Was the February market drop a portent of things to come?

Complacency will get you into trouble, at least in the financial markets. Back in February, when the U.S. stock market dropped almost 3.5% in one day (following an 8% plunge in the Chinese market), investors became alarmed, newspapers ran front-page headlines for several days, and television “experts” opined about the market’s sudden volatility. It wasn’t the market that had suddenly […]

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Forget trends and patterns: Randomness rules the stock market

Despite impressive evidence that most short-term movements in the markets are random, professional and amateur investors alike continue to throw hundreds of billions of dollars at strategies designed to beat the market. The common perception is that certain securities are “mispriced”—that is, investors have bid them too high or too low based on their inherent value.The human mind has evolved […]

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Financial gurus can be too simplistic

Best-selling author Suze Orman has become a veritable guru to women (and many men) who want to get a handle on their finances. Through her books, television shows, and personal appearances, Orman has preached a philosophy of financial responsibility and debt reduction. There is no question that her basic message is helpful and important to the many Americans who find […]

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Client Letter – Q1 2007

Please take a moment to remember the 3.3% decline in the Dow, which occurred less than a month ago (and was caused by the sell off in Asian markets).  Now, look at your performance reports.  You’ll notice that your investments are up for the quarter by two to three percent, which is a great quarterly return.  It always amazes me […]

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IRAs are now charitable giving tools

IRA owners who don’t think they will use all of their accounts in retirement have been given a brief opportunity to make charitable gifts directly from their accounts. A temporary tax rule approved this year allows IRA owners who are 70.5 or older to contribute up to $100,000 to a charity without recognizing the contribution as taxable income. Direct contributions […]

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