Some reading to end your holiday shortened week:

More insider trading: Investors Bullish on Fed Tips (WSJ) see also Alleged Rigging of Libor Rate Dogs London Banks (Bloomberg)
• How to Invest Like a Millionaire in 2012 (WSJ)
Shiller: The Neuroeconomics Revolution (Project Syndicate)
• Private Markets Offer Valuable Service but Little Disclosure (DealBook)
• China’s Super-Rich Buy a Better Life Abroad (Businessweek)
• European Banks Get ‘False Deleveraging’ in Seller-Financed Deals (Bloomberg) see also Dodd-Frank Law May Hinder Crisis Response by U.S. Policy Makers (Bloomberg)
• Physics or Fashion? What Science Lovers Link to Most (Scientific American)
• At Apple, Cloud Experts Wanted (WSJ)
• How to Ease Your Transition to Google Voice (Lifehacker)
• Universe Expands While Minds Contract (Scientific American)

What are you reading?


Clever, clever Turkeys

Category: Financial Press

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

23 Responses to “10 Mid-Week Reads”

  1. JDinCT says:

    I have been reading about Carter Worth’s analysis that the SP500 will hold 1165.

    Pretty brave talk, it seems to me, given the circumstances.

    I’m a little startled by the rampant complacency. The VIX came down as the market continued to sink yesterday. The talking heads seemed to think that was a hopeful sign.

    Is Barry still long equities?


    BR: See this from last week: Jettisoning QQQs and Small Cap Growth

  2. Joe Friday says:


    Ken Langone blasted President Barack Obama Tuesday morning on CNBC, where he was a guest host on “Squawk Box”.

    Langone defended “businessmen and fat cats,” who he feels are being unfairly portrayed as villains in Obama’s administration.

    “We need leadership. We need cheer leading. We need encouragement,” Langone said. “Businessmen and fat cats need to feel like they’re doing something good – not that they’re villains and not that they’re criminals.”

    Somebody call a WHAmbulance !

    The number of ways this poor baby is an idiot is to long to list.

  3. streeteye says:

    Something to ponder while we stuff our faces – a chart of our self-reported weight vs. our presumed ‘ideal weight’

  4. Moss says:

    But the criminals, fraudsters and villains are fat cats, businessman and corporations. They simply have not been held accountable, that is why they only feel like such.

    The .1 % is getting nervous.. now they are the victims.

    Langone does not understand that the trust is broken. Lack of leadership, by not holding the criminals accountable is what has eroded the trust. He has it backwards,

  5. deanscamaro says:

    I just thought this was good for a few yucks in this holiday season, reflecting on the “Stupider Committee” , made up from the cream of the crop “Stupider Congress”.

  6. James Cameron says:

    “The debt crisis that began more than two years ago now risks engulfing Germany. The Markit iTraxx SovX Western Europe Index of credit-default swaps on 15 governments rose to an all- time high as Germany failed to find buyers for 35 percent of the bonds offered at an auction.”

  7. mathman says:

    Hey people, only have a short break before the wife catches me goofin’ off:

    (Merry effing xmas from homeland security)

    (eat up!)

    and finally (there’s lot’s more to check out @ cryptogon!)
    (makes you wonder . . .)

    hope to see you later, let me leave you with this: (the Who, My Wife)

  8. alnval says:

    Shiller: The Neuroeconomics Revolution

    Your reading lists are invariably more stimulating than those I used to assign or had to read as a student. Who would have thought that you would stimulate a discussion of neurological reductionism? (For a brief and easily understandable view of this topic see )

    Now. Question. Where in my brain are you going to find the neurological structures responsible for my thoughts on this page anymore than you could have found the place in Michelangelo’s brain responsible for the paintings in the Sistine Chapel? According to Shiller we’re finally on the trail to finding that answer. Poppycock.

    Shiller’s article is fascinating and informative, however, because it truly reflects his having had the kind of epiphanic experience often necessary if one is to really change one’s mind about something. That’s good for economics and it’s good for the country.

    I hope, however, that he has a few more conversations about the topic with his psychologist wife so that he adjusts his macro view of the relationship between psychology and economics so as to avoid the neurological reductionism trap.

    Psychology and economic behavior yes. Neurology and brain structures no.

  9. DeDude says:

    A lot of smart people get over-confident and have to eat their own words later. I often agree with Krugman but he should stay a little more open minded.

    There actually is a difference between being the least ugly girl, and being the most beautiful girl, at the dance. That is a difference Germany just woke up to today. We may be safe for a couple of years or more and certainly should focus on the problems we have here and now rather than those we perhaps may face years from now. And it is certainly stupid to make today’s problems worse in a misguided attempt to solve those potential future problems now. But our debt is ugly even if our unemployment is uglier.

  10. MorticiaA says:


    Here’s what I’m anxious to read – last year you posted your Christmas wish list. It was very helpful in my own shopping for my hubby. When are you going to post your 2011 wish list so I can start shopping?

  11. Mike in Nola says:

    @streeteye: I regret to say that the spread on my actual v. ideal weight is a bit bigger than the survey results :)

    Re: Apple and cloud executives – Apple is playing a little catchup here. Apple is actually using MSFT and Amazon cloud services to host the iCloud.
    Despite the general view that MSFT is way behind on cloud computing, they have been pushing strongly in that area for several years. The new cloud based Office 365, actually a relaunch and improvement of it’s former web apps, has received very good reviews. It’s actually very practical for even small businesses at $6/user per month for the full suite, including MS hosted Outlook. Google apps is a pretty poor imitation.

