A 5% Junk Bond Bubble: What Could Possibly Go Wrong?

In rare situations, it actually is better to sell off the stock of companies you own rather than try and live off the income. For those of you who pay attention to market history, you know that we are living in one of the worst times of high-yield American bonds with junk status that we have ever witnessed.

Right now, the junk bond yield of something like the Bank of America Merrill Lynch Index is at 5.002%. For a quick refresher on the topic: last year, the yields of junk bond indices fell below 5% for the first time in American history, and we are flirting with that mark again this year. My guess is that a lot of investors are saying, “A diversified basket of so-so securities yielding 5%, I’ll take it.” But you don’t want to put yourself in the position where you are buying something at such a lofty valuation that it has only been seen once before (and that was the previous year, which is still a part of this same business cycle).

Continue Reading!

Visa’s Profit Numbers Continue To Awe Me

To do something successfully, you have to properly execute a two-step process. First, you must acquire the information that is necessary to find the success, and secondly, you must actually—well—do it.

The Wall Street Journal recently ran a report on how the gap between intense novice poker players and professional players has been narrowing considerably in the past twenty years, thanks to the internet. Even though the pros are still better, someone who studies poker day and night, spending hours googling every poker-related question that enters his head is going to come pretty close to overtaking some of the top dogs as the constant researching on the internet allows passions to be fed.

Continue Reading!