Buy Gold!

If you plan to take physical delivery of the gold, hold it personaly, and it only takes up about 10% of your savings.

Otherwise, stay the fuck away from that shit.

If the world fails, your foresight won't save you.  And you won't be able to trade it without someone assaying that stuff.  Ergo, you lose.

Sticky Prices

Seriousley.

Who spilled orange juice all over the prices.

Man.

It got all over the wages too.

Windfall spending

My wife asked me today what would happen if I went on TV and won a lot of money on a quiz show that tops out at a million dollars.  She hedged down to a couple hundred thousand.

Would we pay off the mortgage?  I explained that if we had a safe investment that could return more than the interest rate on the house plus inflation -- we'd do that if we were economically "rational".

But then I explained that even though I know this, I would instead pay off a chunk of the mortgage instead. 

Damn present bias. 

Even when you know better, you don't do better.

A thought against the John Bates Clark Medal

So.

Econ is a "science", but of the social kind, no matter how much you math it.

Which means, in a nutshell, that it is about the relationships between people.

Each x on your cartesian plane has a y that is a function of x.

So...

these are relationships between people.

Do you think that anyone under 40 really understands peoople in isolatuion, let alone together?

And we accept a medal for this as a "Nobel" precousor?

Even worse, these are people who have spent a number of years in academia.  That means they are further alienated from actual people who actual act in a market.  

Compressed Timeline

Hey.

I got the most recent copy of the Journal of Economic Perspectives in the mail this week.

Is anyone interested in reading it?

I am, but everyone stopped talking about it two months ago.

It already feels dated.

I guess I'll just read my friend's book that hasn't been released yet.  I suppose that will be fresh.

Hey.

What's on twitter?

How can I make money investing?

Ignore ZeroHedge.

Buy a broad market index fund.  Put what you can afford to put in there.

If you're saving for something specific, look for tax advantages -- IRA, 401k, College.  Buy the option with the lowest fees.

Don't get a PhD.

I hear it's a waste of time.  Just prove you can do the math with an MA.  There's no reason to write a dissertation that no one will read.

Unless you got into MIT, Harvard, or the University of Chicago.

No matter what, at that point, you can be Megan McCardle.