economics

The trick in any field—from finance to careers to relationships—is being able to survive the short-run problems so you can stick around long enough to enjoy the long-term growth.

terminal value computation is not what growth rate you use in the valuation, but what excess returns accompany that growth rate.

The flow economy is dynamic; you can think of GDP accounts as the economy’s Profit and Loss (P&L) statement. It measures what we are doing, using metrics expressed in dollars per year like consumption, savings, investment, government spending, taxes, net exports, and GDP. Things expressed per unit of time measure speed, like miles per hour on your

There is a strange idea abroad, held by all monetary cranks, that credit is something a banker gives to a man. Credit, on the contrary, is something a man already has.

The introduction and then subsequent final expiration of these programs are an extremely underdiscussed element of the election results (though since I started working on this piece, some coverage has emerged). Yes, price increases, particularly those for food, energy and rental housing had a crucial- and continuing — impact on many households,

US fiscal deficits will remain structurally large for the foreseeable future (i.e. for any investment time horizon of relevance, such as the next decade).

I outlined six reasons for this in my September 2024 newsletter, and they were the following:

1. Unbalanced Social Security


2. High healthcare costs


3. High defense spending


4. High interest expense


5. Political

discipline. With hindsight, our capital cycle approach has failed at times when we have underestimated the impact on industries of political and legal interference, disruptive technologies and globalisation.

In my opinion, this highlights the importance of the hiring channel. When employers want to shrink their workforce (or at least slow its growth), they use hiring as their primary lever; and when it’s time to expand/accelerate, they pull the same lever. Ergo, young people are highly levered to sectoral, occupational or economy-wide cycles, something

climate determined crops, which then heavily influenced our societies. Even decades after most of us have stopped farming, these effects carry into our subconscious cultures.