  12. Mike in Nola says:

    On the investment side, a very interesting post over at ZH coming from a bond bull illustrating the superior performance of longer treasuries over stocks for an extended period.

    I do think a good trader like BR can do much better than bonds since he can capture the ups and downs of the market. But, for your average investor without talent for timing and a good bit of inertia, like yours truly, it has been a good strategy. Can’t claim to have been in long term treasuries for 30 years, but we have had a substantial percentage in intermediate zero coupon treasuries and have moved into longer term treasuries the past few years, including EDV and ZROZ the past 18 months. Done pretty well. Hell, even high quality American Century Euro bond funds did very well in the 2000′s until I got worried about some of the components (Italy, Spain, etc) back just before the crisis here and bailed.

  13. Lookout Ranch says:

    Frank-Dodd my hinder Fed responses to financial crisis?

    Another way to look at it is that it will require the Swedish approach of nationalization instead of bailout. Maybe that’s not so bad.

  14. Jojo says:

    Report | Regulation
    A quick guide to EPI’s research on the costs and benefits of regulations
    By Isaac Shapiro | November 22, 2011

    In 2011, the Economic Policy Institute conducted extensive research on the economic effects of regulations. This policy memorandum synthesizes our research on the costs and benefits of regulations. The research examines federal government cost-benefit data for major regulations, data focusing on the costs and benefits of Environmental Protection Agency regulations, and high-profile estimates that misleadingly inflate the costs of regulations. (See the companion paper, A quick guide to the evidence on regulations and jobs, released by EPI in October and updated in November.)
    Government data show that the benefits of regulations over time have significantly and consistently exceeded their costs


  15. RW says:

    @DeDude, he can annoying but Krugman has been so on target WRT the global economy the past decade (and Dubya’s BS too of course) it led to the ‘kidding on the square’ two rules from Brad Delong (with Niall Ferguson playing the chump this time around).

    1. Paul Krugman’s analysis is correct.
    2. If you think that Paul Krugman’s analysis is incorrect, see rule number 1.

    Kidding aside, if I was forced to chose a single economics text, one that made me the most money, it would be Krugman’s (1998) “The Return of Depression Economics.” Like a lot of folks the market collapse of 2000 had me shaking my head but a friend loaned my that little book and everything snapped into focus (it’s been reissued with a new section on the 2008 credit crisis).

    But this time I don’t see it quite the way PK (or Solman) does, or at least I see an alternative, so I suppose I’d be playing the hapless chump this time around, if I had any status worthy of the name that is.

    In a world where all currencies are relative to each other in value it’s easy to see that the least ugly currencies (and the bonds they are denominated in) are going to become more and more beautiful as the uglies get taken out an shot. But that also means the stock of ‘risk free’ assets available for collateral, transactions, etc; i.e., the remaining assets are going to become more expensive as will hedging costs so global trade margins start to shrink.

    It readily follows that austerity policies are going to keep reducing that stock even as the spreading contagion of perceived credit risk reduces the value, country by country, of the stock remaining: the last one(s) standing are going to become raving beauties.

    That is the long tail scenario where the $USD becomes stronger and stronger with everyone still doing business piling into it while commodities and just about everything else crashes. That is the outright deflation that PK’s model was predicting (he concedes he was expecting this to happen sooner rather than later).

    But there is another long tail scenario where the last one standing goes down too and no sovereign debt is trusted any longer so, eo ipso, no sovereign currency is either. That could look like hyperinflation at first but I think it could get weirder than that as people search for ways to conduct transactions, maintain collateral and hedge risk: diamonds? precious metals? hypothecate your first born? hostage exchanges? wampum and cowrie shells?

    Both scenarios mean global trade and economy will contract so perhaps it is distinction without a different; both will be awful.

  16. DeDude says:

    @RW; I agree pretty much with all of that, but what if suddenly a bunch of new pretty girls show up, then it does make a difference whether you are the least ugly rather than the most beautiful. Lets imagine that certain countries basically defaulted because they had no other choice and certain banks were taken down in that process. Lets also imagine that countries simply let the bond and stockholders take those loses and allowed a lot of rich people to lose a lot of money (perhaps because they had no alternative). After such a shakeout some countries would look a lot better than they did before (when people didn’t really know if they could “survive”). I agree that the US treasuries will be the last one standing, but that doesn’t mean that it will stand forever.

  17. DeDude says:

    It is not like life will stop and all become dark when Spain and Italy defaults.

    Lets say all Italian bonds get converted to 1-30 year bonds; all with an interest rate of 2% (they have a budget surplus except for interest payments so they could handle that). Lets say that Spain give the bond-holders a 20% haircut and convert their bonds into 10-30 year bonds with an interest rate of 2% (that should allow them to finance their budget deficits with short bonds at a rate they could afford). The other three PIIGS would give much larger haircuts in similar deals to become “viable” and be able to access credit at normal rates. After all those loses had been absorbed (and provided no country was stupid enough to try and save their banks), a lot of people would have lesser fortunes, but life would continue and people would go to work every day.