I began my career as an economics professor (actually, assistant professor) at the Claremont Graduate School (now Claremont Graduate University).  In 1980, I joined with three colleagues at the Claremont Men’s College (now Claremont McKenna College) who had started an economics advisory company called Claremont Economics Institute (CEI).  CEI provided financial forecasting and consulting to… Read more

In his book “Unintended Consequences” Edward Conard1 not only supports the benefits of income and wealth inequality (as described in a previous post (August 7, 2012)), both as an indicator of past successful ventures and as an inducement to future ventures, but he also provides a diagnosis and remedy for financial crises. He denigrates the… Read more

A financial planning rule of thumb that you often hear is that the percentage allocation to safe assets (cash or bonds) should increase with age, and accordingly the percentage allocation to the risky asset (equities) should decline with age.  One popular version is that your allocation to equities should be no higher than 100 minus… Read more

The labor department released their monthly jobs report. Today’s release is a report on the employment situation in August. Payroll jobs rose by 96 thousand jobs, driven by private sector job growth of 103 thousand jobs. The private sector job growth was concentrated in services, particularly professional and business services, education and healthcare services, and… Read more

In a recent speech Federal Reserve Chairman Ben Bernanke1 spoke of the importance of financial education.  People commonly make financial mistakes such as saving too little, taking on too much debt, holding too little life insurance, making bad investment decisions and, in general, paying fees that are unnecessary.  The consequences of these mistakes can be… Read more

The Survey of Consumer Finances (SCF) shows that median net worth for baby boomers (households with head of household aged 55-64 in 2010) was $179,000 in 2010, down from $226,000 in 2007.  The median is defined to be the lowest of the top 50% (or the greatest of the bottom 50%).  At first glance, it… Read more

Former Bain partner Edward Conard has published a controversial book “Unintended Consequences”1 in which he provides a positive case for income and wealth inequality and for market solutions to societal problems.  His story is an unabashed defense of market capitalism (and private equity).  A NYT reviewer has labeled the book “The Most Hated Book in… Read more

The BLS Employment Situation was released today, indicating a job increase that exceeded the expectations of the consensus forecast. This information is based on a survey of employers. The 163 thousand job increase over June contrasts with the Bloomberg median consensus of 100 thousand and our forecast of 80 thousand. It is the most rapid… Read more

The BEA released its “advance”, or first, estimate of second quarter GDP today, and it might not surprise anyone that the economy grew more slowly in the second quarter than in the first quarter. The question is: how much slower? The quarter 2 estimate is 1.5 percent, compared with a revised estimate of 2.0 percent… Read more

The London Interbank Offered Rate (LIBOR) is an index (actually, there are 150 indexes covering 10 currencies and 15 maturities from 1 day to 1 year) that is reported daily by the British Bankers Association (BBA).  LIBOR settings are established each day as the result of a survey of a panel of large international banks. … Read more