Blog

First, we offer our most heartfelt condolences to all those who lost their lives, to their families, and to all those now in unbearable circumstances. Placing numerical values on the economic losses is an intolerable insult to all those who lost their lives and to their families and relatives, and is morally indefensible.

Uncertainty is the operative word in Japan, but as we take a step back and think about the broader economic impact, it’s worth noting that this natural disaster is happening at a time when the U.S. data looks solid (good valuation vs. bonds/cash, the market has a free cash flow yield close to 7%, among the highest in history,  and balance sheets have never been better, confidence, consumer spending, hiring, and the availability of credit are increasing, and equity funds see inflows).

See more at http://tinyurl.com/bfm-nwslet-Mar2011-Bull-Japan

On December 16, 2010, Congress passed the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010. President Obama is scheduled to sign the Bill later today. This legislation, negotiated by the White House and select members of the House and Senate, provides for a short-term extension of tax cuts made in 2001. It also addresses the Alternative Minimum Tax (AMT) and Estate, Gift and Generation-skipping Transfer taxes.

See details at http://tinyurl.com/bfm-nwslet-Feb2011-Tax-Stock

I hope you all had a very good holiday season. May 2011 bring you good health and heartfelt happiness.

We decided to start the year by sharing some Behavioral Economics experiments from Professor Ariely from MIT. Behavioral Economics explains how the process of decision making functions among common people. It elaborates on the role of emotions and vision.

See details at http://tinyurl.com/bfm-nwslet-Jan2011-Behavioral

Dalbar Research Institute shows that investor’s performance does not equal investment performance. They found the following annualized returns for investors from 1987 to 2006 (similar results are found for different time period)

See their findings at http://tinyurl.com/bfm-nwslet-Nov2010-Fail-Return

With the end of the year approaching, here are some important tax and financial planning measure you can take to reduce your taxes and improve your financial position.

See the tips at http://tinyurl.com/bfm-nwslet-Nov2010-Planning

As some of you know, we started to be bullish on stocks in January 2009. The stock market had a great rally between March 2009 and April 2010 (up 80+%).

Some clients have asked us what do we think today. Like Buffet, Ballmer and Immelt, we are positive!

See why at http://tinyurl.com/bfm-nwslet-Oct2010-Be-Positive

Human attention is limited and that we can’t analyze all the information we receive.

We tend to pick the information that we need to prove that our thinking is correct.

See the one minute video and more at http://tinyurl.com/bfm-nwslet-Sep2010-Human-Infor

Many of you know that I like behavioral economics.

If you want to learn more about behavioral finance and the role of Psychology, see some useful videos here 

http://tinyurl.com/bfm-nwslet-Sep2010-Behavioral

When Playing the investing game, it’s easy to let your impulse make all the wrong moves. Learning to trick yourself can help.

Why do smart people do such stupid things with their money?

Find the answer at http://tinyurl.com/bfm-nwslet-Aug2010-Brain

From February through May, the Dow Jones Industrial Average gained more than 1000 points in an almost uninterrupted daily march upward. Then came the "flash crash" of May 6 and day after day of losses through May. Now, in mid-June, the market has been up six of the past seven days.

What accounts for these sudden moves? Why do investors so often seem to resemble a school of fish, all changing direction together?

Find out the answers at http://tinyurl.com/bfm-nwslet-Jun2010-Individual