tag:blogger.com,1999:blog-121319522024-03-18T08:57:44.059-04:00Trust and Wealth Management MarketingNotes for trust officers, private bankers and others concerned with estate and trust planning, from a Merrill Anderson Senior Editor and his retired mentor.Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.comBlogger3038125tag:blogger.com,1999:blog-12131952.post-49533016391533396462024-03-05T11:08:00.002-05:002024-03-05T11:08:22.918-05:00The financial time bomb no one is discussing<p><a href="https://www.cnbc.com/2024/03/01/the-us-national-debt-is-rising-by-1-trillion-about-every-100-days.html"> The explosive growth of the national debt.</a></p><p>In the absence of fiscal restraint, the interest rate for servicing this debt can only go higher. As interest rates go higher, the debt gets bigger, even if other federal spending is held constant—which it won't be. Both Republicans and Democrats will vote for higher deficit spending, the only question is how much higher.</p><p>This path is not sustainable. A bipartisan agreement removed the debt limit entirely, but only until next January. The next President will have the mother of all financial calamities to deal with.</p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-15609411538657580862024-02-14T16:29:00.002-05:002024-02-14T16:29:23.664-05:00Yale beats Harvard again<p>Baylor scores high for endowment returns, according to the <a href="https://www.wsj.com/finance/investing/the-small-university-endowment-that-is-beating-the-ivy-leagues-8ce37cf1?st=cspgyp9l2q4vg1t&reflink=desktopwebshare_permalink" target="_blank">Wall Street Journal</a>.</p><p>But why are these multibillion dollar funds tax free, and my personal investments are not? The tax-free sector has gotten much too large for a healthy economy,</p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-86394301299299781152023-06-06T01:07:00.004-04:002023-06-06T01:07:46.738-04:00How does our national debt stack up?<p> I ran across <a href="https://www.imf.org/external/datamapper/CG_DEBT_GDP@GDD/USA">an interesting IMF dataset </a>on the debts of central governments, which is timely considering the latest from Congress on our national debt.</p><p>In GDP terms, we have one of the highest national debts in the world, at 115% of our GDP (2021 data, could be higher by now). Japan has an astonishing 212% debt ratio. At the other end of the scale stands Norway with just 15.75%. Germany has a more manageable 46%. I'm uncertain that having a debt larger than the economy is sustainable.</p><p>Here's a short excerpt from the IMF's more complete table:</p><p class="MsoNormal" style="font-family: Cambria, serif; margin: 0in;"><b><span style="font-family: "Times New Roman", serif;">Country by country, national debt as a percentage of GDP<o:p></o:p></span></b></p><table border="1" cellpadding="0" cellspacing="0" class="MsoTableGrid" style="border-collapse: collapse; border: none; color: black;"><tbody><tr style="height: 15.1pt;"><td style="border: 1pt solid windowtext; height: 15.1pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">Canada<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: solid solid solid none; border-top-color: windowtext; border-top-width: 1pt; height: 15.1pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">55.55%<o:p></o:p></span></p></td></tr><tr style="height: 14.25pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 14.25pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">Mexico<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 14.25pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">40.67%<o:p></o:p></span></p></td></tr><tr style="height: 15.1pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 15.1pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">Germany<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 15.1pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">46.27%<o:p></o:p></span></p></td></tr><tr style="height: 15.1pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 15.1pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">Italy<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 15.1pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">146.55%<o:p></o:p></span></p></td></tr><tr style="height: 14.25pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 14.25pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">United Kingdom<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 