In September 1997 our parent, the American Institute for Economic Research (AIER), in its Research Reports, assessed the state of the world’s fiat currencies at the time and observed that the dollar then stood as “The World’s Tallest Dwarf.” The dollar’s claim to that title is now in question. Following its inception in 1999 the […]

The Producer Price Index rose by 1.7 percent in October, the largest monthly increase since 1990. It remains to be seen whether this signals a trend that will spiral. But investors who follow our approach can rest assured. Our parent, the American Institute for Economic Research (AIER), has long warned of the inherent decline of

We have written a great deal about the debate between active and passive money management, and the topic is now getting attention from the broader financial media. A recent front-page article in the Wall Street Journal (October 18, 2004 “As Two Economists Debate the Markets, The Tide Shifts” ) provided a summary of the debate,

“In recent years, with the U.S. stock market regularly providing returns well into the ‘double digits,’ we suspect that many investors have overlooked the importance of costs. Should the market revert to its long-term average, the impact of these costs will be more apparent.”—Investment Guide, February 2001 If recent trends are any indication, we were

The Wall Street Journal warned in early May that “Nearly everyone agrees the bond market will take a hit when the Federal Reserve starts raising interest rates, perhaps as early as next month.” The Fed did in fact raise the target federal funds rate from 1.00 percent to 1.25 percent on June 30, but the

Not long ago, during the late 1990s, tech stocks were all the rage and common stock dividends were regarded by many to be archaic. But sentiment changes quickly; on July 20 Microsoft announced an unprecedented onetime payout of $32 billion to shareholders, or $3 per share, and doubled its regular dividend to $0.32 per share.

Price inflation is back, if the pundits have it right. Until very recently the financial media was awash in warnings of “deflation.” Now, in the face of rising energy and food prices, and with statistical indicators increasingly pointing toward stronger economic growth, price inflation is back in the news. In our view, monetary inflating is

The month of April ushered in news signaling very solid economic growth, and the bond market responded by sending interest rates to their highest level in a year, as shown in the first chart below. Conservative investors who have structured their portfolios in accordance with our recommendations might be anxious about the decline in their

On April 8 the 30 component companies of the venerable Dow Jones Industrial Average (DJIA) were changed for the first time since 1999. Eastman Kodak, AT&T, and International Paper were dropped while Pfizer, Verizon and American International Group (AIG) were added. Although two of the firms that were replaced were in our high-yield Dow model,

The highly publicized case against Martha Stewart has focused attention on the notion of insider trading. These events, as well as the trend described by the Wall Street journal article reprinted herein, serve as a reminder that individual investors are not well served by stock picking. The capital markets assimilate information with stunning efficiency. This