Chris Leithner

10-year Treasuries also hedge against inflation, recession and uncertainty; moreover, unlike these bonds, boom-bust cycles plague gold. Why should investors own gold? The question is particularly relevant when geo-political tensions are high and rising, fears of recession are growing and stock (but not gold and bond) markets are plummeting. Gold’s advocates have long cited a … [Read more...] about Why investors needn’t – and presently shouldn’t – own gold

Since the late-1980s they’ve mostly been lax. But at some point they’ll constrict and remain tight – and the 40-year bull market will end. Another Inconvenient Truth Today’s Consensus Refuses to Acknowledge “As the Federal Reserve nears the end of a historic cycle of interest rate increases,” wrote Sarah Hansen (“What Does It Mean That Financial Conditions Are … [Read more...] about Tight(er) financial conditions will end the bull market

Its long-term returns have been outstanding. Yet eroding fundamentals and today’s prohibitive valuation imply tomorrow’s mediocre return. CSL Ltd isn’t merely an Australian success story: it’s also a global leader of its field. In recent years it’s ranked among the largest (by market capitalisation) companies listed on the ASX (on 7 March it ranked third, behind CBA and BHP, … [Read more...] about Why CSL will likely underperform term deposits

Many claims about RRE’s returns combine anecdote, distortion, error and omission. I substitute orthodox theory and long series of data. Most comparisons of the returns – or assertions about the relative returns – of Australian stocks and residential real estate (“RRE,” which is often described by the ambiguous shorthand “property”) suffer from one or more of three severe … [Read more...] about Don’t be misled: Aussie stocks and bonds outperform residential real estate

Its impact upon stocks – and of stocks upon it – has long been scant. Investors should ignore it and those who try to predict its actions. It’s infrequently stated openly, but analysts, journalists and investors apparently accept it as conventional wisdom: the consequences of changes to central banks’ policy rates of interest are consistent and significant. After the Reserve … [Read more...] about Stop obsessing about the RBA

“Revolutionary technology” doesn’t boost productivity, profits or returns. Speculators in AI and crypto are the latest to delude themselves. DeepSeek Isn’t AI Speculators’ Biggest Worry “DeepSeek has sparked a deep freakout,” reported The Wall Street Journal (“Nvidia Stock Sinks in AI Rout Sparked by China's DeepSeek,” 27 January). “The Chinese artificial-intelligence … [Read more...] about Never mind DeepSeek: here’s why the AI mania won’t last

Its GDP is growing – but relies upon mammoth, debt-fuelled deficits. Without this “stimulus” the U.S. would’ve been in recession since 2009. A “Remarkably Strong” Economy The consensus is convinced: from the GFC to the COVID-19 pandemic the U.S. economy was robust, and since the pandemic it’s been remarkably strong. Although consumer confidence has underwhelmed, over the past … [Read more...] about The consensus is wrong: America’s economy is chronically ill

Today’s private credit reminds me of “junk” bonds and private mortgages in the 1980s-1990s. These “innovations” created disasters. Leithner & Company neither owns private credit nor plans to do so. We’ve conducted no due diligence in this space; we therefore know little about the major players, whether in Australia or overseas, and nothing of the contents and quality of … [Read more...] about Today’s private credit – tomorrow’s public liability?

If you want to commit fewer loss-making errors, you must accept more gain-foregoing ones. I establish and justify this crucial exchange. Investors inevitably make mistakes. That’s because investment unavoidably entails risk and uncertainty. (By “risk” I mean known potential outcomes and estimates of their likelihoods; uncertainty, in contrast, entails outcomes that are … [Read more...] about To lift your returns, swap these risks

Unlike many investors, he admits and mostly corrects his errors. He discerns two types; knowing their differences can spare you much grief. Sometime in the mid-1990s (I recall vaguely but can’t find the quote), Alan Cameron, who at that time headed the Australian Securities Commission (ASIC’s predecessor), defined an experienced investor as one who accumulates plenty of errors … [Read more...] about Warren Buffett’s 25 biggest mistakes – and 4 lessons they teach