Consider this scenario:  The domestic manufacturing sector is all but gone.  Housing prices crash and billions of dollars of unrealized equity evaporate almost overnight.  Consumer spending drops and the US service economy, driven by consumer spending and propped up by foreign investment and trade deficits, crashes.  Foreign investors see the weakness and stop buying dollar […]

I recently finished reading the 9th edition of Burton Malkiel’s classic text A Random Walk Down Wall Street.  First published in 1973, this book is a classic text that deserves a place on any investor’s bookshelf. 
Malkiel presents two possible security valuation models - one based on a firm foundation of value and one based on […]