14.25pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">102.97%<o:p></o:p></span></p></td></tr><tr style="height: 15.1pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 15.1pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">Norway<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 15.1pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">15.75%<o:p></o:p></span></p></td></tr><tr style="height: 15.1pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 15.1pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">Japan<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 15.1pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">221.32%<o:p></o:p></span></p></td></tr><tr style="height: 14.25pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 14.25pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">India<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 14.25pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">54.27%<o:p></o:p></span></p></td></tr><tr style="height: 15.1pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 15.1pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">Australia<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 15.1pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">43.95%<o:p></o:p></span></p></td></tr><tr style="height: 14.25pt;"><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-left-color: windowtext; border-left-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid; height: 14.25pt; padding: 0in 5.4pt; width: 123.1pt;" valign="top" width="164"><p class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in;"><span style="font-family: "Times New Roman", serif;">United States<o:p></o:p></span></p></td><td style="border-bottom-color: windowtext; border-bottom-width: 1pt; border-right-color: windowtext; border-right-width: 1pt; border-style: none solid solid none; height: 14.25pt; padding: 0in 5.4pt; width: 108.75pt;" valign="top" width="145"><p align="right" class="MsoNormal" style="font-family: Cambria, serif; font-size: 12pt; margin: 0in; text-align: right;"><span style="font-family: "Times New Roman", serif;">115.28%<o:p></o:p></span></p></td></tr></tbody></table>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-16804361546208554402023-04-27T18:48:00.002-04:002023-05-25T18:01:20.265-04:00A Timely Guide to Banking, and Why Banks Fail<p>Wealth meanagers and their clients couldn’t ask for a better pocket guide to banking than<a href="https://www.americanheritage.com/bank-failures-american-apple-pie"> Bank Failures: as American as Apple Pie</a>, by veteran financial historian John Steele Gordon. Although the article appears in the latest online issue of the once beloved American Heritage magazine, the closing section suggests Gordon may have written it in the wake of the S&L crisis. Even so, this quick, readable trip through financial history is timely. Especially this century-old quote from Walter Bagehot:</p><p><span style="background-color: white; color: #3f3f3f; font-family: inherit; orphans: 2; widows: 2;">“Every banker knows that if he has to prove that he is worthy of credit, however good may be his arguments, in fact his credit is gone.” </span></p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-71501844929257887462023-04-14T18:07:00.002-04:002023-04-15T17:13:52.672-04:00The January in April Mystery<p>This full-page ad keeps popping up in our local paper, and that’s downright odd for several reasons: </p><p>1. Hardly anybody runs full-page newspaper ads these days. January’s stands out like a a sumo wrestler at a toddler's birthday party.</p><p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgDKhSYX118LJjMxmP0lOCq0dMx39ZiXGtPbiQqwb8B9A-rLpLu8mjfyj6Obu6Emc-Lb9NXWYDx6mavq7ZhOGlvAlUxM61uP1DdsdLLiQ6lrXq6xNTZt1XS77KXyzzbm41ZtiVcG4cFif-xAAZdBNK29jbu2GUlAE-CYdsOPGBRZSx8pKOrdo8/s3340/january%20cap%20copy.jpg" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" data-original-height="3340" data-original-width="1632" height="850" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgDKhSYX118LJjMxmP0lOCq0dMx39ZiXGtPbiQqwb8B9A-rLpLu8mjfyj6Obu6Emc-Lb9NXWYDx6mavq7ZhOGlvAlUxM61uP1DdsdLLiQ6lrXq6xNTZt1XS77KXyzzbm41ZtiVcG4cFif-xAAZdBNK29jbu2GUlAE-CYdsOPGBRZSx8pKOrdo8/w410-h850/january%20cap%20copy.jpg" width="410" /></a></div>2. January Capital Advisors is based in San Francisco and run by three broker/advisor/insurance agents. The company offers wrap programs and individually managed accounts. As of three years ago they managed about $161 million. Why are they seeking clients on the Atlantic seaboard?