Thursday Reading
After a 7 days in Vancouver, I have been busy in the office all week — digging out from under the email deluge, meetings, a few media hits and conference calls.
As usual, I have a long list of items that I would like to read, but haven’t gotten to. I used to print them all out for the train ride home — perhaps I should think about an iPad for doing precisely what I would use it for.
Regardless, this is what I will be reading on the way home tonite:
• WTF? SEC Says New Financial Regulation Law Exempts it From Public Disclosure (Fox)
• Do You Believe in Technicals or Fundamentals? (Barron’s)
• Americans Three Times as Confident in Small vs. Big Business (Gallup)
• The money-inflation connection: It’s baaaack! (Fed Atlanta macroblog)
• Yes, There’s Actual Demand Out There (Marketbeat)
• Now let us stress-test the central banks (FT.com)
• My new favorite blog: Department of Numbers
• Foreclosures climb in 75% of metro areas (CNN Money)
• The $41,000 Question: Is the Chevy Volt Worth the Money? (Wheels)
• Bill Murray Is Ready To See You Now (GQ)
• Working at a startup sucks (laurentk)
What are you reading?
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July 29th, 2010 at 4:59 pm
Report: Unemployment High Because People Keep Blowing Their Job Interviews http://onion.com/bW5FNn
July 29th, 2010 at 5:08 pm
Our Divisive President:
http://online.wsj.com/article/SB10001424052748703700904575391553798363586.html
By: Mr. Caddell served as a pollster for President Jimmy Carter. Mr. Schoen, who served as a pollster for President Bill Clinton, is the author of “The Political Fix”
July 29th, 2010 at 5:32 pm
The Chevy Volt? Once again, exactly the wrong vehicle at the wrong price at the wrong time. Why? Electric vehicles have never generated any excitement from anyone after years and years of talk.And yesterday, the LA Times had an article about Honda’s new hybrid, the CR-Z. If you have ever driven a Honda and then had to drive any American branded car like from a rental place, then you know General Motors is dead. Maybe they have a deal with China that will force all Chinese to buy only Volts. That is the only way this is going to work. All GM executives responsible for this incredibly stupid idea need to be taken out back and shot.
July 29th, 2010 at 5:45 pm
Why we must halt the land cycle
http://www.ft.com/cms/s/0/8f06df9e-8ac1-11df-8e17-00144feab49a.html
July 29th, 2010 at 5:57 pm
@Technicals v Fundamentals:
Technicals have a strong self-fulfilling-prophecy aspect to them: They “work” as long as enough people (and/or HFT algos programmed to follow technicals) believe in them.
That sort of self-reinforcing herdlike trend following can go on for a long time. What kinds of things break the trend? External shocks, for one … but frequently such “unexpected events” are nothing else but long-ignored-by-the-galloping-technicals-following herd fundamentals finally asserting themselves, often in dramatic cascading fashion when some trigger – say, a sovereign default or big hedge fund blowing up – cause a stampede for the exits, everyone of the recently oh-so-confident technicals acolytes trying to sell at once.
Most asset bubbles are in fact a result of a kind of technical-trend following: Housing going above its 200 DMA is a signal to leverage up and pile into the housing market … ooh, look, housing went up again! This is too easy … think I’ll lever up even more and buy multiple units so I can flip them for a quick profit… whaddya know? Housing went up again! We all know how that ends.
July 29th, 2010 at 6:10 pm
Since the BP disaster started, there are some financial bloggers/commentators that have eroded any credibility they had in my view by going off the deep end with outlandish conspiracy theories and doomsday scenarios. In particular, George Washington’s blog has focused on that almost exclusively for the last 3 months. Even when faced with facts from commentators on Zero Hedge that completely debunk his pile of shit he tries to pass off as objective or quality posts, he dismisses it as lies or heresy. I’ve got a big unamused face for Yves Smith right now too, for reposting his nonsense on Naked Capitalism without question. I was quite delighted this morning to see the Oil Drum decimate GW’s favorite source for information, Matt Simmons.
