September 27, 2006: The Federal Reserves discount rate increased from 3.75% to 4.00% with the latest rate hike. The rationale for hiking rates is soaring inflationary expectations driven by a supply-side economic shock. The economic shock is mainly due to gas and oil shortages and tariffs. U.S. and global bond yields are rising. This is… Continue reading September Stock and Fund Picks
Category: Economic Theory
April 2026 Stock and Fund Picks
April 24: The current state of the economy is full of cross-currents and therefore difficult to assess. For example, Fidelity Viewpoints notes that: Higher oil prices have seeped into consumer confidence, according to the latest University of Michigan survey. The April consumer confidence report’s headline index fell to 47.6, an all-time low, which was down… Continue reading April 2026 Stock and Fund Picks
March 2026 Stock and Fund Picks
March 18, 2026: Stronger stagflation winds blow due to increasing supply-side shocks. We now have both the internal policy shock of tariffs (or taxes) plus the external oil supply shock due to the completely unplanned-for Strait of Hormuz problem. Increases in unemployment due to slowing economic growth and inflationary pressures are therefore imminent. A Schwab… Continue reading March 2026 Stock and Fund Picks
February 2026 Stock and Fund Picks
January 20: We continue to be worse off. Data on wages shows a secular decline as indicated in the following table. The wage growth rate is down significantly from its near-term peak more than 3 years ago (although it is still positive), according to the Atlanta Fed Wage Growth Tracker. Since peaking at 6.7% in… Continue reading February 2026 Stock and Fund Picks
September Update
September 24, 2025: We just moved from one state to another and I have been unable to keep up the blog until now. Because I have a Ph.D. in economics and a much vaster knowledge base in the areas of this subject, I can make predictions that will happen in the future with a high… Continue reading September Update
July 2025 Stock and Fund Picks
July 24: Election cycle theory suggests that the negative effects of Trump’s tariff policy will not fully set in until the beginning of next year. Thus, we can expect that the stock market will remain on relatively steady footing until then. On the other hand, Trump’s fight with Fed chair Powell has some very negative… Continue reading July 2025 Stock and Fund Picks
April 2025 Stock and Fund Picks
April 3, 2025: The “effect [of reciprocal tariffs] will be lower economic growth, higher inflation, higher unemployment, the destruction of wealth and a tax increase on American families,” economist Jason Furman, a former chairman of the White House Council of Economic Advisers, recently explained. “It will deal a blow to the rules underlying the global trading… Continue reading April 2025 Stock and Fund Picks
November Stock and Fund Picks
Socio-Economic Aspects of Election History: I was mortified when Richard Nixon was voted back into his second presidential term. But then I realized that most people were afraid of communism’s spread and wanted protection from it. Moreover, those who could perceive what Watergate would become were very much in the minority. There are some parallels… Continue reading November Stock and Fund Picks
Warren Buffet explains the wealth gap
An advanced market economy Buffett believes the market economy has become more and more “specialized” with “economic rewards flowing to people with specialized talents.” This, he says, has caused the wealth gap with many people barely getting by while others thrive. “It was an agrarian economy a couple hundred years ago,” he said in an… Continue reading Warren Buffet explains the wealth gap
March 2024 Stock and Fund Picks
March 21: Not exactly surprising that the Fed’s dot plots indicate 3 rate cuts this year. The now dovish sounding Fed has no choice but to cut rates. It claims it also wants to slow its balance sheet run off which is a more complicated process than what it might seem. Nevertheless, slowing its balance… Continue reading March 2024 Stock and Fund Picks