<br /><p></p><p>3. In these volatile times, investment advisers brave enough to tell nervous wealth holders, “Don’t just do something, stand there!” have gained admiration. Number crunchers point out that active trading and market timing are good therapy but too often bad for wealthbuilding. According to its Form ADV, January seems to prefer high portfolio turnover, guided in part by technical analysis, with holding periods of a year or less. In other words, don’t stay the course.</p><p>4. January is awfully late to the party. This area, known for its relative affluence, is drastically overstocked with investment advisers and wealth planners. Hundreds and hundreds! Maybe thousands.</p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-56057793424055092232023-03-16T18:01:00.009-04:002023-04-22T21:31:52.652-04:00 How Siri Became Apple’s Bad AppleTwelve years ago I fell in love with Siri, the virtual-assistant app that Apple had just added to the iPhone. <a href="https://trustmarketing.blogspot.com/2011/10/secretary-30.html">Secretary 3.0</a>, I called her. My feelings were widely shared. <a href="https://www.nytimes.com/2011/10/12/technology/personaltech/iphone-4s-conceals-sheer-magic-pogue.html?_r=1&hp">David Pogue</a> gave her a rave review. Siri, <a href="https://archive.nytimes.com/bits.blogs.nytimes.com/2011/10/05/siri-and-apples-future/?searchResultPosition=3">Steve Rohr wrote</a> in The New York Times, "represents the future of Apple as a business.”<p style="orphans: 2; widows: 2;"><span style="color: #333333; font-family: georgia, times new roman, times, serif;">Sure glad he was wrong about that!</span></p><p style="orphans: 2; widows: 2;"><span style="color: #333333; font-family: georgia, times new roman, times, serif;">Unlike like the smart young secretary who typed her way up, Siri never evolved. Now she’s a middle-aged drudge. Her cousins, Alexa and Google Assistant, aren't much better. (To be fair, Alexa will tell me the time of the next high tide when I ask her. Siri diffidently offers me a tide chart and expects me to figure it out myself.) </span></p><p style="orphans: 2; widows: 2;"><span style="color: #333333; font-family: georgia, times new roman, times, serif;">Clunky coding (perhaps dating back to a Pentagon project in Siri’s case) and poor strategy doomed Siri and her ilk. See this new Times <a href="https://www.nytimes.com/2023/03/15/technology/siri-alexa-google-assistant-artificial-intelligence.html?action=click&module=Well&pgtype=Homepage&section=Technology" style="caret-color: rgb(51, 51, 51);">report</a>. Now the enthusiasm once showered on these early attempts to make Artificial Intelligence useful is lavished on far more powerful A.I. tools, like chatbots.</span></p><p style="orphans: 2; widows: 2;"><span style="color: #333333; font-family: georgia, times new roman, times, serif;">What about it, Apple? Could you get it right this time?</span></p><p style="orphans: 2; widows: 2;"><span style="color: #333333; font-family: georgia, times new roman, times, serif;"></span></p><i><div style="text-align: center;"><i><a href="https://www.merriam-webster.com/words-at-play/one-bad-apple-spoil-the-barrel-metaphor-phrase">One ‘Bad Apple’ Can Spoil a Metaphor</a></i></div></i>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-86987665664398037172023-01-14T21:12:00.001-05:002023-01-14T21:21:52.967-05:00Ups and Downs of the Rule Against Perpetuities<p> The Rule Against Perpetuities was born in Tudor England, as <a href="https://www.smithsonianmag.com/history/tudor-roots-billionaires-philanthropy-charity-180981441/">this Smithsonian item</a> reminds us. Charitable funds were exempted by Queen Elizabeth I. In this country the Rule, as applied to family transfers, has now weakened or vanished in a number of states. Dynasty trusts turn out to be an easy sell. </p><p>Should the Rule again apply to great family wealth? What about charitable foundations? </p><p><a href="https://trustmarketing.blogspot.com/search?q=Brooke+Astor">Brooke Astor</a>, known for her philanthropy, disapproved of perpetual funds. Her favorite Thornton Wilder quote: "Money is like manure. It should be spread around." </p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-54298637365839595412022-12-25T16:10:00.002-05:002022-12-25T16:10:44.974-05:00A wonderful Christmas tradition<p><a href="https://www.sanluisobispo.com/entertainment/article270398307.html"> Dave