Category: Excerpts

Now, look, we have the worst revival of an economy since the Great Depression. And believe me: We’re in a bubble right now. And the only thing that looks good is the stock market, but if you raise interest rates even a little bit, that’s going to come crashing down.

We are in a big, fat, ugly bubble. And we better be awfully careful. And we have a Fed that’s doing political things. This Janet Yellen of the Fed. The Fed is doing political — by keeping the interest rates at this level. And believe me: The day Obama goes off, and he leaves, and goes out to the golf course for the rest of his life to play golf, when they raise interest rates, you’re going to see some very bad things happen, because the Fed is not doing their job. The Fed is being more political than Secretary Clinton-said Donald Trump in the first Presidential Debate

I keep getting calls from friends regarding investments.

Nearly all of them want that one stock pick on which they can Bet Big (aka all their life savings) and wait for the money to roll in.

My advice to them is the same as what Katusa writes:

Successful investing is a marathon.

It’s not a sprint.

Building long-term wealth for your family comes down to regularly making intelligent decisions that provide a good balance between capital growth and capital safety.

It does not come down to rolling the dice and “going big” on a single stock. 

But frankly nobody is interested in listening to sensible advice !

Many of the commodity-based sectors see cyclical trends as can be seen in metals, oil, shipping, sugar, commercial vehicles, capital goods etc.

The point to remember while investing in these pockets is that there will be times when these companies will do very badly, which should be the ideal time to buy, and there will be times when these companies do very well, which are times to sell.

The key understanding here is the best time to buy a cyclical stock is when their share price is low and not when their earnings are high.

For example, when sugar prices are at their bottom, sugar stocks will be at the bottom, but their valuation in terms of price to earnings, will be very costly.

So it is important to buy cyclicals based on share prices rather than earnings.

–said S Naren,CIO,ICICI Prudential Asset Management

After all, while Silicon Valley is responsible for some truly astounding companies, its business dealings can also replicate one big confidence game in which entrepreneurs, venture capitalists, and the tech media pretend to vet one another while, in reality, functioning as cogs in a machine that is designed to not question anything—and buoy one another all along the way.

It generally works like this: the venture capitalists (who are mostly white men) don’t really know what they’re doing with any certainty—it’s impossible, after all, to truly predict the next big thing—so they bet a little bit on every company that they can with the hope that one of them hits it big.

The entrepreneurs (also mostly white men) often work on a lot of meaningless stuff, like using code to deliver frozen yogurt more expeditiously or apps that let you say “Yo!” (and only “Yo!”) to your friends.

The entrepreneurs generally glorify their efforts by saying that their innovation could change the world, which tends to appease the venture capitalists, because they can also pretend they’re not there only to make money.

And this also helps seduce the tech press (also largely comprised of white men), which is often ready to play a game of access in exchange for a few more page views of their story about the company that is trying to change the world by getting frozen yogurt to customers more expeditiously.

The financial rewards speak for themselves. Silicon Valley, which is 50 square miles, has created more wealth than any place in human history.

In the end, it isn’t in anyone’s interest to call bullshit-from Vanity Fair