Good morning, here are the longer form weekend reading materials I have accumulated over the week.

• How Netflix Reverse Engineered Hollywood (The Atlantic)
• Americans Love Affair with Cars is Over (Columbia Journalism Review)
• Academic / Media Smackdown:
…..-Academics Who Defend Wall St. Reap Reward (NY Times)
…..-I Have Not Yet Begun to Write: Responding to the New York Times’ Farrago of Dishonesty, Insinuations, and Ad Hominem (Streetwise Professor)
• A Jobs Agenda for the Right (National Affairs)
• A Speck in the Sea (NY Times)
• Why the Passenger Pigeon Became Extinct (New Yorker)
• NSA seeks quantum computer that could crack most codes (Washington Post)
• What should you do if someone puts a gun to your head? (Quora)
• Isaac Asimov Predicts in 1964 What the World Will Look Like Today — in 2014 (Open Culture) see also Visit to the World’s Fair of 2014 (NY Times)
• Outside the Lines: Michael Jordan Has Not Left The Building (ESPN)

Whats for brunch?


S&P 500 Above 200-Day Moving Average for all of 2013

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.

25 Responses to “10 Weekend Reads”

  1. ilsm says:

    Jobs agenda from the right.

    Why import techies when non citizen post grads can work for even less in “labs” in Mumbai, and shelter the taxes?


    • willid3 says:

      why do some think that keeping wages low will increase jobs? it wont. what creates job is some able to buy what you are selling. eliminate that and nobody will hire any one, even if it cost them nothing at all. companies only hire when they can’t support their business based on demand. as i was told long ago. people will only hire you if they can’t do it them selves.

  2. mathman says:

    Billionaires Dumping Stocks, Economist Knows Why

    Despite the 6.5% stock market rally over the last three months, a handful of billionaires are quietly dumping their American stocks . . . and fast.

    Warren Buffett, who has been a cheerleader for U.S. stocks for quite some time, is dumping shares at an alarming rate. He recently complained of “disappointing performance” in dyed-in-the-wool American companies like Johnson & Johnson, Procter & Gamble, and Kraft Foods.

    In the latest filing for Buffett’s holding company Berkshire Hathaway, Buffett has been drastically reducing his exposure to stocks that depend on consumer purchasing habits. Berkshire sold roughly 19 million shares of Johnson & Johnson, and reduced his overall stake in “consumer product stocks” by 21%. Berkshire Hathaway also sold its entire stake in California-based computer parts supplier Intel.

    With 70% of the U.S. economy dependent on consumer spending, Buffett’s apparent lack of faith in these companies’ future prospects is worrisome.

    Unfortunately Buffett isn’t alone.

    Fellow billionaire John Paulson, who made a fortune betting on the subprime mortgage meltdown, is clearing out of U.S. stocks too. During the second quarter of the year, Paulson’s hedge fund, Paulson & Co., dumped 14 million shares of JPMorgan Chase. The fund also dumped its entire position in discount retailer Family Dollar and consumer-goods maker Sara Lee.

    Finally, billionaire George Soros recently sold nearly all of his bank stocks, including shares of JPMorgan Chase, Citigroup, and Goldman Sachs. Between the three banks, Soros sold more than a million shares.

    So why are these billionaires dumping their shares of U.S. companies?

    After all, the stock market is still in the midst of its historic rally. Real estate prices have finally leveled off, and for the first time in five years are actually rising in many locations. And the unemployment rate seems to have stabilized.

    It’s very likely that these professional investors are aware of specific research that points toward a massive market correction, as much as 90%.

    One such person publishing this research is Robert Wiedemer, an esteemed economist and author of the New York Times best-selling book Aftershock.

    [oh, there's more]

    • Generally speaking, Newsmax is biased, money losing asshattery. filed under Meaningless bullshit.

      But it looks good on you

    • swag says:

      Your story is dated August 29, 2012.

      • Here is a sleazy thing Newsmax does:

        They seem to be adding a recent date near the headline “Friday, 03 Jan 2014 12:13 PM” which was exactly 24 hours prior to my accessing this story. But the true date is belied by the URL: 2012/08/29

        Note the original was posted elsewhere in 2012

        You can see a full run of wingnut sites that reposted it here and here

    • ottnott says:

      LOL. I’m sure Buffett follows every word.

      If I were dumping consumer-sensitive shares, it would be because if the worsening and likely already unsustainable disconnect between growth in corporate profits and growth of median wages.

