My morning reads:

• Is a New Bull Market Here? (Barron’s)
Escaping the Fear Factory (TRBversus Time bomb to market meltdown ticks louder (MarketWatch)
• Goodbye, Anecdotes! The Age Of Big Data Demands Real Criticism (The Awl)
•  Is Finance Too Big? (The Grumpy Economist) see also How much value does the finance industry create? (Noah Opinion)
• The Mind’s Compartments Create Conflicting Beliefs (Scientific American)
• Taxing by John Cassidy  (New Yorker) see also How to Owe Capital-Gains Taxes Without Even Trying (WSJ)
• Unlucky (Lame) Ducks? Second terms aren’t always a disaster. Many presidents have had significant wins (WSJ)
• The Trend Against Skeuomorphic Textures and Effects in User Interface Design (Daring Fireball) see also Facebook’s Other Big Disruption (Bits)
• Lack Of Up-To-Date Research Complicates Gun Debate (NPR)
• In U.S., 46% Hold Creationist View of Human Origins (Gallup) wtf?! Gallup Poll: 58% of Republicans Are Young Earth Creationists (Little Green Footballs)

What are you reading?

 

Overbought and Oversold Markets


Source: Global Macro Monitor

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.

35 Responses to “10 Monday AM Reads”

  1. hue says:

    Which President has raised the debt ceiling the most? http://buswk.co/10MaUg3 Raise one for the Gipper

  2. James Cameron says:

    Republicans Are Young Earth Creationists (Little Green Footballs)

    —-

    There was a little more to this than the headline suggests:

    “Gallup has asked Americans to choose among these three explanations for the origin and development of human beings 11 times since 1982. Although the percentages choosing each view have varied from survey to survey, the 46% who today choose the creationist explanation is virtually the same as the 45% average over that period — and very similar to the 44% who chose that explanation in 1982. The 32% who choose the “theistic evolution” view that humans evolved under God’s guidance is slightly below the 30-year average of 37%, while the 15% choosing the secular evolution view is slightly higher (12%).”

    Only 15% believe in secular evolution, which surprised me.

  3. • Is Finance Too Big? (The Grumpy Economist) see also How much value does the finance industry create? (Noah Opinion)

    http://www.ritholtz.com/blog/2013/01/debugging-thats-the-rub/

  4. rd says:

    Being a creationist won’t impact most people who are doing finance, politics, etc. (may even help the politicians in some parts of the country) but it means that it is almost impossible to work effectively in a science-based field.

    However, the over-reliance on the “Word of God” raises what may be a more troubling aspect of our modern age. The bibles that are used in the US are translations of translations of what is essentially the Reader’s Digest version of the bible as the contents were culled, condensed, and selected by a bunch of guys at the equivalent of political conventions several hundred years after Jesus’s death. There is too much unquestioning devotion to preachers’ interpretations or misinterpretations of these texts with too little investigation and examination of the background data and context.

    During this period of unparalled quantity, quality, and access to information, a large percentage of the population are refusing to participate in the great exploration of this information. This is possibly the biggest danger that we face over the coming decades – a resurgence of the Dark Ages if the rejection of the scientific method and open-minded review of information becomes more widespread.

    ~~~

    BR: The italicized paragraph is the key — and not the issue of whether the bible is a translation (thereby making it not the literal word of God).

  5. CofaC,

    re: Lumber..

    that’s been an Awesome Fade..

    note ‘Blow-Off’-Top into the EOY, and, recent, ‘Double-Top’..

    http://finviz.com/futures_charts.ashx?t=LB

  6. rd says:

    A quiet little story over the weekend may indicate that the administration is backing away from Orwell’s concept of perpetual war to maintain fear:

    http://www.cnn.com/2013/01/18/travel/tsa-body-scanners/index.html

    This is a major step towards normalization of security procedures, eliminating one component of the security theater we have had to endure for years now. hopefully we will soon get back to a condition where terror is just one of the many different small threats that we face. More people get killed by accidental discharges of guns in homes in a year than are killed by terrorists in the US.

  7. willid3 says:

    the balance sheet recession. hard to understand?
    http://pragcap.com/the-continual-failure-to-understand-the-balance-sheet-recession

    if one doesnt want to?

