We've been sounding a note of optimism recently, to remind investors that although government intrusion into business produces negative results, we still believe that the best investment plan is to search for ways to match investment capital with innovative and well-run businesses.However, as we have said many times before, government actions do have...
Monday, March 29, 2010
The often-underestimated strength of the free enterprise system
Over the weekend, two important articles appeared on the opinion page of the Wall Street Journal.The first, by the editors of the opinion section, noted the accounting write-downs which public firms are making to their earnings based on their estimates of the costs of the newly-passed healthcare legislation.That the additional government taxation...
Monday, March 22, 2010
Time For Another Dose of Milton Friedman
Almost exactly a year ago, we published a blog post entitled "Don't despair," which is a remarkably relevant post for investors to read again in its entirety today.In it, we linked to an interview with Milt Friedman from December, 1975 in which he discusses the increasing government interference in personal life which took place during that decade,...
Friday, March 19, 2010
Great minds think alike!
We would urge our readers to check out Andy Kessler's March 10th piece published in the Wall Street Journal entitled, "Lessons of a Dow decade."In it, he points out the historic connections between massive capital misallocation -- from the infamous "South Sea Bubble" of the early 18th century to the dot-com bubble of ten years ago and the financial...
Thursday, March 18, 2010
The financial services timeline, 1977 to present, and what it means to you
As we survey the past three decades or so from an investor's perspective, it occurs to us that the Baby Boom generation has had to endure one financial innovation after another. It also occurs to us that their patience must be starting to wear thin.As the chart below illustrates, the peak year for births in the United States during the Baby Boom was...
Monday, March 15, 2010
Still in thrall to the Phillips Curve?
In response to the recent nomination of Janet Yellen to become the next Vice Chair of the Federal Reserve (replacing retiring Vice Chair Donald Kohn), economist Larry Kudlow has written an article entitled "Yellen is spellin' future inflation."Kudlow states that "Ms Yellen is a distinguished economist who unfortunately subscribes to the Phillips-curve...
Tuesday, March 09, 2010
March 9 anniversary
There are plenty of stories out today about the one-year anniversary of the bull market, and in one sense we'd like to simply ignore it, because we often emphasize that investors should focus on businesses rather than markets (see here for instance).However, the return of March 9 -- the day that marked the pit of the most ferocious bear market in...
Friday, March 05, 2010
Have you heard of this company? DLB
In previous posts, we have discussed some of the characteristics of a Taylor Frigon growth company, and have highlighted some examples -- most recently Tractor Supply and Resmed.*With Oscar weekend approaching, and plenty of buzz in Hollywood about 2009 being the "year of 3-D," we thought we would highlight another growth company, Dolby Laboratories.*While...
Tuesday, March 02, 2010
Avatar and long-term inflation
Every now and then, a fact or illustration arises which vividly reveals the long-term corrosive impact of inflation, that insidious force which usually remains invisible and all-but-unnoticed.The following chart (from IMDb data) shows estimated US box office records for the all-time biggest movies. Note that while the current box office champion,...
Monday, March 01, 2010
One of the best explanations you will hear of the financial crisis and its aftermath
This remarkable video from economist Brian Wesbury is one of clearest explanations you will hear on the financial crisis and its aftermath.It is entitled "TARP was a mistake."One of the hardest-hitting points that Mr. Wesbury makes in the video is the fact that, to this day, the view that Congress needed to somehow use taxpayer dollars to buy up troubled...
