The Best of the Aleph Blog, Part 38

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In my view, these were my best posts written between May 2016 and July 2016:

You Can Get Too Pessimistic

In general, I think there is no value in preparing for the “total disaster” scenario if you live in the developed world.  No one wants to poison their own prosperity, and so the rich and powerful hold back from being too rapacious.

The sun will rise tomorrow, Lord helping us… so diversify and take moderate risks most of time.

Risk vs Return — The Dirty Secret

After a certain point, additional risk reduces returns, because average people cannot stomach making the tough decisions when things are too good, or things are too bad.

Simple Stuff: What is Risk?

I thought of doing Simple Stuff as a series, but this is the only one that I have done so far.  Anyone have an idea for another one?

Risk is the probability that an entity will not meet its goals, and the degree of pain it will go through depending on how much it missed the goals.

The Dead Model

My modified “Fed Model” as a measure of the equity premium inherent in the well-known Dividend Discount Model applied to the market as a whole.  Then I break the equity premium apart into three concepts that are simpler to understand.

Brexit Boogeyman

Brexit Boogeyman Bellows “Boo!”

My take on the Brexit, before and after the vote.  It is still my opinion that Britain is better off outside the EU, and that the worries regarding it remain overblown.