Why Inflation Lies Ahead

Inflation, at 1.5%, is tame. So why worry? Because the enormous expansion of the U.S. money supply, thanks to Washington’s attempt at economic stimulus, eventually will lead to harmful inflation, which really is a tax on your wealth.

Handling Market Volatility

Stock market volatility can scare investors. Rising markets tend to show little of it, but falling ones display a lot, as people unload their shares. Volatility – which is basically the degree to which stock prices jump around – is now low. But here’s a guarantee: It will shoot up again.

World Problems and U.S. Stocks

Remember when overseas events influenced the U.S. stock market? From 2010 through 2012, the market zigged and zagged in time with the European debt crisis. Now that the Federal Reserve plans to wind down its stimulus program, which has propped up American stocks, get ready for more shocks from aboard.

Scary News? Keep Your Focus

What can you and other investors do about Russia, vanished airliners or whatever tomorrow’s headlines bring? How does the Ukraine crisis affect your providing income for you and your family for the rest of your lives? The answer – in this age of rat-ta-tat information about disasters – fixes your whole mindset about investing.

Speed Trading Does Rig Markets

To hear the blowback from Wall Street, Michael Lewis’s book slamming high-frequency trading is misguided, naïve and inaccurate. But the Lewis book, Flash Boys, is spot-on. HFT does rig the stock market against small investors.

His take:

Michael Lewis’ Hyperbole

According to author Michael Lewis’ new book, the stock market is “rigged.” The reason: Professional traders armed with super-fast computers get better prices than you. But several smart advisors think his diagnosis is overblown, saying that HFT  harms mainly day traders and that Lewis ignores the good that faster connections bring, such as lowering costs and expanding liquidity.

4 Harmful Market Myths

Market myths keep proliferating, and they are dangerous to your portfolio. Among the worst are: IPOs are the road to riches, ditto biotech, Apple is over and moribund stocks will stay that way.

Good Stocks Get Bad News

Investors often overreact to bad news. When that happens, good companies hit by bad news become that most exquisite thing: a value play. Rule of thumb: When a solid business runs into a temporary mess, it’s likely a buy signal.

Reasons for a Spring Rally

Despite this year’s anemic start, there’s a decent chance of a spring rally. Don’t expect that to continue for the rest of the year, as it did in 2013.

How to Manage Risk Now

Many investors have skewed ideas about risk. Even after 2013’s stock market run-up, they fear losing money more than they wish to make more. That could be a mistake. What’s the best way to handle risk?

Investment advisors and financial planners are getting more and more statements of this ilk: “I would like to invest to make more money but I don’t want to take a risk.” Or: “I want an investment more rewarding than a bank account but I want it to be safe.”


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