Barry's Year in Review. </a> </p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-13694736518854555062022-09-21T09:57:00.000-04:002022-09-21T09:57:55.504-04:00“Your 401k Isn’t Drowning"<div style="text-align: left;">Twitter exchange worth noting:</div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span style="font-family: arial;"><b>Debbie B</b> <br /></span><span style="font-family: arial;">So much for hubby retiring soon...our 401 is drowning</span></div><div style="text-align: left;"><span style="font-family: arial;"><br /></span></div><div style="text-align: left;"><b><span style="font-family: arial;">DelzioEdward<br /></span></b><span style="font-family: arial;">Don’t look at the balance, look at how many more shares it buys at double-digit discounts when it automatically reinvests your Q3 dividends next week.</span></div><p style="text-align: left;"><span style="font-family: arial;">Your 401k isn’t drowning, it's diving for treasure.</span></p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-48499064955389354322022-05-23T22:14:00.005-04:002023-04-15T17:20:54.412-04:00Old Wall Street’s Preserved Fish<p><i>What early New York financier’s name described pickled herring, finnan haddie and other storable seafood?</i></p><p>That was the question posed by WQXR’s Know-It-All New Yorker contest this week. Answer: Preserved Fish.</p><p>Born in 1766, Preserved (a Quaker name, properly pronounced “Pres-ser-ved”) left the farm to become cabin boy on a whaling ship. By age 21 he was a ship’s captain. By his 40’s, whale oil had made him rich enough to move to New York, where he and a cousin started a shipping company. Preserved helped found the New York Exchange Board (forerunner to The New York Stock Exchange) and in 1829 became president of the Tradesman's Bank of New York. </p><p>More on Preserved Fish<a href="https://politicalstrangenames.blogspot.com/2011/07/preserved-fish-1766-1846.html"> here</a>.</p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-57486856592465592692022-05-09T18:28:00.002-04:002022-05-09T18:32:13.039-04:00Some People Have Big Bezzles<p> Today’s Axios Markets pointed me to a<a href="https://www.axios.com/2022/05/09/bull-market-bezzle-end"> Felix Salmon column</a> where I learned a new word. Here’s the gist:</p><blockquote>When markets turn, more investors tend to want to take their money out. That's when victims of fraud find out the money has disappeared. The Bernie Madoff fraud is a prime example — it couldn't survive the downturn of 2008, since the higher Madoff marked his clients' positions, the more likely they were to want to cash out.<br /><br />Until the point of discovery, the money is gone, but the victim feels no loss. Economist John Kenneth Galbraith, writing in 1955, named this "net increase in psychic wealth" the bezzle, and explained that it invariably increases in bull markets, only to shrink when "money is watched with a narrow, suspicious eye.”<div><br />As John Mills <a href="https://archive.org/stream/oncreditcyclesor00manc/oncreditcyclesor00manc_djvu.txt">wrote</a> in 1867: "Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works."</div></blockquote><p>No, Salmon’s column does not mention NFTs.</p><div></div>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-36761920882028845192022-04-26T22:19:00.002-04:002022-04-26T22:24:31.387-04:00Bitcoin: Thumbs Up or Thumbs Down?<div><b><br /></b></div><b>THUMBS UP</b><br /><div>Later this year, the 23,000 companies that use Fidelity to administer their retirement plans will be able to offer Bitcoint as as<a href="https://wallstreetjournal-ny-app.newsmemory.com/?publink=3df7567d6_134842e"> investment option.<br /></a><br />“There is a need for a diverse set of products and investment solutions for our investors,” says a Fidelity spokesman. “We fully expect that cryptocurrency is going to shape the way future generations think about investing.”<div><br /></div><div><b>THUMBS DOWN</b></div><div><span style="background-color: white; color: #303030; font-family: inherit; orphans: 2; widows: 2;">Years ago, tech writer Glenn Fleishman thought cryptocurrency might be among the most exciting and important innovations in technology and finance. His thinking has since evolved to </span><a href="https://tidbits.com/2022/04/20/understand-cryptocurrency-but-dont-invest-in-it/" style="font-family: inherit; orphans: 2; widows: 2;">provisional cynicism.