  8. willid3 says:

    and even more on that 787 problem
    http://www.forbes.com/sites/eamonnfingleton/2013/01/21/what-went-wrong-at-boeing-my-two-cents/?partner=yahootix

    seems to be leading to more competitors for Boeing. and technology that Boeing transferred and new technology that they (Boeing) doesnt have.
    sounds like the new reality of offshoring and outsourcing

  9. willid3 says:

    thinking this is the real drawback to having one person or group (say the .001) have all the money or having robots replace almost all or all but a few (maybe that .001 again). while automation can certainly make it efficient to produce goods or services. the problem is that there are only really 2 consumers of goods and services (aka final demand for goods and services). that would be individuals (70%of our GDP) and government. and we know that government can’t be a long term solution for demand, so that leaves individuals. and we also know that business demand is based on demand for what they sell (i.e. no demand for what they sell, they will shutdown). so robots and automation as we have done it do far are really secondary demand (demand caused by final demand or for what is being sold). today they have generated demand (again secondary demand) for goods and services that has generated more labor. but if some how we were able to replace all labor, where would demand come from to replace the individual (who is about 99% of all workers)?

    http://pragcap.com/weekend-reading-discussion-rise-of-the-robots

  10. wally says:

    Hmmm… so, according to that chart, nothing in the world is now oversold?

  11. louiswi says:

    Barry’s comment to the RD post (and RD) absolutely nails it!!!!!

  12. JoseOle says:

    Behavioral economics explains why the Jets are f*cked next year.

    http://www.newyorker.com/talk/financial/2013/01/21/130121ta_talk_surowiecki

  13. Les Lofton says:

    It goes to show that a young person who believes in the Republicans will believe in anything.

  14. JimRino says:

    Barry, some of the points in this article may no longer be accurate,
    however, the Population vs Oil Chart is very interesting…

    http://www.postpeakliving.com/peak-oil-primer

    Like the oil price jump being a trigger for the 2007 crash,
    how high does oil have to go to trigger a global crash and catastrophic failure of the economy?
    To say nothing about still rapid population growth and climate change.

  15. rd says:

    Re: Is Finance Too Big?

    A few comments on the points they make:

    1. 2.4% of GDP spent on medical billing is one of the major reasons why the US healthcare system spends 50% more as a percentage of GDP per capita than any other developed country. Our vaunted private sector should be able to get that much more efficient (much of that complexity is due to private, not public insurance programs).

    2. Comparing wholesale, retail and transportation of manufactured goods to the actual manufacturing is an apples to oranges comparison that just highlights some ofthe damage that finance has done over the past 30 years. Many of our goods that we buy are manufacturered abroad – of course we are not going to have them show up in our GDP! But we still have to transport, advertise, wholesale, and retail them – the finance sector has aided and abetted turning us into a nation of truckdrivers and shopkeepers.

    3. They then get into a long discussion of investing costs over the past 40 years. However, what they completely skip is that the finance sector has been able to privatize their profits and socialize their losses over the past couple of decades through explicit and implicit bailouts. The finance sector today would be half of its current size if it had been allowed to lose the money it set out to lose in 2007-2008. Instead, the average person was used as the funding source to backstop their stupidity and greed and allow them to retain a substantial percentage of their wealth instead of what has historically occurred in financial crises where imprudent financiers ended up bankrupt whereas now the incompetent ones end up merely wealthy instead of obscenely wealthy.

    In the end, we know that the financial sector is too big because government policies have allowed it to become concentrated among a limited number of players and announced that they are Too Big To Fail. In most other industries this would be subject to anti-trust break-ups to keep the players small enough so that market forces can keep them honest and efficient without threatening to blow up the economy. The military sector is probably the biggest other industry like this but that is another discussion for another day.

  16. whatdoiknow says:

    On the subject of existential threats, two items…

    Item 1:

    Why did TBP only temporarily/momentarily include this awesome link regarding the “resurgence of Facism”? =>

    http://www.ritholtz.com/blog/2013/01/us-truth-is-too-dangerous-to-disclose/?utm_medium=referral&utm_source=pulsenews

    Barry, it was posted for at least 5 seconds… The NSA already catalogued it… fer shur.

