The dilemma many investors face, when looking at today’s markets, is simple: Where can I put my money? Markets are overvalued, and bonds sure look like a bubble, but I have to do something with the cash. I can’t just let it sit there, right?

I get it, but I don’t necessarily agree that you need to do something. Many great investors see sitting on their hands when market conditions are unfavorable as a key to their success. In poker, you make your money by not betting on bad hands. The value of the optionality associated with cash is, in my opinion, underrated.

To follow up on my recent posts, there’s another question I’d like to ask the person (or committee) that decided to outsource Tufts University’s early education program: Are you proud of this decision? Did you go home and announce to your own family what you had done? If the answer is no, what does that say about the quality of the decision?

This is also an important question to ask yourself in an investment context.

I’ve been thinking about Tufts University's decision to outsource its early education program, and why I feel so strongly about it. It’s not that I’m directly affected—Jackson will be finishing up there this summer before the transition. And it’s not that I’d necessarily disagree with the decision if I knew all the facts.

Besides the impact on people I like and respect, the thing that bothers me is that the decision makers seem to have focused on the wrong issues. Whenever you focus on the wrong things, any decision you make—however justified in terms of those wrong things—will turn out wrong.

My wife and I have been incredibly fortunate over the past three years to have our son, Jackson, enrolled in a Tufts University-sponsored day care/kindergarten program. The faculty, the curriculum, and the entire experience have been outstanding, and Jackson has benefited noticeably. Tufts students also benefit from the opportunity to volunteer and mentor the children.

Yesterday, we saw a passenger airliner shot down over what is arguably Europe. We saw an invasion launched as missiles rained down on civilian towns. And, in far less devastating news, we saw equity markets decline.

The Ukraine conflict has been simmering for months; the Middle East has been in conflict for decades. Still, yesterday's news came as a surprise, knocking markets down.

Today, I want to discuss two timely topics that are more interrelated than they seem. One is the growing trend of tax inversions, whereby U.S. companies change their legal structure to avoid or reduce their tax exposure. The other is the launch of a new development bank capitalized by the BRICS countries (Brazil, Russia, India, China, and South Africa)—a rival to the traditional international financial institutions, such as the World Bank and the IMF. 

What’s the common denominator here? Both developments suggest we need to rethink some long-held assumptions about how the world works.

I host a call for advisors’ clients every quarter, and one of the most interesting parts is the questions I get from participants beforehand. They’re invariably cogent, thoughtful, and helpful in defining what I should be talking about—and what I may be missing in my own view of the world.

A question that’s come up in preparation for my call tomorrow concerns inflation—is it coming? If so, when, and how bad will it be?

Although the headline employment numbers look strong, some say that the underlying reality is actually a lot worse, with few full-time jobs and many discouraged workers. According to the skeptics, it’s a Potemkin recovery, dependent on the fact that many people have simply dropped out of the labor force.

I’ve written quite a bit recently about oil production and its benefits for the U.S. economy. A related topic I’ve been asked about, but haven’t addressed here, is where oil prices might be going.

In case you missed it, last Friday, July 11, I appeared on Fox Business Network's Countdown to the Closing Bell. Learn why my outlook for the markets has a bearish bent.