The Disraeli Compromise

When you are on your journey to financial independence, you should study psychology.  One of the major ways that men like Charlie Munger get rich is that they study how the world works.  They study how to manipulate their psyche.  After that they study history to learn from the mistakes that others made.  When you look at the life of Warren Buffett, this is an interesting case study.  People see how he made a greater than sixty billion dollar fortune, and they ask how he made a mistake. (more…)

The FHA Home Affordable Modification Program

One of the goals of pretty much every society is ensuring home stability for each of its citizens.  The reductions is crime, better upbringing conditions for children, and the pride it gives make home ownership for everyone a laudable goal.  As is often the case though, life happens.  Layoffs, sickness, and divorce are still an ever present risk for everyone.  This is where government can help.  The Home Affordable Modification Program allows the government to step in and help people keep their homes. (more…)

Making Money in a Recession

As I spend a portion of my day digging through some of the history of programs and credits that were passed during the great recession, I am starting to get a little… fascinated by the response governments take in confronting economic downturns.  Whether is was a 100% exclusion from ordinary taxes on Qualified Small Business Stock bought after 2010, or the passing of the Tax Credit Assistance Program, the people who maintain liquidity are put in a strong position for making money in a recession.  The more I look at how the best value investors such as Warren Buffett, Charlie Munger, and Walter Schloss managed their portfolios by keeping large amounts of cash available to them, the more I start to think that strategy should be replicated by even mom and pop investors. (more…)

Warren Buffett and Charlie Munger Investing Styles

In honor of the now legendary Berkshire Hathaway annual meeting, I wanted to take a look at the investing styles of Warren Buffett and Charlie Munger.  These two men have astounding records of investing outperformance that have resulted in both of them becoming billionaires.  Naturally I think it is important to look at the early years when some of their best gains were realized. (more…)