    Item 2:

    I recently heard a great sermon regarding recent archaeological finds that continue to substantiate the contents of the Bible… translations of which are based on the original Hebrew & Greek. The following paragraph paraphrases the position of the speaker:

    During this period of unparalled [sic] quantity, quality, and access to information, a large percentage of the population are refusing to participate in the great exploration of this information. This is possibly the biggest danger that we face over the coming decades – a resurgence of the Dark Ages if the rejection of the scientific method and open-minded review of information becomes more widespread.

    LOL

  17. ilsm says:

    @willid3,

    DoD has over $400B a year in “services” contracts, most are “best effort” or “level of effort” by “custom” as neither “efforts” are in the acquisition regulations. Pentagon R&D is run on no penalty for failure.

    Trend is for the big “integrator” to design parts then send the “work” out. Challenges are in engineering drawings, proving the contractor can manufacture with quality and making all the diverse parts “fly” as one airplane.

    The outsourcing model works in automobiles, mobile devises and microcircuits largely because the amount of DoD welfare is not significant. If a supplier does not perform they are dumped, whereas in DoD the supplier is too vital for the “trough” to be dumped for ineptitude.

    You can get a way with this sham in pentagon work. Which is why Boeing is going down the tubes on the commercial side. Engineers get paid better (too much) over on DoD contracts, and the work (no penalty do-overs) is less stressful.

    Corruption has many forms and diverse effects.

  18. Joe Friday says:

    In U.S., 46% Hold Creationist View of Human Origins (Gallup) – Gallup Poll: 58% of Republicans Are Young Earth Creationists

    Scares the hell outta me.

  19. mad97123 says:

    “Republicans Are Young Earth Creationists” – This the kind of reasoning (or lack there of) we’re dealing with..

    “The Theory of Evolution is a scientific model, whereas what the truth is about the Earth and how it was created is something that, logically speaking, does not have to correspond with what science discovers at all.

    Science is about what it looks like, about the appearance of things. What reality actually is doesn’t have to correspond with what it looks like at all. It is logically possible that God created the Earth 6,000 years ago and that it and the rest of the universe were created to look like it all began with a the Big Bang over thirteen billion years ago, and that the species evolved slowly over hundreds of millions of years.

    I can even think of reasons why God might make the appearance different than the reality.

    Remember, science is about what things looks like, not about what the fundamental underlying truth actually is. That is beyond science.”

    http://www.christianforums.com/t7412447/

  20. VennData says:

    “…As for the heavy trading we observe in financial markets, it seems to be necessary in order to incorporate information into the prices of financial assets…”

    If the HFTers add no value, let them knock each other off.

    But they do add value, because ignoramuses trade. Market orders, ETraders, Day Traders etc…

    HFT use these people the way the Koch’s Adelson’s and the rest of the “tax cuts for the rich” crowd use the trailer-park Republicans, call them “The 58%.”

  21. rd says:

    whatdoiknow:

    Schleimann was able to find the location of what appears to be Troy based on what was written down of the original oral history of Homer’s Illiad. Does that mean we are supposed to believe in all of the goings on between Zeus, Athena etc.?http://en.wikipedia.org/wiki/Troy

    Similarly, there is a lot of interesting research going on in the Black Sea region regarding flooding that may have occurred as various glacio-lacustrine lakes around the world released thousands of years ago. These flooding events may have been the source of the Noah/Gilgamesh legends. There weren’t many people back then – major cities would have had maybe 1,000 to 2,000 people so flooding a plain with a rise of several meters of sea water could potentially have displaced an entire population (imagine NJ with sea level 10 feet higher). http://en.wikipedia.org/wiki/Black_Sea_deluge_theory

    Keep in mind that Rome had a million people living in it at its peak about 200 AD. Within 200-300 years that population declined over an order of magnitude and stayed low for quite a while. It is not coincidence that religous doctrine dominated in the West for much of the next millenium which suffered a generally very low standard of living. The East was where the real action was occurring with improved knowledge and invention.

    In the 20th century we saw several shocking episodes when historically civilized areas quickly went stark raving mad with horrific consequences. These changes occurred very quickly, within a decade or two, so we can never take civilization for granted.

