Posts Tagged ‘The Economist’

The Buttonwood Gathering – View from the Top

This was an interesting event!  

On May 17th 1792, twenty-four stock brokers met under a buttonwood tree outside 68 Wall Street and agreed to set up the New York Stock and Exchange board. The tree was a symbol of Wall Street, but also, it was where people originally met to trade, to discuss and to argue.

The Economist has done an excellent job of keeping the tradition alive by bringing together top global financial executives, policymakers, global regulators and opinion leaders to discuss and debate proposed guidelines for the financial community, seeking to bridge fundamental financial issues with macroeconomic and geopolitical viewpoints.

As I mentioned yesterday, I usually don’t like conferences but not only did I find myself sitting between BOE Governor Mervyn King and Nobel Prize winner Joseph Stiglitz but we got to watch my favorite economics rap video together and even met the guys who created it from EconStories, who have lots of good videos on their site (of a more serious nature). 

The conference itself does not take itself too seriously.  Even Nassim Taleb was able to make a few jokes while explaining to us why the financial system is irrevocably screwed up unless we give it a major overhaul.  Taleb’s main points were:

  • People are inherently greedy.
  • The Financial Crisis was caused by and increase of hidden risks that was encouraged by the rules set forth in Basel II
  • Multiple exposure to low-probability, high-risk events accumulate to high probability of bad outcome (Taleb’s "Black Swan").
  • Bonus packages and compensation encourage very bad risky behavior. Stock options that offer potential upside and no downside encourage the maxing of risk-taking by potential beneficiaries.
  • This leads to a banking system where all the traders get rich and all the investors become poor.
  • There is a general,.chronic underestimation of risk and business schools reinforce this bad behavior.
  • Regulation gives investors a false sense of security. 
  • Capitalism must be symmetrical – bonus without penalties (clawbacks, etc.) must be eliminated.

When I am at one of these conferences, I like to watch the audience reaction to what is being said.  Here we have a gathering of the World’s movers and shakers and sometimes the reaction to what is being said is more important than the thing that is said.  For instance, my note on Taleb’s comment that regulations give investors a false sense of security is that
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The Silver Curtain

The Silver Curtain

Courtesy of Marla Singer, Zero Hedge 

On the 5th of March in 1946, in Fulton Missouri, at Westminster College, Winston Churchill delivered an address (since christened the "Sinews of Peace") lamenting the burgeoning power and influence being slowly but surely gathered up by the Soviet Union.  Perhaps the address will be familiar to some of you owing to its most famous passage:

From Stettin in the Baltic to Trieste in the Adriatic, an iron curtain has descended across the Continent. Behind that line lie all the capitals of the ancient states of Central and Eastern Europe. Warsaw, Berlin, Prague, Vienna, Budapest, Belgrade, Bucharest and Sofia, all these famous cities and the populations around them lie in what I must call the Soviet sphere, and all are subject in one form or another, not only to Soviet influence but to a very high and, in many cases, increasing measure of control from Moscow. Athens alone — Greece with its immortal glories — is free to decide its future at an election under British, American and French observation.

Ironic, as I will address, that he should mention Greece.

Much less well known perhaps is this later passage:

Our difficulties and dangers will not be removed by closing our eyes to them. They will not be removed by mere waiting to see what happens; nor will they be removed by a policy of appeasement. What is needed is a settlement, and the longer this is delayed, the more difficult it will be and the greater our dangers will become.1

The "Iron Curtain" came, of course, to signify the cavernous ideological, and eventually concretely physical, divide between East and West.  It took some 43 years before it was lifted once more, first and haltingly, in the form of the removal of Hungary’s border fence in mid-1989 and then, of course, finally via the fall of the Berlin Wall in November that same year.

Not to be compared with a production of Italian Opera, the Iron Curtain did not describe a sudden, smooth, abrupt descent over the stages of Eastern Europe.  Quite the contrary, its drop was in stutters of discrete, fractional lowerings, such that it was a full fifteen years after Churchill used the term before its ultimate expression, the Berlin Wall, was finally…
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Peak Olive Oil: Happy April Fools Day from The Economist

Peak Olive Oil: Happy April Fools Day from The Economist

Courtesy of The Reformed BrokerJoshua M Brown

olive oil

LOL.

From The Economist:

It is becoming clear that reserves of olive oil will peak in the coming decade, as climate change wipes out most of the groves in the Mediterranean, the main production zone.

Who says The Economist is too dry?  I’m re-upping my subscription.  Funny stuff, guys.

Source:

Peak Olive Oil (The Economist) 

 


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HOUSING’S SHAKY FOUNDATION

HOUSING’S SHAKY FOUNDATION

Courtesy of The Pragmatic Capitalist

From The Economist:

THERE are tentative signs of stabilisation in America’s housing market. The S&P/Case-Shiller index, which tracks home prices in 20 cities, ticked up slightly in May, its first gain in 34 months. New construction of single-family homes rose in July for the fifth straight month, while sales of existing homes are expected to show their fourth consecutive month of gains when latest numbers are released on August 21st. Dig deeper, however, and the recovery’s foundations look shaky. A glut of supply will also weigh on prices, thanks to a wave of repossessions. Seized properties now account for almost one in four sales. Some 23% of homes with mortgages are underwater by one estimate, and others are even higher. Deutsche Bank’s securitisation team expects negative equity to peak at 48% of total homes by 2011.

