Investing is always an uncertain project, generally undertaken in uncertain times, building with uncertain tools. It’s great if you own shares in Xanax’s parent, Pfizer, but frequently miserable otherwise.

Three factors make the current market a source of epic uncertainty: valuations are historically high, concentration is historically high, and safeguards are historically weak. Let’s agree that by “historically” we mean something like “since modern civilization nearly ended withthe Great Depression,” so about Continue reading →

I propose that those of us over sixty have been blessed with the experience of living through multiple drastic and dramatic pullbacks, which have been real-life stress tests on what we actually feel and do in a financial crisis.  We have personal experience to draw on to pre-plan for the next inevitable drop.

I grew up listening to the stories of the Great Depression and the Dust Bowl from those who lived through them. I graduated from high school during the stagflation of the 1970’s when unemployment was high, and inflation shrank the purchasing power of the dollar. The bursting of the Dotcom Bubble taught us that stocks had not reached a permanent plateau of higher valuations. People shifted focus from the technology bubble in stocks to an emerging bubble in housing, and the Great Financial Crisis resulted from Continue reading →

A friend of mine asked me to write “Perpetual Income for Dummies,” covering a simple portfolio for a conservative investor that generates steady income to cover withdrawals. The objectives of the “Perpetual Income for Dummies” Portfolio are: 1) income of $40,000 for a $1M portfolio in 2016 that rises with inflation, 2) average ten-year annual return of 7%, and 3) minimize the drawdowns during the COVID and TGN bear markets. The unique part of this study is to estimate the income by year as a constraint in a self-constructed optimizer using Excel Solver.

I compare this portfolio with the Vanguard Wellesley Income Fund (VWIAX) and Continue reading →

In celebration of an ancient tradition, recognizing that the new year starts with the arrival in March of spring, we wanted to share our second New Year’s resolution (after “Don’t Underwrite Lobotomies,” 1/2026).

“Yachts” have always been a curious flashpoint in the investor community. A half-century before J.P. Morgan sailed about in his floating palace, The Corsair (versions 1, 2, and 3), yachts were emblems of clueless avarice. The Gilded Age short-seller and noted wit William R. Travers supposedly uttered the question “but where are the Continue reading →