They say a picture is worth a thousand words. In this case, I’d argue that your financial future rides on appreciating the following two drawings by author and Behavior Gap founder Carl Richards. The first illustration illustrates how may investors behave in a volatile market.
When you least expect it, expect it. I seem to remember that line from a1970s sitcom. Perhaps it was an older brother promising revenge on a younger sibling? In any case, as it turns out, those cautionary words aptly describe the results of the Brexit referendum.
When Warren Buffett, the world’s most famous investor, and his number two man Charlie Munger speak, people listen. And this year, more people than ever could listen in because, for the first time, Berkshire Hathaway’s (Berkshire) annual meeting was livestreamed.
It has been well documented that during the Global Financial Crisis (GFC), many individual investors panicked, sold the bulk of their investments and sat in cash waiting to get back into the market. If you asked them, they would tell you they were looking for a “safe” time to get back into the market.
Have you ever received an email purportedly from a friend who is travelling and finds him or herself without a passport and credit card and needs your cash to get back home? Or perhaps you’ve been contacted by someone claiming to be the executor of the estate of a long lost relative or foreign royalty who has millions to share.
This summer, the Dodd-Frank Wall Street Reform and Consumer Protection Act turned five. Enacted in response to the 2007-2008 financial crisis, the law was intended to totally overhaul our nation’s financial regulations. Today, critics say the legislation has resulted in excessive regulations that have hurt small community banks and low-income borrowers.
China’s Central Bank recently devalued the yuan by nearly 3% against the U.S. dollar aiming to give Chinese exporters an advantage. And with the yuan now sitting at its lowest level against the dollar in four years, fears have surfaced that China could launch a currency war to boost its sagging exports. The repercussions across world markets have been staggering.
At the basic level my job is to help clients make better decisions with their money so they have more time to focus on the things that are important to them–the things that will help cement their legacy. For that reason I’m always looking for new material on the subject of decision-making.
On January 2 2013 President Obama signed the American Taxpayer Relief Act of 2012 also known as the Fiscal Cliff Bill into law. While tax rates grabbed all the headlines the bill also included some good news for charities – and for philanthropically inclined Individual Retirement Plan (IRA) owners.
The election. The fiscal cliff. The national debt. The federal deficit. Slow (to nonexistent) economic growth. Chronically high unemployment. Superstorm Sandy the east coast’s Katrina. Impending tax increases. The euro plague leapfrogging from Greece to Spain next perhaps to Italy and even France. The weak dollar. The Federal Reserve continuing to push on a string.