“A Critical Examination of Matt Simmons’ Claims on the Deepwater Spill”
http://www.theoildrum.com/node/6789
July 29th, 2010 at 6:10 pm
The Obama administration should challenge US firms flush with overseas earnings.
For the next 12 months only:
- a tax credit on repatriated earnings which offset net new (permanent) hires in the US, from a base of the highest employment in the past 12 months.
- a tax credit or accelerated depreciation for incremental capital investment in the US, to offset taxes on repatriated earnings.
July 29th, 2010 at 6:11 pm
The “Party Of NO” sticks it to a major component of its own base (small businesses)
===========
July 29, 2010
Small-Business Bill Falters on Senate Partisanship
By DAVID M. HERSZENHORN
WASHINGTON — Senate Republicans on Thursday rejected a bill to aid small businesses with expanded loan programs and tax breaks, a procedural blockade that underscored how fiercely determined the party’s leaders are to deny Democrats any further legislative accomplishments before November’s midterm elections.
The small business measure, championed by Senator Mary L. Landrieu, Democrat of Louisiana, had the backing of some of the Republican party’s most reliable allies in the business world, including the United States Chamber of Commerce and the National Federation of Independent Business. Several Republican lawmakers also helped write it.
But Republicans leaders filibustered after engaging for days in a procedural fight with Democrats over the number of amendments they would be able to offer during floor debate, and what issues the amendments would cover. A last-ditch offer by Democrats to allow three Republican amendments was refused by the Republican leader, Mitch McConnell of Kentucky.
…
http://www.nytimes.com/2010/07/30/us/politics/30cong.html
July 29th, 2010 at 6:17 pm
Less than 24 hours and a new favorite blog to replace the old favorite blog?
Oh, wait….is that an image of Scarlett Johansson I see in that graph at Dept. of Numbers?
July 29th, 2010 at 6:28 pm
Technicals vs. fundamentals: I use both. There is no need to choose only one. I’ve never understood why there is this false dichotomy presented in financial press or writing that an investor/trader MUST choose one or the other. This isn’t a question like being Catholic or Protestant, where one excludes the other.
Chevy Volt: No. None of these electric cars are. For $41K, the auto companies could deliver a fuel efficient turbo-diesel car that gets 50MPG and gets rid of the issues with batteries and range, and you’d have a very well equipped sedan or small car. Instead, we get a shoebox of a car with a payback timeframe that exceeds the expected lifetime of the battery.
Working at a startup: Been there, done it twice. It is far better than working for a large company and their idiotic HR drones.
Ft. Worth considering ending the defined benefit pension for new workers:
http://www.star-telegram.com/2010/07/27/2365609/fort-worth-council-considers-eliminating.html#ixzz0v2AiY8zA
More states and cities need to seriously consider doing this. The defined benefit pension system can’t be supported any more. The assumptions of 8% average annual gain are simply not realistic. Without a reliable return on investment, there’s no way to define a pension’s benefits as “$XXX” in year “TTTT.”
July 29th, 2010 at 6:52 pm
Adding to the headwinds, Federal Reserve Bank of St. Louis President James Bullard released a paper in which he talked about the potential for deflation.
http://research.stlouisfed.org/econ/bullard/pdf/SevenFacesFinalJul28.pdf
July 29th, 2010 at 6:59 pm
http://www.boston.com/business/articles/2010/07/29/grateful_deads_marketing_strategy_becomes_model_for_internet_age/
new book out describing how the grateful dead’s early marketing is similar to internet startups – freemiums, etc.
July 29th, 2010 at 7:07 pm
banks and capital
http://baselinescenario.com/2010/07/29/required-intellectual-capital/
not so sure that the Volt isn’t a game changer. just like the original version of that technology, in trains. and you won’t see any trains any more that aren’t using the same technology any more. could it be the same for cars? sure. one thing is sure though. any new technology is more expensive to start with (HD TVs? PCs? cell phones?). can any one name one that wasn’t more expensive that what it replaced originally ?
