Jon Stewart v. Jim Cramer (Stock-Picking is a Loser’s Game)

Jon Stewart recently called out CNBC’s Jim Cramer on his stock-picking calls in the wake of the 2008 financial meltdown. The lesson here is that buying individual stocks subjects you to massively more risk than owning “the whole market” via low-cost index funds (to the degree appropriate for you). Does anyone really need more risk [...]

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A Primer on TIPs Bonds (Treasury Inflation-Protected Securities)

Inflation-adjusted Treasury bonds (TIPs) offer investors a nice inflation hedge, but they aren’t without risks. Namely, their total return will be affected by prevailing interest rates, supply and demand, and expected future inflation (not just actual inflation). Lesson: while appropriate in many portfolios, they aren’t a “silver bullet.”
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Don’t Bet the Farm on Bonds

Bonds are an important piece of most portfolios but the “great recession” has many investors moving money to bonds based on recent past performance.
The past isn’t necessarily prologue: the current interest rate environment and potential future inflation could cause this strategy to be “performance chasing” of the worst kind.
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“Forced IRAs?” Let’s Give People a Choice First

President Obama recently asked for $1 billion to create a program to force people (via their employers) to save their own money in IRAs. The $1 billion in question is “not an exact figure but we want to make sure we have enough.” (my words, but pretty close).
Here’s an idea: why not pass an extremely [...]

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