Continued . . . Opportunity: One can make much money by (a) choosing the right investments or by (b) shunning the poor ones. In many cases poor investment decisions could have been entirely prevented by heeding John Farnam’s Three Rules: (1) Don’t go to stupid places; (2) With stupid people, (3) And do stupid things.…
Information, not Advice #20 Continued . . . The Energy Crisis Recession of 1980 – Duration: 6 mos. GDP Decline: 2.2%. Peak Unemployment: 7.8%. 10 yr T-Note Beg 10.80% / End 10.25%. Inflation reached a bit over 11% and the Federal Reserve, not unsurprisingly, raised interest rates to slow money supply growth. When money…
Background: Ultimately, if one looks deeply enough, the market value of an investment is a function of interest rates. Market value is a specific term, and neither price nor cost is a complete synonym. How often does someone buy a new car at full MSRP? And, technically, cost is what you buy something for minus…
Continued . . . In the mid 1600’s the Dutch Republic was beginning its climb to global power. The Dutch traders, having a monopoly of trade with Japan and the East Indies, had become the middlemen between European nations and the Far East. For a period, Amsterdam’s population was doubling every 20 years (an annual…
Continued from Part 1… The late 1500’s, following the Eighty Years War, and most of the 1600’s were Amsterdam’s apogee. It was then, no longer concerned with Spanish warships, that Dutch merchantmen sailed over most of the known world, alert for new sources of rare spices. They returned from Indonesia with pepper, cloves and nutmeg.…