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Vol 23 – The Memory Bank: A Vault of Wisdom or a Cage of the Past?

  • Ann Yu
  • May 4
  • 8 min read



May 4, 2025

What a wild "risk on" week! 🚀 The S&P 500 has clawed back all its losses since the reciprocal tariff announcement on April 2nd, despite mixed earnings so far. But does that mean nothing has really changed in the past month?

What’s in the newsletter this week?


1️⃣ Inflation vs. the Cost of Knowledge? 🎓 JPMorgan crunched the numbers, comparing the rise in everyday household expenses to headline inflation in the U.S. from 1983 to 2024. As a parent, the results made me scream "ouch!"

2️⃣ The Memory Bank: Does Experience Guide or Mislead? 🤔 A recent Wall Street Journal article introduced the concept of "Memory Bank" - the market returns earned collectively by investors of similar age. In my work, I've also observed how each generation navigates investing differently based on their distinct experiences. But here’s the catch: our memory banks aren’t always reliable!

3️⃣ Own a Piece of a Central Bank? Yes, You Can! 💰 While most central banks in the world operate as government institutions, there are 5 countries whose central banks are publicly listed and traded. Can you guess which 5?



Key things to watch for the upcoming week:

China/HK - Earnings

May 8 (Thu) - SMIC (0981 HK)

US - Earnings

May 5 (Mon) - Berkshire Hathaway (BRK), Palantir (PLTR) May 6 (Tue) - AMD (AMD) May 7 (Wed) - Walt Disney (DIS), ARM (ARM), AppLoving (APP)

US - Eco Data

May 8 (Thu) - FOMC Rate Decision

Other Major Events

May 8 (Thu) - Bank of England Rate Decision




Charts of the Week – Inflation and the Cost of Knowledge


The hottest topic among Hong Kong parents this week was a viral post on Threads by a local student admitted to Imperial College London. In a controversial move, he publicly vented his frustration over his parents’ refusal to finance his overseas studies.


His main complaint? Despite his parents’ combined monthly income of HKD 230,000, he alleged that poor financial discipline had left them unable to cover his tuition. The post ignited a fiery debate, with some sympathizing with the student while others argued that financial support for college isn't an entitlement but a privilege. Well, every family has its own struggles, but I couldn't help linking that news to a striking chart I came across earlier: JPMorgan analyzed several household expense items in the US from 1983 to 2024, comparing them to headline inflation to pinpoint which costs have weighed most heavily on the average American family. And the runaway winner? College tuition! Over the past 40 years, tuition costs have skyrocketed 899%, averaging a staggering 5.6% annual increase - far outpacing headline inflation (CPI) and other household expenses.



From a market perspective, it's also interesting to see how globalization has influenced this trend:


  • For goods that Americans can easily import - like apparel and cars - prices have remained relatively tame, increasing at a rate lower than headline inflation.


  • But for the things you can’t outsource to low-cost countries - college, medical care, and housing - prices have gone through the roof.


For all of us middle-class, middle-aged warriors trudging through life, the weight on our shoulders seems to get heavier by the day! So, here’s to us 🥂 - pushing forward, dodging disasters, and maybe even sneaking in a well-earned break every now and then!



For your reference only. Not investment/product recommendations.



Market Buzz – The Memory Bank: Does Experience Guide or Mislead?



What Is in Your Memory Bank?


A recent Wall Street Journal article introduced the concept of "Memory Bank" - the collective market returns earned by investors of similar age. Experience shapes expectations, but is it always reliable?


  • If you're in your 20s or 30s, you’ve seen stocks and crypto crash fast - March 2020, 2022 - the scars of COVID and rate hikes still linger. But your memory bank also tells you that markets tend to bounce back even faster and climb to new highs.


  • If you're a more seasoned investor, the 2008 financial crisis may still make you wary of weaker banks and overleveraged corporations. And if you recall PIIGS (Portugal, Italy, Ireland, Greece, Spain) in 2011, you might remain skeptical of Europe's strength, despite its impressive stock performance this year.

According to the author of the article, experience shapes how we invest - but here’s the danger: The future rarely mirrors the relatively small slice of history we've lived through. More often than you realize, your memory bank can deceive you!

What Is Your Memory Bank Telling You About These Popular Investment Beliefs? The author explored several common investment beliefs stored in Memory Banks across different generations - ideas deeply rooted in minds but possibly outdated. The 3 examples below struck a chord with me:


 1️⃣ "The U.S. is the Only Place to Be" 🧐 For decades, international markets lagged behind the U.S., overshadowed by a strong dollar and booming American tech sector, until this year.


But younger investors might not know that, during 1971-1990, the MSCI EAFE (Europe, Australasia, and the Far East) index, a gauge of developed international markets outside of the U.S., outperformed the S&P 500 by an average of 4.2 percentage points annually, benefiting from a weaker dollar after the "Nixon Shock." (Note: The Nixon Shock refers to U.S. President Richard Nixon's 1971 decision to end the U.S. dollar's convertibility to gold, effectively dismantling the Bretton Woods system of global fixed exchange rates established after World War II. This move triggered a substantial weakening of the U.S. dollar in the years that followed.) 👉 History doesn’t always repeat - it evolves.


Chart: Comparison of MSCI EAFE Index and S&P 500 index (from 1971 to 1990)

Source: Bloomberg
Source: Bloomberg

2️⃣ "Cash Is Trash" 🧐 In the early years of my career, Money Market Funds and Liquidity Funds weren’t even on anyone's radar. Why? Because from 2009 to 2021, cash was a lost cause - barely earning anything after inflation, useless even as a safety net.


