My morning reading material:

• Your Financial Adviser Might Be a Lemon (Time) see also Why Wall Street Hates the Lazy Portfolios Strategy (SmartMoney)
• The Real Oil Shock (NYT)
• Large Hedge Funds Fared Well in 2011 (DealBook) see also Is Wall Street Full of Psychopaths? (The Atlantic)
• Why Ben Bernanke isn’t declaring victory for America’s economic recovery (Telegraph)
• Who Captured the Fed? (Economix)
• Marx at 193 (London Review of Books)
• The End Is Coming: January 1, 2013 (Businessweek)
• Grim Housing Data Shows We Have Not Hit Bottom (The Fiscal Times)
• Apple’s War on Android (Businessweek) but see Google Heightens Rivalry With iPad (WSJ)
• Supreme Court and the National Conversation on Health Care Reform (Economix)

What are you reading?


Moody’s Ratings of Banks’ Debt

Source: NYT

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.

8 Responses to “10 Friday AM Reads”

  1. rd says:

    The combination of psychopaths and sociopaths and 15 years of de-regulation has led us to the current state of affairs in the financial markets.

    You regulate financial markets for the samer reason that you regulate assault and homicide. A large enough percentage of the population will take advantage of lax regulation to make society unfit for most normal people.

    It appears that Florida is attempting to de-regulate homicide. So far that experiment does not appear to be going well.

  2. rktbrkr says:

    Ireland back at the trough. The banksters are going to help these PIIGS to death.

  3. Robespierre says:

    The fact that Goldman is creating this:
    Goldman Bets on Property Rebound With New Fund: Mortgages
    “The firm bought $6.2 billion of the debt in a Feb. 8 auction. Unlike Credit Suisse Group AG, which won a Jan. 19 auction, the bank failed to immediately flip most of the securities to clients bidding through it, regulatory data on trading volumes showed.”
    I bet this id where The Muppet master flips their recently acquired debt…

    The fact that CR is bullish is housing and one of his most cited source has this background:
    Michael Olenick: Housing Pundit Thomas Lawler and the Genesis of Lawlessness

    Reinforces this:
    Grim Housing Data Shows We Have Not Hit Bottom

  4. SOP says:

    Re. The Real Oil Shock
    Rising Gas Prices Don’t Actually Affect Americans’ Behavior

    What is the author’s point?

    No really. He seems to be jumping from one tangent to another, most only superficially related to the question posed.

    The last sentence demonstrates the author is very confused. He clearly gives up on his train of thought right when he gets to the difficult part (this is typical of the highly insulated):

    “As billions of people, throughout the world, enter the middle class in the coming decades, there will be an enormous increase in the demand for gas. This, along with rising environmental considerations, is likely to send the prices far higher than they are today. But at that point, we will all probably be driving solar-powered hovercars anyway.”

    Yes, as “billions of people” enter the “middle class in the coming decades”…. driving hovercrafts…

    The author should just have texted his editor with, “Jesus Christ ate my homework” and took the day off.

  5. machinehead says:

    Paul Farrell’s ‘Lazy Portfolios’ is mostly good advice, except for this clunker:

    ‘No market timing, no active trading. Never. Markets are random and unpredictable, says Wharton economist Jeremy Siegel in “Stocks for The Long-Run.”

    It’s easy to demonstrate that by holding the S&P index when it’s above its 12-month moving average, and not holding it while it’s below the 12-MA, you can obtain about 90% of the buy-and-hold return, with about half the risk (in terms of volatility and drawdown), thus raising the Sharpe ratio substantially. This superior result has nothing to do with ‘prediction’ — everyone who uses the same MA gets the same results.

    But like his Wall Street nemeses, Farrell only quotes compounded returns for his Lazy Portfolios, without analyzing their relative risk. That’s lazy, Paul!

    Risk-adjusted return is the name of the game, and it ain’t rocket science. Bill Sharpe, who won a Nobel Prize for his insight, has posted a how-to tutorial:

  6. ilsm says:

    The end of the world for the military industrial complex (MIC) bottomless trough.

    The “sequestration” taking effect in 9 months will cut 8% off the top of the MIC.

    However, as GAO reports each March in reviewing the largest 95 or so weapons acquisitions (R&D and production, or about 65% of the costs of owning the weapons for their “lives”) cost increases and overruns added 5% for the report released 29 Mar 2012.

    In the past the report has documented 10 or 15% annual increases.

    So, if they cut 8% to reduce the deficit, and the largest, most closely managed programs rise 10% and the other less highly managed programs rise more than 15% a year.

    The 8% sequestration will have the effect of a 23% cut.

    So much for efficiencies in the MIC!

    The result will be instead of 3000 F-35′s the trillion bucks with cuts to performance and capability will only support 700 airplanes.

    In terms of the 11 largest aircraft carriers in the world by 40,000 tons each that will be an aging fleet with more refuelings at $2.7B a pop and a bumch of nuclear waste with no place to hide it.

    The list can go on.

  7. VennData says:

    Do the Rich Work Less as Their Taxes Increase?

    “…a new paper by Jeffrey Thompson at the University of Massachusetts Amherst Political Economy Research Institute says the “going Galt” argument doesn’t hold up to close research. According to the data, “affluent households are unlikely to make substantial changes in their ‘real’ economic behavior in response to modest tax increases.”

    No wonder the GOP hates academia, statistical analysis, and scientific inquiry … it proves the opposite of what they believe.