  22. VennData says:

    Emboldened Obama lays out battle plan as he launches second term

    http://www.reuters.com/article/2013/01/21/us-usa-inauguration-idUSBRE90I04I20130121

    See! See the Teahadists told you! Negotiating with Obama has just emboldened him! Never negotiate with Terrorists!!! Especially Muslim Terrorists! Who never killed bin Laden! It was actors! HOAX!!!

    He never killed Gaddafi either! …and only did do it to create Bengazi! and Kill Americans!!!

  23. GeorgeBurnsWasRight says:

    I saw a PBS science story on continental drift last night which is yet more evidence against the young earth theory.

    Besides the fact that the shapes of the continents fit together in a way that’s unlikely unless they were formerly joined together, there’s fossil evidence. Certain species’ fossils are found in only limited parts of the world, yet those parts are on now-widely separated continents. Hard to imagine the continents (whose movement relative to each other can be accurately measured to a few inches, and which are moving very slowly today) earlier moved at rapid speeds in order to wind up thousands of miles apart.

    Of course, some religionists will say that fossils were put there by the Devil. These people also believe that God is going to throw us into a lake of eternal fire if we haven’t come to the correct theological beliefs. The illogic that God is going to punish fallible humans for falling for tricks from a nearly omnipotent Devil, while taking no action against that same Devil who is the source of much human sin, is breathtaking. Either God is so bored out of His gourd that He’s playing games with us, or the Devil must have some power over God. I guess these “theories” are preferable to considering that maybe the evidence of the real world trumps their interpretation of Bible.

    BR’s right. Apparently bad information often crowds out good information on the internet.

  24. slowkarma says:

    I’ve been reading “Sunday AM Reads” which I missed yesterday, and two of those articles — the Washington Post’s “Channeling Marshall McLuhan” and the Alan Blinder piece — reminded me once again of Einstein’s Razor: “Everything should be made as simple as possible, but no simpler.” There were several items in the Blinder article that seemed to me likely to drive people to incorrect conclusions, but the Post article bothered me even more. The thrust of that article seemed to be (boiled down) that we are not necessarily in trouble because we’re not getting panic-stricken moves in the market, even with all the political fecklessness. I think that totally neglects to consider the fact that we are in a series of extreme positions — just because we’ve seen no big recent moves in the bond market doesn’t mean that it’s not in an extreme position; just because we’ve seen a bit of stability in Europe doesn’t mean that they’re not in an extreme position; just because the yen continues to grow more valuable compared to other currencies doesn’t mean that it’s not in an extreme position. And extreme positions don’t hold. I can’t be sanguine about this, as the Post columnist apparently is. These things may unwind slowly and reasonably without damage; on the other hand, they may not. And I’ve got a lot riding on the outcome.

  25. CB says:

    I found these interesting:
    “There’s a central role being played here by the financial sector. Since the 1970s, it’s really dominated and permeated all sorts of domains and its values have percolated through those domains. The notion of public provision or support of things on a non-market basis is the exact antithesis of that…We need to inspire people with a view of a better society that we can achieve within our available resources. We can’t just think about it in a day-to-day managerial context.”

    http://m.thebrowser.com/interviews/john-quiggin-on-utopia

    “Old truths decay and new ones are born at an astonishing rate…There simply is no substitute for skepticism.” 

    http://reason.com/archives/2012/12/24/half-the-facts-you-know-are-probably-wro

  26. willid3 says:

    ilsm, not sure that it works that in automotive. as they have lots of suppliers they can’t actually eliminate cause nobody else can produce the part(s) that that supplier makes. consider one of the reasons Ford (along with every car company doing business) was in favor of bailouts that if GM had failed, the parts business would have too, taking almost all of the other car makers with them. the reason Boeing is having so much trouble is that no other company has tried to do this (in any industry). they make parts for the airplane in 30-50 countries. and they have to assemble them in the US. and mostly the outsourcing is a management choice and a management problem. and it also happens when a company out sources things like IT or accounting. the company has no idea how to write the contract correctly, and even how to work with the new vendor. and while they can ‘fire’ the vendor, it takes a long time to do, and some times they just live with it. and some times they fire a good provider and get a bad one, who ends up being less effective, but has lower rates, and costs the company, but they keep them. they also experiment with other functions that they turn around very quickly and bring them back in house but only because the vendor was leading them into a legal nightmare. another example is customer (un)service number you call for your bank(etc). think they work for your bank (etc)? most likely not. and they get paid per call, so talking to you longer than a few minutes is counter productive

