Why Many Doctors Struggle Financially: 5 Key Reasons

Posted on September 23, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I. and Staff Reporters

SPONSOR: http://www.CertifiedMedicalPlanner.org

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Despite their high salaries, not all doctors are wealthy, and some live paycheck to paycheck. Here are 5 reasons why many doctors today are broke, according to https://medschoolinsiders.com

1 | Believing They Are Universally Smart

The first reason so many doctors are broke is that many doctors believe they are universally smart. While most doctors have deep specialized knowledge, there’s a big difference between being smart in your profession and being smart with money. A physician’s schooling is quite thorough when it comes to the human body, but med school doesn’t include a prerequisite class on how to handle finances.

MORE: https://medicalexecutivepost.com/2022/11/18/what-is-the-dunning-kruger-effect/

Graduating medical school is a major feat and certainly demonstrates superior work ethic and cognitive abilities. But many new doctors believe these accomplishments transcend all aspects of life. If you’re smart enough to earn an MD, you’re certainly smart enough to handle your finances, but only once you properly and intentionally educate yourself.

The truth is doctors, especially traditional graduates, haven’t had an opportunity to manage large sums of money until they become fully trained attending physicians and start pulling in low to mid six figures in income. Prior to that, there was very little of it to manage.

Far too many aspiring doctors, and students in general, don’t take the time to learn financial basics, in part because it’s uncomfortable and seems like something they can figure out “later”, whenever that may be. Their poor spending habits and lack of investment knowledge carry over into their careers, causing many to make irresponsible decisions.

MORE: https://medicalexecutivepost.com/2025/07/17/doctors-and-lawyers-often-arent-millionaires/

2 | Overspending Too Soon

The second factor is overspending too soon, and this comes up at two points in training.

First, it’s natural to want to start spending more as soon as you get into residency and start making a little more money. After all, you’ve been a broke student for 8 or more years, and now you’re finally making a reasonable and reliable wage. But that’s where young doctors get into trouble. Residency pays, but not nearly as much as you will be making once you become an attending physician. The average resident makes about $60K a year, and if you begin spending all of that money right away, thinking you’ll handle your loans once you become an attending, you delay paying off your medical school debt, which means the compounding effect through your student loan interest rate works against you.

Now that $250,000 in student loans has ballooned to over $350,000 by the time you finish residency. The compounding effect, which can be one of your greatest allies in your financial life, becomes an equally powerful enemy when working against you through debt. But of course, pinching pennies is easier said than done, especially when you’re in residency and are surrounded by peers in different professions. They’ve been earning good money much longer than you have, and they can afford more luxurious lifestyles.

They may not be worried about indulging in fine dining or how much a hotel costs when traveling. Students in college and medical school are often confident they will resist the temptations, but the desire to keep up with your friends and family can be difficult to ignore, which causes many to overspend before they technically have the money to do so.

The same is true of attending physicians. As soon as those six-figure salaries come rolling in, many physicians go overboard with spending, trying to make up for lost time and to treat yourself.

Now, we are not suggesting you shouldn’t reward yourself for completing residency, but that reward shouldn’t be a Lamborghini. It’s best to continue living like a resident in your first few years after becoming an attending to pay off loans, put a down payment on a home, and get your financial foundation built before loosening the purse strings.

3 | Decreasing Salaries

Third, doctors continue to make less money than they did before. And this includes nearly all 44 medical specialties. For example, while physician compensation technically rose from $343k to $391k between 2017 and 2022, this rise does not keep up with inflation. The real average compensation in 2022 was less than $325k—a $20k decrease in purchasing power in only six years.

For doctors who are already spending to the limits of their salaries with huge mortgages, car payments, business costs, and other luxuries, a decreased salary can have a huge impact. You might be able to cut back by going on fewer vacations or eating out less frequently, but many accrued costs are locked in, such as a mortgage payment, car loan, or leased rental space for your practice.

4 | Increasing Costs of Private Practice

In the past, running a private practice was much simpler, but recent stricter guidelines and regulations have made it difficult for solo practices to keep up. While regulations like the Health Insurance Privacy and Portability Act, or HIPAA, and mandatory Electronic Medical Records, or EMRs, are necessary to protect patients, they make costs higher for physicians who run their own private practice. These physicians need to spend their own money to set up and maintain EMRs as well as invest in security to ensure patient data is protected.

With the steep rise of inflation we’ve seen over the past couple of years, everything is more expensive, which means costs, such as business space, equipment, and even office supplies, have gone up for private practice physicians while salaries have not. 2013 to 2020 saw an annual inflation rate of anywhere from 0.7% to 2.3%. This skyrocketed to an annual inflation rate of 7.0% in 2021 and another 6.5% in 2022. In fact, the cost of running a private practice has increased by almost 40% between 2001 and 2021.

These increased costs are exacerbated by another problem plaguing private practices; decreased reimbursement. While costs increased by almost 40%, Medicare reimbursement only increased by 11%. When doctors see patients who are insured, the insurance companies pay the physicians for their time. For Medicare, the new proposed rules for 2023 would cut reimbursement by around 5%. When adjusting for inflation, Medicare reimbursement decreased by 20% in the last 20 years.

These costs add up, making it extremely difficult for physicians to thrive financially while running a private practice.

5 | Tuition Debt

Lastly, we can’t talk about a doctor’s finances without mentioning the exorbitant debt so many graduating physicians are left with. It won’t shock you to hear that med school is expensive. Extremely expensive. The average cost of tuition for a single year is nearly $60k, with significant variance from school to school, and that’s before accounting for living expenses.

In-state applicants pay less than out-of-state applicants, and students at private schools typically pay more than students at public medical schools. The astronomical costs mean the vast majority of students can’t pay for medical school out of their own pockets. And unless your family is part of the 1%, even with your parents footing the bill, it’s difficult to cover tuition, let alone rent, groceries, transportation, tech, social activities, exam fees, and application costs.

The average total student debt after college and med school is over $250k. But keep in mind that’s the average, which includes 27% of students who graduate with no debt at all. This means the vast majority of students leave medical school owing much more than $250k.

For some perspective, in 1978, the average debt for graduating MDs was $13,500, which, when adjusted for inflation, is a little over $60,000. There are multiple ways to eventually repay these loans, but time and discipline are essential to ensure this money is paid off as quickly as possible.

MORE: https://medicalexecutivepost.com/2024/12/03/12-investing-mistakes-of-physicians/

THE FINANCIAL FIX

According to financial advisor Dr. David Edward Marcinko MEd MBA CMP™; consider the following:

  • Place a portion of your salary (15-20% or more) into a savings account, and another portion (10-20% or more) into wise investments [stocks, bonds, mutual funds, and/or ETFs].
  • Pay off your bills each month, and then use leftover spending money to purchase fun things like vacations and fancy dinners, within your means. Shop sales, buy used clothes, and use credit card points for travel.
  • Hire an excellent tax professional and meet with an investment advisor once or twice a year about your investment status and strategy. http://www.MarcinkoAssociates.com

COMMENTS APPRECIATED

EDUCATION: Books

SPEAKING: Dr. Marcinko will be speaking and lecturing, signing and opining, teaching and preaching, storming and performing at many locations throughout the USA this year! His tour of witty and serious pontifications may be scheduled on a planned or ad-hoc basis; for public or private meetings and gatherings; formally, informally, or over lunch or dinner. All medical societies, financial advisory firms or Broker-Dealers are encouraged to submit an RFP for speaking engagements: CONTACT: Ann Miller RN MHA at MarcinkoAdvisors@outlook.com -OR- http://www.MarcinkoAssociates.com

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INVESTING PARADOX: Flexibile and Dogmatic

Posted on September 17, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Dr. David Edward Marcinko MBA MEd CMP™

SPONSOR: http://www.CertifiedMedicalPlanner.org

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A paradox is a statement or situation that seems contradictory but actually makes sense when you think about it more deeply. It challenges logic and often reveals a hidden truth.

FLEXIBLY DOGMATIC PARADOX

The Flexibly Dogmatic Paradox suggests that no matter how sensible your financial planning, investing or wealth management process is there will be uncomfortably long periods when it looks broken. And process is the best way of ensuring you keep standing for something because if you don’t stand for something, you’ll fall for anything. This is why, when assessing an investment fund, focus 50% on the manager’s character and 50% on their process. Everything else is detail. There are few guarantees in investing, but the fact that markets will batter you emotionally is one of them.

FINANCIAL PARADOX: https://medicalexecutivepost.com/2025/07/27/paradox-of-financial-health/

Example: During volatile times, the temptation to abandon the process is strong. But that’s why it’s there. Process is what forces one fund manager to keep buying unbroken companies when everyone else thinks they’re bust, and another to keep faith with a top-quality company when the mob says it’s too expensive The best fund managers dogmatically stick to their process when it’s out of favor. Then, when it returns to favor, the elastic pings back: they recapture lost ground surprisingly fast. However, every rule has an exception. And spotting the exceptions to their process is something the true greats have a knack for buying and selling.

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Example:  In 2007, US value manager Bill Miller had the makings of an investment legend, but the financial crisis wrecked all that. His process told him to double down into falling share prices, which had worked well for years. But it doesn’t work if the companies go bust, which many of his financial stocks did in 2008.

ADVISORS PARADOX: https://medicalexecutivepost.com/2025/06/20/paradoxical-contradictions-all-financial-advisors-must-know-to-win-clients/

Conclusion

The fact is that no matter how good it is, a process operated without human judgment is just an algorithm. The best fund managers and financial prospectors and sales men/women know this.

They stick dogmatically to their process but somehow remain flexible enough to spot the occasions when it’s about to drive them into a brick wall.

COMMENTS APPRECIATED

EDUCATION: Books

SPEAKING: Dr. Marcinko will be speaking and lecturing, signing and opining, teaching and preaching, storming and performing at many locations throughout the USA this year! His tour of witty and serious pontifications may be scheduled on a planned or ad-hoc basis; for public or private meetings and gatherings; formally, informally, or over lunch or dinner. All medical societies, financial advisory firms or Broker-Dealers are encouraged to submit an RFP for speaking engagements: CONTACT: Ann Miller RN MHA at MarcinkoAdvisors@outlook.com -OR- http://www.MarcinkoAssociates.com

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Understanding the Capital Asset Pricing Model

Posted on September 16, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

CAP-M

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By Dr. David Edward Marcinko MBA MED CMP™

SPONSOR: http://www.CertifiedMedicalPlanner.org

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Dr. Harry Markowitz is credited with developing the framework for constructing investment portfolios based on the risk-return tradeoff. William Sharpe, John Lintner, and Jan Mossin are credited with developing the Capital Asset Pricing Model (CAPM).

