Breakfast of Champions?

Breakfast of Champions?

Wheaties was one of the most popular breakfast cereals in the 1960s. At that time, it accounted for six percent of the market and was popular for the photographs of famous athletes on its boxes—a marketing strategy that appealed to both children and adults. The images of hundreds of top athletes and teams like Walter Payton, Mia Hamm and the 1989 Detroit Pistons have adorned the box under the “the breakfast of champions” banner.

Over the past fifty years, however, the brand’s popularity has steadily declined. Wheaties’ market share has now shrunk so much that some breakfast cereal analysts expect that General Mills, the purveyor of Wheaties, will soon drop the brand altogether. Olympic snowboard athlete, Danny Kass, captured the problems facing Wheaties shortly after winning the silver medal in the 2002 halfpipe competition: When asked if he thought his image would be used on the cereal box, he responded, “If I was on something like that, I’d probably want it to be like Count Chocula or something cool.” Continue reading

Call It ‘Friend-O’

There is a storm brewing in financial markets. Surging indebtedness, depleted household savings, rate hikes and excessive leverage. These are factors which will impact both the global economy and financial markets.

After 9 years of gains, there is much greater downside than there is upside.

Plug into our sobering assessment of global asset markets below:


A pdf version is available here:  What’s the most you ever lost…



Driving over the cliff

The Heartbeat of America

Ninety percent of Americans drive to work in privately owned vehicles. For many, there is no way to avoid owning a car.  Public transportation in most cities is inconvenient, inadequate or non-existent—making our cars and trucks essential.  They are also expensive.  The purchase of a vehicle is typically the largest consumer expenditure for most households and often involves a long-term financial commitment.  When people feel good about their employment situation and overall financial health and are optimistic about the near future, they buy cars.  When families become cautious about spending or credit becomes scarce, they get a tune-up. Continue reading

Protect your neck!

It’s not cool, being a jive turkey…

Consider a flock of free range turkeys fed by a farmer for several months. Day after day, the farmer provides a formulated mix of protein-rich turkey feed for the birds. Over time, the flock will develop a strong attachment to Friendly Farmer and begin to anticipate her behavior in the future. As the birds grow more confident in the narrative of the infinitely benevolent Friendly Farmer who enjoys feeding turkeys, the necessity of a counter-narrative diminishes.  It stands to reason, no member of the flock is frantically warning of danger: “Don’t you know what happens to turkeys at the end of the cycle?!” Continue reading

Lalalala…can’t hear you. I’m too busy buying!

Over the last 300,000 years, Homo sapiens (Latin for “wise man”) have become the most influential species on earth.  Our ascent to the top spot is a result of the size and shape of our brains.  In the later stages of our evolution as a species, the back of our brains grew—giving modern humans (Homo sapiens sapiens!) a rounder shape than our ancestors. Scientists believe that change in shape was an adaptive one to accommodate the increasing complexity of our brains’ function. Continue reading

Odds and Ends

You say bologna, I say baloney

The idea that bologna consisted of low-grade cuts of beef or pork—the leftovers—gave it a bad reputation.  Over the past several years, however, researchers have determined that the simple “odds and ends” of meat manufacturing were not nearly as detrimental to human health as are added preservatives.  Sodium nitrates and nitrites are added to most packaged meats to increase shelf life.  In bologna, these chemicals improve flavor and prevent the meat from turning grayish—to the detriment of human health. A growing body of research links these types of preservatives to increased risk of cancer, Alzheimer’s and Parkinson’s diseases.  It seems consumers’ bologna skepticism was justified all along even though the real risk was not posed by spare parts of meat. Continue reading

All Time Highhh (Apr/May 2017)


And you know that notion just crossed my mind.

The Grateful Dead

All Time Highhh

In March 2017, a broad indicator of investor leverage, margin debt, achieved an all time high.  According to data published by the NYSE, the aggregate amount of debt provided by brokerage firms to investors reached $536 billion.  These loans are used by investors to partially fund the purchase of securities.  Used in this way, debt can significantly boost the profit potential of one’s investment portfolio.  For this reason, rising margin debt is generally considered a signal of investor confidence as many typically avoid leverage when the future appears more uncertain. Continue reading



Over the past six years, favorable credit conditions and steady employment gains have contributed to produce the best period of domestic US auto sales since the mid-1990s.  More recently, however, the underlying strength of these and other factors has begun to moderate and households appear to be entering a period of more cautious spending.  If we are correct, a pullback in household consumption will have a significant negative impact on US auto sales in coming quarters.

Continue reading