Strategies

Money illusion is a longstanding concept in economics that has enormous significance for you if you’re a saver, investor or entrepreneur. Money illusion is a ruse performed by central banks that can distort the economy and destroy your wealth. Let me explain.

It was only a few decades ago that currencies around the world were back by gold which meant that whatever piece of money that people used in their day-to-day lives represented a real amount of gold held by that government. Today, the main influencing factors on exchange rates are as illustrated in the infographic below.

Is it time to sell all of your stocks because we’ve seen huge gains over the past five years? Not necessarily. It all depends on your time horizon and what kind of investor you are. Let me explain.

We are not as smart, or as unbiased, as we think. Outside influences can greatly - and adversely - affect our decision making. Here are two ways in which “doing less” can probably "make us more" in our investing lives.

Events and conditions do not make investors behave in any particular way that can be identified as shown in this analysis of the supposed relationship between interest rates and stock prices. So much for the popular claim that "Interest rates drive stock prices"!

There’s no better time than now to start saving for the future. Retirement is becoming longer and more expensive with many costs likely to come out of your own pocket. Here are 4 investment strategies to get you on the right path and give yourself an edge toward meeting your retirement goals.

Extremes eventually reverse, and generally in rough symmetry with their explosive rise and we are reaching such extremes in valuation, complacency and margin debt. When the speculative frenzy dissipates, central banks will be the only buyers left and unless the Fed increases its balance sheet from $4.5 trillion to $14.5 trillion in a matter of months, even central bank manipulation will be swamped by sellers exiting bursting-bubble markets.

As the markets are propelled higher by the successive interventions of the Federal Reserve, it is hard not to think that the current rise will continue indefinitely, but the reality is that markets cycle from peaks to troughs as excesses built up during the up cycle are liquidated...This time...[will be no] different...[so what's an investor to do? Below] are 10 basic investment rules that have historically kept investors out of trouble over the long term [and hopefully will for you as well].

We understand the appeal of passive investing. It offers lower fees and simplicity and many investors are skeptical about the ability of active managers to consistently beat a benchmark...yet there’s also a lot of evidence supporting the benefits of an active approach. Today, we see many risks that are hard to avoid by hugging a benchmark—and opportunities that simply cannot be captured by going passive. While not every point is relevant to every investor, in every market, we can think of ten good reasons to stay active in equities today.

Before placing trades, it’s good practice to review market-moving indicators such as jobless claims, housing starts and sales, consumer confidence, and inflation as they can help you make smarter investments and grow your wealth. Here's a look at each of the above mentioned indicators that you may want to become familiar with.