Author Archives: OnceUSave

Treasury bonds are issued by the federal government. Bonds with a maturity of one year or less are called Treasury bills but we’ll keep calling them bonds. So, say the year is 1999 when one-year Treasury bonds paid 4 percent as interest. If bonds with a maturity of one year paid 4 percent, you wouldContinue reading “Risk & Return”

Berkshire Hathaway class A shares trade at hundreds of thousands of dollars. This below is the price for each share… Apple shares trade at hundred and some dollars apiece. And the shares of Uber trade at a twenty plus dollars. So, Uber stock is cheaper than Apple stock and Apple stock is cheaper than BerkshireContinue reading “Stock Splits Don’t Make Stocks Cheaper”

Crypto is not an investment. It can never be an investment. The United States dollar is not an investment. The Japanese yen is not an investment. The Euro is not an investment. None of these are investments. They are all currencies. The latter ones at least are. Crypto is not even a currency. Anything thatContinue reading “On Crypto”

Economist Hyman Minsky once wrote that stability brings instability. The more stable things become, and the longer things remain stable, the more unstable the system gets until an eventual crisis hits. And it makes sense. When there is never a risk in sight, when everyone is fat and happy is when the chances of theContinue reading “On Bear Markets”

My first exposure to a stock market boom and bust cycle was back home in India in the early 1990s in what was deemed the ‘Harshad Mehta’ scam. It was a classic pump and dump scheme that was financed by fake bank receipts which Mr. Mehta’s firm brokered in transactions between banks. He used theContinue reading “Pascal’s Wager”

If you are into weight training, you know that if you want to increase muscle mass and strength, you must lift heavy. Heavy to a point of discomfort. Heavy to a point of pain. Not that I would know but that is what I’ve heard. The same applies to investing. You must be willing toContinue reading “Growth Comes With Discomfort”

Reserves as in safe. Reserves as in accessible. Reserves as in durable. There is nothing safer than cash. There is nothing more accessible than cash. And if done right, there is nothing more durable than cash. And by done right means that the quantity of reserves matches the duration required of those reserves. For most,Continue reading “Reserves”

Say someone you know is running short on funds and comes to you for a loan that he promises to pay back in a month. Will you lend him the money? And if so, would you do it for free? You’d say why not. You have loaned him money before and without fail, he paysContinue reading “Yield Curves”

A widely known way to value a stock is its price to earnings ratio. It tells us what investors are willing to pay for each dollar of profit a business behind that stock earns. The other way to look at that same information is by flipping that ratio upside down. That is, earnings divided byContinue reading “Equity Risk Premium”

A wise woman once said that when in doubt, zoom out. So zoom out I did. This is what a 40-year chart of Dow Jones Industrial Average looks like… Add in reinvested dividends and we are looking at an easy double of that. Or if you want to get exotic, here is what the IndianContinue reading “Perspectives”