The Living Legacy of Dr. Harry Markowitz

CAPM is an economic model based upon the idea that there is a single portfolio representing all investments (i.e., the market portfolio) at the point of the optimal portfolio on the Capital Market Line (CML) and a single source of systematic risk, beta, to that market portfolio.  The resulting conclusion is that there should be a “fair” return investors should expect to receive given the level of risk (beta) they are willing to assume. 

The excess return, or return above the risk-free rate, that may be expected from an asset is equal to the risk-free return plus the excess return of the market portfolio times the sensitivity of the asset’s excess return to the market portfolio excess return.  Beta, then, is a measure of the sensitivity of an asset’s returns to the market as a whole.  A particular security’s beta depends on the volatility of the individual security’s returns relative to the volatility of the market’s returns, as well as the correlation between the security’s returns and the markets returns. 

While a stock may have significantly greater volatility than the market, if that stock’s returns are not highly correlated with the returns of the overall market (i.e., the stock’s returns are independent of the overall market’s returns), then the stock’s beta would be relatively low.  A beta in excess of 1.0 implies that the security is more exposed to systematic risk than the overall market portfolio, and likewise, a beta of less 1.0 means that the security has less exposure to systematic risk than the overall market. 

MPT has helped focus investors on two extremely critical elements of investing that are central to successful investment strategies. 

First, MPT offers the first framework for investors to build a diversified portfolio.  Furthermore, an important conclusion that can be drawn from MPT is that diversification does in fact help reduce portfolio risk. 

Thus, MPT approaches are generally consistent with the first investment rule of thumb, “understand and diversify risk to the extent possible.” 

Additionally, the risk/return tradeoff (i.e., higher returns are generally consistent with higher risk) central to MPT based strategies has helped investors recognize that if it looks too good to be true, it probably is.

Passive Investing

Passive investing is a monetary plan in which an investor invests in accordance with a pre-determined strategy that doesn’t necessitate any forecasting of the economy or an individual company’s prospects.  The primary premise is to minimize investing fees and to avoid the unpleasant consequences of failing to correctly predict the future. The most accepted method to invest passively is to mimic the performance of a particular index. Investors typically do this today by purchasing one or more ‘index funds’. By tracking an index, an investor will achieve solid diversification with low expenses. 

An ivestor could potentially earn a higher rate of return than an investor paying higher management fees.  Passive management is most widespread in the stock markets.  But  with the explosion of exchange traded funds on the major exchanges, index investing has become more popular in other categories of investing.  There are now literally hundreds of different index funds.  

Passive management is based upon the Efficient Market Hypothesis theory.  The Efficient Market Hypothesis (EMH) states that securities are fairly priced based on information regarding their underlying cash flows and that investors should not anticipate to consistently out-perform the market over the long-term.

The Efficient Market Hypothesis evolved in the 1960s from the Ph.D. dissertation of Eugene Fama.  Fama persuasively made the case that in an active market that includes many well-informed and intelligent investors, securities will be appropriately priced and reflect all available information. If a market is efficient, no information or analysis can be expected to result in out-performance of an appropriate benchmark. There are three distinct forms of EMH that vary by the type of information that is reflected in a security’s price:

  • Weak Form

This form holds that investors will not be able to use historical data to earn superior returns on a consistent basis.  In other words, the financial markets price securities in a manner that fully reflects all information contained in past prices. 

  • Semi-Strong Form

This form asserts that security prices fully reflect all publicly available information.  Therefore, investors cannot consistently earn above normal returns based solely on publicly available information, such as earnings, dividend, and sales data. 

  • Strong Form

This form states that the financial markets price securities such that, all information (public and non-public) is fully reflected in the securities price; investors should not expect to earn superior returns on a consistent basis, no matter what insight or research they may bring to the table.

While a rich literature has been established regarding whether EMH actually applies in any of its three forms in real world markets, probably the most difficult evidence to overcome for backers of EMH is the existence of a vibrant money management and mutual fund industry charging value-added fees for their services. 

The notion of passive management is counterintuitive to many investors.  Passive investing proponents follow the strong market theory of EMH.  These proponents argue several points including;

  1. In the long term, the average investor will have a typical before-costs performance equal to the market average. Therefore the standard investor will gain more from reducing investment costs than from attempting to beat the market over time. 
  • The efficient-market hypothesis argues that equilibrium market prices fully reflect all existing market information.  Even in the case where some of the market information is not currently reflected in the price level, EMH indicates that an individual investor still cannot make use of that information. It is widely interpreted by many academics that to try and systematically “beat the market” through active management is a fools game.

Not everyone believes in the efficient market.  Numerous researchers over the previous decades have found stock market anomalies that indicate a contradiction with the hypothesis.  The search for anomalies is effectively the hunt for market patterns that can be utilized to outperform passive strategies.  Such stock market anomalies that have been proven to go against the findings of the EMH theory include;

  1. Low Price to Book Effect
  2. January Effect
  3. The Size Effect
  4. Insider Transaction Effect
  5. The Value Line Effect

All the above anomalies have been proven over time to outperform the market.  For example, the first anomaly listed above is the Low Price to Book Effect.  The first and most discussed study on the performance of low price to book value stocks was by Dr. Eugene Fama and Dr. Kenneth R. French.  The study covered the time period from 1963-1990 and included nearly all the stocks on the NYSE, AMEX and NASDAQ. The stocks were divided into ten subgroups by book/market and were re-ranked annually. In the study, Fama and French found that the lowest book/market stocks outperformed the highest book/market stocks by a substantial margin (21.4 percent vs. 8 percent).  Remarkably, as they examined each upward decile, performance for that decile was below that of the higher book value decile.  Fama and French also ordered the deciles by beta (measure of systematic risk) and found that the stocks with the lowest book value also had the lowest risk. 

Today, most researchers now deem that “value” represents a hazard feature that investors are compensated for over time.  The theory being that value stocks trading at very low price book ratios are inherently risky, thus investors are simply compensated with higher returns in exchange for taking the risk of investing in these value stocks. The Fama and French research has been confirmed through several additional studies.  In a Forbes Magazine 5/6/96 column titled “Ben Graham was right–again,” author David Dreman published his data from the largest 1500 stocks on Compustat for the 25 years ending 1994. He found that the lowest 20 percent of price/book stocks appreciably outperformed the market.  

One item a medical professional should be aware of is the strong paradox of the efficient market theory.   If each investor believes the stock market were efficient, then all investors would give up analyzing and forecasting.  All investors would then accept passive management and invest in index funds.  But if this were to happen, the market would no longer be efficient because no one would be scrutinizing the markets.  In actuality, the efficient market hypothesis actually depends on active investors attempting to outperform the market through diligent research.

The case for passive investing and in favor of the EMH is that a preponderance of active managers do actually underperform the markets over time.  The latest study by Standard and Poor’s (S&P) confirms this fact.  S&P recently compared the performance of actively-managed mutual funds to passive market indexes twice per year. The 2012 S&P study indicated that indexes were once again outperforming actively-managed funds in nearly every asset class, style and fund category. The lone exception in the 2012 report was international equity, where active outperformed the index that S&P chose.  The study examined one-year, three-year and five-year time periods. Within the U.S. equity space, active equity managers in all the categories failed to outperform the corresponding benchmarks in the past five year period.  More than 65 percent of the large-cap active managers lagged behind the S&P 500 stock index.  More than 81 percent of mid-cap mutual funds were outperformed by the S&P MidCap 400 index. 

Lastly, 77 percent of the small-cap mutual funds were outperformed by the S&P SmallCap 600 index.  U.S. bond active managers fared no better that equity managers over a five year period. More than 83 percent of general municipal mutual funds under-performed the S&P National AMT-Free Municipal Bond index, 93 percent of government long-term funds under-performed the Barclays Long Government index, nearly 95 percent of high yield corporate bond funds under-performed the Barclays High Yield index.  Although the performance measurements for index investing are very strong, many analysts find three negative elements of passive investing;

  1. Downside Protection:  When the stock market collapses like in 2008, an index investor will assume the same loss as the market.  In the case of 2008, the S&P 500 stock index fell by more than 50 percent, offering index investors no downside protection.
  • Portfolio Control:  An index investor has no control over the holdings in the fund. In the event that a certain sector becomes over-owned (i.e. technology stocks in 2000), an index investor maintains the same weight as the index.
  • Average Returns:  An index investor will never have the opportunity to outperform the market, but will always follow.  Although the markets are very efficient, an investor can perhaps take advantage of market anomalies and invest with those managers who have maintained a long-term performance edge over the respective index. 
Efficient Market Hypothesis – or Perhaps Not?

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EDUCATION: Books

SPEAKING: Dr. Marcinko will be speaking and lecturing, signing and opining, teaching and preaching, storming and performing at many locations throughout the USA this year! His tour of witty and serious pontifications may be scheduled on a planned or ad-hoc basis; for public or private meetings and gatherings; formally, informally, or over lunch or dinner. All medical societies, financial advisory firms or Broker-Dealers are encouraged to submit an RFP for speaking engagements: CONTACT: Ann Miller RN MHA at MarcinkoAdvisors@outlook.com -OR- http://www.MarcinkoAssociates.com

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Stocks, Bonds and Commodities

Posted on September 13, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I. and Staff Reporters

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  • Stocks: The NASDAQ rose to its fifth record high of the week, while the S&P 500 and the Dow sank late in the day as investors turned their attention to the FOMC meeting next week.
  • Bonds: While equities climbed all week long, the bond market has been sending signals that weak economic data really isn’t great news.
  • Commodities: Oil rallied after President Trump expressed his growing frustration with Vladimir Putin and threatened further energy and financial sanctions. Meanwhile, the US may ask its G7 counterparts to apply 100% tariffs against China and India for purchasing Russian crude.