  27. VennData says:

    Deal Gone Wrong Adds to Caterpillar’s Troubles in China

    “…Siwei, which sells mine-safety equipment, also boasted an American pedigree. Its controlling shareholders were James E. Thompson III, the scion of one of Asia’s most successful expatriate families, and Emory Williams, a former head of the American Chamber of Commerce in China…”

    http://online.wsj.com/article/SB10001424127887323301104578255740261180404.html

    Another Chamber of Commerce dirt bag.

    Yeah, keep those disclosures, those rules and regs. to a minimum.

  28. ilsm says:

    @willid3

    I generally agree, in principle, but in degree auto and electronics is better than DoD and sadly aerospace follows defense.

    I have a little knowledge of automotive and micro circuits outsourcing, SAE standards in particular are superior to the sorry state of DoD engineering and product data standards.

    I am quite familiar with military R&D. Military design and production “drawings” are rarely usable by anyone else, the drawings lack “standards”, not even ISO standards. ISO standards are supposedly too expensive (as if quality is too costly), and might “cost” the designer competitive advantage over the pentagon. Mil Spec drawings went out with the Soviet Union.

    Boeing military weakness seem to have crossed over to Boeing civil aviation, as may have occurred to Airbus, who is as short on quality as Boeing, if not worse.

  29. leveut says:

    “Is a New Bull Market Here? (Barron’s)”

    The end is nigh.

    —————————-

    Joe Friday Says: January 21st, 2013 at 1:21 pm—“In U.S., 46% Hold Creationist View of Human Origins (Gallup) – Gallup Poll: 58% of Republicans Are Young Earth Creationists”—Scares the hell outta me.

    That doesn’t scare me much, as they are harmless. What does scare the hell out of me is practitioners of Islam with weaponry. They are not harmless.

  30. Joe Friday says:

    leveut,

    That doesn’t scare me much, as they are harmless. What does scare the hell out of me is practitioners of Islam with weaponry. They are not harmless.

    Actually, just from the April 1995 bombing of the Murrah Federal Building in Oklahoma City forward, the fundamentalist American RightWing has initiated MORE THAN SIX DOZEN TERRORIST PLOTS inside our country:

    * Plots to bomb government buildings, banks, gasoline refineries, utility companies, medical clinics, synagogues, mosques, and bridges

    * Plots to assassinate police officers, government officials, judges, politicians, civil rights figures and others

    * Plots to rob banks, armored cars, and firearms dealers

    * Plots to accumulate illegal machine guns, missiles, rocket launchers, explosives, not to mention chemical and biological weapons

  31. leveut says:

    Joe Friday

    “Actually, just from the April 1995 bombing of the Murrah Federal Building in Oklahoma City forward, the fundamentalist American RightWing has initiated MORE THAN SIX DOZEN TERRORIST PLOTS inside our country:”

    “Joe Friday Says: January 21st, 2013 at 1:21 pm—“In U.S., 46% Hold Creationist View of Human Origins (Gallup) – Gallup Poll: 58% of Republicans Are Young Earth Creationists””

    Those are Republicans? What? Are there no “fundamentalist American Left Wing” terrorist plots?

    What about actions?

    Republicans are harmless. What does scare the hell out of me is practitioners of Islam with weaponry. They are not harmless.

  32. Joe Friday says:

    leveut,

    Those are Republicans?

    Indeed.

    You’ve never heard of the extremist religious right ‘Council for National Policy’ ?

    Check their membership.

    How about the ‘Christian Identity’ or the ‘Chalcedon Foundation’ ?

    Are there no ‘fundamentalist American Left Wing’ terrorist plots?

    There isn’t much of a ‘Left Wing’ in America and I’m unaware of any that would be fundamentalist, let alone be involved in domestic terrorism.

    What about actions?

    You want a body count ?

    Republicans are harmless.

    Not according to the Justice Department or their released studies in regards to domestic terror groups.