It has been one heck of a ride in US stocks since the "Covid Crash" lows. The S&P 500 index* is up just shy of 100% since March 23rd 2020. In 2021, the S&P 500 continues to rise and has yet to sell off more than 5% at any point - offering a very smooth …
The Only Winning Move
Have you ever seen the movie War Games (1983)? The film, which stars Matthew Broderick, Dabney Coleman, John Wood, and Ally Sheedy, follows David Lightman (Broderick), a young hacker who unwittingly accesses a United States military supercomputer programmed to predict and execute nuclear war against the Soviet Union*. At the end of the movie (spoiler alert!), the supercomputer realizes that the many different scenarios (games) involving …
The Inflation Boogeyman
Inflation is on the minds of investors as February 2021 comes to a close. As you can see in the chart below, inflation expectations have risen sharply from the COVID lows to the highest level since 2013*. Of course, this is "expected" inflation over the next five years and not actual inflation which is currently …
Three Key Investing Charts For 2021
As the 2021 investing year gets going, I thought I would post a few charts* that I think are important for investors this year. The first chart is a one year chart of the relative performance of the S&P 500 when compared to non-US stocks. We can see that US stocks have significantly outperformed non-US …
The Optimism Bias
I am currently reading a book titled "The Optimism Bias: A Tour of the Irrationally Positive Brain" by Tali Sharot (see below for Amazon link). The Optimism Bias is simply: "our tendency as humans to overestimate the probability of positive events and underestimate the probability of negative events". The author believes that the human brain …