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FIXED INCOME SECURITY RISKS: All Physician Investors Should Know

Posted on September 12, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Dr. David Edward Marcinko MBA MEd CMP™

SPONSOR: http://www.MarcinkoAssociates.com

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Here are some of the most common risks associated with fixed income securities.

Interest Rate Risk

The market value of the securities will be inversely affected by movements in interest rates. When rates rise, market prices of existing debt securities fall as these securities become less attractive to investors when compared to higher coupon new issues. As prices decline, bonds become cheaper so the overall return, when taking into account the discount, can compete with newly issued bonds at higher yields. When interest rates fall, market prices on existing fixed income securities tend to rise because these bonds become more attractive when compared to the newly issued bonds priced at lower rates. 

Price Risk

Investors who need access to their principal prior to maturity have to rely on the secondary market to sell their securities. The price received may be more or less than the original purchase price and may depend, in general, on the level of interest rates, time to term, credit quality of the issuer and liquidity.

Among other reasons, prices may also be affected by current market conditions, or by the size of the trade (prices may be different for 10 bonds versus 1,000 bonds), etc. It is important to note that selling a security prior to maturity may affect actual yield received, which may be different than the yield at which the bond was originally purchased. This is because the initially quoted yield assumed holding the bond to term. As mentioned above, there is an inverse relationship between interest rates and bond prices. Therefore, when interest rates decline, bond prices increase, and when interest rates increase, bond prices decline.

Generally, longer maturity bonds will be more sensitive to interest rate changes. Dollar for dollar, a long-term bond should go up or down in value more than a short-term bond for the same change in yield. Price risk can be determined through a statistic called duration, which is featured at the end of the fixed income section.

REVENUE BONDS: https://medicalexecutivepost.com/2024/12/20/bonds-revenue/

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Liquidity Risk

Liquidity risk is the risk that an investor will be unable to sell securities due to a lack of demand from potential buyers, sell them at a substantial loss and/or incur substantial transaction costs in the sale process. Broker/dealers, although not obligated to do so, may provide secondary markets.

Reinvestment Risk

Downward trends in interest rates also create reinvestment risk, or the risk that the income and/or principal repayments will have to be invested at lower rates. Reinvestment risk is an important consideration for investors in callable securities. Some bonds may be issued with a call feature that allows the issuer to call, or repay, bonds prior to maturity. This generally happens if the market rates fall low enough for the issuer to save money by repaying existing higher coupon bonds and issuing new ones at lower rates. Investors will stop receiving the coupon payments if the bonds are called. Generally, callable fixed income securities will not appreciate in value as much as comparable non-callable securities.

ZERO COUPON BONDS: https://medicalexecutivepost.com/2024/11/12/bonds-zero-coupon/

Prepayment Risk

Similar to call risk, prepayment risk is the risk that the issuer may repay bonds prior to maturity. This type of risk is generally associated with mortgage-backed securities. Homeowners tend to prepay their mortgages at times that are advantageous to their needs, which may be in conflict with the holders of the mortgage-backed securities. If the bonds are repaid early, investors face the risk of reinvesting at lower rates.

Purchasing Power Risk

Fixed income investors often focus on the real rate of return, or the actual return minus the rate of inflation. Rising inflation has a negative impact on real rates of return because inflation reduces the purchasing power of the investment income and principal.

GENERAL OBLIGATION BONDS: https://medicalexecutivepost.com/2022/03/24/general-obligation-and-revenue-bonds/

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Stocks, Bonds and Commodities

Posted on September 4, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I. and Staff Reporters

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  • Stocks: Markets slowed along yesterday with the S&P 500 and NASDAQ buoyed after a pivotal antitrust ruling for Alphabet pushed big tech stocks higher across the board.
  • Bonds: The 30-year Treasury pushed 5% yesterday as traders fret about the Fed’s independence and the odds of interest rate cuts.
  • Commodities: Oil sank on reports that OPEC+ is contemplating increasing its crude output next month, while gold reached yet another new record high as uncertainty swirling around the future of tariffs continued to rise. JPMorgan analysts now think the precious metal could climb as high as $4,250 by the end of next year.

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Stocks, Bonds and Commodities

Posted on September 3, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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Bonds: Treasury yields rose yesterday as investors dug into a Federal appeals court ruling last Friday stating that most of President Trump’s tariffs are illegal. The 30-year yield closed in on the key 5% level.
Stocks: Equities tumbled across the board as technology stocks sold off and pulled the rest of the market down with them.
Commodities: Gold hit a new record high as traders hedged against tariff uncertainty and braced themselves for an extremely important US jobs report on Friday that could make or break the case for the Fed to start cutting rates.

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BEWARE: Stocks and the U.S. Stock Markets?

Posted on September 2, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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  • Markets: After a day off for Labor Day, Wall Street is entering September with little confidence as stocks shrugle with tariffs and AI-slowdown jitters to rise for four straight months. September has historically been the weakest month for US stocks, plus a hugely consequential Federal Reserve meeting looms on September17th.
  • Stock spotlight: An already booming Celsius hit a 52-week high last week after Pepsi said it would up its stake in the energy drink maker.

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If the Government Can Take A 15% Cut From Nvidia, Who Is Next?

Posted on August 31, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Rick Kahler; MSFP CFP™

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This month, the U.S. government demanded a direct cut of a company’s foreign sales as the price for letting those sales happen.

Tech companies Nvidia and AMD had been stuck in regulatory limbo over selling their newest AI chips to China. According to an August 12, 2025, Reuters article by Karen Freifeld, Nvidia CEO Jensen Huang had even received a public “green light” for the company’s H20 chip, but the Commerce Department would not issue the export licenses.

The stalemate ended only after Huang met with President Trump and agreed to a deal: the licenses would be granted, but the U.S. Treasury would get 15% of all H20 revenue from China. AMD agreed to identical terms for its MI308 chip. Two days later, both companies had their licenses.

The numbers are staggering. Bernstein Research estimates Nvidia could sell $15 billion worth of H20 chips in China this year, and AMD about $800 million of MI308s. That is more than $2 billion flowing straight to Washington, not as taxes but as a contractual price for market access. The legality of this arrangement is questionable, and the deal also raises security concerns.

It is worth noting the administration first asked for 20% before “settling” on 15%. This was not a polite request but a “take it or leave it” demand. From a behavioral economics standpoint, the decision was predictable. The pain of losing an entire market is far greater than the pain of losing a fraction of it.

How is this any different from a tariff? A tariff is a standardized, legally defined tax that applies broadly to certain goods and is collected under public trade policy. This 15% cut is a one-off, privately negotiated condition aimed at just two companies, tied to export license approval. It is taken from gross revenue, not profit, meaning the government gets paid on every dollar of sales before the companies cover a single expense.

“Tax farmming” is an old practice where the state sold the right to collect taxes for a fixed sum, allowing the collectors to keep the rest. Its use in France made some people enormously rich, made everyone else furious, and eventually helped spark the French Revolution. Similar systems appeared in Ottoman Egypt, Qing China, and the early Dutch Republic until abuses finally brought them down.

The Nvidia/AMD deal is not exactly tax farming, but it is a similar dynamic. The government’s role is no longer just regulating. It is stepping in as a business partner, taking a direct share of private sales. Supporters might call it a smart use of national leverage. Critics will see a step away from free-market capitalism toward something more political and transactional.

Nor is this deal a one-off. In June, the administration approved foreign investment in U.S. Steel only after securing a “golden share” that gives it veto power over strategic corporate decisions. History teaches us that once a government finds a way to take a cut, it rarely stops with one sector. Today it is steel and AI chips to China. Tomorrow it could be pharmaceuticals, energy, or consumer goods.

What is the likely impact for average Americans? Money flowing to the U.S. Treasury from a source other than taxpayers may seem like a benefit. Yet any company required to give away 15% of its gross revenue, which could equal its entire profit, has to compensate in some way. The most likely result is higher prices. Hiking prices on computer chips sold to China may not seem to be a big deal—until you consider that many of the products that use those chips are sold to U.S. consumers.

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Stocks, Bonds and Trade Craft

Posted on August 27, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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  • Bonds: Long-term Treasury yields rose and short-term yields fell after President Trump fired Fed Governor Lisa Cook opening the gap between 5-year and 30-year yields to its widest point in three years.
  • Stocks: Equities barely budged on the latest FOMC drama with investors’ attention fully focused on Nvidia earnings tomorrow afternoon.
  • Trade Craft: President Trump vowed retaliation against countries that apply a digital services tax against US tech companies. He may also slap a 200% tariff on China if that country restricts trade on rare earth magnets.

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PHYSICIAN DIVORCE: “Buyer’s Settlement Remorse”

Posted on August 24, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I and Dr. David Edward Marcinko MBA MEd CMP™

SPONSOR: http://www.CertifiedMedicalPlanner.org

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Introduction

It is normal for physician litigants to develop a case of “buyer’s remorse” after any mediation or divorce settlement. They may feel disappointed after entering into a settlement agreement or feel that they received a bad deal.

PHYSICIAN DIVORCE: https://medicalexecutivepost.com/2025/08/14/physician-divorce-within-the-medical-profession/

Mediation: Some advantages of divorce mediation over divorce litigation include:

◊ Mediation is generally faster and less costly.

◊ Mediation is voluntary, private and confidential.

◊ Mediation facilitates creative and realistic solutions.

◊ Mediation allows parties to control their agreements.

◊ Mediation eliminates a win-lose atmosphere and result.

◊ Mediation provides a forum for addressing future disputes.

◊ Mediation fosters communication and helps mend relationships.

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Settlement

And so, in a vast majority of cases, mediation and settlement is probably a good deal. In fact, it is probably a great deal because you are receiving something without having to risk losing. Remember, trial can be a crap-shoot, and nothing is worse than losing it all at the time of trial.

  • Bench trial verdict by a trial judge.
  • Jury trial verdict by your “peers.”

Instead, you entered into a settlement agreement and now your divorce case is over.

But beware since trying to get out of a settlement agreement reached at mediation or settlement is virtually impossible.

