Posts filed under “Mathematics”
Earlier this summer, I tweeted a wonderful line from Brett Arends column, 25 things I wish I knew when I graduated from high school:
3 simple rules will explain 99% of human behavior 1: Most people don’t think. 2: Some people are jerks. 3: Everyone is selling something.
— Barry Ritholtz (@ritholtz) June 15, 2015
That led to a delightful column last week from Michael Johnston’s A Visual History of Market Crash Predictions.
Here are some of the more egregious calls, but the entire article is well worth your time to read:
Source: Fund Reference
@TBPInvictus here. We have interesting experiments going on in the state of Kansas and the city of Seattle. Herewith a brief update on both. Thanks to the following Tweet, I was made aware of the fact that – as you can see – the state of Kansas, under Sam Brownback’s awesome tax cuts, recorded the…Read More
Its early in this potential correction, but let me remind you of Buffett’s interesting (1997) comments: “If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef? Likewise, if you are going to buy a car from time to time but…Read More
@TBPInvictus here: The New York Post ran a piece on Netflix (NFLX), written by Claire Atkinson, that was, to put it charitably, interesting. And by interesting I mean that it painfully misstated the very simple mathematics of stock splits. The piece implied that NFLX is wildly overvalued. I have no problem with that. Not that…Read More
This must be the “new normal” everyone’s talking about. Where a cyclical low in the unemployment rate, to the the low 5 percent range, is met with a courtly high stock market and talks of an impending rise in rates. Sure there is a feeling in some pockets of the economy that “things” are much…Read More
About a year ago, we discussed what happens “When Correlations Lie.” Delving into the classic logical fallacy that correlation implies causation, we looked at equities and a variety of supposedly related factors, including gross domestic product, rising interest rates, earnings surprises, new financial products and the “death cross” involving daily moving averages. All were classic coincidences of…Read More
I love this debate between the idea of Tobin’s Q-Ratio as th be all for valuation analysis. It is embodied between Smithers & Co. quoted in this scary BBRG article and Pragmatic Capitalism’s Cullen Roche. Here is PragCap: “Better yet, look at the number of times this ratio has been cited during the most recent bull market…Read More
Salil Mehta is a statistician and risk strategist. He served for two years as Director of Analytics in the U.S. Department of the Treasury for the Administration’s $700 billion TARP program. Salil is on the Editorial Board for the American Statistical Association, is a Chartered Financial Analyst, a fellow member of the American Statistical Association and…Read More
There was some pushback on yesterday’s rather tame suggestion that the U.S. properly finance the fund that pays to maintain and repair our roads. Much of the correspondence was surprising. Then again, I am continually flabbergasted by the cognitive errors that the human brain can make. It’s a marvelously designed piece of wetware that does a…Read More
We’re down to the Final Four in this year’s iteration of March Madness, also known as the national collegiate basketball tournament. Our earlier discussion of “The March Madness Theory of Investing“ didn’t sit well with some readers. The lessons we sussed out from the bracket-destroying results included home-country bias, how expert forecasts are about as good as those…Read More