  3. alonzo says:

    Re: NSA seeks to build a quantum computer.
    First it was the government sorting through our online communications. Now, I’m shocked – shocked – I tell you to find out the government wants to build a faster computer – just like private industry and the EU!
    Is Snowden really relevant?

  4. RW says:

    Laffer may have admitted his error but inflationista fever rages on and folks continue to pour money into the play. I take the other side of their trade as often I can but, unfortunately, am not in the position of someone like Michael Aronstein who can be paid richly in fees for adding fuel to the pyre.

    Michael Aronstein Poised to Get Rich Off Inflation Derp

    Michael Aronstein’s Mainstay Marketfield fund is a new start on Wall Street, with $12.4 billion in inflows making it the most popular actively managed fund around. How do you bring in all that cash?

    NB: I figure inflationista fever won’t really cool until inflation actually is poised to take off for real, maybe three or four years from now, give or take a tad? We’ll see. As far as Laffer goes, I’m aware of no evidence that he had any real commitment to the inflationista position nor any model that might support it (or any model at all if it comes to that) so there may be less to his admission of error than meets the eye.

    • ottnott says:

      Regarding Laffer’s belief in coming inflation, here he is in June 2009:
      “Get Ready for Inflation and Higher Interest Rates
      The unprecedented expansion of the money supply could make the ’70s look benign.

      It’s difficult to estimate the magnitude of the inflationary and interest-rate consequences of the Fed’s actions because, frankly, we haven’t ever seen anything like this in the U.S. To date what’s happened is potentially far more inflationary than were the monetary policies of the 1970s, when the prime interest rate peaked at 21.5% and inflation peaked in the low double digits. Gold prices went from $35 per ounce to $850 per ounce, and the dollar collapsed on the foreign exchanges. It wasn’t a pretty picture.

      OT: I’m trying to remember if I’ve ever encountered the word “frankly” used in a way that didn’t immediately make me more skeptical of the writer.

      His “model” is as shoddy as you suggest and even more puzzling than shoddy. It appears to be something along the lines of: money supply is high, but demand is low, so…high interest rates and inflation!:
      With an increased trust in the overall banking system, the panic demand for money has begun to and should continue to recede. The dramatic drop in output and employment in the U.S. economy will also reduce the demand for money. Reduced demand for money combined with rapid growth in money is a surefire recipe for inflation and higher interest rates. The higher interest rates themselves will also further reduce the demand for money, thereby exacerbating inflationary pressures. It’s a catch-22.

      • RW says:

        Good description: Laffers ‘model’, such as it is, most closely emulates the model of the Underpants Gnomes in South Park:
        (1) Collect underpants
        (2) ?
        (3) Profit!

        Catch-22 also doesn’t mean what Laffer appears to think it means — he’s actually just describing a (mythical) positive feedback loop — it probably more accurately describes those who believe Laffer is serious and behave accordingly; i.e., if you’re insane you can get out of the echo chamber but if you want to get out you must be sane therefore you have to stay.

  5. DeDude says:

    If the amount of money that want to purchase futures in commodity X goes from $10 billion to $50 billion then either the amount of that commodity has to drastically increase (often not an option) or the price of futures for X goes up. Since most users of a commodity cannot wait with purchase to the last minute (when speculators would be forced to sell because the commodity is about to be delivered), the result is higher prices paid by the end users of the commodity and the finished products it produce. To deny that speculators can drive up prices in a commodity is to deny basic market forces. Whether such denial is the result of being stupid or because a person is paid to be stupid, that is another issue. Unless some serious evidence is present you have to presume that it is just plain old stupidity, rather than corruption.

  6. hue says:

    The Death of John Galt (Pieria)

    Taibbi: Yuppie Prohibition League Denounces Pot Legalization (Rolling Stone)

    In 1964, Isaac Asimov Imagined the World in 2014 (The Atlantic) George Carlin: Earth Day (YouTube)

  7. rd says:

    Re: Passenger pigeon

    Extinction is a complex subject, especially when you get into people’s role in it.

