Frank Boland's blog

Frank Thoughts: The Constancy of Change

Change is the very essence of the investment business. Because of this reality, every portfolio manager I’ve known has a desk that can only be described as saved chaos. And that’s not including the piles of newspapers on the floor. Some managers even have a library behind their desk. Not in nice wooden cases as you would expect but stacks of books piled high lying sideways also on the floor. It’s because every investment manager knows change in the investment world is constant. After all, you never know when you might feel the need for supporting information to make a better decision.

Frank Thoughts: The Impact of Interest Rates

When interest rates start to move higher, it will be considered a negative for the economy and the stock market. This reality started in in the middle of the last century.  General Motors was the largest corporation in the world, but rising interest rates proved very difficult to overcome. That contrasts sharply with the cash Microsoft, Apple, Facebook and Google generate today… and how little they need it.  It’s the difference between an industrial and a knowledge economy. The former was driven by the cost of money. The latter by the cost of knowledge which is driven by stock options.

Frank Thoughts: The Target Date Mutual Fund

Over the years, I’ve always enjoyed going to growth stock conferences. You meet interesting people and learn about upcoming companies. Sometimes, you even learn about yourself. That happened years ago in Baltimore. For whatever reason, I was late at the start of the conference and decided to stand in the back of the room rather than disturb people. By happenstance, I stood next to a man who was intently focused on two 30ish self-proclaimed Harvard Business School graduates explaining their business.

Frank Thoughts: The Wall Street Movie

Ever see a movie, or hear a song, and think to yourself, “I’ve seen or heard this before?”  Well there is a new “movie” coming to Wall Street and I know I have seen it before.  In fact, I saw the movie 50 years ago!  One of the advantages of longevity is that you get to experience many things twice.  This soon-to-be released movie is about a bear market in fixed income ... and what really happens.

Frank Thoughts: The New Economy

The seemingly sudden collapse of commodity prices has made news in the press.  Oil declined close to 50% in just a few weeks. The press claimed it was due to increased U.S. shale production and slowing global demand.  While these two factors are valid, I believe, they are on the margin.  What’s not on the margin:  Americans understand something very fundamental has changed in our economy.

Frank Thoughts: If I Were A Rich Man

If you were to become a “rich man” would you live differently than you currently do … as in showcase your wealth?  Most of us could never imagine that a friend could be one of the richest persons in the world … and that we would never know it.  A person’s persona can conceal --- or show --- a great deal.  Our impression of people is often based on their outward appearance.  Since most of us have friends that are like ourselves, we believe they are ordinary people.  But sometimes they are not.   

Frank Thoughts: The Real Business

“Do you have a Macy’s credit card?” asked the woman behind the counter.  “No,” I replied shaking my head somewhat disdainfully side-to-side.  “Who needs another credit card?” I thought.   ‘Well, I ask because you can get another 20% off’ continued the woman.  “Oh,” I said quietly to myself.  “I’m getting 20% off because it’s on sale … and I can get still another 20% off?  And I’m buying $300 worth of clothes.”  I quickly filled out the short credit application.  I mean who wouldn’t want to save $120?

Pages

So long as predictions remain popular, and are so numerous as they are today – and so long as they receive notoriety through repetition in the press and on the radio – contrary opinions will increase in importance as thinking aids. “

– Humphrey Neil