Clippings
Fortune Magazine
8 really, really scary predictions
Dow 4,000. Food shortages. A bubble in Treasury notes. Fortune spoke to eight of the market's sharpest thinkers and what they had to say about the future is frightening.
8 really, really scary predictions
Dow 4,000. Food shortages. A bubble in Treasury notes. Fortune spoke to eight of the market's sharpest thinkers and what they had to say about the future is frightening.
Under pressure, private banks move onshore
Fri Dec 12, 2008
By Lisa Jucca
VADUZ, Liechtenstein (Reuters) - Foreign-registered cars dot the underground car park of Liechtenstein's biggest bank, where elevators sweep visitors to top-floor corridors of private meeting rooms.
Liechtenstein, a tiny principality of 35,000 people nestled between Austria and Switzerland, still discreetly advises the very wealthy around mahogany tables, even though it recently relaxed its bank secrecy laws under pressure from the United States.
Now, thanks to a U.S. tax probe into Swiss bank UBS and other pressure, a quiet revolution is brewing in the $7 trillion world of offshore banking, as banks realize that holding untaxed money can ultimately sting them.
Fri Dec 12, 2008
By Lisa Jucca
VADUZ, Liechtenstein (Reuters) - Foreign-registered cars dot the underground car park of Liechtenstein's biggest bank, where elevators sweep visitors to top-floor corridors of private meeting rooms.
Liechtenstein, a tiny principality of 35,000 people nestled between Austria and Switzerland, still discreetly advises the very wealthy around mahogany tables, even though it recently relaxed its bank secrecy laws under pressure from the United States.
Now, thanks to a U.S. tax probe into Swiss bank UBS and other pressure, a quiet revolution is brewing in the $7 trillion world of offshore banking, as banks realize that holding untaxed money can ultimately sting them.
- bubbalouie
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I remember Amanda Lang saying something to the effect that the derivatives portion of UBS is 7 times greater than the GDP of Switzerland. This bank has the potential to bankrupt the country.taggart wrote:Now, thanks to a U.S. tax probe into Swiss bank UBS and other pressure, a quiet revolution is brewing in the $7 trillion world of offshore banking, as banks realize that holding untaxed money can ultimately sting them.
"They misunderestimated me." --George W. Bush, November 6, 2000
- Bylo Selhi
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For those who need some Schadenfreude to deal with their investment losses: America's 25 Biggest Billionaire Losers
Sedulously eschew obfuscatory hyperverbosity and prolixity.
Good article for those reconsidering their risk level and portfolio allocation.
CNN Money
Last Updated: December 19, 2008
Is it all over for stocks?
After a miserable decade, you have to ask whether some of the most basic assumptions about equities are just plain wrong.
CNN Money
Last Updated: December 19, 2008
Is it all over for stocks?
After a miserable decade, you have to ask whether some of the most basic assumptions about equities are just plain wrong.
The Madoff Economy
The revelation that Bernard Madoff — brilliant investor (or so almost everyone thought), philanthropist, pillar of the community — was a phony has shocked the world, and understandably so. The scale of his alleged $50 billion Ponzi scheme is hard to comprehen
Yet surely I’m not the only person to ask the obvious question: How different, really, is Mr. Madoff’s tale from the story of the investment industry as a whole?
The financial services industry has claimed an ever-growing share of the nation’s income over the past generation, making the people who run the industry incredibly rich. Yet, at this point, it looks as if much of the industry has been destroying value, not creating it. And it’s not just a matter of money: the vast riches achieved by those who managed other people’s money have had a corrupting effect on our society as a whole
DECEMBER 20, 2008
Is the Medicine Worse Than the Illness?
The world ran out of trust in 2008 -- but there is no shortage of money because the Fed is printing like mad. It's the wrong approach, with potentially dire consequences, says James Grant.
Is the Medicine Worse Than the Illness?
The world ran out of trust in 2008 -- but there is no shortage of money because the Fed is printing like mad. It's the wrong approach, with potentially dire consequences, says James Grant.
- bubbalouie
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- Peculiar_Investor
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A very good article that offers some sober second thought about how this is all going to play out in the US.Taggart wrote:DECEMBER 20, 2008
Is the Medicine Worse Than the Illness?
The world ran out of trust in 2008 -- but there is no shortage of money because the Fed is printing like mad. It's the wrong approach, with potentially dire consequences, says James Grant.
finiki, the Canadian financial wiki New editors wanted and welcomed, please help collaborate and improve the wiki.
Normal people… believe that if it ain’t broke, don’t fix it. Engineers believe that if it ain’t broke, it doesn’t have enough features yet. – Scott Adams
Normal people… believe that if it ain’t broke, don’t fix it. Engineers believe that if it ain’t broke, it doesn’t have enough features yet. – Scott Adams
The following is from the website of a Singaporean mutual fund retailer. The website has some useful information, with an Asian point of view (but still in English!)
