Our country is facing a retirement crisis. The unfunded liabilities of Social Security and Medicare coupled with the low savings rates and decimated 401(k) large parts of the baby boomer generation not having enough money to retire.
One of the key principles we bring up over and over again is the difference between an asset and a liability. All other lessons hinge on understanding these two concepts.
“I love market crashes.” Apparently not wanting to hear the rest of my explanation, the young man stomped off muttering a word that sounded like “moron.” I’ve covered this subject of booms, busts, and bubbles before in my columns and books, but since the world seems to be on the brink of so many different booms and busts, I think it’s a good time to revisit it.