Today is the 50th anniversary of the "Nixon shock", the day President Richard Nixon closed the gold window and ended the post-WWII Bretton Woods currency agreement. That agreement, largely a product of John Maynard Keynes, pegged the dollar to gold and most other currencies to the dollar. It wasn't a true gold standard as only other countries that were party [...]
There is no change to the risk budget this month. For the moderate risk investor the allocation to bonds is 50%, risk assets 45% and cash 5%. We have had continued volatility since the last update but the market action so far is pretty mundane. The initial selloff halted at the 200 day moving average and the rebound carried to [...]
If man is not to do more harm than good in his efforts to improve the social order, he will have to learn that in this, as in all other fields where essential complexity of an organized kind prevails, he cannot acquire the full knowledge which would make mastery of the events possible. He will therefore have to use what [...]
The Law Of Unintended Consequences, often cited but rarely defined, is that actions of people - and especially of government - always have effects that are unanticipated or unintended. Economists and other social scientists have heeded its power for centuries; for just as long, politicians and popular opinion have largely ignored it. Rob Norton, The Concise Encyclopedia of Economics There [...]
The US stock market rose 2% last week based primarily on the perceived wisdom of various central economic planners around the world. Mario Draghi announced a new bond buying program in Europe designed specifically to circumvent the verdict of the market and prop up the governments of the peripheral countries. There are conditions which the beggar countries must meet before [...]
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