Reader Mailbag: June 2026

At last, summer is here! A time for frolicking, iced tea, the FIFA World Cup, late-evening strolls and a wonderfully full reader mailbag!

When you say “the market has priced that in,” who is doing the pricing?

Everyone! Every time an investor or trader makes the decision to buy, sell or hold, they do so with the influence of all the information they have taken in. All the news, opinions, forecasts, vibes, observations and their own emotional reactions to and opinions of it all. And each investor or trader, knowing and thinking and forecasting all that they do, buys, sells or holds accordingly. Those who buy and sell bid prices up and down according to their views and expectations. Multiply this across millions of people (and algorithms) daily, and you get “the market.”

Another way to think about this: Between 1 and 1.5 billion shares traded hands on the New York Stock Exchange on a typical day this month (typical, meaning, not a day when oodles of options need to roll over). Each share (and each transaction price) was the product of a trading decision someone made based on everything they knew, cheered and feared. All buyers and sellers in the proverbial auction—that is “the market.” It is messy, beautiful, ruthless and elegant.

What are your thoughts on investing in Emerging Markets to get in early on future growth?

We think there are some fine opportunities in Emerging Markets (EM), but we don’t think viewing them as a ground floor opportunity is beneficial. For one, that is a very popular view, one markets know and have priced in (see the previous answer). If successful investing is about having unique insight others don’t, and you survey EM with the “ground floor” thesis, your insight won’t be unique. There is no edge, and you will end up looking for needles in a haystack. If the ground floor view were true, then EM would always outperform. It doesn’t.

Two, EM is a catch-all for a diverse bunch of markets. Some constituents (Taiwan, South Korea) are modern and developed by most definitions but remain Emerging Markets because of some quirks in the classification criteria. South Korea, for example, has some legacy capital controls. Greece is in this category because it was downgraded from developed during the eurozone crisis, leading to many jokes that it was a Submerging Market. (Happily for Greece, it returns to developed markets next summer.) Some constituents are relatively recent graduates from Frontier Markets, some are commodity powerhouses, and China is China. EMs have varying levels of property rights, sound governance, sector diversity and economic development.

Moreover, while some EMs will sport faster economic growth than the developed world from time to time, the connection between growth rates and market returns is tenuous at best. There is no set relationship that says a faster-growing country is really the “ground floor” or foundation for higher stock returns than other opportunities.

What can we do to train our kids to save for the future?

Only your best, with the knowledge that not all seeds fall into receptive soil and it might take years before your teaching bears fruit. Your kids might continue spending all their allowance on baseball cards now but be expert savers in their 30s, remembering what you sought to instill in them. Generally speaking, humans don’t really do well with long-term thinking and risk/reward until the frontal lobe finishes developing around age 25. So delayed gratification is usually a concept that comes late to people.

With that said, there is one thing we have found powerful to help young folks want to save and invest: compound growth. We remember learning this in fifth grade math and our eyes getting big as saucers when we learned $1,000 that earns 6% interest compounded annually would be almost $6,000 in 30 years. Those were big numbers back then, and it was free money! Free money that would buy sooooooo many more baseball cards than we could presently afford with what we earned pulling weeds and cleaning bathrooms.

So maybe on the next rainy afternoon or lazy family evening, show your kid (or grandkid, godchild, niece, nephew, whoever!) the Compound Interest Calculator at the SEC’s investor.gov website. You can play around with starting amounts, monthly contributions, investment time horizon and growth rates and show how even small investments can grow into tidy sums over time. We did that just now, and would you believe, if we took that same initial $1,000 investment and 6% growth rate but added $100 monthly contributions, it snowballed into over $100,000 after 30 years! Magic! And those numbers are intentionally low-ball estimates of long-run returns and compounding.

Can wages keep up with inflation?

Yes! They so can! It just takes a while for inflation to work its way that far through the system. When inflation accelerates, wages tend to follow several months later as workers demand more pay to cover rising living costs. This is how society gets over spells of hot inflation. Prices don’t fall, but they become less of a burden as pay catches up. (Which is why inflation is toughest on folks with low or fixed incomes.)

Keep your expectations measured, though. This spring’s inflation uptick was all about energy prices, tied to the Iran War and the Strait of Hormuz’s closure. That was a temporary disruption, and oil and gas prices are down quite a lot from springtime highs. Stranger things, we guess, but it would be a little weird for wages to rise broadly and permanently in response to a temporary living cost bump.

If the US is a leading exporter of oil with ample supply, why did gas prices spike? Was it refining capacity?

That is a big part of it, and it plays into the larger reason: Oil and gas markets are global, moving on global supply and demand. US (West Texas Intermediate) and global (Brent) benchmark oil prices each jumped on shortage fears when the Strait closed, affecting the price refiners pay. US refineries are also geared more to heavy crude than the light, sweet variety that flows from US shale oil fields, so US refiners import a fair amount. Meanwhile, there was a scramble for refined products (gasoline, diesel, jet fuel) globally that affected our prices at the pump, too. Record-high US production and exports were still major positives, but more for their effect on global supply. For this reason, the notion America had achieved energy “independence” in recent years merely because US daily oil output topped consumption was always too simplistic to be realistic.

Why is the market so volatile when we all know you should just stay invested?

Investing is tricky in that the things “we all know” are right can feel very wrong when volatility erupts. The whole story of humanity is acting in ways contrary to what we know is good and right. It is one thing to tell yourself, “stay cool.” It is another thing to act on that command when volatility hits and your fight-or-flight response engages. Markets are volatile because humans are volatile.