</a><p><span style="background-color: white; color: #303030; font-family: inherit; orphans: 2; widows: 2;">"Cryptocurrency is on everyone’s lips,” he writes, "but it should be in no one’s virtual pockets. </span><span style="color: #303030; font-family: inherit; font-variant-ligatures: normal; orphans: 2; text-decoration-thickness: initial; widows: 2;">An overhyped form of imaginary value storage, it has all the disadvantages of cash, suffers from all the volatility of an overhyped penny stock, and consumes more power than a mid-sized European nation. Although it has been vaunted as untraceable, anonymous, and beyond the reach of governments, none of that is true. Law enforcement agencies have used cryptocurrency to </span><a href="https://www.justice.gov/opa/pr/two-arrested-alleged-conspiracy-launder-45-billion-stolen-cryptocurrency" rel="null noopener" style="box-sizing: border-box; color: #265281; font-family: inherit; font-variant-ligatures: normal; orphans: 2; touch-action: manipulation; transition: all 0.5s cubic-bezier(0.405, 0, 0.195, 1) 0s; widows: 2;" target="_blank">take down crime rings</a><span style="color: #303030; font-family: inherit; font-variant-ligatures: normal; orphans: 2; text-decoration-thickness: initial; widows: 2;">, </span><a href="https://www.wired.com/story/tracers-in-the-dark-welcome-to-video-crypto-anonymity-myth/" rel="null noopener" style="box-sizing: border-box; color: #265281; font-family: inherit; font-variant-ligatures: normal; orphans: 2; touch-action: manipulation; transition: all 0.5s cubic-bezier(0.405, 0, 0.195, 1) 0s; widows: 2;" target="_blank">stop people from exchanging child sexual abuse material</a><span style="color: #303030; font-family: inherit; font-variant-ligatures: normal; orphans: 2; text-decoration-thickness: initial; widows: 2;">, and seize </span><a href="https://www.justice.gov/opa/pr/department-justice-seizes-23-million-cryptocurrency-paid-ransomware-extortionists-darkside" rel="null noopener" style="box-sizing: border-box; color: #265281; font-family: inherit; font-variant-ligatures: normal; orphans: 2; touch-action: manipulation; transition: all 0.5s cubic-bezier(0.405, 0, 0.195, 1) 0s; widows: 2;" target="_blank">massive amounts of Bitcoin and other currencies</a><span style="color: #303030; font-family: inherit; font-variant-ligatures: normal; orphans: 2; text-decoration-thickness: initial; widows: 2;">."</span></p><p><span style="background-color: white; font-variant-ligatures: normal; orphans: 2; text-decoration-thickness: initial; widows: 2;"><span style="font-family: inherit;">Personally, I think NFTs are a speculative fad that possess useful features. Bitcoin is a speculative fad that ...?</span></span></p></div></div>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com1tag:blogger.com,1999:blog-12131952.post-57947061161732742342022-02-04T12:46:00.000-05:002022-02-04T12:46:51.820-05:00“Take that, Exxon! Shove off, Chevron!”<p>Last summer Yale issued a list of fossil fuel stocks in which it would no longer invest. <a href="https://trustmarketing.blogspot.com/2021/06/yale-divests-some-oil-stocks.html">Conspicuously absent:</a> Exxon and Chevron. Since then, shares in the two largest oil companies have produced significant gains for investors. This apparently inspired divestment activists to redouble their efforts, for both Exxon and Chevron have now been<a href="https://yaledailynews.com/blog/2022/02/01/exxonmobil-and-chevron-deemed-ineligible-for-yale-investment/"> added to the list </a>of stocks in which the Yale endowment must not invest. </p><p>Exxon and Chevron shares are to be shunned because the companies fail to give enough support to climate-change regulations and climate-change science.</p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-53802018289737641882022-01-11T21:07:00.003-05:002022-01-12T18:12:41.917-05:00 Disaster Insurance for Billionaires<p>What will happen if the crazies take over and inflation goes hyper, turning dollars into pennies? A few billionaires are<a href="https://www.bloomberg.com/news/articles/2022-01-01/billionaires-dalio-peterffy-embrace-bitcoin-ethereum-as-inflation-hedge"> worried enough</a> to go long on bitcoin. Some choose other cryptocurrencies. Even if worst comes to worst, they figure, bitcoin and the like might be tradable for goods and services. </p><p>Billionaires are ideal cryptocurrency investors – they can afford the risk. As for the rest of us, we do well to heed a <a href="https://www.cnbc.com/video/2021/12/27/heres-why-bitcoin-looks-worse-than-a-madoff-style-ponzi-scheme-says-robert-mccauley.html">warning</a> issued on CNBC by Robert McCauley: Investing in crypto is worse than investing with <a href="https://trustmarketing.blogspot.com/search?q=Madoff">Madoff</a>.