Category Archives: Wise Investing

I received a copy of a research newsletter from Brown Brothers Harriman, a prominent private bank based in New York. The piece is titled, "Does G.O. Spell Go?" and makes the valid point that municipalities around the country are under credit stress, and that general obligation ("GO") bonds are not always as secure as they've always been perceived to be. BBH lumps Stockton and San Bernardino, CA with Detroit, MI as "...examples of ...

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We get electronic alerts from our clients' security custodians (Schwab and Fidelity) whenever something happens that they judge warrants our attention. Last night, we received 233 separate alerts -- each of which delivered the news that Moody's had upgraded its credit ratings on a particular municipal bond. The ratings involved school district voter-approved general obligation (GO) bonds, and the ratings went from the existing Baa1 up to A3. As we have ...

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Last week I was listening to the business update on the local AM news station and the host was going and on and on about the NASDAQ hitting 3000 for the first time in over 10 years. It brought me back to the heady days of the dot.com boom in the late 90’s right into 2000. As a skeptical investor I always like to peel back a few layers and ...

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We get calls from journalists from time to time. Here are links to a few of our thoughts, as reported by online news sources: FoxBusiness had Rick as a guest again, talking about investing in 2012. "Invest cautiously in 2012. Preserve capital." The Chicago Sun-Times interviewed Rick about higher-yielding investments. September 2011. "In his view, the stock market is priced for 'a continued and unbroken economic recovery.”'But the bond market 'is priced for a ...

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Accomplishing something without help can be very satisfing, but sometimes the best decision can be to hire a guide. I’m like many other do-it yourselfers and believe I can accomplish most tasks on my own or with minimal help. With age and experience I have learned to stand back and take a second look. My wife would be the first to tell you I certainly am not capable of accomplishing all home improvement ...

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We commonly think of three possible actions that we can take with our investments – Buy, Sell or Hold. One of these three is always the wrong choice. Can you tell which one? For more than a generation, Wall Street analysts have issued reports on stocks. These reports are generally accompanied by a recommendation to Buy, Sell or Hold the stock. Many analysts further break these three categories into finer gradations ...

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Stocks are plummeting. What to do? That's not the right question...the right question is, "In past eras, what have stock returns looked like in the five years following prices like these?" We calculate the P/E ratio on stocks using Robert Shiller's method: Take the last 10 years of reported earnings on the S&P500; adjust for inflation; average those numbers. That produces a quite reliable figure for future earnings expectations -- the ...

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