Major Upgrades to the Site

This morning, I woke up to find that the private server on which my site is hosted had been overwhelmed by incoming traffic.  Since this has always been a nice side-project to me (throughout the day, as I work in the office I can talk about whatever is on my mind to take a break), [...]

from Joshua Kennon

Free Trade Isn’t Always Fair Trade

A few days ago, I wrote a five-part essay called How to Solve the Trade Deficit in response to a reader question about trade policy in the United States. The reader, Adam, responded on his blog.  Here is my followup to his commentary. I Would Love to Run Trade Surpluses But It Isn’t Going to [...]

from Joshua Kennon

Mental Model: Veblen Goods

In today’s installment of our mental models catalog, we are going to discuss Veblen goods, which are a special type of item that would appear, at first glance, to violate the law of supply and demand relationships to prices. Veblen goods are a type of commodity, product or service for which demand increases the higher [...]

from Joshua Kennon

A Reader Question About the Trade Deficit

A message from a reader named Adam about the trade deficits.  I responded in a five-part essay on How to Solve the Trade Deficit. Joshua, I follow your personal blog, and find your articles very informative, it’s a great reference, and you inspire me, as I feel I am very similar to you, minus the [...]

from Joshua Kennon

PPL Corporation Stock Risk Analysis

This is a risk analysis of PPL Corporation stock for a friend of mine that was hired by the company.  Those of you who want to know how I think about risk management are perfectly welcome to read it but it is specifically targeted so I’m not sure how useful you’ll find it. I’ve worked [...]

from Joshua Kennon

Mental Model: Satisficing

Satisficing: A psychological and economic phenomenon that results from consumers choosing a product that meets criteria at an adequate level, rather than expending a great deal more time to find a fully optimal solution. Put another way, people are not looking for optimal solutions in their life.  They are looking for a combination of “just [...]

from Joshua Kennon

The Bosendorfer Strauss Grand Piano – A Real Life Lesson in the Time Value of Money

The Opportunity Cost of a Bosendorfer Strauss Grand Piano I’m going to teach you a financial technique that can help empower you to make informed choices about your own life and keep more cash in your pocket.  I’ve been using it since college and it’s done wonders from my bank balance and investments. From the [...]

from Joshua Kennon

John Templeton and Value Investing

John Templeton was a billionaire mutual fund pioneer that specialized in using a value investing strategy to buy stocks around the world.  By practicing a disciplined version of Benjamin Graham’s teaching on a global scale, Templeton amassed an astounding record that made shareholders of his fund wealthy and earned him hundreds of millions of dollars [...]

from Joshua Kennon

Earnings Yield as a Value Investing Strategy

Many famous portfolio managers that practice a value investing strategy have said they think of stocks as “equity bonds”.  Instead of receiving a fixed rate of return, like you would when you buy a traditional bond, you receive a variable return based on the company’s underlying profit.  This approach makes it easier to value a [...]

from Joshua Kennon

Why Income Inequality Will Always Exist as Part of the Post-Industrial Revolution Global Economy

First: Before we begin, the education system in the United States over the past few decades has done such a poor job teaching basic logic that by virtue of the headline alone, it is statistically likely that you have already made a decision about whether or not this short essay on pay inequality is “good” [...]

from Joshua Kennon

The Psychology of Human Misjudgment by Charlie Munger

By Charlie Munger (Warren Buffett’s partner at Berkshire Hathaway) Speech at Harvard Law School (1995) Transcription of The Psychology of Human Misjudgment, comments [in brackets] by Whitney Tilson.  Note from Joshua Kennon: I’ve written a lot about Charlie Munger over the years, especially the influence he has had on my life and how we run [...]

from Joshua Kennon