My 6AM West Coast reads to start my day (in the middle of your day):

• 5 Big Fears Hanging Over the Stock Market (Fiscal Times)
• Fed May Extend Support Past 2014, Official Says (NYT)
• Natural Gas Sinks Beneath $2 Level (WSJ) see also Investors See Makings of Coal-Share Resurgence (WSJ)
• When the tail-event becomes the standard risk (Alphaville)
Baum: Inflation Lurks as Stealth Tax on Top of Form 1040 (Bloomberg) see also Tax me if you can (Economist)
• How My Job as a Business Journalist Has Changed: Greenberg (CNBC)
• A Buffet of Magazines on a Tablet (NYT)
• Why Amazon Wants Your Old CDs (SmartMoney)
• It’s Not What You Sell, It’s What You Believe (Harvard Business Review)

What are you reading?


Where Has All the Trading Gone? Volume Hits 4-Year Low

Source: CNBC

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.

11 Responses to “10 Thursday AM Reads”

  1. gordo365 says:

    Using Occam’s razor – maybe the simplest explanation is that all the high-volume trading ideas that were driving up volume – aren’t producing profits.

  2. RW says:

    The Bloomberg article wasn’t impressive: core inflation is not “3 to 4″ percent currently, it is less than 2%, and the argument for more inflation is an argument for 3 to 4%, not “7 to 8%,” because the former is a level that has a chance of reducing unemployment with minimal destabilization.

    The Fed is not currently adhering to its mandate WRT maximizing employment and it needs to. A primary tool it has to operationalize that mandate is inflation expectations (not the straw man of “high inflation”) to reduce the tendency to horde cash and put it to productive uses …like making things and providing services which causes hiring which creates a virtuous circle of more people who can buy things or require service, etc.

    WRT high-volume trading, what gordo365 said. It was probably profitable for awhile but, like most strategies, once a lot of folks get into the act and competition heats up the margins start to shrink.

  3. mathman says:

    That “pillar of society”, the home insurance industry – there to protect the mortgage lender, is pulling out due to too much weather related damage!

    “As weather gets biblical, insurers go missing

    PITTSBURGH (Reuters) – As weather disasters strike with more frequency, homeowners first get hit with the destruction or total loss of property. Many are then hit with the unexpected loss of homeowners insurance policies as insurance companies re-evaluate their financial liabilities.

    After a tornado ripped through Springfield, Massachusetts, last year, R. Paula Lazzari’s home was badly damaged. The retired teacher found broken windows, missing siding and a damaged roof. Her insurer offered to fund repairs for one broken window and some of the siding. It took nine months — and mediation services from an independent adjuster and the Massachusetts Division of Insurance — to get her bills paid, according to the parties involved.

    In this era of unpredictable weather patterns, Lazzari’s case is not unique. Insurance companies are raising rates, cutting coverage, balking at some payouts and generally shifting more expense and liability to homeowners, according to reports from the industry and its critics.

    “Insurance companies have significantly and methodically decreased their financial responsibility for weather catastrophes like hurricanes, tornados and floods in recent years,” the Consumer Federation of America said in a statement after studying industry data.

    The industry concedes that it is trying to avoid getting trounced by those same punishing weather patterns.

    “Last year (2011) was an extraordinary year for natural disasters,” said Michael Barry of the Insurance Information Institute (III), an industry trade group. “Insurers have taken a step back to assess whether or not they can absorb severe losses.”


    Some insurance companies have pulled out of weather-challenged states — meaning they will not write new homeowners policies and may not renew contracts with current policyholders.

    In the wake of Hurricane Irene last summer, for example, Allstate informed some 45,000 North Carolina policyholders that it would not renew contracts that were not bundled with auto insurance.

    After a spate of tornadoes last April caused $11 billion of property damage in Alabama, Alfa Mutual Group announced it would not renew 73,000 Alabama property insurance policies.

