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A Bias Towards Inaction
A business makes capital allocation decisions such as expanding a factory or investing in new tech with the intent of recouping that investment over a timeframe that spans years and decades. Not all capital allocation…
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Sometimes, The Year You Retire Can Make A World Of Difference
Let me introduce you to Jason. He retires in 1969 with today’s equivalent of a million dollars. That is, he retires with an amount of money that has the same purchasing power as what million dollars…
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Positive-Sum Games
Say you decide to play blackjack with a friend, and you play to a point where one of you wins everything from the other. And say the game starts with $100 from you and another…
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The Retirement Spending Smile
You think you’ll spend like this… But instead, you spend like this… Retirement experts who’ve studied this say that we spend in three phases… The go-go years are your first set of years in retirement.…
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Plan Like A Cockroach
Cockroaches are the ultimate survivors1. They can live without air for an hour, without food and water for months. They can survive the Arctic cold. Ice ages and continent shifts mean nothing to them. It…
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Sidestepping Bubble Stocks
Buying businesses (stocks) is not about winning popularity contests. In fact, the more popular a stock or a category of stocks gets, the less likely its price matches its value. Pay too rich a price…
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Pre-Packaged Portfolios Are Seldom Optimal
Cookie-cutting the investing process seldom works. Take for example someone who is a federal government employee, and we know what that entails…a rock-solid job security with access to an equally rock-solid pension plan. So, assuming…
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Retire To Something
San Luis Obispo has one of the cutest downtowns in California. A must try there if you are ever around is a Turkish pastry shop called Lokum. So, so good. On a stroll to one…
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How Risky Are Individual Stocks?
Google was busy relishing its unrelenting grip on the search business and along comes ChatGPT, a supposed Google-killer that helped lop several hundred billion dollars off its market value. Whether ChatGPT does any lasting damage…
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Demystifying Investment Returns
We’ll start with the simplest of all possible investments and that is buying Treasury bonds. When we buy a bond, we become a lender. And with Treasury bonds, we become a lender to the U.S.…