Why? Well, there is a strong interest by the court to enforce mediation and settlement agreements. The court wants your divorce case to be over and off its docket. There are a few very narrow exceptions; for example, if one party was truly coerced because someone held a gun to their head. But that rarely happens, and it certainly doesn’t happen to most doctors or dentists.

MEDIATION: https://medicalexecutivepost.com/2024/09/15/financially-egalitarian-dating-marriages-and-divorce-mediation-for-doctors/

Re-litigate?

Of course, you can fight against your mediation or settlement agreement if you like, but you won’t get too far. There’s an old adage in the law that a bad settlement is better than a great trial. That’s because no one knows how a judge or jury will rule come time of trial.

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This buyers remorse phenomenon also isn’t uncommon among people who receive sudden wealth, whether through divorce settlements, inheritances, lottery winnings, or other windfalls.

Assessment

Financial advisors often see clients struggle with “sudden wealth syndrome”—the inability to properly manage a large sum of money they’re not accustomed to having.

Common mistakes include:

  • Lifestyle inflation without sustainable income to support it.
  • Poor investment decisions or lack of investment planning.
  • Emotional spending following traumatic life events like divorce.
  • Failure to set aside money for taxes on the settlement.
  • Not creating a long-term financial plan for the money.

So, do not let these mistakes happen to you!

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SPEAKING: Dr. Marcinko will be speaking and lecturing, signing and opining, teaching and preaching, storming and performing at many locations throughout the USA this year! His tour of witty and serious pontifications may be scheduled on a planned or ad-hoc basis; for public or private meetings and gatherings; formally, informally, or over lunch or dinner. All medical societies, financial advisory firms or Broker-Dealers are encouraged to submit an RFP for speaking engagements: CONTACT: Ann Miller RN MHA at MarcinkoAdvisors@outlook.com -OR- http://www.MarcinkoAssociates.com

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Stocks Up, Bond Yields Down as Commodities Rise and Fall

Posted on August 23, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I and ME-P Staff Reporters

SPONSOR: http://www.CertifiedMedicalPlanner.org

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  • Stocks: The stock markets rose today after Jerome Powell opened the door to interest rate cuts. The Dow soared to a new all-time high, while small-cap stocks in the Russell 2000 had a banner day.
  • Bonds: Yields fell while the chances of a rate cut after the Fed’s next meeting in September rose to 83%.
  • Commodities: Gold rose on rate cut hopes while oil fell as peace talks between Ukraine and Russia stalled. But the biggest winner is coffee: prices have risen for six straight days to cap off its biggest weekly gain since 2021.

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SPECIAL PURPOSE VEHICLE: What it Is – When is It Needed?

Posted on August 21, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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What is an SPV and When Do You Need One?

A SPECIAL MEDICAL-EXECUTIVE-POST GUEST PRESENTATION

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What Is a Special Purpose Vehicle (SPV)?

A special purpose vehicle is a subsidiary created by a parent company to isolate financial risk. It’s also called a special purpose entity (SPE). Its legal status as a separate company makes its obligations secure even if the parent company goes bankrupt. A special purpose vehicle is sometimes referred to as a bankruptcy-remote entity for this reason.

These vehicles can become a financially devastating way to hide company debt if accounting loopholes are exploited, as seen in the 2001 Enron scandal.

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Stocks, Technology and FOMC Drama

Posted on August 21, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I. and Staff Reporters

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  • Technology: Fears of an A.I. bubble continue to climb after MIT published a report that 95% of companies using generative A.I. programs have nothing to show for it, despite pouring billions of dollars into this space.
  • Stocks: Another day of technology stocks selling off pulled the S&P 500 and NASDAQ lower yesterday, with investors rotating out of some of the hottest names and sectors in the market.
  • FOMC Drama: President Trump demanded the resignation of Fed Governor Lisa Cook for allegations of mortgage fraud. Meanwhile, the minutes from the July FOMC meeting revealed a growing divide between central bankers.

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PHYSICIAN GENDER FINANCIAL DIFFERENCES: In Marriage and Divorce

Posted on August 16, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Dr. David Edward Marcinko MBA MEd

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Whatever the statistics regarding physician standard of living, the reality is that within most marriages the husband more frequently takes responsibility for understanding and managing the finances.  Additionally, women are more likely to remain in the marital home following a separation, thus inheriting a large fixed expense that may prove be an excessive, albeit short-term burden to them.  At the time the decision is made to separate or divorce, many women do not have an understanding of how to manage their household budget, or how to manage their assets and liabilities. 

But, this is changing over time.

DIVORCE MONTH: https://medicalexecutivepost.com/2024/01/31/january-doctors-beware-divorce-month/

An issue many divorcing physicians face is that the other spouse (in the past the wife), may have concentrated their energies on managing the home, while the physician concentrated on earning and managing the finances.  The problems of the spouse of a physician are often compounded in divorce; not only do they not understand their personal finances, but that their absence from the work force has made them financially dependent on the other. 

At what probably be the most emotionally taxing time in their lives, they are forced to play catch-up.

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Taking a more active role in their own financial planning during the marriage may help the spouse of a physician avoid some of the financial pitfalls of separation and divorce. 

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BENEFICIARY DESIGNATIONS: Top 10 Tips for Medical Professionals

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NOTE: Barbara Stanny provides an excellent overview and reading bibliography on how people can get smart about money in her book Prince Charming Isn’t Coming. [1]

[1] Penguin USA (paper), 1999.

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SPEAKING: Dr. Marcinko will be speaking and lecturing, signing and opining, teaching and preaching, storming and performing at many locations throughout the USA this year! His tour of witty and serious pontifications may be scheduled on a planned or ad-hoc basis; for public or private meetings and gatherings; formally, informally, or over lunch or dinner. All medical societies, financial advisory firms or Broker-Dealers are encouraged to submit an RFP for speaking engagements: CONTACT: Ann Miller RN MHA at MarcinkoAdvisors@outlook.com -OR- http://www.MarcinkoAssociates.com

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MONEY ADDICTED PHYSICIANS: The Investing and Stock Trading Personality of Doctors

Posted on August 7, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Dr. David Edward Marcinko MBA MEd CMP™

SPONSOR: http://www.CertifiedMedicalPlanner.org

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THE ADDICTIVE INVESTING / TRADING PERSONALITY OF DOCTORS

Dr. Donald J. Mandell, a pediatrician, always needs to leave the office fifteen minutes ahead of schedule. The reason is because it takes that long to make the necessary number of trips to ensure the front door is truly locked.

Dr. Kamela A. Shaw, a general surgeon, is constantly rushing to the bath room so that she can wash her hands. As far as she is concerned, it is not possible to get one’s hands clean enough considering the COVID pandemic or recent influenza outbreak.

Although the behaviors displayed by these two doctors are different, they are consistent in that each, to some degree, display behavior that might be called an obsessive-compulsive disorder [OCD].

COGNITIVE BIAS: https://medicalexecutivepost.com/2025/06/22/investing-cognitive-biases-for-financial-advisors-to-know-and-understand/

[A] When Investing or Trading In No Longer Fun

An obsession is a persistent, recurring preoccupation with an idea or thought. A compulsion is an impulse that is experienced as irresistible.

Obsessive-compulsive individuals feel compelled to think thoughts that they say they do not want to think or to carry out actions that they say are against their will. These individuals usually realize that their behavior is irrational, but it is beyond their control. In general, these individuals are preoccupied with orderliness, perfectionism, and mental and interpersonal control, at the expense of flexibility, openness, and efficiency. Specifically, behaviors such as the following may be seen:

  • Preoccupation with details.
  • Perfectionism that interferes with task completion.
  • Excessive devotion to work and office productivity.
  • Scrupulous and inflexible about morality (not accounted for by cultural or religious identification);
  • Inability to discard worn-out or worthless objects without sentimental value;
  • Reluctance to delegate tasks or to work with others.
  • Adopts a miserly spending style toward both self and others.
  • Demonstrates a rigid, inflexible and stubborn nature.

Most people resort to some minor obsessive-compulsive patterns under severe pressure or when trying to achieve goals that they consider critically important. In fact, many individuals refer to this as superstitious behavior. The study habits required for medical students entail a good deal of compulsive behavior.

As the above examples suggest, there are a variety of addictions possible. Recent news accounts have pointed out that even high-level governmental officials can experience sex addiction. The advent of social-media has led to what is referred to as Internet addiction where an individual is transfixed to a computer, tablet PC or smart-phone, “working” for hours on end without a specific project in mind. The simple act of “surfing”, “tweeting-X”, “texting” or merely posting opinions offers the person afflicted with the addiction some degree of satisfaction.

Still another form of addictive behavior is that of the individual with gambling disorder (GD).

GD is recognized as a mental disorder in the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders-V. This is the behavior of an individual who is unable to resist the impulse to gamble. Many reasons have been posited for this type of behavior including the death instinct; a need to lose; a history of trauma; a wish to repeat a big win; identification with adults the “gambler” knew as an adolescent; and a desire for action and excitement. There are other explanations offered for this form of compulsive behavior. The act of betting allows the individual to express an immature bravery, courage, manliness, and persistence against unfavorable odds. By actually using money and challenging reality, he puts himself into “action” and intense emotion. By means of gambling, the addicted individual is able to pretend that he is favored by “lady luck,” specially chosen, successful, able to beat the system and escape from feelings of discontent.

Greed can also have addictive qualities. In fact, a poll conducted by the Chicago Tribune revealed that folks who earned less than $30,000 a year, said that $50,000 would fulfill their dreams, whereas those with yearly incomes of over $100,000 said they would need $250,000 to be satisfied. More recent studies confirm that goals keep getting pushed upward as soon as a lower level is reached.

PHYSICIAN IPS: https://medicalexecutivepost.com/2025/07/30/investment-policy-statement-construction-for-physicians-and-medical-professionals/

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Question: So how much money is enough?

Answer: Just a little bit more.

Edward Looney, executive director of the Trenton, New Jersey based Council on Compulsive Gambling (CCG) reports that the number of individuals calling with trading-associated problems is doubling annually. In the mid 1980s, when the council was formed, the number of people calling the council’s hotline (1 – 800 Gambler) with stock-market gambling problems was approximately 1.5 percent of all calls received. In 1998 that number grew to 3 percent, and rose to 8 percent by 2012. Today, that number is largely unknown because of its pervasiveness, but Dr. Robert Custer, an expert on compulsive gambling reported, that stock market gamblers represent over 20 percent of the gamblers that he has diagnosed. It is evident that on-line trading presents a tremendous risk to the speculator.

