Monthly Archives: May 2009
Selecting a Buffett Biography: Lowenstein vs. Schroeder
By Ravi Nagarajan While there have been countless books written regarding Warren Buffett’s track record in business and investing, along with many books of variable quality seeking to find formulas to replicate his success, there are only two full fledged … Continue reading
Street Fighters: Good Information and Good Fun
think not, but that is part of the fun. The reader can collect information — raw data — with real confidence. There will be many accounts of the financial crisis. Anyone seeking a complete understanding should consult many sources. The … Continue reading
Feeling the Squeeze, Exclusive Country Clubs Get the Common Touch
Their standing dinner reservation at the country club is for 6:30 p.m., because at least that much never changes. Every Wednesday night, Charles and Mimi Cluss dress in pleated slacks and suit jackets and drive to the manicured playground where … Continue reading
Coal Conditions Coming
Recently I had occasion to watch an online debate between a clean-coal advocate and a robust, articulate green-energy blogger. The debate followed predictable contours. In one corner, the clean-coal advocate repeated a series of rather inflated achievements, supposedly gained over … Continue reading
Ending the Fed: the rebirth of Jacksonian bankphobia
Onetime presidential hopeful and current Republican congressman Ron Paul has an interesting piece of legislation wending its way through the US capitol. HR1206 calls for “a complete audit of the Federal Reserve and removes any significant barriers towards transparency in … Continue reading
The basic story of China’s foreign portfolio is simple…..
Keith Bradsher’s New York Times story on the recent evolution of China’s foreign portfolio gets — at least in my view — the story right. Of course, that may be because I was — rather obviously — a source for … Continue reading
It’s Official: Worst Recession in Five Decades
This recession is now the worst since at least 1958, which is as far back as the index of coincident indicators stretches back. The Conference Board reported today that the index, which is intended to measure how the economy is … Continue reading
Let the PBGC bailout talk commence
From Eric Lipton at the NY Times: Bankruptcies Swell Deficit at Pension Agency to $33.5 Billion The deficit at the federal agency that guarantees pensions for 44 million Americans more than doubled in the last six months to a record … Continue reading
Mean Street: The Sorry State of Our Sorriest State, California
You live, you learn. Right? Well, not in America. Here we live, screw up and then go back to doing the same stupid things we did before. Apparently, it is just too hard for us to make the tough, necessary … Continue reading
ARMs Away!
Subprime is done. All the teaser rates are over, the interest rates have reset and the writing is on the wall. But in the coming quarters, the scenario will play out with other exotic mortgages, Option ARM (pick-a-pay), Alt-A, etc. … Continue reading
Beggars Are We All…..
http://jessescrossroadscafe.blogspot.com/ Bernanke’s wager is on a virtual free lunch by printing money. “Fed chair Ben Bernanke has long argued that central banks can bring down long-term borrowing rates by purchasing bonds “at essentially no cost”. His frequent writings rarely ask … Continue reading
With U.K. AAA Rating In Jeopardy, Is U.S. Next?
The UK’s AAA-rating is at risk. (Bloomberg, MarketBeat, EconomPic Data, Zero Hedge) Bye, bye miss american pie….. Don’t wait…..buy Gold and Gold Mine Stocks!
Out Of Control! Welcome to USAWagen
In for a dime, in for a dollar. “The GMAC funding is an illustration of how rapidly the government effort to rescue the U.S. auto industry is escalating in cost and scope.” (WSJ) GM Borrows $4 Billion From U.S. to … Continue reading
The Required Yield Theory of Asset Valuation
Is the Required Yield Theory better than the Fed Model? (CXO Advisory Group) What aggregate return thresholds are critical to investors in deciding whether to accept or reject equity and bonds for investment portfolios? In their December 2008 paper entitled … Continue reading
The Danger Of Greed and Short Term Focus
An important question at Custerstock: Are activist investors to blame for horrible corporate balance sheets? (Clusterstock) On Squawk Box this morning, DealBook maven Andrew Ross Sorkin made some comments about the role investor activism played in getting companies to lever … Continue reading
I.P.O.’s Offer Encouraging Signs
“The creation of risk capital, of which I.P.O. demand is a leading indicator, is crucial to getting the economy back on its feet.” (Breakingviews) In the grand scheme of the global capital markets, half a billion dollars is a drop … Continue reading
All About Alpha?
There are funds that implement a so called 130-30 strategy. The strategy is to first put 100% into an index like the S&P 500. Then sell short 30% in stocks expected to do worse than the market. Take the proceeds … Continue reading
However…..
The VIX:VXV ratio is flashing a warning sign for the stock market. (VIX and More) Note that while this basic interpretation of the VIX:VXV ratio sets parameters for long and short entries, it does not include recommendations about exits or … Continue reading
Muni Rising
Muni bonds are back to pre-crisis levels. (TraderFeed) In a low interest rate environment, those tax-free yields have looked attractive to retail investors and, amidst hopes of economic stabilization, investors have been willing to move away from Treasuries and into … Continue reading
Dollar Down and Out?
Do you believe the US Dollar is going to tank? Think international equities. (Barron’s, BusinessWeek)
Changing Strategies
For many investors their definition of diversification is changing. (NYTimes, Bull Bear Trader)
Is The Federal Reserve Overreaching?
A good article at Forbes: http://www.forbes.com/2009/05/19/federal-reserve-ron-paul-fdic-sec-opinions-columnists-bernanke.html
Health Care Crisis
When President Obama won approval for his $787 billion stimulus package in February, large sections of the 407-page bill focused on a push for new technology that would not stimulate the economy for years. The inclusion of as much as … Continue reading
SEC in trouble?
From Bloomberg: May 20 (Bloomberg) — The Obama administration may call for stripping the Securities and Exchange Commission of some of its powers under a regulatory reorganization that could be unveiled as soon as next week, people familiar with the … Continue reading
Lower Volatility?
“Wall Street will market the VIX as bullish no matter what it does.” (Daily Options Report also Trader’s Narrative, Freakonomics) We should take it as good news that after a substantial stock price run up on Monday, the VIX responded … Continue reading →