</p><p>McCauley's reasoning: Eventually Madoff’s victims have had most of their losses returned to them. If bitcoin bites the cosmic dust, there’ll be nothing left but unpaid electric bills. </p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com1tag:blogger.com,1999:blog-12131952.post-87321692259158036712022-01-02T11:42:00.003-05:002022-01-02T11:42:45.761-05:00Food for thought<p><a href="https://taxprof.typepad.com/taxprof_blog/2022/01/new-state-business-tax-climate-index-blue-states-are-worst-red-states-are-best.html"> From the TaxProf</a>, reporting on the Tax Foundation new study.</p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com2tag:blogger.com,1999:blog-12131952.post-91812964569371727852021-12-24T14:33:00.000-05:002021-12-24T14:33:02.302-05:00Dave Barry does not disappoint<p> <a href="https://www.miamiherald.com/living/liv-columns-blogs/dave-barry/article256603076.html" target="_blank">His review of all the important 2021 developments.</a></p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-44371020179385071632021-12-13T22:10:00.002-05:002021-12-13T22:11:39.686-05:00Samuel Pepys Saves Widow’s Estate<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEgb1tEY4s6YXRq_g0LchnoBGCAPhqHW6_s9PJG1rC1MwTcAhYAKBGRl022ynm29l_bKroMPo_we8Y2UbTtIRzG5PlWDwbE6yTZwPObIrynqK4hOYv4tOj_H7o2dpYgUxcoE8YOkp_R3WS18LK3uTLwmsMl0YphVC7Wx8EQTMiQlomgfCfBWZfk=s1119" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" data-original-height="1119" data-original-width="961" height="248" src="https://blogger.googleusercontent.com/img/a/AVvXsEgb1tEY4s6YXRq_g0LchnoBGCAPhqHW6_s9PJG1rC1MwTcAhYAKBGRl022ynm29l_bKroMPo_we8Y2UbTtIRzG5PlWDwbE6yTZwPObIrynqK4hOYv4tOj_H7o2dpYgUxcoE8YOkp_R3WS18LK3uTLwmsMl0YphVC7Wx8EQTMiQlomgfCfBWZfk=w213-h248" width="213" /></a></div>On January 16, 1667/68, Samuel Pepys’ despondent cousin decided to end it all. He threw himself <br />into a pond behind an inn, determined to drown. A woman spotted him in the water and alerted farmhands who pulled him out. He was revived but sickened and died at home a few days later. <p></p><p>Now his widow faced a potentially disastrous financial loss. By law, the estates of suicides were forfeit to the crown. She asked Pepys, a naval bureaucrat, for help. As we can read in his diary entry for <a href="https://www.pepysdiary.com/diary/1668/01/21/">January 21</a>, Pepys came through big time:</p><i></i><blockquote><i>So, at their entreaty, I presently took coach to <a href="http://www.pepysdiary.com/encyclopedia/180/">White Hall</a>, and there find <a href="http://www.pepysdiary.com/encyclopedia/830/">Sir W. Coventry</a>; and he carried me to the King, the <a href="http://www.pepysdiary.com/encyclopedia/800/">Duke of York</a> being with him, and there told my story which I had told him:<a href="https://www.pepysdiary.com/diary/1668/01/21/#fn1-1668-01-21">1</a> and the King, without more ado, granted that, if it was found, the estate should be to the widow and children. I presently to each Secretary’s office, and there left caveats, and so away back again to my cozens, leaving a chimney on fire at White Hall, in the King’s closet; but no danger. And so, when I come thither, I find her all in sorrow, but she and the rest mightily pleased with my doing this for them; and, indeed, it was a very great courtesy, for people are looking out for the estate, and the coroner will be sent to, and a jury called to examine his death. This being well done to my and their great joy, I home, and there to my office, and so to supper and to bed.</i></blockquote>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-68678936536272178982021-11-26T20:38:00.000-05:002021-11-26T20:38:35.919-05:00Christmas Price Index up 5.7%<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhRZyb4NTwgysuZbIoEj87ViZDdgzkMyrZvzUar3DHmzpPIkQXqSrjZH39kSsZtyXFR2uV1AHMv41-q-GF5uZsbk3H50B5P8YGRt5xW3yIXjjVuFN8vafmyhmThLszNpPiHjdZecQ/s247/1stday.gif" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="247" data-original-width="159" height="247" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhRZyb4NTwgysuZbIoEj87ViZDdgzkMyrZvzUar3DHmzpPIkQXqSrjZH39kSsZtyXFR2uV1AHMv41-q-GF5uZsbk3H50B5P8YGRt5xW3yIXjjVuFN8vafmyhmThLszNpPiHjdZecQ/s0/1stday.gif" width="159" /></a></div><br />Back in 1984, a bank economist came up with the fun idea of measuring inflation by annual changes in the cost of the gifts in “The Twelve Days of Christmas.” PNC has continued the whimsy, and <a href="https://www.pnc.com/en/about-pnc/topics/pnc-christmas-price-index.html">this year’s index</a> shows significant price increases. (To avoid distortions in 2020 prices caused by the coronavirus, PNC compared current costs with those from 2019.)