Imagine that you face the following pair of concurrent decisions. First examine both decisions, then make your choices. Decision (i): Choose between A) Sure gain of $240 B) 25% chance to gain $1,000 and 75% chance to gain nothing Decision (ii): Choose between C) sure loss of $750 D) 75% chance to lose $1,000 and 25% chance to lose nothing What’s your decision?
And that’s OK. This is exactly what the tariff should result to (at least part of the intention). The tariff episode is really a mean to an end to get to the final objective when countries will lower or eliminate the tariff all together. However, given the disparity of development in different nations, the “grand”… Read More »
In the past week, almost all major news outlets are publishing their “10 year” series: 10 years since the collapse of Lehman Brothers, 10 years since the past financial crisis etc. It was probably nice to write those events into history textbooks and read about them once in a while. However, I have to remind… Read More »
Recently I read about an interesting experiment from the book “Thinking, Fast and Slow”. It is about the way our brain works and how to utilize more of your System 2 and constantly checking against the usual intuitions and stereotypes created by System 1. (System 1 is the part of the brain that is giving… Read More »
Trade: tariffs are always a mean to the end and it should never be the end Despite various headlines lately on tariffs, and for a while, it seems that US is “picking a fight” with the rest of the world (or at least with the countries that are running a trade surplus against US), such… Read More »
“Superinvestor” Warren E. Buffett, who got an A+ from Ben Graham at Columbia in 1951, never stopped making the grade. He made his fortune using the principles of Graham and Dodd’s Security Analysis. Here, in celebration of the 50th anniversary of that classic text, he tracks the records of investors who stick to the “value… Read More »
The past week has been nothing short of major news, and yet S&P 500 ended the week effectively flat. First was the spat at G7: I guess Justin should have given Don a heads-up: ” by the way Don, I have to act tough in the press conference so I may use some words that… Read More »
This was a question to me the past week from a Co-CEO of a major asset management firm. The embedded message was almost: since we are in the late stage of a cycle, what’s your approach to investing? Coincidentally, Warren Buffett used a baseball metaphor last week when asked the same question: the economy is… Read More »
We live in a very “noisy” world. The news media used to be on a weekly or daily publication cycle and now it is up to the minute thanks to widespread of social media channels. The actions to buy or sell securities used to be difficult and expensive, and required a telephone call to a… Read More »
Buy low and sell high I know it looks easy. However, in reality, it is much harder than it looks. People can be a perfect bargain hunter when it comes to everything in life, except stocks or investment opportunities. I have seen folks looking for the best electronic gadgets deal they can find (“50% off… Read More »