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Become a Better Investor Newsletter – 12 July 2025

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Noteworthy this week

  • Unemployment signals US recession
  • US housing isn’t getting any cheaper
  • US stocks aren’t getting cheaper either
  • PE companies don’t look great
  • Climate policies are luxury goods

Unemployment signals US recession: Every single time unemployment starts rising from a base, a recession has followed. Will it be the same this time?

US housing isn’t getting any cheaper: The US Housing Market has reached its most unaffordable level in history.

US stocks aren’t getting cheaper either: The Shiller P/E ratio on the S&P 500 is higher than it has been 96% of the time in history, extremely expensive by long-term standards.

PE companies don’t look great: PE portfolio companies are smaller, more leveraged, pay higher interest rates, and have lower margins than public companies. These are not great selling points for private equity as an asset class. Buying sub-scale, low-margin businesses with expensive debt hardly seems like a path to riches.

Climate policies are luxury goods: Germany shuts down nuclear, but drills in a protected marine zone. Again, climate change policies are “luxury goods” purchased when affordable.

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Weekly market performance

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Chart of the week

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Podcasts we listened to this week

#393 The Marketing Genius of the Michelin Brothers – Founders

“You cut every unprofitable product and go all in on making rubber tires. You have no experience and don’t know a single thing about rubber manufacturing. You have a genius insight that selling tires is a waste of time and instead you should create the conditions for your product’s success.”

Listen on Apple or Spotify.

Readings this week

Markets Already Crashing

“Until this cycle, the gold price followed general asset prices in nominal terms: when the Fed added liquidity, the gold price increased along with stocks; when the Fed decreased liquidity, the gold price and other asset prices fell. Only those who accepted gold’s role as free market money understood that gold was, in fact, trading against asset markets on a real basis.”

Download PDF.

Book recommendation

Risk Savvy: How to Make Good Decisions by Gerd Gigerenzer

“In the age of Big Data we often believe that our predictions about the future are better than ever before. But as risk expert Gerd Gigerenzer shows, the surprising truth is that in the real world, we often get better results by using simple rules and considering less information.”

Get the book on Audible or Kindle.

Audible is great; have you tried it? If not, click here to get 2 books for free.

Memes of the week

New My Worst Investment Ever episodes

Enrich Your Future 37 & 38: The Calendar Is a Crook & Hot Funds Are a Trap

In this episode of Enrich Your Future, Andrew and Larry Swedroe discuss Larry’s new book, Enrich Your Future: The Keys to Successful Investing. In this series, they discuss Chapter 37: Sell in May and Go Away: Financial Astrology and Chapter 38: Chasing Spectacular Fund Performance.

LEARNING: Calendars don’t drive returns. Winners ignore hot funds.

Access the episode’s show notes and resources

Published on Become a Better Investor this week

In this episode of Enrich Your Future, Andrew and Larry Swedroe discuss Larry’s new book, Enrich Your Future: The Keys to Successful Investing. In this series, they discuss Chapter 36: Fashions and Investment Folly.

Listen to Enrich Your Future 36: The Madness of Crowded Trades

Axiata Group Berhad (AXIATA MK): Profitable Growth rank of 8 was same compared to the prior period’s 8th rank. This is below average performance compared to 250 large Comm. Serv. companies worldwide.

Read Axiata Group – World Class Benchmarking

Anhui Expressway Company Limited (600012 SH): Profitable Growth rank of 3 was same compared to the prior period’s 3rd rank. This is above average performance compared to 1,430 large Industrials companies worldwide.

Read Anhui Expressway – World Class Benchmarking

Catcher Technology Company Limited (2474 TT): Profitable Growth rank of 5 was same compared to the prior period’s 5th rank. This is average performance compared to 750 medium Info Tech companies worldwide.

Read Catcher Technology – World Class Benchmarking

Strong equity rebound in Emerging Markets, Asia, and US. Performance review of our strategies in June 2025 – All Weather Inflation Guard gained 1.4%, All Weather Strategy gained 1.3%, All Weather Alpha Focus gained 1.5%.

Read A. Stotz All Weather Strategies – June 2025

DISCLAIMER: This content is for information purposes only. It is not intended to be investment advice. Readers should not consider statements made by the author(s) as formal recommendations and should consult their financial advisor before making any investment decisions. While the information provided is believed to be accurate, it may include errors or inaccuracies. The author(s) cannot be held liable for any actions taken as a result of reading this article.

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