Seeking Alpha, the most read investment blog, has a fascinating story on Dr. Michael Burry’s current investment strategy.   If you’re not familiar with Dr. Burry, read “The Big Short”, the mesmerizing tale of Burry and the mortgage bond market.  He is commonly viewed as the first predictor of the debacle that followed.   Inherent in his current picks is a move toward hard assets, and implicitly, a hedge against inflation.   This is  our common theme–index annuities protect your principal, even in rising interest rate market and allow you to capture the “up” years.   In Burry, Predictor of Mortgage Collapse, Bets on Farmland, Gold, Bloomberg has a great profile on Dr. Michael Burry and his recent investments. Says Bloomberg: Michael Burry, the former hedge-fund manager who predi ...

  I am attempting to accumulate a library of commentary on the Great Recession vs. the Great Depression.   This powerful comparison by Barry Eichengreen and Kevin H. O’Rourke is comprehensive in its review of the distinct differences between these two calamities. http://www.wealthvest.com/blog/wade-dokken/great-depression-vs-great-recession-devaluation-unemployment-global-trade-everything/     http://www.voxeu.org/index.php?q=node/3421   Barry Eichengreen Kevin H. O’Rourke 8 March 2010   This column updates the original Vox columns by Barry Eichengreen and Kevin O’Rourke comparing today’s global crisis to the Great Depression. The three previous columns have shattered all Vox readership records with over 450,000 views. This latest edition covers up to February 2010 sho ...

Spend a little time looking at the two accompanying tables and charts.    I’d like to draw your attention to the similarity of yields in 1954 and today for the 10 year Treasury Bond.   Now, look at the graph below the table and the steep 26 year rise in bond yields.   I’m working on the numbers now, but the simple conclusion is that history would suggest that from today’s bond prices to bond prices in the future is an treacherous road for bond investors. Bond buyers lost a tremendous level of their principal between 1954 and 1981. Can rates go lower today (hence bond prices higher)?  Yes, and in fact bond buyers today may in fact be experiencing very positive returns.   If deflation were to happen, and in some portions of economic analysis (wages), deflation is occurring.   Even 0% yields in that environment produce positive returns, since purchasing power of the principal is being enhanced. However, when the cycle turns, bond principal can be devastated. ...

  I have shared this essay with my boys, because I believe the macro-economic forces highlighted in Fareed's essay are at the heart of our current long-term economic predicament.   We need to fundamentally adjust our domestic priorities and expectations on ourselves;  willing to study longer, harder and accept less consumption and greater savings.  We need to look carefully at how much we are willing to spend on defense, entitlements and be honest about the level of government we support and are willing to pay for. I'm terribly pessimistic on our ability to do some of these things and therefore, I believe are in for a long-term inflationary cycle.  Great for real estate.   Bond for stocks and bonds.    It make sense.   We have a great run in financial assets.   Those days are likely done. However, we live in Montana, ski at Big Sky, hike the Spanish Peaks, fish the Yellowstone River.   Life is still great. His weekly show is the most thoughtful, ratio ...

 This is a blog that I posted on another site.   The point was slightly different and whimsical.  However, their is a different point for a real estate blog.   We have had minor deflation in the U.S. last year, which was the first year in nearly 50 years of declining prices.  In real estate, we have seen three years of declining prices, and I can't believe they can continue.   Housing costs are around 2003 cost levels--even though overall inflation for the past decade was nearly 30%.   The dates do not make a perfect match, but the point remains.   Houses are below replacement cost.   The population of our country is growing and as a nation our GDP is growing, which means we are becoming wealthier.  Moreover--and perhaps most importantly, the Federal Reserve and the U.S. Congress/Executive remain focused on a series of fiscal and monetary strategies to inflate the money supply and prime the pump.    Once this process successfully gains hold, the pri ...

 We often do not connect the dots--between the preservation of our precious state and the reality that those who are attracted to come here to vacation, travel, recreate, and live part of their life, base their decisions on the high quality of our wild spaces and the abundance of our great wildlife resource.   Big Sky's luxury buyers are also people who are keenly focused on helping to preserve the wild spaces of their new Montana home; whether that is at the Yellowstone Club, Big Sky, Spanish Peaks or Moonlight Basin.   By MATTHEW BROWN Associated Press Posted: 12/12/2010 09:36:57 AM PST Updated: 12/12/2010 09:44:51 AM PST       BILLINGS, Mont.—Philanthropist Hansjorg Wyss grew up in Switzerland and now spends the bulk of his time outside Philadelphia, but it is the wild landscapes of the Rocky Mountains where he could leave his most lasting mark. In recent years the publicity-shy billionaire has quietly donated tens of millions of dollars to the preservatio ...

  HELENA — Newly empowered congressional Republicans, elected on promises to rein in federal spending and eliminate oft-criticized spending “earmarks,” are working on how to do that while still ensuring local needs are met. “Congress doesn't need to earmark money to direct it to states if we write funding requirements for programs with greater care,” Rep. Denny Rehberg, R-Mont., wrote on Twitter on Thursday. Rehberg has been critical of earmarks — the numerous amendments to spending bills that direct money to specific projects — in the latest federal budget cycle, joining other Republicans in abstaining from such requests. Conservative critics of spending say the incoming Congress could be backsliding on the no-earmarks pledge, and Democrats who support the practice of earmarks say some of the Republican plans amount to earmarks by another name — with possibly with less transparency than in the current system. “Thanks to the reforms we passed in 2007, all earmarks are public, including who asked for ...

  I have reprinted this entire article from the Wall Street Journal.   It is unfathomable to you or I the pain that must be felt by Bernie Madoff's victims--to wake up one day and realize that your entire financial plan is a mirage--all your savings evaporated.  My six degrees of separation is three degrees.  A very good friend is in the business of placing money with hedge fund managers.  He could not get capacity to place money with Bernie Madoff--and I can't remember how hard he tried.   In his town of Fairfield, Connecticut, another family was in the same business and could get hundreds of million of capacity in Bernie Madoff's fund.   They and their investors have been wiped out, like everyone Bernie's criminal activity.   Today it is his own son. Dead from suicide.   i don't know if he was complicit or not complicit.  Others will determine this in due time, but regardless, so tragic. Some in our local area would categorize Tim and Edra Blixseth, o ...

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New York, November 30, 2010  Home Price Indices, the leading measure of U.S. home prices, show that the  U.S. National Home Price Index declined 2.0% in the third quarter of 2010, after having risen 4.7% in  the second quarter.  Nationally, home prices are 1.5% below their year-earlier levels. In September, 18 of  the 20 MSAs covered by S&P/Case-Shiller Home Price Indices and both monthly composites were  down; and only the two composites and five MSAs showed year-over-year gains. While housing prices  are still above their spring 2009 lows, the end of the tax incentives and still active foreclosures appear to  be weighing down the market.       The chart above depicts the annual returns of the U.S. National, the 10-City Composite and the 20-City  Composite Home Price Indices. The S&P/Case-Shiller U.S. National Home Price Index, which covers all  nine U.S. census divisions, recorded a 1.5% decline in the third quarter of 2010 ...