The CCG describes some of the consequences:

  • Dr. Fred B. is a 43-year-old Asian male physician with a salary above $150,000 and in debt for more than $150,000. He is married with two children. He was a day trader.   
  • Michael Q. is a 28-year-old Hispanic male registered nurse. He is married and the father of one (7 month old) child. He earns $65,000 and lost $50,000 savings in day trading and is in debt for $30,000. He has suicidal ideation.

[B] A Question of Suitability

Since online traders are in it for many reasons, investment suitability rarely enters the picture, according to Stuart Kaswell, general counsel of the Securities Industry Association, in Washington, DC.  The kind of question that has yet to be confronted, by day or online trading firms, is a statement, such as: “Equities look good this year. We favor technology stocks. We have a research report on our Web page that looks at the social media industry.” Those kinds of things are seldom considered because they do not involve a specific recommendation of a specific stock, like Apple, Google, Groupon, Facebook or Twitter.

However, if a firm makes a specific recommendation to an investor, whether over the cell-phone, iPad®, fax machine, face-to-face, instagram or over the Internet, or Twitter-X, suitability rules should apply. Opining similarly on the “know your customer” requirements is Steven Caruso, of Maddox, Koeller, Harget & Caruso of New York City. “The on-line firms obviously claim that they do not have a suitability responsibility because they do not want the liability for making a mistake as far as determining whether the investor was suitable or buying any security. I think that ultimately more firms are going to be required to make a suitability, [or eventually fiduciary] determination on every trade”.

[C] On-line Traders and Stock Market Gamblers

Some of the preferred areas of stock market gambling that attract the interest of compulsive gamblers include options, commodities, penny stocks and bit-coins, index investing, new stock offerings, certain types of CAT bonds, crowd-sourcing initiatives,  and some contracts for government securities. These online traders and investment gamblers think of themselves as cautious long-term investors who prefer blue chip or dividend paying varieties. What they fail to take into consideration is that even seemingly blue chips can both rise and precipitously drop in value again, as seen in the summer of 2003, the “crash” of 2008, or the “flash crash” of May 6, 2010.  On this day, the DJIA plunged 1000 points (about 9%) only to recover those losses within minutes. It was the second largest point swing 1,010.14 points, and the biggest one-day point decline, 998.5 points, on an intraday basis in Dow Jones Industrial Average history.

Regardless of investment choice, the compulsive investment gambler enjoys the anticipation of following the daily activity surrounding these investments. Newspaper, hourly radio and television reports, streaming computer, tablet and smart phone banners and hundreds of periodicals and magazines add excitement in seeking the investment edge. The name of the game is action. Investment goals are unclear, with many participating simply for the feeling it affords them as they experience the highs and lows and struggles surrounding the play.  And, as documented by the North American Securities Administrators Association’s president, and Indiana Securities Commissioner, Bradley Skolnik, most day or online traders lose money. “On-line brokerage was new and cutting edge and we enjoyed the best stock market in generations, until the crashes. The message of most advertisements was “just do it”, and you’ll do well. The fact is that research and common sense suggest the more you trade, the less well you’ll do”.

Most day or online traders are young males, some who quit their day jobs before the just mentioned debacles; or more recently with the dismal economy. Many ceased these risky activities but there is some anecdotal evidence that is re-surging again with 2013-14 technology boom and market rise. Most of them start every day not owning any stock, then buy and sell all day long and end the trading day again without any stock – – just a lot of cash. Dr. Patricia Farrell, a licensed clinical psychologist states that day traders are especially susceptible to compulsive behaviors and addictive personalities. Mark Brando, registered principal for Milestone Financial, a day trading firm in Glendale, California states, “People that get addicted to trading employ the same destructive habits as a gambler. Often, it’s impossible to tell if a particular trade comes from a problem gambler or a legitimate trader.”

VALUE STOCKS: https://medicalexecutivepost.com/2025/02/28/value-stocks-bargain-hunting-investing-for-physicians/

Arthur Levitt, former Chairman of the Securities and Exchange Commission (SEC) in discussing the risks and misconceptions of investing are only amplified by on-line trading. In a speech before the National Press Club a few years ago, he attempted to impress individuals as to the risks and difficulties involved with day trading. Levitt cited four common misconceptions that knowledgeable medical professionals, and all investors, should know: 

  • Personal computers, tablets, mobile devices and smart-phones are not directly linked to the markets – Thanks to Level II computer software, day traders can have access to the same up-to-the-second information available to market makers on Wall Street.  “Although the Internet makes it seem as if you have a direct connection to the securities market, you don’t. Lines may clog; systems may break; orders may back-up.” 
  • The virtue of limit orders – “Price quotes are only for a limited number of shares; so only the first few investors will receive the currently quoted price. By the time you get to the front of the line, the price of the stock could be very different.” 
  • Canceling an order – “Another misconception is that an order is canceled when you hit ‘cancel’ on your computer. But, the fact is it’s canceled only when the market gets the cancellation. You may receive an electronic confirmation, but that only mean your request to cancel was received – not that your order was actually canceled”. 
  • Buying on margin – “if you plan to borrow money to buy a stock, you also need to know the terms of the loan your broker gave you. This is margin. In volatile markets, investors who put up an initial margin payment for a stock may find themselves required to provide additional cash if the price of the stock falls.

How then, can the medical professional or financial advisor tell if he or she is a compulsive gambler? A diagnostic may be obtained from Gamblers Anonymous. It is designed to screen for the identification of problem and compulsive gambling.

But, it is also necessary to provide a tool to be used by on-line traders. This questionnaire is as follows:

1. Are you trading in the stock market with money you may need during the next year?

2. Are you risking more money than you intended to?

3. Have you ever lied to someone regarding your on-line trading?

4. Are you risking retirement savings to try to get back your losses?

5. Has anyone ever told you that spend too much time on-line?

6. Is investing affecting other life areas (relationships, vocational pursuits, etc.)?

7. If you lost money trading in the market would it materially change your life?

8. Are you investing frequently for the excitement, and the way it makes you feel?

9. Have you become secretive about your on-line trading?

10. Do you feel sad or depressed when you are not trading in the market?

ALPHA: https://medicalexecutivepost.com/2025/07/02/managing-for-endowment-portfolio-alpha/

NOTE: If you answer to any of these questions you may be moving from investing to gambling.

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The cost of compulsive gambling and day trading is high for the individual medical or lay professional, the family and society at large. Compulsive gamblers, in the desperation phase of their gambling, exhibit high suicide ideation, as in the case of Mark O Barton’s the murderous day-trader in Atlanta who killed 12 people and injured 13 more in July 29th 1999. His idea actually became a final act of desperation.

Less dramatically, for doctors, is a marked increase in subtle illegal activity. These acts include fraud, embezzlement, CPT® up-coding, medical over utilization, excessive full risk HMO contracting, Stark Law aberrations and other “white collar crimes.”  Higher healthcare and social costs in police, judiciary (civil and criminal) and corrections result because of compulsive gambling. The impact on family members is devastating. Compulsive gamblers cause havoc and pain to all family members. The spouses and other family members also go through progressive deterioration in their lives.

In this desperation phase, dysfunctional families are left with a legacy of anger, resentment, isolation, and in many instances, outright hate.    

[D] Day Trading Assessment

Internet day trading, like the Internet and telecommunications sectors, become something of a investment bubble a few years ago, suggesting that something lighter than air can pop and disappear in an instant. History is filled with examples: from the tulip mania of 1630 Holland and the British South Sea Bubble of the 1700’s; to the Florida land boom of the roaring twenties and the Great Crash of 1929; to the collapse of Japans stock and real estate market in early 1990’s; and to an all-time high of $1,926 for an ounce of commodity gold a few years ago. 

Today it is Ask: $3,388.30 USD Bid: $3,367.30 USD

CONCLUSION

To this list, one might again include smart-phone or mobile day trading.

Cite: Eugene Schmuckler PhD MBA MEd CTS

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Why Your Startup Needs to be a C-Corporation

Posted on August 5, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

A SPECIAL MEDICAL EXECUTIVE-POST PRESENTATION

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Why Your Startup Needs to be a C-Corp

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Why [Too Many] Physician Colleagues Don’t Get Rich?

Posted on July 29, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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DAILY UPDATE: Stocks, Commodities and Trade as Stock Markets End Mixed

Posted on July 29, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

MEDICAL EXECUTIVE-POST – TODAY’S NEWSLETTER BRIEFING

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Essays, Opinions and Curated News in Health Economics, Investing, Business, Management and Financial Planning for Physician Entrepreneurs and their Savvy Advisors and Consultants

“Serving Almost One Million Doctors, Financial Advisors and Medical Management Consultants Daily“

A Partner of the Institute of Medical Business Advisors , Inc.

http://www.MedicalBusinessAdvisors.com

SPONSORED BY: Marcinko & Associates, Inc.

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Daily Update Provided By Staff Reporters Since 2007.
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CITE: https://www.r2library.com/Resource

  • Stocks: Investors cheered the news of an EU & US trade deal over the weekend, pushing the S&P 500 above 6,400 for the first time ever. But the index gave up most of its gains late in the day as attention turned to a huge week of data ahead (more on that in a minute).
  • Trade: Today was the first day of discussions between US and Chinese negotiators in Stockholm to keep the trade war truce alive. Elsewhere, President Trump foresees a baseline 15% to 20% tariff rate for the rest of the world.
  • Commodities: Gold fell as trade deal hopes heightened investors’ risk appetite, while oil spiked higher after Trump gave Russia a 10- to 12-day deadline to sign a truce with Ukraine.

CITE: https://tinyurl.com/2h47urt5

According to Bloomberg, 83% of the S&P 500 companies that have reported earnings have outpaced Wall Street’s estimates, putting the index on pace for its best season of beats since the second quarter of 2021.

CITE: https://tinyurl.com/tj8smmes

Visualize: How private equity tangled banks in a web of debt, from the Financial Times.

