his homework (since when do first graders have homework, anyway?), we often need to mute or turn off the TV.  Handheld screens are completely off the table for him unless we are on a long car ride.  He doesn’t have the discipline to choose substance over sparkle.  YouTube knows that he and his generation love unboxing videos and shoddy animation.  Don’t think the media isn’t targeting you the same way. As an adult, you should be immune to such base manipulation, right?  This is not the case.  Advertisers need to get you to self-diagnose moderate to severe Wandering Toe Syndrome and ask your doctor if Toeproxin™ is right for you.   How do they do that?  The adult version of unboxing videos is drama.  This used to be the domain of prime-time fictional television….


News as drama

Three Trades Based on This Week’s Headlines

The two big news items this week are the French election and US tax reform.  There was also a big shakeup in the House of Mouse as Disney’s ESPN laid off a significant amount of on-air talent.  What’s the best way to trade this news?  If you read this blog with any regularity, you already know where this is going. French Election France’s establishment parties got the boot as nationalist Marine Le Pen and centrist Emmanuel Macron advanced through the first round of voting.  This continues a global trend of shaking up the political status quo.  As in other recent elections, volatility picked up before the election only to drop once the results were reported.  While Le Pen is seen as a populist wild card, Macron is expected to win handily in the next round.  Many expect Macron to add a stable presence to contrast President Trump’s boat-rocking. The trade: No…


No Picture

A Note on Structured Notes

What happens to all the investments we say no to?  We are acutely aware of how our invested money performs, but it can be difficult to keep track of the investments that just didn’t make the cut.  Did we dodge a bullet?  Or did we miss out on a shooting star? Structured Notes I recently came across an email from a year ago where I researched a structured note for one of our advisors.  In the SEC’s investor bulletin regarding structured notes, these are “securities issued by financial institutions whose returns are based on, among other things, equity indexes, a single equity security, a basket of equity securities, interest rates, commodities, and/or foreign currencies.”  I suggest you read the entire thing as well as FINRA’s investor alert on structured notes. The Pitch This particular note was pitched to one of our clients by his banker and the client wanted us to…


A warning sign to the rest of society.

Walk of Shame

Motivation Most people seem to be operating on the same social frequency.  I can see this, but I am unable to take part without tremendous effort that feels insincere.  Awkward conversation is my forte.  Hoping to improve, I observe and try to understand how people interact with one another.  One thing that has helped me in deciphering social interaction has been to recognize motivation.  Once you find out what drives someone, their behavior becomes easier to understand.  What is the most common motivator that I have seen? People like to feel important.  Everyone is the star of their own movie.  So when an airline looks for volunteers to give up their seats, they’re actually telling their passengers this: “There are four people more important than you who are getting on this flight.  How much do we have to pay you to admit that?” Before boarding, this is a glorified marshmallow test.  Delay…


Cleveland Bridge

Eventful 24 Hours

The last 24 hours have been eventful.  If you need yet another perspective on world events, keep reading.  If not, just skip to Other Stuff where it’s less serious. We launched missiles into Syria. This feels like the typical setup where the world calls on the US to act as the world’s police, our military is deployed, and the world decries our meddling in world affairs.  A dictator is butchering his own people, but no one is willing to do anything about it except us (sternly worded letters don’t count as action).  If we don’t do anything, we’re abandoning the region to nefarious powers.  If we go in guns blazing, we’re warmongers.  Ad hoc missile strikes seem to have minimal political backlash while still accomplishing a mission. If this doesn’t lay to rest the conspiracy theory that Vladimir Putin controls our executive branch, it certainly erodes its credibility. In one…