The Daily Mission

A rising spirit of the times. You fed up yet?

J Pow wraps Jackson Hole Fed meeting with some thoughts

An update on the US $ and it’s hegemonic role as the world’s preferred reserve currency The U.S. is 26% of the global economy, as measured by annual GDP. US$ is still 58% of global reserves. It was already declining pre-Covid & pre-UKR War. Despite the massive $$ creation, mismanagement of Fed debt, and abuses of the dollar, it’s still in place for years ahead.  I don’t see how it’s unseated w...

A note on mortgage rates & inflation This is where mortgage banking and residential real estate overlap w/macroeconomics & money mgt.  First, a disclaimer. I am not a real estate agent or broker.  However, understanding some basics around calculating risk, probability, and applying to personal money management/financial decisions: 1. I wouldn't be buying a house right now until prices...

You have 28 months before the 2018 TCJA (Tax Cuts & Jobs Act) sunsets. ▶ If it expires, we roll back to prior tax brackets 📈 or ▶ It could be extended and remain as-is or ▶ It could be replaced w/a new act and higher tax rates 📈 2/3 of outcomes lead to higher taxes ❗  Roth conversion?  Maybe.  ▶ Depends on your tax situation, your current income bracket, your ability to pay the taxes on the...

How Much Is Enough? "The Psychology Of Money" Series Chapter 3: Never Enough. When Rich People Do Crazy Things.

There are different ways to measure wealth. In this case, we’re talking about money and assets. You can look at income. You can look at overall wealth, or holdings, or assets. You can also zero in on cash deposits.  After all, cash is king when you need it. When the prices of goods and services go up. When you have to feed your kids and get them school supplies. When opportunities arise and you ho...

Some highlights -> 8 stocks have driven 90% of the S&P 500’s return (but that may be changing) -> Cost at the fuel pump is up -> Inflation up just a bit. CPI came in today at +3.2% YoY, so a little bit higher than the June YoY #. We’ll go over those #’s in minute. -> GDP is up. That’s on $1.5 trillion of government spending. Think of 3 big factors that affect GDP: consumption, inve...

Part Tres Mid-Year Review & Outlook 2023; Warning: Content May Be Boring.

Part Deux Mid-Year Review & Outlook 2023; Warning: Content May Be Boring.

Part 1 of our firm's Mid-Year Review & Outlook 2023; Warning: Content May Be Boring.

A few points from the latest in jobs. Stuff you won't hear from financial media.

Having skill at something, anything boosts self-esteem and gives a person a backup job.

Consider risk management and what it takes to recover from a deep loss.

Consumers are getting squeezed, cash levels are growing short, credit card usage is way up at a time when the average APR is 21%, and we now know that globally consumers, and not manufacturing, are carrying the economy. The global economy seems to be cruising on one engine as it relies on services for momentum. Meanwhile, we’re in an industrial & manufacturing recession as factories slow produ...

These are the 12 Steps we use in planning: 1. Live on less than you earn. This is rule #1. Full stop. Nothing can happen beyond this until it’s upheld through lifestyle and budgeting. 2. Make sure you have enough insurance coverage for all needs. 3. Make sure you can cover basic deductibles. 4. Set aside the first 1 month of emergency cash reserves, while making minimum payments to high-interest d...

Some have asked our view on crypto. Crypto market cap, minus BTC and ETH, is -60% since cycle peak in Nov 2021. BTC still trades like a high-beta asset.  (Comments on Bitcoin further below, if you want to TL;DR and jump ahead) 🔹 I would not feel comfortable in a fiduciary role commenting on crypto, positive or negative, beyond what I've posted and put into a podcast to say that we're not...

Is “The Mother Of All (Asset) Bubbles” underway?

Have you ever looked at a situation, or a person, and wondered if and how luck plays into success? Luck is real, as is risk. And these two factors show us the reality that every outcome in life has forces that exist in addition to, and beyond our individual effort. Fact is, they both play a role in life and must be respected. We don’t know how much luck plays into anyone’s success. As Housel says,...

This is a quick market note for today, given the news on global banking, risk, and signs that we could be seeing a sovereign debt crisis unfold. Here’s a pertinent take from J. Kyle Bass this morning. If you don’t know Kyle Bass, he is the Dallas-based Hayman Capital hedge fund manager who first came to public prominence for shorting the subprime fallout. Since then he has become a nearly unmatche...

Since we’ve talked quite a bit about inflation over the course of this podcast, given that it launched last year, it’s important to note that the calculation of inflation just underwent a change. And February’s CPI report was the first to be calculated using a new methodology. Here’s the change. Measuring CPI in 2022, you would take 2021+2020 consumption. 2023 = ONLY 2022 consumption. Previously,...

When the cost of capital goes up, and quickly, things break. We've reached that point.

I'm going drop a risk-grenade in the room and walk out. When you deal w/publicly-traded securities, there's regulation. There's also (generally) liquidity and some sort of market value even if markets sell off. Yes, technically all stocks and all funds could go to zero. I think if that were to occur, society/civilization as we know it would cease to exist. Those left would be rendered back to hunt...

Wages are "sticky". Once raised, they tend not to drop. Wages and benefits are also the largest cost a business has to cover. Yes, inflation is hitting our wallets. And further squeezing a huge swath of the American public. 👉🏼 50% of Americans do not own a single share of stock, or an index fund, mutual fund, or ETF. 👉🏼 40% of Americans report that they could not come up with $400 in the event...

Money in-and-of itself is just a tool. It’s a thing that is supposed to represent the exchange of energy that you put into work for its return. I personally believe that huge piles of cash stored away is a disservice in that it’s not being invested or put into flow, whereby more money can be made, people can start businesses and be funded, etc. Money should not be the cause of losing your closest...