the only range concerns with the Volt as it has been designed. is that it can only go as far as the batteries electricity and gas for motor can generate electricity can drive the car.not much different than how far your current car can go. the difference is that the generator (gas engine) can run in its sweet spot all the time, not just on occasion like in your car. makes the MPG for that engine much better. its not really an electric car, except the motor is a generator to charge the battery. so you end up with more than 290 miles. and the gas tank is really small. that motor only runs as needed when the battery has been discharged, an estimated 40 miles.
and doing away with pensions sounds really good i suppose. but there are no replacements that are even 1/10 as good. 401k (aka 2.05k) can’t even repeat what a pension will, not even close, and there is not protection of the assets at all, your employer can use that cash (though not legally) and there are no agencies watching, only employees who check it can be sure that money is flowing correctly. and you have to file suit to address that. can you afford to do that? IRA maybe safer (less likely to be employer based) but really limited in wealth (savings) accumulation.
so does that mean retirement can only be done using SS? cause usually the problem with pensions isn’t their growth estimates, its the employer contributions. they tend to fall in good times, and in bad they fall faster, making the shortfall even larger. and of course there is the manipulation of the actuary tables that are used. GM was big example of this. they estimated that retirees wouldn’t live as long back in the 80s, this helped reduced contribution and helped make their numbers look better, but made the pension seriously underfunded late.
July 29th, 2010 at 7:09 pm
Are you a speed reader or do you have a long train ride?
July 29th, 2010 at 7:22 pm
bailouts helped? or not?
http://www.nytimes.com/2010/07/28/business/economy/28bailout.html?_r=1&scp=1&sq=Second%20Depression&st=cse
July 29th, 2010 at 7:50 pm
economists ….
frauds?
http://www.project-syndicate.org/commentary/delong104/English
July 29th, 2010 at 8:41 pm
James Bullard, President of the St. Louis Federal Reserve explains how ZIRP can cause, instead of prevent, deflation:
http://www.bloomberg.com/news/2010-07-29/fed-should-resume-treasury-purchases-if-deflation-risk-grows-bullard-says.html
There’s a more extensive paper he published, but I haven’t got the cite handy.
And Barry, you Applehead, get the f#$*ing iPad already. But tell them you want it for free, in order to evaluate the thing for your readers.
July 29th, 2010 at 8:44 pm
If you have ever driven a Honda
as soon as I get neutered or married-
I’ll check it out- I hear they are sooooooo . . . practical and trouble free
~~~
BR: One of the cars I drive is a Honda . . . Good pieces of equipment
July 29th, 2010 at 8:44 pm
SEC catches more bad guys:
These 2 scumbags were behind the Swift Boat attacks on John Kerry. (Regardless of your political views, or feelings towards tax cheat Kerry, what they did to a veteran who actually served in VietNam was reprehensible )
July 29th, 2010 at 8:59 pm
Barry, about that “I-Pad.” One of our family members brought a new “I-Pad” with them on our vacation and I’m telling you it was incredible. Most of us brought laptops with us but hauling them out and connecting was very time consuming (even though some of us had to keep in touch with our offices).
The I-Pad had everyone using it…fighting over it…because it instantly connected to the wireless in our rental villa and everyone could access what they needed to keep up with news, searches for weather and some connected with their E-Mail from office without needing to “uncase and fire-up” their laptops which would have taken up our whole eating area in the villa with the plugs and wires and space taken.
My biggest complaint with the I-Pad was no “Shock Wave” so some searches we did wouldn’t allow us to see a menu for restaurant and some of our folks wanted to see other sites where they needed Shock Wave. However you could You Tube, fine, without trouble.
I didn’t like the “touch scrolling” because my fingure kept hitting those Ads that every site has on the right side and so my “touch” would hit on erroneous ads because I hit the wrong spot.
All in all, though, it helped all of us not have to “wire up” for simple searches (we’ve all become so accustomed to doing) and there was even a game site and other things for entertainment for those who have to be “connected 24/7″ for whatever.
We mostly were really impressed with it. I hear they are going to fix the lack of “Shock Wave.”
It’s a handy tool…if you don’t want to dig your Laptop out and connect it all with disruption when you are visiting folks. Also, because of the size, one doesn’t spend the enormous amount of distracting time on it as one dose when one fires up the laptop and clicks away on the mouse. The Apple Keyboard is Ample…and easy to use, though.
