My afternoon train reads:

• Establishing Your Top 10 Investment Default Settings (Above the Market)
• Top 5 cultural references Wall Streeters use when ripping people off (Fortune)
• Tight Credit Is Causing Housing Prices to Rise (Miller Samuel) Counter intuitive enough for you?
• Predicting Markets, or Marketing Predictions (Advisor Perspectives) see also Perils of Predictions (Inside Futures)
• So God made a banker (MarketWatch)
• Why History May Be Unkind to Tim Geithner (Real Clear Politics) see also Geithner, the under-appreciated finance guy (MarketWatch)
• The Tongue-Lashings of Chris Christie (Bloomberg)
• Understanding Apple Requires an Analysis of Fundamentals and Psychology (Institutional Investor)
• Venture Capital’s Massive, Terrible Idea For The Future Of College (The Awl)
• Dell Acquired By Gateway 2000 In Merger Of 2 Biggest Names In Computer Technology (The Onion)

What are you reading?


As Stocks Surge, Buyouts Return

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.

17 Responses to “10 Mid-Week PM Reads”

  1. adownun says:

    “Is it better to make decisions in the morning or the afternoon?” Morning, here’s why:

  2. mad97123 says:

    Chris Martenson examines a toxic global economy and does some basic math.

    “I don’t think we ever actually got out of the last recession …When the government is borrowing 8% to 10% of GDP, and GDP is growing at 2% to 3%, it tells me that the real economy is shrinking by 5%-7%.”

  3. danm says:

    , it tells me that the real economy is shrinking by 5%-7%.”
    I understand what he means but I can’t help but become technical… what is a real economy? Only a free market economy?

    An economy is reflected by trade… whether this trade is done through government or free markets, it is still “the” economy.

    The USSR, however disfuntional it was, lasted for 67 years. That’s what is meant by “markets can stay irrational longer than you can remain solvent”.

    My arguement is that if it were not for government over the last centry and central bank money creation, we would not be 7 billion people on this planet and the US GDP would not be over 14 trillion.

  4. farmera1 says:

    The Robots are coming the Robots are coming.

    “Because unlike the Industrial Revolution, which added powerful BTUs in the form of coal to augment human labor, thus creating a tidal wave of profits and increased wages, a robot revolution promises to furnish the world with stuff at the expense of human employment.”

  5. James Cameron says:

    Sorry, but what a clown . . . South Carolina is a big beneficiary of DOD largesse.

    “I’m sure Iran is very supportive of sequestration,” said Senator Lindsey Graham of South Carolina. Unless Obama leads the way to prevent the defense cuts, he’ll be remembered “as one of the most irresponsible commanders in chief in the history of the country,” Graham said.

  6. mad97123 says:

    Damn, I get your point. The internet and housing bubbles were “real” economic activity as well. A lot of infrastructure was built, and a lot of trade took place.

    This time could be different because the bubble actor is the government. It could be decades as you note.

    I just wish we started printing our way to prosperity when I was a little younger so I could recover if the grand experiment is too good to be true.

  7. willid3 says:

    old old times


  8. willid3 says:

    failure works as well as success in the oil business?

  9. yon QOTD..

    “I rarely think the market is right. I believe non dividend stocks aren’t much more than baseball cards. They are worth what you can convince someone to pay for it.”

    -Mark Cuban

    you know, back when, Stocks paid Dividends because Investors didn’t trust the MGMT.

    they were Right, then, as Cuban is, ~now..

  10. mad97123 says:

    Crash Watch

    GRANTHAM: Investors Are Being Bullied Into Buying Risky Assets, Which Are Doomed To Crash

    Read more:

    DOUG KASS: ‘I’m Getting The Summer Of 1987 Feeling’ In The Market Right Now

    Read more:

  11. leveut says:

    re the “counter intuitive” tight credit is causing housing prices to increase

    “Tight lending standards has prevented many sellers from listing their homes because they don’t qualify for the trade up, holding supply off the market.”

    Ok, that makes sense. If you can’t qualify to buy the home you want to trade up to, you don’t put your existing house on the market, so supply is lower than if lending standards were less tight.

    “The shortage is manifesting itself by also keeping people unaffected by tight credit from listing until they find a home they wish to purchase. ”

    Does that really make sense? If you are unaffected by tight credit it would seem to mean you can pay cash, i.e. you don’t need to finance the house. If you do need a mortgage, then you are subject to the tight lending standards. How many people can pay cash? Not a significant amount I would expect. Isn’t this kind of insignificant compared to the first statement?

    “Record low mortgage rates keep the demand pressure on as affordability is at record highs.”

    But affordability isn’t just the ratio of payment to income or house price to income, it depends on credit availability. If there are tight lending standards, then, for example, higher down payments are required, or higher income for a given house value, which reduces affordability separate and apart from interest rates. And if lending standards are tight, does it matter that there are “record low mortgage rates” because people don’t qualify for them.

    Rising prices may not be based on fundamentals, but that has nothing to do with whether his premise is correct.

    Maybe I am missing something, but it seems to me his logic does not hold together.

  12. rjb says:

    Top 10 Investment Default Settings sound like the standard advice to a retail client from a 1970′s broker. In the era of daily/overnight moves such as JDSU (closed -5.05%, up 14.7% afterhours on earnings) or BIDU (-10% and more at the open on earnings), to mention only two from the changing daily list, do you really think the general public will put money in stocks? What teacher, electrician, middle manager, etc., wants to lose 10% of their money in a day or gamble on a 15% to 20% gain while “saving” for retirement?

    One remembers the recent comment by Bill Gross: “The countdown begins when investable assets pose too much risk for too little return……” While he was referring to lenders moving into real assets, I think the same must apply here.

  13. tagyoureit says:

    I’m looking forward to all future parodies of “So God made the _____”. It’s going to be great fun!

  14. TAT says:

    “Tight Credit is Causing Housing Prices to Rise”

    I’m 30 and my wife and I just bought my first house in a decent area in Long Island. As an engineer and teacher, we might be considered the bottom feeders of the market around here. I will tell you, however, I certainly see that statement being accurate on the low end of the scale. 450k+ houses simply weren’t moving in the few years (yes, years) I looked at this area. Good 300-350k houses disappeared in a heart beat.

    Oh, and I’m not sure that lending standards are really fixed. Granted, I have good credit, but most places I talked to would have underwritten me for well more than a reasonable human being should ever take on. I ultimately went with a credit union which was patient, up front, and very clear with me how everything would break down. Some of the other loan officers I spoke to at these corrosive institutions were pretty interested in saddling me with as much debt as I would accept.

  15. rd says:

    Note to book cover designer: Read book first before designing cover (or ask your daughter for help).

    Some of the best customer reviews ever slamming one of the most complete product branding misses ever: