Wednesday Reading
By Barry Ritholtz - July 8th, 2009, 2:30PM
Some interesting and random linkage:
• Hall of Shame: 12 of the Worst Financial Gurus (Bill Shrink)
• Wall Street’s Newest Product Is Tale of Denial (Bloomberg)
• Quibbles With Quants (Psy-Fi)
• Why U.S. Financial Markets Need a Public Credit Rating Agency (Berkeley Electronic Press)
• Condo Boards Take On Lenders (WSJ)
• Bob Shiller didn’t kill the housing market (Fortune)
• Goldman, Morgan Stanley Threatened by CFTC Review (Bloomberg)
• Google Plans to Launch Operating System for PCs (Official Google blog)
• What’s a Petabyte? (Infectious Greed)
• E-Tailers Grapple with Sales Tax (Visual Economics)
Did I miss anything good today? Please use the comments . . .
July 8th, 2009 at 2:43 pm
Hall of shame was great! Thanks BR!
July 8th, 2009 at 2:53 pm
Speaking of “Halls of Shame,” what about this post-bubble, recession/depression market environment? All asset classes seem less markets than cabals of speculative frenzies. Yet media and commentators continue to cover as if they are stuck in a pre-leverage, pre-hedge fund world.
July 8th, 2009 at 2:59 pm
The article on Shiller is interesting. The article’s title is reflective of the common sentiment that those who forecast any kind of economic downturn are actually primary causal agents in the eventual playing out of that forecast (unless their timing is off, in which case they’re just “whackos”).
That’s reflected also in the meme that the negativity in the media caused the panic last fall that created the recession. Balderdash, of course. But it allows those who espouse it to hang on to their faulty investing methodology, etc. Denial is strong.
Also the idea of hedging your risk in housing is a good one. Of course the devil’s in the details and you’d want to watch out for unintended consequences, and speculation that would just cause more problems than it would solve and skew the market. But it would help to take short term risk from home ownership and enable mobility for the job market.
Because real estate is so local, it would be tough to hedge perfectly and some markets would be easier than others to create the hedges (larger, more homogeneous markets). You could end up losing on a bad hedge, and that would obviously defeat the whole purpose of the idea.
July 8th, 2009 at 3:39 pm
Meh…The Hall of Shame deal was an exercise in blogger petulance imo.
July 8th, 2009 at 4:25 pm
can we really hope that the CFTC will actually crack down on GS and MS in their speculations on oil and others? it would be nice to be able to have real gas prices that aren’t the result of speculation and nothing else
July 8th, 2009 at 4:37 pm
the Bloomberg “Denial” article is a must read- Wall Street is on the public relations offensive trying to spin the story- the bad guy of course are the short sellers- and Wall Street experienced a once in a century event that was the fault of no-one-
“The once-in-100-years-storm story means that there’s nothing to learn here, it just happens every now and then and we have to accept it,” says Joseph Mason, professor of banking at Louisiana State University. “That absolves banks and regulators from responsibility for reforming in a meaningful fashion financial regulation.”
” the message is clear: the credit crunch didn’t occur because the financial system was rotten. No, instead it was swamped by an epic storm worsened by investors looking to profit from misery”
man- that is some brazen stuff
July 8th, 2009 at 4:49 pm
I thought this would be a joke from the Onion:
“Morgan Stanley Plans to Turn Downgraded Loan CDO Into AAA Bonds ”
but it’s not…
http://www.bloomberg.com/apps/news?pid=20601109&sid=aeTzfvEedKpQ
“Morgan Stanley plans to repackage a downgraded collateralized debt obligation backed by leveraged loans into new securities with AAA ratings in the first transaction of its kind, said two people familiar with the sale. ”
it leaves me mouth agape and head shaking. i just don’t understand. talk about short memories!
July 8th, 2009 at 5:11 pm
1 hour into Earning sessions and I have already heard “better than expected” about 30 times.
The next month is going to be torture as the media spin machine kicks into over drive.
Of course better than analysts expectations is simply a Bloomberg survey, which could be anything they want it to be, I predict we are in for another major does of green shoots here…..Sorry I feel a vomit coming on.
July 8th, 2009 at 5:22 pm
“Alcoa tops estimates”
http://money.aol.com/article/aluminum-giant-alcoa-tops-estimates/562604
Give me a break. This was linked from AOL one minute and then replace by a much more upbeat article:
http://www.dailyfinance.com/2009/07/08/alcoas-second-quarter-earnings-top-expectations-is-the-recover/
Kind of fascinating to catch the MSM in the act of spinning the news.
So much for unbiased news.
July 8th, 2009 at 5:23 pm
re: Infectious Greed link
Petabytes have been with us for many moon..
here is one, of many utilizations– http://www.globalresearch.ca/index.php?context=va&aid=14249