Book Bits: 10 December 2022

Principles for Navigating Big Debt Crises
Ray Dalio
Summary via publisher (Avid Reader Press/Simon & Schuster)
Ray Dalio, the legendary investor and #1 New York Times bestselling author of Principles—whose books have sold more than five million copies worldwide—shares his unique template for how debt crises work and principles for dealing with them well. This template allowed his firm, Bridgewater Associates, to antic­ipate 2008’s events and navigate them well while others struggled badly. As he explained in his #1 New York Times best­seller Principles, Ray Dalio believes that most everything happens over and over again through time so that by studying patterns one can understand the cause-effect relationships behind events and develop principles for dealing with them well. In this three-part research series, he does just that for big debt crises and shares his template in the hopes of reducing the chances of big debt crises hap­pening and helping them be better managed in the future.

Goals-Based Portfolio Theory
Franklin J. Parker
Blog post by author
Traditional portfolio optimization (often called modern portfolio theory, or mean-variance optimization) balances expected portfolio return with expected portfolio variance. You input how opposed you are to portfolio variance (your risk tolerance), then you build a portfolio that gives you the best return given your risk tolerance.
Goals-based investing, by contrast, defines “risk” as the probability of not achieving your goal. We assume you want to minimize that risk, so that is the only portfolio objective of a goals-based investor. As you will see, variance and returns are inputs into that equation, but they are not the equation

Wise Decisions: A Science-Based Approach to Making Better Choices
James E. Loehr and Sheila Ohlsson Walker
Summary via publisher (Wiley)
Every 15 minutes, each of us can make ten or more small decisions. Some of them are relatively inconsequential, while others can change the course of our lives. What if you could improve all of your decisions, across the board, and start to build a healthier, more productive, and meaningful life? In Wise Decisions: A Science-Based Approach to Making Better Choices, a team of accomplished industry experts delivers an evidence- and research-based blueprint for making the best decisions you can with the information you have. You’ll learn to make the targeted, repeated investment of energy required to turn your decision-making process into one informed by reason, emotion, intuition, and science.

Global Investing: A Practical Guide to the World’s Best Financial Opportunities
Darrin Erickson
Summary via publisher (Wiley)
In Global Investing: A Practical Guide to the World’s Best Financial Opportunities, veteran portfolio manager Darrin Erickson walks readers through how to best analyze, understand, and invest in leading global businesses. In the book, you’ll discover how you can improve the performance of your investment portfolio by taking advantage of opportunities that exist outside of the borders of the country you happen to inhabit. The author discusses how to identify and make investments around the world in effective and efficient ways, and how to successfully manage the risks associated with investing in a foreign country.

Sold Out: How Broken Supply Chains, Surging Inflation, and Political Instability Will Sink the Global Economy
James Rickards
Interview with author via Financial Sense
Financial Sense Newshour interviews Jim Rickards to discuss his just released book, Sold Out: How Broken Supply Chains, Surging Inflation, and Political Instability Will Sink the Global Economy, where he argues that the global supply chain built up and in existence over the past few decades cannot be fixed but ultimately replaced with a new one. Why? There are many reasons he cites in today’s interview but perhaps one of the biggest is a ‘once in a century decoupling’ of the world’s two largest economies and trading partners, which will have ripple effects for years to come. This is leading to what he argues is the building of Supply Chain 2.0, and it is being pursued by both countries at the same time, not just the US nor China alone. Listen in as Jim explains the long-term outlook for the global economy, the global supply chain, energy, and how today’s events fit within this broader trend, including some of the implications he believes to come from this.

To the Moon Investing: Visually Mapping Your Winning Stock Market Portfolio
Kelly J. Frank
Summary via publisher (Wiley)
In To the Moon Investing: Visually Mapping Your Winning Stock-Market Portfolio, veteran asset investor Kelly James Frank delivers an exciting and intuitive fresh approach that enables you to navigate an increasingly volatile market through the use of tailored portfolio maps. In the book, you’ll learn how to understand risk and how it affects you as an investor, how to prepare for your investing future, and how to uncover why you want to invest. You’ll also shore up your financial literacy and explore the difference between growth and value strategies. The book offers a vivid and innovative approach to investing that you’ll actually have fun reading and its engaging philosophy ensures you’ll be able to put your newfound knowledge to work immediately.

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