Houses HOUSINGS SHAKY FOUNDATION

Source: The Economist
 


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ValueWalk

Walker's Manual of Unlisted Stocks

By VWArticles. Originally published at ValueWalk.

This looks interesting Walker’s Manual of Unlisted Stocks – Margin of Safety style –  expensive book unless its same as this version Walker’s Manual of Penny Stocks?

Anyone have a LEGAL copy feel free to contact us

H/T CornerOf Berkshire

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Phil's Favorites

Why leadership looks weak and wobbly at Uber, Snap and Twitter

 

Why leadership looks weak and wobbly at Uber, Snap and Twitter

Courtesy of John ColleyWarwick Business School, University of Warwick

Worawee Meepian/Shutterstock

Silicon Valley has not had a great year for governance, and ride-sharing business Uber has been struggling more than most. The company’s culture has come under sustained attack for ...



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Zero Hedge

Moody's: Modest Downside Could Spark $3 Trillion Surge In Pension Liabilities

Courtesy of ZeroHedge. View original post here.

Some very simplistic math from Moody's helps to shed some light on just how inevitable a public pension crisis is in the United States.  Analyzing a basket of 56 public plans with net liabilities of $778 billion, Moody's found that just a modest downside return scenario over the next three years (2017: +7.2%, 2018: -5.0%, 2019: 0%) would result in a 59% surge in new unfunded liabilities.  Moreover, given that total unfunded public pension liabilities are roughly $5 trillion in aggregate, this implies that a simp...



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Insider Scoop

7 Stocks To Watch For June 22, 2017

Courtesy of Benzinga.

Related SNX Earnings Scheduled For June 22, 2017 5 Must-See Earnings Charts Related SCS ...

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Digital Currencies

Ethereum Flash Crashes By 96% After Status ICO Clogs Network

Courtesy of ZeroHedge. View original post here.

While Bitcoin, and recent Chinese and Korean momentum favorite, Litecoin, have been relatively stable for much of the day, Ethereum suffered dramatic losses on Wednesday, sliding from $360 to $260 before rebounding, in the process experiencing what may have been its first flash crash, when it plunged by 96% from $315 to $13 on massive volume, before rebounding.

...



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Chart School

Biotech breakout of bullish pattern in play!

Courtesy of Chris Kimble (posted at Zero Hedge)

Bio-tech used to be an upside leader over the broad market coming off the 2009 lows. Bio-tech gave up its leadership back in 2015, where it peaked and started under performing the broad market. Over the past 15-months, Biotech has started acting a little better.

...

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Biotech

Even though genetic information is available, doctors may be ignoring important clinical clues

Reminder: Pharmboy and Ilene available to chat with Members, comments are found below each post.

Even though genetic information is available, doctors may be ignoring important clinical clues

Courtesy of Greg HallCase Western Reserve University

Digitized strand of DNA. Mathagraphics/From www.shutterstock.com

With the availability of home genetic testing kits from companies such as “23andMe” and “Ancestry DNA,” more peo...



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OpTrader

Swing trading portfolio - week of June 19th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Mapping The Market

Frontier laid off state Senate president after broadband vote it didn't like

Courtesy of Jean-Luc

Speaking of FTR – not nice people…

Frontier laid off state Senate president after broadband vote it didn’t like

By Arstechnica.com

Broadband provider Frontier Communications recently laid off the West Virginia state Senate president after a vote the company didn't like—and yes, you read that correctly.

West Virginia does not have a full-time legislature, and state lawmakers can supplement their part-time government salaries ($20,000 a year,&...



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Promotions

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We have a great guest at today's webinar!

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Members' Corner

Robert Sapolsky: The biology of our best and worst selves

Interesting discussion of what affects our behavior. 

Description: "How can humans be so compassionate and altruistic — and also so brutal and violent? To understand why we do what we do, neuroscientist Robert Sapolsky looks at extreme context, examining actions on timescales from seconds to millions of years before they occurred. In this fascinating talk, he shares his cutting edge research into the biology that drives our worst and best behaviors."

Robert Sapolsky: The biology of our best and worst selves

Filmed April 2017 at TED 2017

 

p.s. Roger (on Facebook) saw this talk and recommends the book ...



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Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

Courtesy of Chris Kimble.

Below looks at the Brazil ETF (EWZ) over the last decade. The rally over the past year has it facing a critical level, from a Power of the Pattern perspective.

CLICK ON CHART TO ENLARGE

EWZ is facing dual resistance at (1), while in a 9-year down trend of lower highs and lower lows. The counter trend rally over the past 17-months has it testing key falling resistance. Did the counter trend reflation rally just end at dual resistance???

If EWZ b...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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