Then came a dramatic shift - a series of aggressive rate hikes post-COVID turned the tables. Fast forward to 2025 year-to-date, Money Market Funds and Liquidity Funds aren’t just holding their ground - they’re outperforming stocks and beating inflation in the process.

👉 Once dismissed as financial dead weight, cash is now stealing the spotlight! 

Chart: Comparison of JPM USD Liquidity Fund and S&P 500 Index (2025 Year-to-Date)

Source: Bloomberg
Source: Bloomberg

3️⃣ "Gold Always Glitters" 🧐

If you've recently invested in gold, you know it shines during times of crisis. But here’s what your Memory Bank might not tell you: Gold’s post-crisis comebacks tend to be slow and stubborn.

  • 1980 Boom & Bust – After hitting a record $834 in January 1980, gold took nearly 28 years to reclaim that high.


  • 2011 Rally & Retreat – After soaring to $1,892 in August 2011, it remained below that level for almost 9 years.

👉 Gold may dazzle when uncertainty reigns, but when calm returns, it’s often left struggling to regain its shine.


Chart: Historical Price of Gold (from 1975 to 2025)

Source: Bloomberg
Source: Bloomberg

Test Your Memory Bank or Risk Becoming Its Prisoner

The author urges us to challenge our investment beliefs - not by relying solely on personal experience, but by digging into the longest-term data available to uncover market cycles beyond what we’ve lived through.


Testing your Memory Bank won’t erase the lessons you’ve learned. Instead, it will free you from its blind spots.

Or, better yet, contact Jadewell Family Office today - because sifting through decades of market data is our idea of fun, so you don’t have to! 😆💪


For your reference only. Not investment/product recommendations.



Fun Facts - Own a Piece of a Central Bank? Yes, You Can!

Earlier this week, I stumbled upon a mind-blowing discovery - some central banks are actually publicly listed and traded!

Back in the early 20th century, privately owned central banks were far more common, with monetary policy shaped by both government and private investors. This setup lasted until the post-World War II era, when governments finally decided that it was better to have full control over their monetary policies. Fast forward to today, and only 5 countries still have central banks with publicly traded shares: Switzerland, Japan, South Africa, Greece and Belgium. Let’s dive into Switzerland and Japan - because their stories are simply fascinating! 🤩


Switzerland - Swiss National Bank (SNBN SW)

The Swiss National Bank (SNB) has been publicly listed since 1907, allowing investors to own a piece of Switzerland’s central bank. But as a shareholder, all you get is an annual CHF 15 dividend per share, a maximum payout fixed by law since 1921, translating to a better-than-nothing 0.45% dividend yield.

Despite being the central bank of one of the world’s safest economies, SNB’s share price has been surprisingly volatile. In 2018, a German investor newsletter compared SNB shares to rare collectibles, likening them to the Blue Mauritius, a prized 19th-century postage stamp. This sparked a buying frenzy among retail investors, who saw SNB shares as a scarce and valuable asset rather than just a traditional stock. Chart: Historical Price of Swiss National Bank (from 1990 to 2025)

Source: Bloomberg
Source: Bloomberg

Japan - Bank of Japan (8301 JP)


Closer to home, Bank of Japan (BOJ) has also been publicly listed since 1949. But under the Bank of Japan Act, at least 55% of its capital must be owned by the Japanese government, ensuring state control over monetary policy. Unlike the Swiss National Bank (SNB) mentioned earlier, BOJ does not pay dividends, leaving almost nothing for public shareholders - no dividends, no voting rights, no influence over policy, and no access to BOJ's profit growth (if any). Yet, despite these limitations, BOJ shares were in high demand during Japan’s 1980s financial bubble, as market sentiment ran wild.

After that bubble burst, BOJ's price chart began mirroring Japan’s Lost 30 Years (1990–2010) - and its weak performance has extended even beyond that era. Chart: Historical Price of Bank of Japan (from 1987 to 2025)

Source: Bloomberg
Source: Bloomberg

Curious to learn more? Reach out to Jadewell Family Office directly today, and we’ll be happy to dive deeper for you!


About Jadewell Family Office


Jadewell is committed to offering proactive, customized services akin to a “single-family office,” yet within the ease of a “multi-family office” environment.



Ann Yu
Co-Founder and CEO
Jadewell Family Office





FOR INSTITUTIONAL & PROFESSIONAL CLIENTS ONLY – NOT INTENDED FOR RETAIL CUSTOMER USETHESE ARE NOT STOCK OR PRODUCT RECOMMENDATIONS

This document is intended for informational purposes only. It should not be considered as advice or a recommendation for any specific investment product, strategy, plan feature, or any other purpose in any jurisdiction. It is educational and does not represent a commitment from Jadewell Family Office to participate in any mentioned transactions. Any examples used are generic, hypothetical, and for illustration purposes only.


This material is insufficient to support an investment decision and should not be relied upon to evaluate the merits of investing in securities or products. Users should independently assess the legal, regulatory, tax, credit, and accounting implications, and work with their own financial professional to determine if any mentioned investment is appropriate for their personal goals. Investors should ensure they have all relevant information before making any decisions.


Any forecasts, figures, opinions, or investment techniques and strategies provided are for informational purposes only. They are based on certain assumptions and current market conditions and are subject to change without prior notice.


All information presented herein is considered to be accurate at the time of production, but no warranty of accuracy is given and no liability in respect of any error or omission is accepted.

It should be noted that investment involves risks, the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested. Both past performance and yields are not reliable indicators of current and future results.


 
 
 

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