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PHYSICIANS: Do You Use A Financial Planner?

Posted on July 27, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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TO: All Physicians and Dentists

QUESTION?

Do you use a financial advisor?

What has been your experience with him or her?

THANK YOU

EDUCATION: Books

SPEAKING: Dr. Marcinko will be speaking and lecturing, signing and opining, teaching and preaching, storming and performing at many locations throughout the USA this year! His tour of witty and serious pontifications may be scheduled on a planned or ad-hoc basis; for public or private meetings and gatherings; formally, informally, or over lunch or dinner. All medical societies, financial advisory firms or Broker-Dealers are encouraged to submit an RFP for speaking engagements: CONTACT: Ann Miller RN MHA at MarcinkoAdvisors@outlook.com -OR- http://www.MarcinkoAssociates.com

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PARADOX of Financial Health

Posted on July 27, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Dr. David Edward Marcinko MBA MEd

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FINANCIAL HEALTH

Classic Definition: Research from Ernst-Young [Nikhil Lele and Yang Shim] uncovered a chasm between how consumer patients think they’re doing financially, and the actual state of their finances. Even more striking, their study suggested that improving consumers’ financial health will become one of the top imperatives in reframing consumer financial services.

Modern Circumstance: For example, the study asked consumers to rate their own financial health, and 83 percent rated themselves “good,” “very good” or “excellent.”  Now, contrast this figure with what is known about their actual situation:

  • 60 percent of Americans say they are financially stressed.
  • 56 percent of Americans have less than $10,000 saved for retirement.
  • 40 million American families have no retirement savings at all.
  • 40 percent of Americans are not prepared to meet a $400 short-term emergency.

Paradox Example: Fortunately, even though the vast majority of consumers rate themselves as financially healthy, the study found that most still want to improve. Importantly for health economists, the attractive 25-34 and 35-49 year-old age groups were most likely to be extremely or very interested in improving their financial and economic health.

Paradox Example: Massively affluent consumer patients are even more interested in improving this paradox than their mass market counterparts.

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Stocks & Commodities

Posted on July 25, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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  • Stocks: President Trump said there’s a “50/50 chance” of a deal with the EU ahead of next week’s deadline. Investors decided they like those odds, and pushed the NASDAQ and S&P 500 to yet another new closing record high—in fact, the S&P 500 set a new record every day this week. Meanwhile, trade deal talks with Brazil have reportedly stalled.
  • Commodities: Oil fell to a three-week low today as Iran signaled a willingness to come to the negotiating table with European powers for nuclear talks.
  • Hopes of trade deals and less need for a safe haven investment pushed gold prices lower.

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Individual Up and Down Stocks

Posted on July 23, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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What’s up

  • Medpace isn’t a meme stock, but it still soared 54.67% yesterday. It was all thanks to a seriously impressive beat-and-raise earnings report for the clinical researcher.
  • It was also a great day for healthcare stocks: IQVIA climbed 17.92% after beating Wall Street forecasts last quarter.
  • DR Horton popped 17.02% after the homebuilder crushed Q3 earnings expectations.
  • It was also a great day for other homebuilders: Pultegroup rose 11.52% despite lower home closings last quarter, and management is optimistic that sales will bounce back next quarter.
  • Northrop Grumman gained 9.41% after a strong quarter, including an 18% increase in international sales for the defense contractor.

What’s down

  • Lockheed Martin dropped 10.81% after the legacy defense contractor revealed big losses in its classified aeronautics program.
  • It wasn’t that great a day for defense contractors in general: RTX fell 1.58% after the company cut its earnings guidance.
  • General Motors may have beaten earnings expectations last quarter and kept its fiscal forecast intact, but investors didn’t like to hear about the $1.1 billion in tariff costs. Shares of the automaker stumbled 8.12%
  • Coca-Cola lost 0.59% after strong European sales helped the soft drink titan beat earnings estimates, but shareholders weren’t happy about weakness everywhere else.
  • Equifax tumbled 8.18% thanks to disappointing guidance for the current quarter from the consumer credit company.

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Stocks, the FOMC and Trade Deals

Posted on July 23, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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By A.I.

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  • Stocks: The multi-day rally wavered this afternoon as investors turned their attention to big tech earnings tomorrow. The S&P 500 closed at a record high, while the NASDAQ finally broke its hot streak.
  • FOMC: Treasury Secretary Scott Bessent sees no reason for Jerome Powell to step down, while President Trump tempered his outrage against the Fed chair. Instead, well-known economist Mohamed El-Erian took up the gauntlet.
  • Trade: Bessent said China may get an extension to make a true trade deal, while promising a “rash of trade deals” in the coming days. Speaking of, Trump declared the US has made a deal with the Philippines capping import levies at 19%.

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Stocks, Trade and the FOMC

Posted on July 22, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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Stocks: Markets lost steam late in the trading session yesterday as investors awaited more earnings announcements, with the DJIA tumbling into the red. But the S&P 500 managed to end the day above 6,300 for the first time ever, while the NASDAQ enjoyed its sixth consecutive record close

FOMC: Over the weekend, President Trump disputed reports that Treasury Secretary Scott Bessent talked him out of firing Jerome Powell. Meanwhile, Bessent said that the entire Federal Reserve should be put under review.

Trade: Commerce Secretary Howard Lutnick reiterated that August 1st will be the “hard deadline” for countries to make a deal with the US. Both negotiations and tensions with the EU are ramping up as Trump threatens to slap the bloc with 30% levies.

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Beware of Borrowing That Helps Your Advisor – Not You

Posted on July 21, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Rick Kahler MSFP CFP™

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When Maria needed $400,000 for a down payment on a new home, her broker at a large Wall Street firm offered a solution: “Don’t sell investments and trigger capital gains. Just take out a margin loan.”

A margin loan is a line of credit from a brokerage firm, secured by the client’s investment portfolio. It offers quick access to cash with no immediate tax consequences and minimal paperwork. But the convenience comes at a cost. As of mid-2025, margin loan interest rates range from 6.25% to over 11%.

Margin loan recommendations are often presented by brokers as tax-savvy strategies that allow clients to access “tax-free” cash while keeping their portfolios intact. In many cases, however, the math benefits the advisor more than the investor. The cost of borrowing often exceeds what an investor is likely to earn by holding on.

For example, let’s assume an interest rate of 7.5% on Maria’s $400,000 margin loan. While borrowing delayed the payment of $20,000 in capital gains tax, she will eventually have to pay that tax anyway unless she holds the investments until her death. Two years later, with portfolio returns of 4% annually, she had earned around $32,000 from the $400,000 in investments she might have sold. Meanwhile, she had paid $60,000 in interest—leaving her some $28,000 worse off. That’s without factoring in ongoing interest payments, or the risks of a margin call if the investments securing the loan drop in value.

Why do advisors keep recommending margin loans? Because selling investments reduces the portfolio size and the advisor’s fee. Borrowing keeps the portfolio intact and the compensation unchanged—while the firm receives additional income from interest on the loan. In some cases, advisors suggest using margin loans to buy more investments, increasing both the portfolio and the fee they collect.

None of this is illegal. But when the borrowing cost is higher than expected returns and the advisor benefits financially, the ethics are questionable. The client takes the risk, while the advisor keeps the revenue.

This kind of conflict appears more often in portfolios where compensation is tied to asset volume and the company’s primary culture rewards gathering assets over delivering unbiased advice. By contrast, fee-only financial planning and investment advisors typically operate on simpler hourly, flat, or tiered fee structures. Their compensation doesn’t depend on whether a client borrows, sells, or holds. The culture of the firm focuses on conflict-free advice aligned with the client’s best interest.

Wall Street brokers are often held to a fiduciary standard, but structure still matters. In 2024 the SEC reported their examinations of brokers would continue to focus on advisor recommendations unduly influenced by the company’s compensation and incentives.

There are rare situations where a margin loan may be appropriate. A client with large unrealized gains might use a short-term margin loan to minimize taxes. An elderly investor might borrow tax-free rather than sell assets that will receive a step-up in basis at their death. Even in those cases, the math must be exact and the client must clearly understand the risks, including the possibility of a margin call.

If your advisor recommends a margin loan, especially to buy more investments, ask strong questions. What’s the interest rate? What return is realistic? What are the tax consequences of selling? How does this affect the advisor’s income?

If you don’t get direct answers, that’s a warning sign.

In a high-rate, low-return environment, margin loans rarely favor the client. The exceptions are narrow. The risks are significant. And the conflict of interest is measurable.

Sometimes the smartest move is the simplest: sell what you need, pay the tax, and leave leverage out of your plan.

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PARADOXES: Beware Financial and Investing Contradictions

Posted on July 21, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Staff Reporters

SPONSOR: http://www.MarcinkoAssociates.com

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As we plan for our financial future, I think it’s helpful to be cognizant of these paradoxes. While there’s nothing we can do to control or change them, there is great value in being aware of them, so we can approach them with the right tools and the right mindset.

Here are just seven of the paradoxes that can bedevil financial planning and investment decision-making:

  • There’s the paradox that all of the greatest fortunes—Carnegie, Rockefeller, Buffett, Gates—have been made by owning just one stock. And yet the best advice for individual investors is to do the opposite: to own broadly diversified index funds.
  • There’s the paradox that the stock market may appear overvalued and yet it could become even more overvalued before it eventually declines. And when it does decline, it may be to a level that is even higher than where it is today.
  • There’s the paradox that we make plans based on our understanding of the rules—and yet Congress can change the rules on us at any time, as it did just a few weeks ago.
  • There’s the paradox that we base our plans on historical averages—average stock market returns, average interest rates, average inflation rates and so on—and yet we only lead one life, so none of us will experience the average.
  • There’s the paradox that we continue to be attracted to the prestige of high-cost colleges, even though a rational analysis that looks at return on investment tells us that lower-cost state schools are usually the better bet.
  • There’s the paradox that early retirement seems so appealing—and has even turned into a movement—and yet the reality of early retirement suggests that we might be better off staying at our desks.
  • There’s the paradox that retirees’ worst fear is outliving their money and yet few choose the financial product that is purpose-built to solve that problem: the single-premium immediate annuity.

