Recommendations regarding Lyn Alden's site?

[misanman]

I really enjoy reading her articles - as far as stock picking is concerned, I prefer to follow my own star.

 

[ZachTB]

Thanks everyone!

Maybe my "nobody understands economics" comment is because I lack the knowledge to sift through and find those who truly understand. But I've seen far too much argumentation, with no apparent resolution.

I still think the system is simply too complex [and too political] for anyone to fully understand, hence all the arguments about economics. The Director of the People's Bank of China sneezes in a press conference, and the S&P 500 drops 0.5%. Unless, of course, Apple simultaneously issues a quarterly report showing better-than-expected earnings...

People want to believe that econ is just like physics. But living beings are obviously far less predictable than natural phenomena. You can mathematically describe atomic density or stellar motion a lot better than the vagaries of the human mind. Or even the mind of a deer or a badger! Doesn't stop people from trying, though, and I suppose that's where the issues come in.

For what it's worth, I've been most impressed by Dalio's The Changing World Order. I think he does a really good job of explaining large trends over long historical periods, and he's generally much less partisan than most of what I read.

I still like Alden's macro analysis [at least, I usually do. Some of her articles seem a little self-congratulatory]. But I'm on my second go-around of Dalio's book, and I can definitely recommend that one for enthusiasts of macroeconomics.

 

[OldShooter]

... I still think the system is simply too complex ... for anyone to fully understand, hence all the arguments about economics. ...

Yes. My standard metaphor is a trout stream. Although the mathematics of incompressible fluid flow is well understood, that does not give us the ability to predict the future whorls, eddies, and currents in a stream. Our best approximation to dealing with that stream is consider the flow to be random and chaotic with a slight bias towards going downhill. The same thing is true about the economy and the markets, random and chaotic with a slight bias that is (fortunately) upwards.

 

[ERD50]

...

I still think the system is simply too complex [and too political] for anyone to fully understand, hence all the arguments about economics. The Director of the People's Bank of China sneezes in a press conference, and the S&P 500 drops 0.5%. Unless, of course, Apple simultaneously issues a quarterly report showing better-than-expected earnings... ...

OK, I guess it depends which aspect of "economics" you are referring to. I agree that there is a jumble of 'explanations' for the market moving this way or that over the course of a minute, hour, day, week, year, decade. Who knows?

But the concepts of economics, like supply/demand are well understood. Human behavior is not.

-ERD50

 

[ZachTB]

Yes. My standard metaphor is a trout stream. Although the mathematics of incompressible fluid flow is well understood, that does not give us the ability to predict the future whorls, eddies, and currents in a stream...

I really like this metaphor, OldShooter!

 

[ZachTB]

You're more a less a subscriber to the philosophy of Bogle, Bernstein, and many others. You're a passive indexer!

Exactly!

And you've found the techniques of great investors like me -- VGSLX in a Roth-IRA account...

I did a whole lot of reading and learning when I was in grad school. While I didn't have a whole lot of money, I did have a little. And I wanted to know how to handle my money like a responsible adult before I started making a full-time wage.

I'm still learning, obviously, but I soaked up a number of stories about people's mistakes, and how to avoid them. One of those involved the lesson of holding REITs in a tax-sheltered account, so I can avoid a nasty surprise on my taxes every year. (It probably doesn't matter too much today, but in 30 years...)

...I've never paid for a newsletter since I read a wide variety of opinions, and don't need actionable advice, since I am also almost 100% indexer...

I wish I would have put it as succinctly as you did here!

As you said, you...are looking for understanding about the economy and maybe the stock market...There have been several threads on favorite books, favorite podcasts and favorite reading sites for investors. This is the spray and pray approach. You don't get a nice sip from the garden hose, it's full on with the fire hose!

Well, I like to drink from the fire hose sometimes. I just avoid making hasty decisions based on that information. That makes me think of the Ents from Lord of the Rings!

 

[target2019]

I'm still learning, obviously, but I soaked up a number of stories about people's mistakes, and how to avoid them. One of those involved the lesson of holding REITs in a tax-sheltered account, so I can avoid a nasty surprise on my taxes every year. (It probably doesn't matter too much today, but in 30 years...)

I just checked, and this year I will measure out at 95% qualified dividends in taxable brokerage. I've largely followed the prescription, but I admire my solitary REIT (O) and the monthly income. It also acts a roadblock to stop me from chasing any more yield.

 

[ZachTB]

I just checked, and this year I will measure out at 95% qualified dividends in taxable brokerage.

