Blogs

Australia undertakes the preferential voting system and it amazes me how many Australians don’t understand how this system works. Like all systems, it has its pros and its cons. To me however the beauty of the preferential system is that you get to send a message to a major party but can ultimately direct your…

Well, Donald Trump is implementing his strategy of “Making America Great Again” and the equity markets don’t like it. With the markets going down we get the usual noises from the funds management industry and, unfortunately, some financial advisers with platitudes like “the market always goes up over the long term and rewards the patient investor”. 

After the election of Donald Trump much has been said about trying to reduce the US debt. The first part of this is to not run a yearly deficit which increases the size of the existing debt." The most high profile initiative has been Elon Musk being appointed to DOGE to stop wasteful government spending. Whilst it makes for good television having press conferences highlighting the cancelling of dubious programs that cost the taxpayers millions will it actually make a difference? In this blog we break down the US Government expenses to see if it is realistically possible to get the budget to breakeven or even surplus.

The US federal debt has surged to $36 trillion, now exceeding 124% of GDP. Rising interest rates have pushed debt servicing costs past $1.1 trillion annually, outpacing defense spending. While foreign countries hold $8.5 trillion in US Treasury securities, central banks are no longer increasing their reserves. Instead, debt is increasingly bought by price-sensitive investors, making future borrowing more challenging. If deficits continue, the debt burden will only grow, raising concerns about long-term economic stability.

A lot has been said by the industry and regulators about the costs associated with, and the effort involved in, running a Self Managed Superannuation Fund (SMSF). As proponents of Self Managed Superannuation Funds we acknowledge the cost and time involved in running these structures, but when measured against the benefits, in most instances, the case for running an SMSF is compelling.

An interesting finding was released by Rosenberg's research based on Federal Reserve data that Americans who are nearing retirement age (55 years+) have 80% of their portfolios in equities.

Last year we did a blog on valuation that was derived from a conversation with one of Australia’s leading fund managers, Paul Moore from PM Capital. Further to this, I stumbled upon the following graph posted by James Bianco on LinkedIn that graphically represents exactly what Paul Moore was discussing.

In the last blog, we took a look at the rising price of gold and what was driving it.

"Gold is money. Everything else is credit." - JP Morgan 1912. What has driven this increased demand for the yellow rock?