Does it apply to you? — In 1966, American taxpayers hit the roof after hearing that over 100 high-income households paid zero income tax. And many other wealthy individuals paid little tax. The AMT (alternative minimum tax) was created by law in 1969 to assure that even the very wealthy would pay some tax. This attempt…

Should these be in your portfolio? — Let’s get the definitions out of the way. TIPS are Treasury Inflation-Protected Securities which have been issued by the U. S. Treasury since 1997. IABs are Inflation-Adjusted Bonds issued by the U. S. Treasury and other countries. TIPS were issued to protect investors against inflation. The principal of a TIPS…

Some thoughts. — When the stock market drops 20% from a recent high, it’s said to have fallen into a bear market. And recently it’s done that. But what does such a large drop mean for the average investor? How long do bear markets usually last? How bad could a bear market get…

Do the Federal Reserve policies aimed to tame inflation guarantee a recession? — In order to put a stop to inflation, the traditional way is for the Federal Reserve to use one of its powerful tools. Raise interest rates. The theory is that major purchases (cars and houses for consumers, and machinery and equipment for the business sector) typically become more expensive as…

Economists weigh in with some statistics. — Prices have been increasing at rates not seen for over 40 years. Simply put, what cost you $15 thirty years ago, will cost you $60 today. A few prices (gasoline) have fallen recently, housing prices are settling down, and some travel costs are down. But they are the outliers. Food…

Here’s some free advice. — Someone once asked the Oracle of Omaha, Warren Buffett, why doesn’t everyone invest like you do and become rich? His answer was that few have the patience that he has. Most want instantaneous riches and that only happens with relatively few people. Good advice when the stock market falls-patience. It…

Can using this theory help you make better economic and financial decisions? — Let’s start with some definitions. Qualitative research. Qualitative research gets data and information directly from others. For example, case studies, interviews, questionnaires, observation, and documents. The data is usually nonnumerical. Subjectivity. This refers to how your opinion, biases, and feelings are affected by outside influences. So, someone growing up in…

Better safe than sorry. — Is the stock market going to crash? Who knows? Depending on which forecaster you follow the answer is maybe yes, maybe no. One thing is certain, however, the market’s going to fluctuate. In any event, it’s better to be prepared for a crash, just in case. There’s no specific definition…

A interesting approach to investing. — Buying stocks is usually based on fundamental analysis, technical analysis, friends’ recommendations, hot tips, social media rants, and other reasons. The newest fad on the street is ESG investing. It is becoming popular with large investors such as pension funds, but also some small investors use it trying to achieve…