Money For the Rest of Us

How central banks can become insolvent and why it can lead to hyperinflation. What are four ways the Federal Reserve and the U.S. Treasury could monetize the national debt. Topics covered include: What are the major asset and liabilities of the Federal Reserve How does the Federal Reserve make a profit and what happens if it suffers a loss. How has the Federal Reserve has significantly expanded th...

How the stories we tell ourselves lead to economic change. What are current pandemic related narratives that are impacting financial markets and the economy. Topics covered include: Examples of mathematical models for epidemics. What are the risks when the global economy is opened again. Under what circumstances do individuals rely on anecdotal evidence rather than statistics. What are some propos...

What is the difference between risk and uncertainty and how our decision making approach should differ under each scenario. Why pandemics are highly uncertain and should be treated as such. Topics covered include: How the coronavirus pandemic is far worse than other pandemics this century. How humans have a difficult time accepting that things won't return to normal. What is the difference between...

What central banks such as the Federal Reserve and federal governments are doing to counteract the negative impact of the pandemic related economic shutdown. What are the risks of this massive monetary and fiscal stimulus and how to mitigate those risks. Topics covered include: How central banks have the capacity to create an infinite amount of money. How the Federal Reserve is using its money-pri...

How to avoid ruin and help others avoid ruin as the economy shuts down to slow the spread of the coronavirus. Topics covered include: What is the precautionary principle and how can it help us make important decisions with regards to the coronavirus pandemic. How many people could be infected with Covid-19 in the next 30 to 60 days at the current daily growth rate. Why investment managers are sell...

Why closed-end funds are David's favorite investment vehicle, particularly during market panics. What are the unique characteristics of these funds and what are successful strategies for investing them. Topics covered include: How closed-end funds differ from open-end mutual funds and ETFs. Why most closed-end funds are bond funds and use leverage. Why closed-end funds can sell at large discounts...

Why most investors practice both market timing and time in the market. Why it is okay to reduce stock exposure given the coronavirus pandemic threat. What would a stock portfolio return that misses the best or worst days and how likely is that. How do rolling 30-year stock returns differ depending on the starting point. Why are stocks likely to outperform bonds over the next 30 years. What is sequ...

Almost half of Millennials want to retire early. Will that hurt economic growth? There were similar concerns in the 1920s that early retirement would wreck the economy. In fact, there was significant pushback against retiring at all due to fears retirements would destroy the economy. Yet, the Great Depression still came. In this episode, we consider what ended the Roaring Twenties, caused the Grea...

What factors lead to hyperinflation, why it is so devastating, how hyperinflation can be overcome and what can individuals do to be prepared for hyperinflation. Topics covered include: What causes inflation and how do central banks manage it. How the causes of hyperinflation differ from more normal levels of inflation. What is the biggest challenge of living in a country with hyperinflation. How Z...

How pandemics have impacted the economy and financial markets. Where does the coronavirus rank in severity compared to other pandemics. What portfolio changes, if any, should investors make in response to the coronavirus pandemic. Topics covered include: Definition of a pandemic The worst pandemics in the 20th and 21st centuries What are the factors in determining the severity of the coronavirus'...

How most money, such as currency, bank deposits, money market mutual funds, and repurchase agreements, is really short-term debt, often backed by other debt. As a result, money is subject to runs when investors lose confidence and don't want to own it. That can lead to financial crises. Topics covered in this episode include: How counterfeiting currency works. Why most money is debt backed by debt...

How to protect against financial hardship and assist others who are struggling financially. Topics covered include: Why are so many families leaving Central America and seeking to enter the United States. How have U.S. immigration patterns changed. Why immigration leads to higher economic growth. Why unsheltered homelessness is increasing around the world and what strategies have been effective in...

How investors make money with carry trades, how central banks encourage such trades, and what are the dangers to financial markets and the economy when carry trades get too big. Topics covered include: What are the attributes and examples of carry trades. Why do carry trades exist even though investors can suffer massive losses. What was Volmageddeon and Francogeddan. How central banks are the lar...

What factors determine the well-being of an individual or nation and why gross domestic product is an inadequate measure of prosperity. Topics covered include: Evidence many Americans are poorer than before the Great Recession. Why life expectancy in the U.S. is falling. How satisifiedare U.S. citizens. What is GDP and why is the U.S. Bureau of Economics developing a new methodology What are the f...

How climate change, money, trust and technology will interact to impact financial markets and the economy in the coming decade. Topics covered include: Why we change much more over a decade's time than we predict. What is the best approach for transitioning to a new career. What have stocks and bonds returned over the past decade and what are reasonable return expectations for the decade ahead. Ex...

How is it the global economy still functions even though most individuals do not trust brands, public institutions or each other. Topics covered in this episode include: The low level of interpersonal trust around the world What is social capital and how it facilitates a trust economy. What are the incentives that encourage individuals and businesses to produce goods and services rather than steal...

How a safety-first retirement approach using income annuities is more predictable and takes less money than depending entirely on your investment portfolio to fund your retirement. Topics covered include: The difference between a safety-first and probability-based approached to retirement. How income annuities work. Why setting a sustainable retirement withdrawal rates requires planning for below...

Two Money For the Rest of Us podcast listeners are struggling with spending money. The first listener is 22 and lives in Canada. He feels as if his money is going everywhere such as saving for a house, car, and retirement, but very little goes to things he enjoys. The second listener is 46 with a $2 million net worth, but in his case, he finds he doesn’t enjoy spending money on himself. He is will...

How regulatory changes could lead to a boom in new ETFs, including actively managed ETFs. Why ETFs continue to be one of the most innovative, cost effective and tax efficient investment vehicles. Topic covered include: How big is the ETF market relative to mutual funds. What are the benefits of ETFs that have allowed them to gain market share from mutal funds. What are some of the negatives with E...

How to find your unique work that can bring satisfaction and income before and during the traditional retirement years. Topics discussed in this episode include: What is settled work. Why you need time and space to find and do your best work. What is a commonplace book and why it can be helpful. How filters and saying no can help us control our time. The important role of serendipity in finding ou...

Is it possible to be too diversified and how can you tell? Why Warren Buffet thinks diversification is protection against ignorance. Topics covered include: The skills you need to be able to select individual stocks. How have active managers outperformed relative to passive indexing products. How much diversification is too much and a test to determine if one is over diversified. What is factor in...

David's book Money for the Rest of Us: 10 Questions to Master Successful Investing is now available (at least the e-book version). To celebrate, here is a bonus episode with excerpts from the forthcoming audiobook. Please enjoy the Introduction and Chapter One. Also, as part of the book launch, David will be hosting an Ask Me Anything (AMA) on Reddit on Wednesday, October 30, 2019 at 1PM Eastern t...

What are the timeless principles we can follow in order to become better investors.  Topics covered in this episode include: How a book's permanence makes it different from a podcast. How David's book got written and published and why his publisher just recalled the hardcover version of the book. What are the 10 questions we should answer before we invest in anything. Thanks to NetSuite and T...

What are the benefits and risks of investing in exchange-traded notes (ETNs) compared with ETFs. Topics covered include: How big is the market for ETNs compared with ETFs. How ETNs can do a better job tracking their target index than ETFs. Why ETNs can be more tax-efficient than ETFs.. How ETNs have counterparty risk, pricing risk, and liquidity risk. Under what circumstances would an ETN be prefe...

Why some analysts believe the Consumer Price Index formula understates inflation while others believe the CPI formula overstates inflation. What really matters to us individually when it comes to inflation. Topics covered in this episode include: What is inflation and what causes it. How is the Consumer Price Index calculated and how has the CPI formula changed over time. What are examples of diff...