    “The increased frequency and severity of storms over the last decade have highlighted the need for Alfa to review its overall property portfolio,” Alfa President Jerry Newby said in a statement.

    Florida, where insurers have been dropping coverage since Hurricane Andrew in 1992, is a good example of where this can lead. With an annual average of $1,460 per home, homeowners’ premiums there are second-highest in the country (Texas, at $1,511 is first), according to the most recent data available, a 2010 report from the Insurance Information Institute.

    “Florida’s off the charts when it comes to pricing,” said Mike McCartin, an Ashton, Maryland, independent insurance agent.

    The state has stepped in to cover some 1.5 million properties via its publicly funded Citizens Property and Insurance Corporation as insurers drop more and more homes.

    “You simply have major private insurers that are unwilling to write policies in Florida,” said Robin Westcott, the state’s insurance consumer advocate.

    “It’s just a tough market to be in,” said Phil Supple, a spokesman for State Farm, which was once Florida’s largest property insurer. It stopped writing new homeowners’ policies there in 2007.”

    (from Blazing Saddles) “Sonny, you’re on your own.”

  4. wally says:

    Low trading volume?
    Isn’t that more indicative of confidence than of concern?

  5. La Marque says:

    I read a piece on MarketWatch this morning about how there were 7400 public US companies in 1997 while today’s Wilshire 5000 has only about 3700 companies. I had heard in the past that there are fewer shares of stock available today than there were in 2000.

    Maybe, more and more ‘boomers’ are like me: buy and holders, exiting mutual funds and ETFs for the individual stocks. Prices are high and dividends are important. Unless a ‘black swan’ event happens, we are on the sidelines waiting for better entry points.

    My guess is that bonds and index funds are getting a lot of 401K money while the traders are getting less for equity investing. Gordo365 is probably right.

  6. Mike in Nola says:

    Didn’t notice posts about the US antitrust lawsuit against Apple and book publishers.

    I can see why CNBC would keep it quiet; might depress the markets. But, didn’t notice it here either.

  7. Bob is still unemployed   says:

    This article, Teens Break Up With Facebook caught my eye. I had noticed something different when I looked at my Facebook account, but I was not able to put my finger on what was different.

    Now I realize that the difference was that the average age of of the items’ authors in my newsfeed is increasing. There are hardly any comments anymore by my teenage relatives, and a lot more comments by my adult friends and relatives.

  8. obsvr-1 says:

    @mathman Says: … “It’s just a tough market to be in,” said Phil Supple, a spokesman for State Farm, which was once Florida’s largest property insurer. It stopped writing new homeowners’ policies there in 2007.” …

    *** reply

    I guess we need an Affordable Housing Insurance Program (A-HIP), that mandates that everyone participate in the insurance program or face a penalty. Because, after all everyone needs a roof over their head and ultimately will face some catastrophic event in their lifetime. [sarcasm off].

  9. willid3 says:

    Mike in Nola, not sure where, but i thought there was already settlement for that.

    from what i read it sounded like the publishers were setting the retail price and not allowing the retailers to set their own prices, meaning there was no competition at all. and the price was the price whether you bought a book from Amazon or APPLE
    but it also sounds the settlement is just temporary as all of the problems will reoccur later

  10. Jojo says:

    In case you are on a real sinking ship…. [lol]
    Report: It’s everyone for himself on sinking ships
    By LOUISE NORDSTROM | April 12, 2012

    STOCKHOLM (AP) — A hundred years after the Titanic sank, two Swedish researchers on Thursday said when it comes to sinking ships, male chivalry is “a myth” and more men generally survive such disasters than women and children.

    Economists Mikael Elinder and Oscar Erixon of Uppsala University also showed in their 82-page study that captains and their crew are 18.7 percentage points more likely to survive a shipwreck than their passengers.

    “Our findings show that behavior in life-and-death situation is best captured by the expression ‘every man for himself’,” the authors wrote.