Assessment

QUESTION: How should you respond to these paradoxes? As you plan for your financial future, embrace the concept of “loosely held views.” In other words, make financial plans, but continuously update your views, question your assumptions and rethink your priorities.

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The GENIUS Act

Posted on July 20, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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The GENIUS Act is the law of the Land

President Trump signed the bill into law Friday, setting up a framework for regulating stablecoins—digital currency pegged to traditional assets—that are linked to the US dollar. It’s a big win for the crypto industry, and Trump said it was a “giant step to cement American dominance of global finance and crypto technology.”

The law could help push stablecoins into the mainstream, and major companies like Walmart and Amazon have been said to be considering launching their own, according to Morning Brew.

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Do Political Biases Shape Your Financial Planner’s Advice?

Posted on July 19, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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Crypto-Currency and the Stock Markets

Posted on July 18, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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  • Markets: Stocks slid lower today even as a preliminary survey revealed that consumer sentiment hit its highest point since February, while inflation expectations fell to pre-tariff levels. The selloff deepened on reports that President Trump wants 15% to 20% tariffs against the EU, though the NASDAQ managed to eke out a win.
  • Crypto: Although bitcoin fell after the president signed the GENIUS Act into law, ether rose to its highest price in six months today, while enthusiasm for the new legislation pushed total crypto assets above $4 trillion.

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Can You Contribute to Both a Roth IRA & 401(k)?

Posted on July 18, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Staff Reporters, AI and the Linqto Team

SPONSOR: http://www.CertifiedMedicalPlanner.org

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Yes, you can contribute to both a Roth IRA and a 401(k), provided you don’t exceed annual contribution limits for each account.

Determining whether to contribute to a Roth IRA, 401(k), or both can be an important step in planning for your retirement. Here are the key differences, including tax advantages, employer contributions, and investment options. 

Eligibility requirements are the first consideration when contributing to a Roth IRA and a 401(k). For Roth IRA contributions, your eligibility is determined by your income. Specifically, if your modified adjusted gross income (MAGI) exceeds certain thresholds, your ability to contribute to a Roth IRA may be reduced or eliminated. However, there are no income limits for contributing to a 401(k), making it accessible to anyone with earned income.

IRS rules do allow for contributions to both a Roth IRA and a 401(k), provided you adhere to the annual contribution limits for each account.

This means you can take advantage of the higher contribution limits of a 401(k) while also benefiting from the tax-free growth of a Roth IRA. This dual approach can be a strategy for maximizing your retirement savings. The advantages to contributing to both accounts present some key benefits, such as: 

  • Tax diversification in retirement, allowing for better management of taxable income. 
  • Potential reduction of overall tax burden. 
  • Maximization of savings potential by taking full advantage of the benefits each account offers.3

Balancing contributions between a Roth IRA and a 401(k) requires careful planning. You might start by contributing enough to your 401(k) to receive the full employer match, which is essentially free money, if your employer offers this. Once you’ve secured the match, consider maxing out your Roth IRA contributions, if you’re eligible.

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COMMODITIES and STOCKS

Posted on July 17, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

SPONSOR: http://www.CertifiedMedicalPlanner.org

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Stocks: Markets started the day on a high note thanks to a fifth straight decline in weekly initial jobless claims and surprisingly strong monthly retail sales. The NASDAQ hit its 10th record closing high of 2025 and the S&P 500 hit its ninth high.

Commodities: Lithium prices popped around the globe after the Chinese government ordered domestic producer Zangge Mining to halt operations. Plus, the US is reportedly set to impose 93.5% tariffs on Chinese imports of graphite, a key component.

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DOCTORS AND LAWYERS: Often Aren’t Millionaires

Posted on July 17, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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Stocks, Crypto & Stock Markets

Posted on July 16, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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By A.I.

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  • The Fed Drama: A White House official said President Trump will likely fire Jerome Powell soon. Stocks sank at the thought of the Fed head being shown the door, offsetting the pleasant surprise of a flat wholesale inflation reading.
  • Markets: Stocks managed to recoup their losses after Trump said it’s “highly unlikely” that he will fire Powell, but bonds remained shaken.
  • Crypto: Bitcoin bounced higher after the crypto bills currently under consideration in the House of Representatives cleared a key hurdle.

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Stocks, Commodities and the FOMC

Posted on July 15, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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  • Stocks: The S&P 500 and Dow tumbled on a mixed bag of bank earnings, while the NASDAQ was buoyed by big news for Nvidia.
  • Federal Reserve Drama: Treasury Secretary Scott Bessent reassured investors that Jerome Powell isn’t getting the boot.
  • Commodities: Oil fell just a bit as Donald Trump is about to hit his 50-day deadline for Russia.

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INCENTIVE STOCK OPTIONS: Defined

Posted on July 15, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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By Staff Reporters and AI

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Incentive stock options (ISOs)

Also called “qualified” or “statutory” stock options, ISOs are considered tax-advantaged stock options based on U.S. tax law. With ISOs, the spread (the difference between the award price and the fair market value) will count as income for the alternative minimum tax (AMT) in the year you exercise your options.

CBOE: https://medicalexecutivepost.com/2024/11/19/cboe-chicago-board-of-trade-volatility-indexes/

Example: If you exercise and hold the shares for more than one year past the exercise date and more than two years past the original grant date, the sale of the stock becomes a qualifying disposition, and any realized profit is typically taxed at the long-term capital gains rate. If you sell earlier, the spread will be taxed at your ordinary income tax rate.

ISOs vs. NSOs: What’s the difference?

There are two types of employee stock options: statutory and nonstatutory. They can also be referred to as qualified and nonqualified, respectively. ISOs are statutory (qualified) and differ from nonstatutory (nonqualified) stock options (NSOs) in a few key ways:

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  • Eligibility. ISOs are issued only to employees, whereas NSOs can be granted to outside service providers like advisors, board directors or other consultants. Typically, mainly senior executives or key employees are given ISOs, as a company is not required to offer ISOs to all employees.
  • Tax perks. ISOs have more compelling tax treatment compared with NSOs.

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Stocks and Commodities

Posted on July 14, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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  • Stocks: Markets shrugged off President Trump’s weekend threat of 30% levies against the EU and Mexico, as well as his proposed 100% secondary tariffs against Russia today. Stocks eked out a win across the board, with the NASDAQ climbing to a new record close.
  • Commodities: Oil prices fell while gold took a breather, but the big winner was orange juice futures, which hit a four-month high thanks to Trump’s promise of 50% tariffs on all imports from Brazil. Coffee prices also climbed.

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BIAS: Beware Overconfident Investing

Posted on July 13, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Staff Reporters and A.I.

SPONSOR: http://www.CertifiedMedicalPlanner.org

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OVERCONFIDENT INVESTING BIAS

Overconfident Investing Bias happens when we believe we can out-smart other investors via market timing or through quick, frequent trading. This causes the results of a study to be unreliable and hard to reproduce in other research settings.

Example: Data convincingly shows that people and financial planners/advisors and wealth managers who trade most often under-perform the market by a significant margin over time. Active traders lose money.

Example: Overconfidence Investing Bias moreover leads to: (1) excessive trading (which in turn results in lower returns due to costs incurred), (2) underestimation of risk (portfolios of decreasing risk were found for single men, married men, married women, and single women), (3) illusion of knowledge (you can get a lot more data nowadays on the internet) and (4) illusion of control (on-line trading).

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MORE:

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Bitcoin, Stocks, Oil, Gold and Silver

Posted on July 12, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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  • Stocks: The major Wall Street stock indexes languished. The S&P pulled back from its record high to close the week just a bit lower, but the NASDAQ managed to post a gain across the week.
  • Crypto: Bitcoin hit a new high-water mark above $118,000. Next week, July 14th, Congress hosts “Crypto Week” to discuss regulating the industry in a growth-oriented manner.
  • Commodities: Silver rose to its highest level since 2011, and it’s been even hotter than gold. The metal is up ~27% this year. Oil, meanwhile, ticked higher on speculation that President Trump will place more sanctions on Russia early next week.

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Goldman Sachs and Bitcoin

Posted on July 11, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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By A.I.

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Bitcoin notched another all-time record yesterday, beating the previous record that was set two days ago.

Goldman Sachs plans to ask junior bankers to certify their loyalty every three months in order to prevent poaching by private equity firms, Bloomberg reported.

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Stocks, Commodities and Crypto-Currency

Posted on July 10, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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  • Stocks: Jobless claims came in lower than expected, the 30-year US bond auction met with strong demand, and Delta Airlines unofficially kicking off earnings season with a solid report. The S&P 500 and the NASDAQ hit record highs.
  • Crypto: Bitcoin reached a record high for the second day in a row, hitting $113,863.31 today. The crypto’s price has stayed above $100k for 60 consecutive days.
  • Commodities: Coffee futures in New York climbed as much as 3.5% in response to President Trump’s threat to slap 50% tariffs on Brazil, which is the top producer of higher-end arabica coffee.

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Gerontologist V. Geriatrician?

Posted on July 9, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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ELDER ABUSE: Financial Exploitation Protection

Posted on July 7, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Rick Kahler CFP™

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One serious risk to financial wellbeing in retirement that is difficult to talk about is financial exploitation. Someone whose cognitive abilities are declining is vulnerable to harm from both financial predators and their own financial misjudgments. Protecting such clients is a crucial part of a financial advisor’s role.

A little-known but important law, the Senior Safe Act, was enacted in 2018. It encourages financial advisors and institutions to report suspected elder abuse by offering immunity from legal liability when reports are made in good faith and with reasonable care. To qualify for these protections, financial professionals must undergo annual training to recognize the signs of exploitation and know how to act on their suspicions.

In many ways, the Senior Safe Act mirrors the duty of therapists to report when clients are threats to themselves, such as when a client becomes suicidal. Just as a therapist must balance confidentiality with the moral and legal responsibility to protect their client from harm, a financial advisor must weigh privacy against the need to prevent financial exploitation. Both roles rely on professional judgment, training, and the courage to act when the stakes are high.