5 Reasons Why The US Market May Be Past A Bottom
http://www.fundsupermart.com/main/resea ... cleNo=3124
5 Reasons Why The US Market May Be Past A Bottom
http://www.fundsupermart.com/main/resea ... cleNo=3124
Toronto Star
A Keynes insight into free markets
Seminal economist's interventionist views fell from grace in the hyperinflation 1970s. They're back
Dec 21, 2008
A Keynes insight into free markets
Seminal economist's interventionist views fell from grace in the hyperinflation 1970s. They're back
Dec 21, 2008
Speaking of accelerating spending on infrastructure, from ASCE:
George
The danger, of course, is that if infrastructure projects are undertaken in a hurry (Spend it or lose it!!!) the proportion of waste will rise. In some cases, it could go above 100%.Quantifying the waste present in an operation is an important part of a number of performance improvement initiatives in the architecture engineering construction industry. Contemporary management approaches focus on waste minimization to reduce operating costs and to increase operating responsiveness and flexibility. In construction, studies have been conducted over the past 30 years as part of productivity-improvement efforts that have documented levels of wasted time in construction activities. This paper draws on the methodology of meta-analysis to provide a synthesis of the findings across all of these studies. The analysis reveals that an average of 49.6% of time in construction is devoted to wasteful activity, although this amount is widely varied. Among other things, these results demonstrate considerable potential for improvement in construction through initiatives that reduce levels of wasteful activity.
George
The juice is worth the squeeze
- parvus
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"Why oh why can't we have a better press corps?" is a frequent feature on Brad DeLong's site.
Wovon man nicht sprechen kann, darüber muß man schweigen — a wit
finiki, the Canadian financial wiki Your go-to guide for financial basics
finiki, the Canadian financial wiki Your go-to guide for financial basics
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Investing Experts Urge 'Do as I Say, Not as I Do'
Lessons the Market Taught Us in 2008Jason Zweig wrote:If you think it is hard to stick to your New Year's resolutions, consider how some of the investing world's leading experts don't always take their own advice. Often, they diversify by the seat of their pants, fail to adjust their portfolios to changing values, ignore tax issues and take a flier on individual securities even when they know better. Nobody -- and I mean nobody -- is perfect.
Larry Swedroe wrote:Every year, the markets provide investors with lessons on the prudent investment strategy. This year’s bear market provided a sufficient number of lessons that it should be considered a “doctoral seminar.”
Sedulously eschew obfuscatory hyperverbosity and prolixity.
Re: Clippings
The message is, they don't hire dummies to work on Wall Street, but as regards to making any attempt to predict the future, it doesn't matter how smart they are, they don't know anymore than you or I.
What Wall Street Won't Tell You
Brett Arends wonders if Wall Street pros know anything more than the rest of us.
What Wall Street Won't Tell You
Brett Arends wonders if Wall Street pros know anything more than the rest of us.
Re: Clippings
Forecast of 15 yr real returns to US stocks
Basically the authors constructed a model using the Q ratio, Mkt cap/GNP and S&P deviation from long term trend and did a curve fit to historical data. If it worked we'd all be rich but I think it rightly points to the current high valuation in the US and the future consequences. How can the S&P be at pre-crash levels with all that has happened?
Basically the authors constructed a model using the Q ratio, Mkt cap/GNP and S&P deviation from long term trend and did a curve fit to historical data. If it worked we'd all be rich but I think it rightly points to the current high valuation in the US and the future consequences. How can the S&P be at pre-crash levels with all that has happened?
Source: Shiller (2011), Doug Short (2011), Butler|Philbrick & Associates (2011)
You can see that 15-year 'Regression Forecast' returns are 0.02% per year, and 10-year returns are forecast to be just 0.82% per year using market valuations to the end of May, 2011. To be clear, this means our model forecasts essentially flat real total returns to U.S. stocks over the next decade, including dividends, given current levels of market valuations.
"Everybody has a plan until they get punched in the face." Mike Tyson
- parvus
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Re: Clippings
Krugman sounds a little Hayekian here (but you have to add in the Fed put and moral hazard).
The Busts Keep Getting Bigger: Why?
The Busts Keep Getting Bigger: Why?
But we could also be talking about 1991, when the consequences of vast, loan-financed overbuilding of commercial real estate in the 1980s came home to roost, helping to cause the collapse of the junk-bond market and putting many banks—Citibank, in particular—at risk. Only the fact that bank deposits were federally insured averted a major crisis. Or we could be talking about 1982–1983, when reckless lending to Latin America ended in a severe debt crisis that put major banks such as, well, Citibank at risk, and only huge official lending to Mexico, Brazil, and other debtors held an even deeper crisis at bay. Or we could be talking about the near crisis caused by the bankruptcy of Penn Central in 1970, which put its lead banker, First National City—later renamed Citibank—on the edge; only emergency lending from the Federal Reserve averted disaster.
Wovon man nicht sprechen kann, darüber muß man schweigen — a wit
finiki, the Canadian financial wiki Your go-to guide for financial basics
finiki, the Canadian financial wiki Your go-to guide for financial basics
- Shakespeare
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Re: Clippings
An interesting column.
But does it mean that the only way to break the capture of Congress by moneyed interests and re-regulate greed is to have another Great Depression and another New Deal?
But does it mean that the only way to break the capture of Congress by moneyed interests and re-regulate greed is to have another Great Depression and another New Deal?
Sic transit gloria mundi. Tuesday is usually worse. - Robert A. Heinlein, Starman Jones
Re: Clippings
http://news.morningstar.com/articlenet/ ... 320&part=1
An interesting article from Morningstar, on the relationship of risk and reward. The thesis of the article is that conventional wisdom on the relationship is not always right.
An interesting article from Morningstar, on the relationship of risk and reward. The thesis of the article is that conventional wisdom on the relationship is not always right.