My morning reads to start your week:

• The Ten Biggest Economic Policy Mistakes from the Depression to the Recession (HNN)
• Bonds Drop Globally as Stocks Reach Highs on Growth Optimism (Bloomberg) see also Interest rates are rising! Here’s why we should be thrilled (Wonkblog)
• Bonds’ Point of No Return About a Standard Deviation Away (Bloomberg)
• Smart and Stupid Arguments for Active Management (The Reformed Broker)
Jaffe: You’re overpaying for money management (MarketWatch) see also Hulbert: Everyman’s hedge funds aren’t worth it (MarketWatch)
• Short Seller Seeks Valley ‘Pretenders’ (WSJ)
Roubini: After the Gold Rush (Project-Syndicate)
• The Dictatorship of Data (MIT Technology Review)
• Welcome to Mogadishu (
• The 100 Most Creative People in Business 2013 (Fast Company)

What are you reading?


Risk-Averse Culture Infects U.S. Workers, Entrepreneurs?
Source: WSJ

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.

22 Responses to “10 Monday Reads”

  1. Moss says:

    Regarding the sudden rise in interest rates… How about professional Investors front running the prospect of the Fed tapering purchases of MBS and TSY Bonds based on what Bernanke said at his Congressional testimony.

    No other reality based reason.

  2. rekesk says:

    Over at nakedcapitalism, there’s a direct critique of the WSJ article that image was pulled from.

    “Too bad the paper resorts to blaming workers as risk slackers rather than fingering the real perp, namely, failed neoliberal policies.”

    • lrh says:

      Thanks for the link. I read both and found some value so it’s time well spent. We need more job creation and more innovation so any downtrend in risk taking and entrepreneurship is a worry.

      But there also is a lot of what Ely Devons said was the conceit of economists in both of those posts: “Let’s consider what an economist would do if he wanted to understand horses.” Devons said, “What would he do?  He’d go to his office and think, ‘What would I do if I were a horse?’ And he’d come up with the conclusion.”

      I’d appreciate more “horse sense” from the real entrepreneurs of the 80s and today and less imaging from journalists and academics.

  3. You won’t find this reported many places, but the great University of Washington men’s V8 crew won the national title yesterday at the IRA Championships, held at Lake Natoma, CA, this year. The Husky crews swept the regatta as they had the year before – in fact, no boat lost during semis and finals – and the V8, 2V8 and Freshmen V8 went undefeated for the season. Washington has won 5 national rowing titles since 2007 – 3 in the last 3 – for a total of 16 since 1923. They also won the Ten Eyck Award, given to the top overall team at IRA, for the seventh consecutive season. It would be very difficult to find this level of predominance in any other sport, collegiate or professional. And these guys do it for the love of the sport, because there’s no professional career that can follow. (Husky Crew)

  4. PeterR says:

    Funny that the first link about economic policy mistakes has the Greenspan Bubbles as #2.

    What will be said about the Helicopter Ben’s multiple QE’s with the hindsight of another few years?

    Those who ignore history are bound to repeat it?

  5. VennData says:

    The guys that recount an experience with data then conclude to claim:

    “…we fail to appreciate its inherent ability to mislead…”

    What is data’s inherent ability to mislead?

    If you’ve got measurement or interpretations issues that’s one thing, but data’s inherent ability to mislead?

    • The Human tendency to be misled by a narrative is enormous, and IMO far greater than our ability to misinterpret clean and well presented data.

      • Anonymous Jones says:

        Completely agree with BR. To “mislead” does not require intent. All sorts of stimuli, born of both animate and inanimate things, have the power to create false impressions in sentient beings.

        If you are questioning whether it is possible to identify which data have the “inherent” ability to mislead, then you have a point.

  6. rd says:

    It turns out that the hedge fund industry, and actually the entire financial sector, are poorly understand. Instead of being psycophatic robber baron vampire squid rentiers, it turns out they are bleeding heart liberals in disguise:

    So, when you are payng your 2% fees, you should view it as giving to charity but without the tax deduction.

  7. Mike in Nola says:

    What our markets are reduced to on the bad is good meme:

    From Bloomberg:
    “U.S. stocks fluctuated between gains and losses as investors weighed whether a report showing an unexpected contraction in manufacturing will bolster the likelihood the Federal Reserve maintains stimulus measures.”

    Not that I put much weight in instant analyses of why markets are bouncing around, it is the fact that a serious organization like Bloomberg expresses such thoughts which shows how screwed up things are.

    • spooz says:

      Same analysis from Marketwatch:

      “We can now say with even more confidence that there is literally zero chance the Fed announces any adjustments to its QE program in June,” noted Dan Greenhaus, chief global strategist at BTIG LLC, after the report from the Institute for Supply Management, which said its business-conditions index last month fell to 49% in its first contraction since November. …
      It’s too soon to wonder whether ‘bad news is good news’ again, but we hope today’s report is not the start of a trend,” Greenhaus said.”

  8. Theravadin says:
    It’s not a single post, but an entire blog on Arctic Sea Ice. Fascinating in a techy sort of way. The core people involved are at the bleeding edge of understanding global warming impacts, not sometime in the future, but now. Definitely another lens to look at investment decisions through

  9. Willy2 says:

    “The Ten Biggest Economic Policy Mistakes from the Depression to the Recession”

    This assumes that the US government is omnipotent. And the US gov’t isn’t. It needs the cooperation of the public “(a.k.a. “Mr. Market”). If 300 million US citizens don’t want something then the gov’t can huff & puff all it wants but then it isn’t going to happen. A government can only slow down or accelerate already existing developments.

    It’s a myth that the FED could have prevented the Depression of the 1930s. “Mr. Market” & “Mr. Margin” ruled the roost and NOT the FED. In the early 1930s there was a FED who bought A LOT OF bonds in an effort to prop up the market, but deflation happened any way.

    In 1873 there was a stockmarket crash as well. In 1913 the FED was established to have a “lender of last resort” to prevent another crash but the crash of 1929 & 2008 happened anyway. So, why have a FED at all ?

    • willid3 says:

      well i suppose we could ask this question why have brakes on cars after all there will be crashes any way?

  10. end game says:

    Willy2: From 1929 to 1932 U.S. money supply fell by one-third. One. Third. Your rebuttal is that in the early 1930s there was a Fed “that bought a lot of bonds” … please let us know how “buying a lot of bonds” allowed money supply to fall by 1/3.

    Regarding your comment that purpose of Fed is to prevent crashes… no, the purpose is to prevent depressions when crashes occur by, among other things, providing sufficient liquidity. Fed failed to expand money supply in 1929 and depression resulted. Fed did expand money supply in 2008, and depression was averted.