Must Reads of the Week – December 19, 2018

Must Reads of the Week

Our favorite reads of the week and the quotes that make them worthy…

“For the first time in decades, every major type of investment has fared poorly, as the outlook for economic growth and corporate profits is dampened by rising trade tensions and interest rates. Stocks around the world are getting pummeled, while commodities and bonds are tumbling — all of which have left investors with few places to put their money.”
Investors Have Nowhere to Hide as Stocks, Bonds and Commodities All Tumble by Matt Phillips | The New York Times


“Rather than being blinded by short-term gains (or losses), try to focus instead on the big picture. Do your holdings align with the qualities you’ve laid out in your investment policy statement (above)? Is your portfolio as streamlined as it can be, or can you identify redundancies?
Your Market Downturn Tool Kit by Nir Kaissar | Morningstar


“The index has experienced a double-double-digit drawdown (kind of like double secret probation?) for the first time since 1990. That means the S&P 500 fell 10%, made those losses back, only to fall 10% yet again. The only other years on record I could find when this happened were in 1946 and 1947.”
The One Constant in the Stock Market by Ben Carlson, CFA | A Wealth of Common Sense


“You should do whatever makes you happy. If living a frugal life that allows you to end the 9-5 grind twenty years early, then by all means do it. But be careful, because the hardest problem in finance is too complicated for simple rules of thumb.”
The Hardest Problem in Finance by Michael Batnick, CFA | The Irrelevant Investor


“But by biding its time and working the problem, rather than rushing to compete, and, crucially, knowing that no one really knows what the global motoring market will look like in 2025, BMW has produced an innovative solution to the problem of which powertrain to get behind: all of them. It’s not sexy, but it’s very clever.”
BMW’s new electric car powertrain system totally torpedoes Tesla by Jeremy White | WIRED


“This finding suggests that the talents and ambitions of individual students are worth more than the resources and renown of elite schools. Or, less academically, the person you’re becoming at 18 is a better predictor of your future success than the school you graduate from at 22.”
Does It Matter Where You Go to College? by Derek Thompson | The Atlantic


“”I am worried that algorithms are getting too prominent in the world,” he [Dr. Knuth] added. “It started out that computer scientists were worried nobody was listening to us. Now I’m worried that too many people are listening.””
The Yoda of Silicon Valley by Siobhan Roberts | The New York Times


“The primary source of controversy and confusion surrounding FiveThirtyEight’s predictions is that they are ‘probabilistic.’ Practically what this means is that they do not predict a winner or loser but instead report a likelihood. Further complicating the issue, these predictions are reported as point estimates (sometimes with model implied error), well in advance of the event.” 
Why you should about the Nate Silver vs. Nassim Taleb Twitter war by Issac Faber | Towards Data Science