<p></p><p>How much would you need to to spend this year to purchase the gifts mentioned in the song and hire twelve drummers drumming, eleven pipers piping, etc.? $179,454.19.</p><p>Most expensive gift by far: those seven swans.</p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-15427844321336658572021-11-08T11:55:00.000-05:002021-11-08T11:55:04.212-05:00Unhappy news for financial advisors<p> Rich millenials are apparently succeeding without them. <a href="https://www.wsj.com/articles/rich-millennials-to-financial-advisers-thanks-for-the-golf-invite-but-you-cant-invest-my-money-11636367400?st=37jrdvs1gwc50iv&reflink=desktopwebshare_permalink">The Wall Street Journal reports </a>that:</p><blockquote><p><span style="caret-color: rgb(51, 51, 51); color: #333333; font-family: Exchange, Georgia, serif; font-size: 17px;">About 70% of households with a net worth of $500,000 or more headed by a person under 45 had an investing style that was either strongly or mostly self-directed in 2019, up from 57% in 2010</span></p></blockquote><p>Will the coming inflation change their perspective? </p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com1tag:blogger.com,1999:blog-12131952.post-64363575828366352672021-10-19T13:58:00.001-04:002021-10-19T13:58:32.992-04:00Who remembers Black Monday?<p> I remember it well. My senior editor, JLM, had turned on a radio in his office to follow the events, which was without precedent. I didn't have any money in the market in those days, but I was concerned about the possibility of another Great Depression.</p><p><a href="https://www.powerlineblog.com/archives/2021/10/black-monday-revisited.php">Here's a nice retrospective on the events of that day.</a></p><p>The 1929 crash was down 13% in one day. Black Monday in 1987 was down 22%, bringing the three-day loss to about 33%.</p><p><br /></p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-54313941691571363802021-10-12T21:35:00.000-04:002021-10-12T21:35:10.519-04:00“Harry and Meghan can make E.S.G. investing part of pop culture“<p>According to the New York Times DealBook, the Duke and Duchess of Sussex have <a href="https://www.nytimes.com/2021/10/12/business/dealbook/harry-meghan-ethical-investors.html">made a deal</a> with Ethic, a fintech provider of ESG portfolios. The Duchess apparently intends to market Ethic’s services as ESG for ordinary people like herself:</p> “From the world I come from, you don’t talk about investing, right? You don’t have the luxury to invest. That sounds so fancy.”<div><br /></div><div>(Before her marriage to Harry, Meghan reportedly made $450,000 annually from her seven seasons on the TV series “Suits.”) </div>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-27511205487542279012021-10-10T21:42:00.001-04:002021-10-10T21:42:23.573-04:00A change at the Times<p> Paul Sullivan is<a href="https://www.nytimes.com/2021/10/09/insider/paul-sullivan.html"> leaving his Wealth Matters</a> column after 13 years.</p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com1tag:blogger.com,1999:blog-12131952.post-78050563492300062962021-10-05T10:30:00.003-04:002021-10-05T19:02:47.019-04:00South Dakota, World-Class Tax Haven<p>Back in 2013, when this blog saluted Sioux City’s<a href="https://trustmarketing.blogspot.com/2013/12/the-street-of-trust-companies.html"> street of trust companie</a>s, South Dakota seemed an unlikely addition to the list of states that promote upscale financial services by offering to keep family assets safe in trusts – trusts that can last a long, long time. </p><p>Now the <a href="https://www.theguardian.com/news/2021/oct/04/pandora-papers-at-a-glance">Pandora papers </a>reveal that South Dakota has become a world class, $367 billion<a href="https://www.theguardian.com/news/2021/oct/04/pandora-papers-reveal-south-dakotas-role-as-367bn-tax-haven"> tax haven</a>. <a href="https://www.icij.org/investigations/pandora-papers/us-trusts-offshore-south-dakota-tax-havens/">Handsome office buildings</a> have replaced the old mail-drop trust offices.