Long-term Trends and Game Changers

2017 Chart Updates – Natural Gas: An Energy Game Changer Booklet

April 13, 2017
Ron published Natural Gas: An Energy Game Changer in November 2013. Here are 2017 updates to some of the charts in the booklet.

Natural Gas: An Energy Game Changer

April 12, 2017
In this country, a quarter of our natural gas production is used by industry, a quarter is used to generate electricity, and half is used for home heating. As investors, we learned a long time ago that if a product or service makes sense to the consumer it probably will last a long time.

Let’s Get Real: Understanding Your Purchasing Power

June 8, 2016
You must understand the difference between a nominal interest rate and a real interest rate to determine your purchasing power. This essay was originally published in Muhlenkamp Memorandum Issue 108, October 2013.

Recap: December 3, 2015 Investment Seminar

January 19, 2016
On December 3, 2015, portfolio managers Ron and Jeff Muhlenkamp provided an update on the checklist they use to monitor the investment climate. Over the past several years, the stock market, in general, has been acting as though we’ve had a normal recovery from a normal recession. The items on their checklist indicate otherwise: there is a gap between how the stock market is performing and how the economy is performing.

How Shale Gas Benefits the Consumer

May 25, 2015
This essay was originally published in 2012. Ron—investment manager, engineer, farmer, and landowner—examines how the consumer of natural gas is benefitting from the lower price of natural gas.

U.S. Personal Consumption Expenditures Per Capita: 1950, 1980, and 2010

May 5, 2015
Pie charts of U.S. Personal Consumption Expenditures Per Capita: 1950, 1980, and 2010.

Effects of Currency Manipulation

January 14, 2015
This article explains the ripple effect that could occur when one country devalues its currency. It also examines who “wins” and who “loses” in the game of currency manipulation.

The Signposts of Change: Economics, Rules, Markets

May 1, 2009
We have three topics for today: what’s happening with the economy, the rules (informal and formal)  that affect ongoing changes, and how it all gets reflected in the markets.

How Much Money Are You Willing to Lose for a Theory?

May 20, 2005
There are a lot of theories that people use when choosing investments for their portfolio. Unfortunately, they are only theories, meaning they are not always accurate or helpful. The challenge is to determine which ones are and which ones are not. The criteria are simple: Does this theory help me make better investment choices (does it make me money?), or does following this theory lead me to poor investment choices (does it cost me money?). There are currently several very popular theories that are costing people an awful lot of money. I’d like to discuss four of them.

Review of “What Works on Wall Street”

July 20, 1997
A friend asked me to review the book What Works on Wall Street, by James P. O’Shaughnessy. The book was published in 1997 by McGraw-Hill and is subtitled A Guide to the Best-Performing Investment Strategies of All Time. These are my comments:  It is a useful book—chock full of data; the book is limited in scope, focusing on the “Wall Street” in the title instead of the “Investment Strategies” in the subtitle; the book is all hindsight. It should be titled, “What Would Have Worked on Wall Street.”

Thoughts On The Future

January 2, 1997
The future is good! The future is good because large parts of the world population are adopting freer markets. In Asia, in Eastern Europe, and in much of South America, the move from state-controlled economies to free-market economies is now irreversible. In a free market, the consumer is king.

Are Stocks Too High?

January 2, 1994
This essay, written in January 1994, looks at the assumptions behind stock valuation models and why they often mis-price the stock market. Using the same data, but modifying the model, Ron creates a new valuation model that better anticipates stock prices. Same data—different perspective.

And the Climate Is

January 20, 1993
This essay reviews the investment climate changes from the 1970s to 1993. Of particular interest is the lag in perception of the changes by the public. In the ’70s, people used strategies appropriate in the climate of the 1960s, and lost money. In the 1980s, people used strategies appropriate in the 1970s, and lost money. You don’t have to predict climate changes, but you must recognize them when they occur.

This is 20/20

January 1, 1990
Written in January 1990, this essay looks back at the international growth of free-market economies since the 1960s and their effect on America’s economic position in 1990. By understanding the past, we can better assess the present and better prepare for the future.

Wake Up America – Houses Don’t Make You Money!

January 1, 1987
In the 1970s (when inflation rates were higher than mortgage rates), one of the best investment strategies was to borrow money. The easy way for people to borrow money was on real estate. It worked in housing, in farmland, and in commercial real estate (which was also an effective tax shelter). People continued to believe in the strategy through the 1980s, even though the economic climate had reversed in roughly 1981. Ron wrote “Wake Up, America—Houses Don’t Make You Money!,” in July 1987, to point out that change.