3 things I’m thinking about this week…

1 –  Comfort Now...or Later?  Inflation ticked up to 2.6%...still moderate…but with a price level now up over 21% since the start of 2021. But what’s to come? I don’t forecast…but preparedness is important. As once 5%-ish (now 4%-ish) money markets and CDs tempt the investor, it’s important to remember how vital it is for your asset allocation to address an inflationary world over the next decades. CDs are more comfortable today. Asset classes like common stocks offer the potential for comfort tomorrow.

2. - The Dorito-fication of the World.  This article forwarded by Manual of Ideas is both fascinating and frightening – worth a click. In food, teams of Ph.Ds tweak flavors and textures to create addictive products like Doritos. Bending our diets toward ultra-processed foods our body has trouble processing. In news (sadly this now includes social media for many) TikTok and others have become expert at creating customized content that’s similarly addictive. Reducing our ability to contemplate, think and direct our attention meaningfully. As many have recalibrated their diets away from ultra-processed foods, perhaps similar effort is likely needed on the news front?

3 – Candy or Vegetables..  . In 2001, I appeared (briefly) on Bloomberg TV to talk about eBay – I worked for a money manager with a position in the name. Doing this required a trip to their San Francisco studio at 4am…today it could have happened on a smartphone. It was a little nerve-wracking but fun to do. Other fun stuff: economic and investment forecast dinners. You get to see advisors and investors out there weighing in on things both inside (and outside) their “circle of competence.”

Forecasts, like media interviews, are investment candy. Fun but ultimately empty investment calories. Financial news and advertising tends to be quite sugary - another reason to cut back. And forecasts are short-term (up to a year or so)…really just guesswork given the short horizon. Also quite unenforceable. Can you imagine bringing back the forecast dinner speakers a year later...not with new forecasts but to score last years results? The tomatoes could start flying.

It’s worthwhile to spend more time understanding what you own, and the competitive landscape that your investment choices face. And combine that with a persistent mentality so as to “not interrupt compounding unnecessarily” as Charlie Munger said.

…and one more thing

Progress comes in many forms. Though it’s been illegal to smoke on a U.S. airline since 1990, the No Smoking sign was still required to have a working “off” switch. Until last month. Also…I remember “no smoking” sections in airliners…how exactly were those supposed to keep the smoke in one place?

-Dave