July 29th, 2010 at 9:04 pm
the banksters strike back!
http://thefourteenthbanker.wordpress.com/2010/07/29/oligarchs-pass-on-costs/
July 29th, 2010 at 9:06 pm
bill murray. you know, he’s just a fucking actor. he doesn’t write the words, he just says them. what’s the big deal about actors, anyway? it’s not like he’s some genius author who changes worlds by what he creates. sounds like a real prick, too. why does the author of the piece seem to kiss his ass so much, treat him as if he was an artist, for god’s sake? get a grip, man. he’s just some guy.
~~~
BR: Actually, what makes Bill Murray so special is that he DOES write the words. He is a notorious improviser, and many of the most memorable scenes/lines/bits in his comedies are his spontaneous creations.
If he were just some guy, i wouldn’t be linking to a story about him.
After this 14,000 posts and 63 million page views, I would have hoped to earn the benefit of the dout by now ; (
July 29th, 2010 at 9:09 pm
“As soon as I get neutered or married”
Uh, isn’t that the same thing?
July 29th, 2010 at 9:35 pm
@willd3:
A defined benefit pension looks really good to those who will receive them – right now. To the taxpayers, who will have to make up for the shortfall in defined benefits vs. investment returns, it is now a back-breaking deal. Look at the CalPERS returns and situation (they’re going to be asking for more than $600 million from the Legislature to fill an investment shortfall this year) and you see where defined benefit pensions are going. They’re unsustainable without the type of secular bull market returns we had in from ’83 to ’00.
Back to the Chevy Volt: If we really wanted to maximize the mileage we could get with existing technology, we’d put in some sort of hybrid drive into a diesel car. Period. This is what infuriates engineers – we already know that diesel engines have far higher efficiencies than a gasoline engine (or, more accurately, the Diesel combustion cycle is more efficient than the Otto cycle). If you want a 100MPG car, we engineers could deliver that to you TODAY – if you’re willing to drive a diesel hybrid. Want 100MPG with a gasoline/Otto engine? Now that’s very much harder.
The idiots at GM have screwed the US customer on the subject of diesels in the late 70′s – and so the US consumer won’t look at diesels again. The truth can be seen in Europe, where over 40% of all new cars bought in their auto fleet are little, efficient turbo-diesels. If we could get rid of the idiots in the EPA who are slaves to the CARB and get rid of the idiots from GM who keep screwing this up, we could get a large leap in auto efficiency into the auto fleet at reasonable prices. BTW – $41K for a shoebox car with a battery liability in the future is not reasonable.
July 30th, 2010 at 12:16 am
Good luck with your new favorite blog but please let them know that Brooks is a neo-con, hardly a moderate.
dsawy,
I drove a Diesel Citroen C5 last time I was in France, it’s not because I am French, but GM and Ford (I drive Fords here) are 10 years behind.
Not because American engineers are dumb but because those companies are run by finance cockroaches who couldn’t care less about what they produce.
July 30th, 2010 at 6:38 am
Was this you, Barry?
http://www.bbc.co.uk/news/uk-england-london-10810772
July 30th, 2010 at 6:42 am
Divisive President article: A typical “class warfare piece using race to make it sound like it’s not. The rich have got theirs’ over the past decade. If you want some of it back, you’re engaging in class warfare.
This is a much better description of what’s going on
http://theburningplatform.com/blog/2010/07/29/the-ruling-elite-called/
July 30th, 2010 at 7:04 am
Anecdotal evidence of using money not paid to banks on “stuff.”
http://www.bloomberg.com/news/2010-07-29/americans-splurge-on-ipads-while-broke-in-new-abnormal-economy.html
It wasn’t a strategic default, but same effect.
July 30th, 2010 at 10:27 am
PLEASE get an iPad – that will force you to stop using Flash in your posts for those of us already using one.
Sent from my iPad.
July 31st, 2010 at 10:13 am
The ruling elite just called.
http://theburningplatform.com/blog/2010/07/30/the-ruling-elite-called/