Economics

Would You Buy All of the Bitcoin in the World for $25?

The recent debacle at FTX and the broader selloff in cryptocurrencies over the past year have us thinking a lot about our investment discipline and why we believe in owning productive assets. What makes for a good investment strategy? In our view, the simple answer is to buy productive assets. No doubt there are a…

Quarterly Client Letter: Q3 2022

We have to get supply and demand back into alignment and the way we do that is by slowing the economy. Federal Reserve Chair Jerome Powell 09/21/22 Press Conference The Stock Market and Speculation Deflation The stock market closed the 3rd quarter at the low for the year.  As measured by the S&P 500 (with…

CHIPS+ in Semiconductor Supply Chains

In light of the passage of the CHIPS+ act and recent news about tensions between China and Taiwan, I’d like to shed some light on microchip manufacturing trends in the US and around the world. The strength of the semiconductor supply chain is a national security issue akin to ensuring a strong US energy supply.…

Economic Tug of War

Economic Tug of War On Wednesday August 10th, the stock market rallied on news that inflation, as measured by the Consumer Price Index (CPI), may be starting to cool down. The YoY increase in CPI for July of 8.5% was down from the 9.1% print for June, a welcome change in direction and a lower…

The Macro Mood

The Macro Mood Even before Russia invaded Ukraine, inflation (as measured by the Consumer Price Index) was touching levels not seen in the U.S. since the early 1980s. While most people have and will continue to be hit by rising prices, at the start of the year I was anticipating that decelerating economic growth, easing…

The Price Is Never Right

“We must look at the price system as such a mechanism for communicating information if we want to understand its real function…” F.A. Hayek, The Use of Knowledge in Society The word “inflation” is on the tip of everyone’s tongue. Aggressive monetary and fiscal policy interventions in response to the Covid-19 pandemic and an unprecedented…

Money, Credit & Crypto

Money, Credit & Crypto Money has taken on innumerable forms throughout history. Whether it’s been salt, tea, spices, rice, potatoes, bullion, bank notes, or even cigarettes, humans have used an impressive array of commodities and conventions to engage in trade and track the exchange of value across time and space. As standard economic history would…

A Window into the Economic Recovery

A Window into the Economic Recovery It can be instructive to zoom in on a business and use “micro” economic data to take a pulse on broader “macro” economic trends. We own one business in our model portfolio* – Visa – that provides a particularly interesting view into global economic activity by using this framework.…