In this episode Pete and Steve discuss philosophy and why it is arguably the most important of the 4. They use the characteristics discussed in previous episodes to determine how philosophy has evolved since the earlier generations. With a focus on the 9 Types, Pete and Steve delve into just how you can use the characteristics to assist in developing your own philosophy to help you achieve greater wellbeing. Books Mentioned: - Bowling Alone: The Collapse and Revival of American Community -...

In this episode Pete and Steve discuss the final 4 characteristics that you should think about in developing your 4 F's model. They discuss, thinking, curiosity, perseverance and finally planning and how each of these can help you in achieving your goals and living a balanced life. Books mentioned: - The E-Myth by Michael E. Gerber - Stephen Jay Gould Thanks for listening! Download a free copy of our latest book, Total Money Management – How to escape the rat race and unlock your...

In this episode, Pete and Steve discuss 4 of the characteristics or principles that we each should consider when building your own 4 F's model. We discuss the importance of balance and how it can impact your life. We talk about distributions like the normal distribution and relate it to finance. How important it is to have a dynamic approach rather than a static outmoded view of the areas that impact our lives and finally, how discipline works in the model. Books mentioned: - Awaken...

In this new series Pete and Steve discuss their 4 F's mental model. The 4 F's stands for: Fun Fitness Finance and Filosophy. In this introductory episode Pete and Steve outline their thoughts around what makes a life successful. Being successful is about your whole life, not just the financial side and so it is important to pay attention to the other 3 - fun, fitness and filosophy. So join Pete and Steve as they discuss some of their life experiences and share how you can build not only...

In this, the final episode in the Buffett mini-series, Pete and Steve discuss what we can learn from Warren Buffett's journey as an investor. Are there any special characteristics that each of us can gain from Buffett in helping us be successful not just in investing but in life in general. Recommended books for the series: · The New Buffettology · The Warren Buffett Way · Buffett: Beyond Value · 7 Secrets to Investing Like Warren Buffett · Buffett: The Making...

In this episode, Pete and Steve discuss the Kelly Criterion and whether Warren Buffett could be considered a Kelly investor. Buffett has never mentioned whether he is a Kelly investor, but by looking at the Kelly principles, Pete and Steve believe that Buffett is probably a Kelly investor given the way he invests and his philosophy which appears to be closely aligned with Kelly. They also discuss what criteria make for a Kelly type investor and how it can lead to greater investment...

In this episode, Pete and Steve chat about how Buffett has been able to succeed by saying no to a majority of investing themes and remaining through thick and thin to his investment style. Many investors especially when first starting out, say yes to everything and often come to the conclusion that saying no more often than yes leads to investment success. Again Pete and Steve demonstrate that simple principles and the avoidance of complexity in investing is the best approach. They...

In this episode, Pete and Steve discuss each of Warren Buffett's criteria of what constitutes a "simple" business. (1) Large purchases and large companies, (2) Demonstrated consistent earning power, (3) Businesses earning good returns on equity while employing little or no debt, (4) Management in place (we can’t supply it), (5) Simple businesses (if there’s lots of technology, we won’t understand it), (6) An offering price. We then summarise whether all of these have the same importance...

In this episode, Pete and Steve discuss Buffett's quote "be fearful when others are greedy and greedy when others are fearful". They discuss Buffett's musing about the value of the stock market overall; his understanding and the way he takes advantage of other investors emotions and how he uses logic as a central part of his steadfast conviction that price follows value; How CAPE can assist in considering when to enter and exit markets; and finally Buffett's favourite macro valuation...

"Price is what you pay, and value is what you get". So says the master Warren Buffett. In this episode Pete and Steve discuss what exactly Buffett thinks about price and value and what do they really mean for investors. We also discuss value in both the micro and macro sense and also a discussion on how Buffett thinks about value. And of course, we chat about our old favourite the CAPE ratio and how it ties to the idea of value. Thanks for listening! Download a free copy of our latest...

In this podcast series on Warren Buffett, Pete and Steve dissect some of Buffett's best known quotes to determine what Buffett means and how you can use Buffett's philosophy to improve your investment prowess. In this opening episode, Pete and Steve discuss the meaning behind Buffett's best known quote "Rule No.1 - Don't Lose Money and Rule No. 2 is Don't Forget Rule No. 1". Pete and Steve also get the chance to throw in a few more Buffettisms and what the quote has to do with risk and...

Join Pete and Steve as they wrap up the Economics and the Market series with this episode where they discuss: - What are our beliefs about the connections between economics and markets? - Which way does the correlation go – do markets drive economics or the other way around. Because asset prices are such an important part of our wealth, they play a much greater role than they did for previous generations. - What is the Low Rates High returns philosophy regarding markets and economics? -...

It's widely assumed that there is a close connection between the stock market and the broader economy. It sort of makes sense, right? After all, both deal with money! In this episode, Pete and Steve discuss whether there actually is a correlation between economic growth and stock market returns, and they question whether economic growth actually does assist investors in delivering superior investment returns. Listen to this week's episode and understand why the CAPE and earnings yield...