Financial advisors, accountants, and attorneys are often the first to notice troubling signs that someone is being taken advantage of financially. These might include sudden large withdrawals, changes to account ownership or beneficiaries, or a newly and overly involved friend or family member. Behavioral shifts like confusion, anxiousness, secretiveness, or uncharacteristic deference are also red flags. These patterns are unsettling and demand attention, even when stepping in is uncomfortable.

Reporting possible elder abuse isn’t always straightforward, especially if the suspected abuser is a family member. As an advisor, I worry about misunderstandings, potential conflicts with the family, and even the possibility of damaging a relationship with the client. None of this is easy, But when the signs of exploitation become clear, staying silent could mean allowing harm to continue. That’s a risk I can’t take.

One of the tools I started using decades ago is the trusted contact disclosure form. This simple but powerful document allows clients to name someone my firm can contact if they notice unusual activity, such as a suspicious withdrawal or transfer. The trusted contact does not have control over the client’s account but serves as a resource to verify their well-being and ensure that their financial decisions align with their long-term goals. If you as a client have not signed such a form, it’s worth discussing with your advisor as a preventative step.

If you are concerned about the financial well-being of an elderly loved one, it’s crucial to alert not only their financial advisor but also other professionals like accountants, attorneys, or bankers. These professionals may have insights or access to information you don’t have, and by sharing your concerns, you provide a broader picture that can help them detect and address issues more effectively. Even if they are already monitoring for red flags, your input can provide valuable context to guide their next steps.

Difficult though it may be, stepping into uncomfortable territory is often essential to protecting vulnerable individuals. Whether it’s a financial advisor detecting exploitation or a therapist intervening in a mental health crisis, the goal is the same—to prevent harm while respecting the person’s autonomy.

The Senior Safe Act is a reminder that sometimes the most impactful safeguards work quietly behind the scenes. Taking simple steps like completing a trusted contact form or encouraging your loved one to work with a reputable, fiduciary advisor can make all the difference. Vigilance is an act of care that helps protect someone’s financial assets as well as their dignity and well-being.

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OREGON BANS: Corporate Control of Physicians

Posted on July 6, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Health Capital Consultants LLC

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On June 9th, 2025, Oregon’s governor signed into law the country’s strictest corporate practice of medicine (CPOM) prohibition. Senate Bill (SB) 951 will severely curtail the involvement of private equity firms and other corporations in the state’s medical practices.

This Health Capital Topics reviews the bill and discusses the implications on the healthcare industry. (Read more…)

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Stocks, Bonds & Commodities

Posted on July 3, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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Stocks, Bonds & Commodities

Posted on July 2, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

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DAILY UPDATE: Crude Oil Prices Reverse as Stock Markets Diverge

Posted on July 2, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

MEDICAL EXECUTIVE-POST – TODAY’S NEWSLETTER BRIEFING

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Essays, Opinions and Curated News in Health Economics, Investing, Business, Management and Financial Planning for Physician Entrepreneurs and their Savvy Advisors and Consultants

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Power station: Crude oil prices reversed as tensions in the Middle East cooled, but AI likely raises electricity demand over the longer term, creating investment opportunities and risks.

Oil supplies now exceed demand, noted Michelle Gibley, director of international research at the Schwab Center for Financial Research, in her latest analysis, though “AI is transforming the energy sector,” raising power shortage concerns.

CITE: https://tinyurl.com/2h47urt5

🟢 What’s up

  • Solar stocks got a reprieve today after the Senate dropped the excise tax on clean energy projects. Sunrun soared 10.51%, Enphase Energy rose 3.18%, SolarEdge Technologies popped 7.16%, and Array Technologies climbed 12.54%.
  • Apple tumbled this summer after investors were disappointed by its AI rollout, but rose 1.29% on the news that the company may pivot to using Anthropic or OpenAI in iPhones instead of building something in-house.
  • Wolfspeed, the best name for a company that makes computer chips, exploded 98.09% after the company officially filed for Chapter 11 bankruptcy.
  • Hasbro got a nice 4.29% bump thanks to Goldman Sachs analysts, who are big old nerds who think Magic: The Gathering will boost the toymaker’s sales.
  • Ford popped 4.61% after the automaker reported an impressive 14% increase in sales last quarter.
  • Casino stocks soared on the news that gaming revenue in Macau rose 19% in June. Wynn Resorts climbed 8.85%, Las Vegas Sands added 8.95%, and MGM Resorts gained 7.24%.

What’s down

  • AMC Entertainment tumbled 9.03% after the one-time meme stock announced its new debt restructuring plan.
  • Progress Software sank 13.03% after the business application software company reported mixed results last quarter, beating on profit but missing on revenue.
  • Joby Aviation fell 7.01% after traders took profits following the air taxi company’s big pop yesterday.
  • AeroVironment dropped 11.42% after defense contractor announced it’s offering $750 million in common stock and $600 million in convertible senior notes to pay off its debt.
  • Diabetes device makers tumbled on the news that the government may change the reimbursement rate for glucose monitors and insulin pumps. Insulet lost 4.52%, Dexcom fell 4.25%, and Beta Bionics sank 4.26%.

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Visualize: How private equity tangled banks in a web of debt, from the Financial Times.

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Stocks, Bonds and Safe Havens

Posted on July 1, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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Financial Monte Carlo Simulation’s FLAW and FIXES

Posted on July 1, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

Physicians Must Understand Deus ex Machina

[By Wayne J. Firebaugh Jr; CPA, CFP®, CMP™]

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wayne-firebaughNamed after Monte Carlo, Monaco, which is famous for its games of chance, MCS is a software technique that randomly changes a variable over numerous iterations in order to simulate an outcome and develop a probability forecast of successfully achieving an outcome.

Endowment Fund Perspective

In private portfolio and fund endowment management, MCS is used to demonstrate the probability of “success” as defined by achieving the endowment’s asset growth and payout goals. In other words, MCS can provide the endowment manager with a comfort level that a given payout policy and asset allocation success will not deplete the real value of the endowment.

Divorce from Judgment

The problem with many quantitative software and other tools is the divorce of judgment from their use. Although useful, both mean variance optimization MVO and MCS have limitations that make it so they should not supplant the physician investor or endowment manager’s experience. MVO generates an efficient frontier by relying upon several inputs: expected return, expected volatility, and correlation coefficients. These variables are commonly input using historical measures as proxies for estimated future performance. This poses a variety of problems.

Problems with MCS 

First, the MVO will generally assume that returns are normally distributed and that this distribution is stationary. As such, asset classes with high historical returns are assumed to have high future returns.

Second, an MVO optimizer is not generally time sensitive. In other words, the optimizer may ignore current environmental conditions that would cause a secular shift in a given asset class returns.

Finally, an MVO optimizer may be subject to selection bias for certain asset classes. For example, private equity firms that fail will no longer report results and will be eliminated from the index used to provide the optimizer’s historical data [1].

Example:

As an example, David Loeper, CEO of Wealthcare Capital Management, made the following observation regarding optimization:

Take a small cap “bet” for our theoretical [endowment] with an S&P 500 investment policy. It is hard to imagine that someone in 1979, looking at a 9% small cap stock return premium and corresponding 14% higher standard deviation for the last twenty years, would forecast the relationship over the next twenty years to shift to small caps under-performing large caps by nearly 2% and their standard deviation being less than 2% higher than the 20-year standard deviation of large caps in 1979 [2].

Table: Compares the returns, standard deviations for large and small cap stocks for the 20-year periods ended in 1979 and 1999.  Twenty Year Risk & Return Small Cap vs. Large Cap (Ibbotson Data).

1979 1999
Risk Return Correlation Risk Return Correlation
Small Cap Stocks 30.8% 17.4% 78.0% 18.1% 16.9% 59.0%
Large Cap Stocks 16.5% 8.1% 13.1% 18.6%

*Reproduced from “Asset Allocation Math, Methods and Mistakes.” Wealthcare Capital Management White Paper, David B. Loeper, CIMA, CIMC (June 2, 2001).

More Problems with MCS

David Nawrocki identified a number of problems with typical MCS as being that most optimizers assume “normal distributions and correlation coefficients of zero, neither of which are typical in the world of financial markets.”

Dr. Nawrocki subsequently describes a number of other issues with MCS including nonstationary distributions and nonlinear correlations.

Finally, Dr. Nawrocki quotes Harold Evensky who eloquently notes that “[t]he problem is the confusion of risk with uncertainty.

Risk assumes knowledge of the distribution of future outcomes (i.e., the input to the Monte Carlo simulation).

Uncertainty or ambiguity describes a world (our world) in which the shape and location of the distribution is open to question.

Contrary to academic orthodoxy, the distribution of U.S. stock market returns is far from “normal”. Other critics have noted that many MCS simulators do not run enough iterations to provide a meaningful probability analysis.

Assessment 

Some of these criticisms have been addressed by using MCS simulators with more robust correlation assumptions and with a greater number of iterative trials. In addition, some simulators now combine MVO and MCS to determine probabilities along the efficient frontier.

Conclusion

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References:

1. Clark, S.E. and Yates, T.T., Jr. “How Efficient is your Frontier?” Commonfund Institute White Paper (November 2003).

2. Loeper, D.B., CIMA, CIMC. “Asset Allocation Math, Methods, and Mistakes.” Wealthcare Capital Management White Paper (June 2001).

3. Nawrocki, D., Ph.D. “The Problems with Monte Carlo Simulation.” FPA Journal (November 2001).

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Liberation Day Comeback

Posted on July 1, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By A.I.

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The S&P 500 closed within a hair of a new record yesterday marking an enormous comeback that followed the April announcement of “Liberation Day” tariffs.

Despite a persistent vibe of uncertainty related to US economic policy and geopolitics:

  • The S&P 500 closed less than 0.1% away from a record high which it notched in February before cratering nearly 20% in April. The index has regained ground in fits and starts since then and briefly surpassed its record in intra-day trading yesterday.
  • On Monday, the tech-heavy NASDAQ 100 one-upped the broader market and logged its highest-ever close. It came after President Trump said Israel and Iran agreed to a ceasefire, which eased investors’ concerns about a potential oil crisis.

According to Morning Brew, between unresolved geopolitical conflicts and President Trump’s still-unfolding tariff policies, a portfolio manager with Capital Wealth Planning, Kevin Simpson, told CNBC that he was “surprised by the magnitude of the rebound.”

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