The Federal Reserve plays an ever-increasing, complex role in the U.S. economy. By significantly expanding its scope, the Fed is now the single most important economic factor influencing the financial markets. The Federal Reserve is, no doubt, a complex topic, perhaps one of the most challenging areas within finance. Few…

In the mid-1970’s, my mom helped care for a Cambodian refugee family in Tulsa, Oklahoma. The family had narrowly escaped the genocide of the communist Khmer Rouge regime, fleeing to the United States with the assistance of a Tulsa-based missionary couple returning from Cambodia. Almost 158,000 Cambodians entered the United…

I originally thought I was writing a book but found my topics too disparate and unrelated to collapse into a sequence of chapters within a single bound, cohesive structure. Consequently, a blog seemed the better format for my musings. The problem — I had no idea how to setup a…

Imagine a world where money is nearly free. In this make-believe world, the citizens planted a magical tree whose fruit is money. Sure, the citizens needed to water the money tree, prune it and generally care for it. They also, of course, had to pick the money from the tree…

If we are to believe the media, Sweden’s response to the Coronavirus differs from the rest of the world. Certainly, there are no shortages of articles and opinions about Sweden’s approach, spawning much discussion and speculation on its merits or ultimate demise. Time magazine published an eye-catching title: Sweden’s Relaxed…

When possible, I prefer to read original source documents for my research, rather than summarizing secondary or tertiary sources. Consequently, I read the entire 880-page CARES Act (“Coronavirus Aid, Relief, and Economic Security Act”) yesterday and today. I made summary bullet points as I read. Accidentally, this became a 7-page…

The past three Summers, I have traveled to Ukraine to visit my web developers. The first trip, my wife and oldest daughter traveled with me. The next Summer (2018), I went solo, and missed my wife’s keen sense of direction. Okay, I got lost. But for me, that’s not so…

Although the market is currently at an all-time high, that’s an insufficient rationale to avoid it. It is possible the economy will continue to expand, thus warranting higher equity valuations, perhaps for years or even decades. But if so, it will be against significant headwinds, based on the confluence of…

While the discounted cash flow (DCF) methodology is the most rigorous and financially sound for business valuation, it does have several significant limitations, namely: Extreme sensitivity to certain input assumptions. Uncertainty in calculating the terminal value of the company. 1. Sensitivity to Assumptions Two variables overwhelmingly influence the output of a DCF model: 1.A…