Immoral Hazard « plumbreport.com

Article Review:

May, 2008

Immoral Hazard

As many of you know, Jeremy Grantham of GMO is one of my favorite financial commentators. His quarterly letter is always on my “must-read” list. This quarter, apropos of this month’s question, he writes a scathing examination of the Fed’s handling of the economy and their role in the current crisis. You can find his article, Immoral Hazard, at GMO’s website (it may require you to register, but it’s free and I have never received any spam as a result of being registered. It’s definitely worth it):

Immoral Hazard

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Tags: economy, Federal Reserve, financial crisis, money supply, personal finance, valuations
Posted in Article Review, Resources and Recommendations, Reviews | No Comments »

What's New

Article Review:
September, 2011
Going to the Johns–Mauldin and Hussman

I’ve mentioned John Mauldin many times in the past and it’s time to do it again. John publishes a free weekly letter that I never miss. It requires registration, but I never receive junk mail as a result of having registered. His latest letter, Preparing for a Credit Crisis, is reason enough to sign up. In this latest missive, John gives us an up-to-the minute overview of the problems and costs facing Europe, the increasing likelihood of a U.S. (global) recession, the outlook for another 2008-style credit crisis and what the average investor might want to think about doing in the face of all of this. Read more…
Book Review:
May, 2011
Debts, Deficits and the Demise of the American Economy

Debts, Deficits and the Demise of the American Economy by Peter Tanous and Jeff Cox is about as close to the book I would write right now as I can imagine. It explains today’s economic mess and the unfolding financial crisis in straightforward language that doesn’t require a degree in economics.

Read more…
Video Review:
January, 2011
Quantitative Easing Explained

A number of subscribers forwarded this video to me and it’s making the rounds in financial circles. If you’re still unclear about the phenomenon I refer to as “Queasing,” this should clear up any questions. Warning: After watching this video, you may not be able to hear the name Ben Bernanke without wanting to call him “The Bernank.” It’s like one of those songs that gets stuck in your head. If you like the absurd, I think you’ll like “Quantitative Easing Explained.”

Plumb's Guide to Investing

Over the years, many people have asked me for investment advice. This section is my answer to the question, “Chip, what are you doing with your portfolio?” It details the portfolio I use to implement my investment strategy— the Plumb Performance Portfolio©

Plumb Performance Portfolio

Further details and return history about the Plumb Performance Portfolio.

Questions & Answers

May, 2011
Q: Can you comment on building positions within the PPP?
June, 2010
Q: How does the gold/silver ratio impact your allocation?
April, 2010
Q: How important is it to adjust my allocations monthly?
January, 2010
Q: What about individual TIPS vs. a TIPS fund?
November, 2009
Q: Do you see REITs as totally miserable?

“...an investor who proposes to ignore near-term market fluctuations needs great resources for safety and must not operate on so large a scale, if at all, with borrowed money. Finally, it is the long-term investor, he who promotes the public interest, who will in practice come in for the most criticism, wherever investment funds are managed by committee or boards or banks. For it is the essence of his behavior that he should be eccentric, unconventional and rash in the eyes of average opinion. If he is successful, that will only confirm the general belief in his rashness, and if in the short run he is unsuccessful, which is very likely, he will not receive much mercy. Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.”

– Lord John Maynard Keynes

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The opinions as to portfolio allocation and specific investment vehicles contained herein are solely the opinions of the author and are not intended to be specific recommendations which would be suitable for every investor. The suitability of any specific investment or recommendation is dependent upon many subjective factors and characteristics of the individual investor including, but not limited to, particular investment objectives, risk tolerance, investment horizon or timeline, net worth, overall portfolio allocation and income needs. Specific investments may be suitable for some investors and yet unsuitable for others due to different needs and objectives. All readers should carefully consider their individual objectives and needs and should consult with their investment and financial advisor as to the suitability of any particular investment. The author specifically disclaims any liability or responsibility for any losses, which may result from any investment or allocation referenced herein.

Immoral Hazard

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