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HOW WILL YOU BE PAYING?
With the steady grind higher in rates, it is no surprise to see delinquencies starting to tick up. This isn’t limited to credit cards. We have seen bankruptcies tick up as well as deterioration in several other indicators of overall credit health. We are lifting off historic lows in delinquencies, and though the change is an expected development, it is certainly one to watch.
Defunding the IRS
Another great breakdown of something we all intuitively know – funding tax collectors increases the amount of tax collected. There is simply an inherent dislike (shocker) for government tax agencies which leads to sometimes illogical and politically driven funding decisions. A great piece from the Washington Post.
Meanwhile, the agency pulled in $3.18 for each dollar spent auditing the top 1 percent, and $6.29 for the top 0.1 percent
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A succinct and interesting history lesson on financial markets. It is always important to look at the past to avoid recency bias. There have been lost decades for asset classes, but there have also been long periods of time where certain assets rallied despite all odds. Asset allocation is the key in making sure you have exposure to growth, but not at the cost of enduring a long and painful period.
It is worth noting that there are two types of pain. The pain of a loss, and that of missing out on opportunity.
I was an institutional investor in 2009 and all anyone in the pension and endowment space could talk about were tail-risk hedging strategies, black swan funds and hedge funds.
Everyone was so concerned with finding the next Big Short that they almost missed the Big Long of the 2010s
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It feels like we are covering AI just a little too much, so this one is a quick hit.
People are generally using the wrong mental models for thinking about what's going on. It's worth noting that there is only a small sample of periods with wide automation, so every analogy is fraught, making the recent waves of factory and office automation even less helpful. A better metaphor, insofar as there is one, is the Industrial Revolution, with wide-ranging, multidecadal impacts across a host of fields.
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A skeptical take on the latest and greatest(?) new tech gadget. We would take a more optimistic view of the potential here, though this is very much a first take that will need some iteration. We have heard some folks describe it as a 4k workstation you can bring with you anywhere you go. That doesn’t sound bad. The societal implications of everyone having a computer on their face on the other hand…
In the best-case scenario, it’s an early version of tech that hints at the promise to come, when we get a better, cheaper, lighter version ... someday down the road.
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