</p><p>Who ever imagined that South Dakota would one day be compared to Switzerland and the Cayman Islands?</p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-56912219534506542752021-08-25T22:39:00.004-04:002022-01-12T18:25:07.178-05:00Jason Zweig’s Artful Newsletter<p>Recently signed up for Jason Zweig’s newsletter from the WSJ. <a href="https://columnalerts.createsend1.com/t/ViewEmail/d/D4BF6C6B43DEFB612540EF23F30FEDED/48DEDADCAD97662E33C48669A65BFAC1">The latest is a winner</a>.</p><p>Zweig leads off with the depressing thought that the average performance of active investment managers is one or two percent lower than reported. Reason: survivorship bias. As time passes, the unfortunate returns of funds or managers that drop out of the race vanish from data bases, leaving an average based on better-performing survivors.</p><p> Delightfully, Zweig illustrates his items with everything from ephemera to fine art. Here he uses a Koloman Moser painting that we can imagine as a collection of deceased funds floating around in other waste matter. </p><p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg7aEHDG3cOTFbKBl2KQJIe8-Aalb_YcMJS3H7sZitk9yc1_4BewEoMB76WPcDZbs9xNq2yjax8Wd7ya6YMjfARQz3tyvJmTg52-0iG0sXY6LsdEL7L4OOoS0uh_WqumN7DeaWBxQ/s300/wwbp-210-42_1.095953.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="237" data-original-width="300" height="237" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg7aEHDG3cOTFbKBl2KQJIe8-Aalb_YcMJS3H7sZitk9yc1_4BewEoMB76WPcDZbs9xNq2yjax8Wd7ya6YMjfARQz3tyvJmTg52-0iG0sXY6LsdEL7L4OOoS0uh_WqumN7DeaWBxQ/s0/wwbp-210-42_1.095953.jpg" width="300" /></a></div><div class="separator" style="clear: both; text-align: center;"><span style="text-align: left;"><br /></span></div><blockquote style="border: none; margin: 0 0 0 40px; padding: 0px;"><div class="separator" style="clear: both; text-align: justify;"><span style="text-align: left;">Guess what happened a few months before Prohibition? Coca Cola went public. Shares were sold on the Curb, Street brokers received orders from clerks who signaled from office windows or ran downstairs to deliver orders. Fights sometimes broke out. Here’s the Curb as shown on a 1919 postcard: </span></div></blockquote><p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjWzpgKa7mgN1z-jD6V4fFh-TyE1rLgYie2n2H30Lffy0V-lOKHVwp4AaxiCea4UOhB1CDtCpyP2Q7H9mRC93XJhwPcraESg4Cfnce8YF8Sh95DksBJjXp9m_EyMKLfLJcujQWKsg/s760/nypl.digitalcollections.510d47e2-8eb9-a3d9-.162807.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="760" data-original-width="492" height="400" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjWzpgKa7mgN1z-jD6V4fFh-TyE1rLgYie2n2H30Lffy0V-lOKHVwp4AaxiCea4UOhB1CDtCpyP2Q7H9mRC93XJhwPcraESg4Cfnce8YF8Sh95DksBJjXp9m_EyMKLfLJcujQWKsg/w260-h400/nypl.digitalcollections.510d47e2-8eb9-a3d9-.162807.jpg" width="260" /></a></div><p>Can’t promise all of Zweig’s newsletter will be as sprightly as this one, but they are worth a look. </p>JLMhttp://www.blogger.com/profile/04202556695741998690noreply@blogger.com0tag:blogger.com,1999:blog-12131952.post-15535164373164225032021-08-18T11:18:00.000-04:002021-08-18T11:18:43.141-04:00Contrary indicator?<p> The New York Times has a nice, <a href="https://www.nytimes.com/interactive/2021/08/18/opinion/inflation-economy-transitory.html">well-illustrated analysis of the inflation picture at the moment</a>.</p><p>However, I don't trust their conclusion that we don't need to worry about inflation, that it really is transitory. The general public perceives inflation by what they see at the gas pump and at the grocery store. Inflationary expectations are as significant as inflation itself. The fact that the prices of window coverings and men's suits are going down doesn't cut much ice. Gas prices can only go higher given the new restrictions on building pipelines and fracking. Note also that President Biden's plea to OPEC to boost production was rebuffed.</p><p>What's more, the New York Times has been practicing "agenda journalism" for the past few years, which makes me skeptical of any of their pronouncements. "No long-term inflation to see here" sounds an awful lot like "Kabul can survive for 90 days" to my ears. Wishful thinking.</p><p>Having said all that, I do find their data presentation and explanations to be interesting, potentially helpful.</p><p><br /></p>Jim Gusthttp://www.blogger.com/profile/03521913514595091124noreply@blogger.com0