Fidelity and the Flight to the Suburbs

Originally posted on May 13, 2021. Back in February, I wrote to you about how I started in the institutional research and trading investment business at Model Roland & Co. on Federal St. in Boston in August 1971. Just up the street from Model were Fidelity Investments, and Wellington Management, both of whom I called on from my very first hours on the job. Over five decades ago, Ned Johnson, aka “Mister Johnson,” ran the show at Fidelity. At Wellington, Jack Bogle, “Mr. Mutual Fund,” had not yet left Wellington to start Vanguard.    My focus in the initial going was international research and trading, and remains so today all these decades later.  I still consider Fidelity and … [Read More...]

What You’ll Hear When You Call My Office

When you call the office of Richard C. Young & Co., Ltd. during business hours, what you’ll hear first is the voice of a real human being working at an American small business that values its clients. You won’t hear a recorded phone tree directing you to a no man’s land of extensions and recordings. You won’t be answered by someone in a far-off place. Whoever answers the phone will pick up in either of our Naples, Florida, or Newport, Rhode Island offices. The personal touch you get from the folks you’ll talk to is part of what has earned Richard C. Young & Co., Ltd. a ranking in the top 5 of CNBC’s 100 Financial Advisors (2021), and what has earned my son, Matt Young, President and … [Read More...]

Do Governments Cause Recessions On Purpose?

That’s a question I put to readers back in 1988, and which is now relevant to today’s economy. The Federal Reserve is rapidly raising rates, and that is good news for savers who want to invest in bonds with decent interest rates, but the implications for the greater economy are also noteworthy. Here’s what I wrote in response to that question then: Do Governments Cause Recessions On Purpose? A recession is a prospect in the second half of 1989 because smart presidents realize that it’s tough to get re-elected if the public is dealt a recession before a presidential election year. It’s wise to take the recession medicine in the first year of a new term. I can’t overemphasize this point. … [Read More...]

My Battle-Hardened Stock Market Strategy for the Worst of Times

UPDATE 7.26.22: Have the worst of times come? It's hard to say, but many investors who were feeling great about the market only six months ago are now terrified. If investors had employed the Ben Graham-inspired, battle-hardened strategy of conservation of principal and a defensive portfolio, they may not be so unsure of themselves today. Originally posted on August 14, 2019. In September of 2014, I explained to readers my battle-hardened strategy for dealing with the worst of times in the stock market. My strategy was inspired by Ben Graham, and I have used it throughout my 55-year career in investing. Here’s how it goes: Ben Graham’s The Intelligent Investor was first published in … [Read More...]

A Cashless Society Is A Debacle for Americans

UPDATE 6/30/22: Alarm bells should be going off for Americans who want a dependable currency. The push for a "digital dollar" is intensifying, and now Congressman Jim Himes (D-CT), the chairman of Congress's Select Committee on Economic Disparity, is pushing hard for digitizing your dollars. Why is it important that he's the chairman of the Select Committee on Economic Disparity? A digital dollar will make manipulation of your money via negative interest rates a snap. And if all your money is digitized, wealth taxation becomes easy as the push of a button. Of course, Himes isn't advertising digital dollars that way. Instead, he's using the troubles of cryptocurrencies to set up a digital … [Read More...]

The Best Investment Strategy is Simple, Like Analog Music

UPDATE 6.28.22: In the last week, cryptocurrency funds have recorded record-breaking outflows over twice as large as any week ever before. This comes after speculators began fleeing from crypto in response to Federal Reserve monetary tightening and other events in markets. Forbes reports: Cryptocurrency funds posted net outflows of $423 million last week, eclipsing the prior record of $198 million set as crypto markets tumbled in January and bringing total assets down to $36.2 billion, according to a Monday report by CoinShares. Cash transferred out of bitcoin funds drove the record activity, with net outflows of $453 million—virtually erasing all inflows this year and pushing assets … [Read More...]

The Magic of Compound Interest

UPDATE 6/27/22: I don't want to harp on cryptocurrency speculators. They've been through a lot lately and not much of it good. The news that Three Arrows Capital, a Singapore-based cryptocurrency hedge fund is at risk of defaulting on $675 million in loans must be pretty terrifying for the crypto market. During all their time speculating on the newest technological innovation, crypto investors ignored the one magical power available to them, compound interest. Now, investors in Three Arrows are at risk of losing everything. Baystreet reports on the firm's imminent collapse: Singapore-based Three Arrows is one of the largest and most prominent cryptocurrency hedge funds. But it is facing a … [Read More...]

Here’s How I Climbed on the Dividend Bandwagon

UPDATE 6.10.22: Do you feel a recession coming on? Treasury Secretary Janet Yellen just told an interviewer at the New York Times that "Is there a recession risk? Of course there's a recession risk. But is it likely? I don't think so." She also said, "I believe there is a path through this that entails a soft landing." Meanwhile, most CEOs, the World Bank, and the Fed's own GDP tracker suggest the opposite. Who's correct? No one can know for sure, but it's important that your portfolio is prepared for any outcome.  UPDATE 3.11.22: Market turbulence today once again supports the value of an investment strategy based on compound interest and dividends. While stock and bond prices oscillate … [Read More...]

PRICES SOAR: Diesel Shortage Could Cripple America’s Economy

Prices for diesel fuel are soaring, and shortages of the critical transportation fuel could leave economies, including America's, in shambles. At MarketWatch, Dan Molinski reports on the fears of a shortage of diesel, writing: One of the U.S.'s largest truck stops, Love's, said Wednesday it is closely watching its diesel fuel supplies in the Northeast amid growing concerns of industry-wide shortages, but said it has no plans to limit purchases. "Love's is monitoring the fluid situation on the East Coast, we have experienced minimal outages during low traffic hours," Oklahoma-based Love's Travel Stops said in an emailed statement. "The company has no plans to restrict purchases of … [Read More...]

When Bigger Is Better

Originally posted October 22, 2021.  Supply chain disruptions and rising raw materials costs are eating into profitability and resulting in shortages of products for many firms. Procter and Gamble is not immune to rising prices and supply chain disruptions, but strong brand value and impressive scale have enabled the company to navigate the environment better than some. Price hikes are being passed onto consumers and P&G is finding a way to keep its products in stock by leveraging its scale. Sharon Terlep writes in The Wall Street Journal: Procter & Gamble Co. said that it expects solid sales and profit growth over the next nine months, even as costs for everything from warehouse … [Read More...]