    Here is a paper looking at how the forest in the northeastern US has changed over the past 400 years:

    The shift from beech, oaks, hickories etc. to maples, ash etc. would have been dramatically reducing the passenger pigeons food supply by the late 19th century as land clearing by logging and farming occurred and subsequent reforestation was with non-mast bearing trees. However, natural predators would also have been dramatically reduced (man gladly stepped in to fill that role) so there would have been population explosions of young birds because people weren’t shooting the fledglings, just the adults. From past information that I have seen, the records of the massive sky-filling flocks seem to be just limited to the 19th century as it seemed to just be another bird in the forest before that. It appeared that the massive changes in the eastern ecosystem due to farming, logging, and urbanization happening in the 18th and 19th centuries were causing major disruptions to the passenger pigeons populations resulting in a population boom and bust.

    Another example is Torreya taxifolia, the most endangered tree, located in a little alcove at the Florida-Georgia border:

    This tree has a very hard large seed that requires scarification and transport for reproduction. The existing population is believed to be a remnant of the forest that was in that area during the last glaciation. The rest of the forest moved north to cooler climes as the area warmed. However, it is believed that this tree needed a large animal to eat the seed, scarify it in its gut and redeposit it later at another location in order to migrate. It is also believed that the arrival of humans in the area wiped out these particular mega-fauna, along with numerous other ones (see La Brea Tar Pits for examples of what was in North America 20k years ago). So as the climate warms further, the tree is unable to move from its current niche and is severely threatened. There is a lot of debate about “assisted migration” of this species. It is happening in small quantities where the tree is being replanted further north in Appalachia to try to re-establish it where it would likely have ended up several thousand years ago if the mega-fauna had not been killed off.

  8. Stock Soup says:

    I wonder about the market stats of the 200MA chart above. How unusual is that? How long has the S&P stayed above the 200MA with dipping below? What’s the longest ever? etc

    Makes me nervous (and I’m bullish on this market).

  9. JoseOle says:

    That Jordan story is a year old. But no harm, no foul.

  10. willid3 says:

    hm US used Chinese materials in the f35 fighter

    sounds like a rerun of an old story. seems back in the Clinton administration GM sold their super magnets plant to a firm, that turned out to be Chinese owned. later when Bush was in charge that Chinese firm closed the US plant and moved it to China. even though the US military still needs those magnets. who woulda known? and I am sure that Obama had a hand in some how.

  11. Jojo says:

    Syria, Iraq, Egypt most deadly nations for journalists

    The conflict in Syria, a spike in Iraqi bloodshed, and political violence in Egypt accounted for the high number of journalists killed on the job in 2013. A CPJ special report by Elana Beiser

    Published December 30, 2013

    Syria remained the most deadly place for journalists on the job in 2013, while Iraq and Egypt saw a spike in fatal violence. Two-thirds of journalist killings during the year took place in the Middle East.

    Seventy journalists were killed for their work in 2013, down from 74 in 2012, the Committee to Protect Journalists found in its annual analysis. CPJ is investigating the deaths of 25 more journalists in 2013 to establish whether they were work-related.

    Pakistan, Somalia, India, Brazil, the Philippines, Mali, and Russia also saw multiple journalist deaths during the year, although the number of deaths in Pakistan and Somalia declined significantly. Mexico was notably absent from the list, with no deaths confirmed as work-related.

  12. Jojo says:

    Depending on your age, these people who passed on in 2013 may strike a chord for you.
    NBC Nightly News | December 27, 2013
    Luminaries we lost in 2013

    Jean Stapleton, Annette Funicello, Jonathan Winters, James Gandolfini, and Helen Thomas are just a few of the many notable lives lost in 2013. Here we honor their contributions.

  13. gremlin says:

    The MJ article was good, another link on the same espn page about the bat used by Roberto Clemente to get his 3000′th hit was pretty good too:

  14. willid3 says:

    suspect that the reason the fall out of love with the car happened is also economic. it used to be that some one with a minimum wage job could afford a brand new Mustang (course they saved to do it. but they could). today, they couldn’t afford any new car at all. that and the high price of every thing else related to it (gas, maintenance and insurance!). and you can see that many dont see any real reason to want to get into a car, unless they have too. they have other things that they can use in place of it that are much cheaper (phones, tablets, etc). and even if those are can be as pricey as what they used to pay for cars, cars are now much more expensive to them now.

  15. gman says:

    Some interesting ideas in the jobs plan from the right, fostering mobility through increased info about job mkts in other areas is a no brainier. Much of it though just amounted to ways to suppress real wages even more (at median for men they have been falling for 40 yrs. already)

    The premise that “the lefts ideas were tried and found wanting” is bs!

    How about avoiding pro cyclical austerity in the midst of the biggest downturn since the depression for a jobs agenda?