Nice!!!

I've largely followed the prescription, but I admire my solitary REIT (O) and the monthly income. It also acts a roadblock to stop me from chasing any more yield.

Wise approach. I'm thinking that REITs could serve (at least partially) as a bond-substitute in the current low-yield environment. Solid dividend payments, plus opportunity for price appreciation [along with the obvious caveat that they can go down just as quickly as they go up. And even in the relatively short period of time I've held a REIT, it's done plenty of both].

 

[olyveoil]

These newsletter people always make me smile. She has no finance training and no experience in the industry. Her financial ideas are so wildly successful that she holds down a day job working as a worker bee ("Technical Lead") for the FAA -- unrelated to markets or finance, and her company office is a post office box. Her alma mater (Rowan University) is rated #187 on US News' ranking list, barely above the bottom half.

But, hey, she might guess right. There are enough of these letters that someone always does.

​

The best way to make money with a market newsletter is to write one.

Makes me like her more. Especially if she paid for her education in lieu of a trust-funder going to wharton business school.
Line up 100 harvard graduates and what do you get? 100 ways to blow tuition. Their "education" is no better or worse in my view.

 

[olyveoil]

Actually, given the random nature of markets and the number of prognosticators, someone is always right simply due to luck.

What matters is a verified track record of being right often enough to indicate skill. The academics have been looking for investing skill for years and have still not found any. For example: Ken French on picking a manager: https://famafrench.dimensional.com/videos/identifying-superior-managers.aspx

To me, opting to peddle a newsletter is prima facie evidence that the advice is not useful. Either she doesn't believe in her own advice or she has actually tried to use it and failed. The need to keep an inconsequential day job is just a nail in the coffin.

In the remote possibility that there are people with some skill in this area, they are certainly not giving their expertise away to subscribers for a few bucks a month (or for free!), nor are they offering their skills for hire to others as portfolio managers. This is French's point about who gets the rents.

Gotta love the person who demeans someone's job as inconsequential. What is YOUR job?

By the way, you skipped the transparency part.

 

[Markola]

The latest free version of Lyn Alden’s newsletter is out and, as always, she gives a macro, historical context to messy current events in clear English with compelling evidence. I always find it an enjoyable read. The theme of this edition is summarized in her sentence,

“…In other words, we can have no growth and less inflation, or some growth and a lot of inflation, but if we want ample growth with low inflation, then fixing the energy supply side is necessary.”

https://www.lynalden.com/august-2022-newsletter/

 

[ZachTB]

Thanks! I've subscribed to her free newsletter and am in the midst of reading this one.

My favorite of her articles probably remains this one: https://www.lynalden.com/fraying-petrodollar-system/

This is extensive, but full of info: https://www.lynalden.com/what-is-money/

This is a pretty good primer for beginners who want to invest: https://www.lynalden.com/how-to-invest-money/

As some commenters have noted, you can find this information elsewhere. But it seems to me that she has a pretty good understanding. She's also more bullish on Bitcoin than I am, but on the other hand, she's wealthier than I am, so she can better handle the gut-wrenching price changes...

 

[triangle]

Those who are interested in macroeconomic developments from a layman's perspective, might find the Uneducated Economist on youtube interesting. While Lyn can be very good, she can be too technical at times for causal reading. This guy is more topical and down to earth.

https://www.youtube.com/c/UneducatedEconomist/videos

Despite having barely graduated high school (his words) and working a retail job at a lumber supply store, his passion has been to learn about economics, economic theories and he watches (reads) Fed minutes and uses all that to give a somewhat different take on the economy as compared to traders on CNBC. Most of his videos are about 10 minutes in length where he sits in his car and talks. I occasionally listen when I am working on something around the house.

 

[Rianne]

Those who are interested in macroeconomic developments from a layman's perspective, might find the Uneducated Economist on youtube interesting. While Lyn can be very good, she can be too technical at times for causal reading. This guy is more topical and down to earth.

https://www.youtube.com/c/UneducatedEconomist/videos

Despite having barely graduated high school (his words) and working a retail job at a lumber supply store, his passion has been to learn about economics, economic theories and he watches (reads) Fed minutes and uses all that to give a somewhat different take on the economy as compared to traders on CNBC. Most of his videos are about 10 minutes in length where he sits in his car and talks. I occasionally listen when I am working on something around the house.

I just learned some things from him. I'd never listen to him sitting at a bar (not that I do, I don't drink alcohol) but listening to a youtube video, he makes sense of the economy. I love the background.