Is MMT good for the stock market? Why is it so controversial? In this episode Steve and Pete discuss the various aspects of MMT including whether it is good for markets and the impacts of the theory on your stock market portfolio. Books - Stephanie Kelton, The Deficit Myth; L. Randell, Wray Modern Monetary Theory. Thanks for listening! Download a free chapter from our book ’Low Rates, High Returns’ www.lowrateshighreturns.com/podcast Pete...

Economics has a long history but one that is littered with failures to predict large influential events that impact the global economy. The Queen of England famously asked why economists could not have seen the Global Financial Crisis before it happened. Since the GFC, economics and alternative theories have been gaining wider publicity as a result of the consistent failures of the neo-classical theory to avert economic problems such as poverty, recessions and growing inequality. In this...

In this opening episode of Series 5, Steve and Pete discuss the history of economics and how the theory has evolved over time. This is the first in the series which seeks to gain a greater understanding how economics interacts and influenced the stock market. Reference books: 1. John Kenneth Galbraith – Any of his books are great but 2 stand out – The History of Economics and The Great Crash 2. Robert Heilbroner – The Worldly Philosophers 3. Binyamin Appelbaum – The Economists’ Hour 4....

Participating in any market bubble can be lots of fun. Making money and watching your portfolio grow quickly is music to every investors ears. But what about when you recognise the market is getting or is in a bubble. What should you do? Should you join in? Sell out and wait in cash? Find alternative stocks? Ignore the bubble and forge on? In this episode, Pete and Steve discuss how you should invest when markets are looking bubbly and what options are available to investors to profit...

Market bubbles are generally thought of as overall negative events because when they burst they leave behind a lot of sad investors who are nursing heavy losses. Once the bubble bursts, investor get a change to survey the damage. But most clouds have a silver lining if you look hard enough. In this episode. Pete and Steve discuss what happens after the bubble bursts and whether there is any good to come from them. And what lessons can investors, both new and old learn from market...

In today's episode we discussed some of the characteristics of a bubble, and how they can be identified. We discussed several warning signs, including the following: -Valuation metrics become redundant -No price too high! -Technical analysis starts at high valuations -Investor profile: a surfeit of new young men coming into the market -A sharp rise in the use of leverage We also discussed why it's difficult to pick the top. Books/articles referenced David Einhorn Buchanan Capital cycle...

The excessive bubbles of history took a great economic situation and extrapolated it into the future, based on an assumption that today’s perfect conditions will continue. We find there are bubbles in all asset classes – property, stocks, art, basically any area where people trade. Jeremy Grantham recently said - “We are in a bubble,” “but it is unlike any other.” Everything is overpriced, he said, but there is no way to say when they will peak. To call that peak, it is useful to look for...

In this week’s episode we discuss: -The ‘risk hierarchy’ of investing and why individual companies can carry the greatest risk -Why systematic structural advantages can lead to investment success -Porter’s 5 forces versus Greenwald: which model is better -Monopolies and oligopolies – supply versus demand -industry specific models -other simple models for finding value Other simple models - EV/EBIT (Carlisle), 52 Week Low (Wiley), Low P/E (Dreman/Neff) Net Nets (Graham), - discuss benefits...

In this week’s episode we discuss: -industry cycles and why they repeat -industry CAPE ratios -why supply matters as well as demand -focussing on statistics over stories -a very simple method for investing in sector ETFs! Books mentioned: Geoffrey West – Scale Jonathan Tepper – The Myth of Capitalism James O’Shaughnessy – What Works on Wall Street Edward Chancellor – Capital Returns: Investing Through the Capital Cycle Jeremy Siegel – The Future for Investors: Why the Tried and the True...

In this week’s episode we discuss: -which model is best for the stock market? Which model reflects the true reality? -what is capital growth theory? -why it’s best to think dynamically and to take an active approach -why EMH is best for financial advisors, but not for you -our 8 timeless principles and how they work as a model -are markets random? How best to cope with randomness -how to adjust your approach as the environment changes Thanks for listening! Download a free chapter from our...

In this week’s episode we discuss: -Why every investor has a favourite model for achieving superior returns -Characteristics of the different ways to invest: fundamental, technical, or quant -Why simple models outperform the complex -Correlation and complexity: why it’s so hard to weight variables to stock market returns -Investing over different timeframes -Which model is best for you and your personality types -The greatest investors and their commonalities Thanks for listening! Download...

In this week’s episode we discuss systematic simplicity, and how more moving parts can mean that there are more things to go wrong. Here’s what we cover and discuss: • Why discounted cashflow calculations are difficult • What’s the best way to value a company? • How the great investors can end up with simple systems and variables • Do computers add any value for investors? • Why simple doesn’t mean thoughtless • Some simple models for investing • Calm and circumspect: how systems can reduce...