Two loosely related and thoughtful posts today point up some of the ways that the fundamental frameworks of how participants think about and relate to financial markets are breaking down. Note that this development is separate from the fact that financial institutions look pretty wobbly. Instead, these two writers, Roger Ehrenberg and Cassandra, highlight two […]
Read more...All About Alpha, which is a fine site for all things hedge fund related, has an excellent piece today by Dr. William Shadwick of Omega Analysis. Shadwick has the unusual distinction of being a serious mathematician (he established Fields Institute for Research in Mathematical Sciences) who writes well. He also entered the finance industry relatively […]
Read more...A comment in today’s Financial Times, “The fall of a financial model,” by Jean-Louis Beffa, chairman of Saint Gobain and Xavier Ragot of the Paris School of Economics argues that the approach to financial capitalism in operation for the last decade is coming to an end. They define the model as giving a primary to […]
Read more...Readers may have noticed that this site has gotten what one can most politely call visually busy. I’m not happy with the awkward adolescent ad-cluttered look. That in turn leads to a broader discussion of aesthetics, not just in terms of appearance but also positioning. The visual issue is pretty obvious: I’d like this to […]
Read more...Readers may have noticed that this site has gotten what one can most politely call visually busy. I’m not happy with the awkward adolescent ad-cluttered look. That in turn leads to a broader discussion of aesthetics, not just in terms of appearance but also positioning. The visual issue is pretty obvious: I’d like this to […]
Read more...Steve Cecchetti, Professor of Global Finance at Brandeis, has a nice post at Vox EU, “The Art of Crisis Management: Auctions and Swaps.” The title’s misleading; Cecchetti describes it as a FAQ on the central bank actions of last week to try to close the unusually high and troubling spread between interbank rates like Libor […]
Read more...Nassim Nicholas Taleb, seasoned trader and risk manager, and author of the provocative and well regarded book Black Swans, today in the Financial Times takes on the high priesthood of modern finance. He argues that modern portfolio theory and many of its offspring, such as the Black-Scholes option pricing model and the capital asset pricing […]
Read more...A wry and informative article, “Slicing and dicing risk rebounds on banks,” by John Dizard at the Financial Times tells us that newfangled investment vehicles considered to be a good thing because it moved risk assumption away from large banks (and therefore ultimately central banks) to the wealthy. But Dizard explains the rich were too […]
Read more...A story in today’s New York Times, “Buyers Pounce as Homes Go on the Block.” shows that true belief in housing as an investment is far from dead. And the belief that auction = bargain quickens the pulse. While some local markets will have shallow (if any) price declines and fast rebounds, and Minnesota, the […]
Read more...A piece in Seeking Alpha, “Buybacks: A Wolf In Sheep’s Clothing,” by Matthew Hougan at Index Universe, does a nice job of debunking the myth that stock buybacks are a positive indicator for price performance. I’ve always had trouble with the logic of buybacks. If a company doesn’t believe that it has attractive enough prospects […]
Read more...A very good post by Menzie Chin at Ecnobrowser explores the meaning of an expression often used by regulators, traders, and the media, the strength (or weakness) of a currency. Chin tells us (and I hope I am not oversimplifying a lucid explanation) that it really signifies two things. The first meaning is the value […]
Read more...A clever post by Elizabeth Warren at Credit Slips keys off, of all things, a discussion by mystery writer Lisa Scottoline about her experiences with American Express and reward programs generally. Scottoline gives a colorful recap of her inattentiveness about paying on time and its predictable impact on her credit record (“My FICO score was […]
Read more...Today’s Wall Street Journal, in a page one story, tells how makers of high-end watches, such as Omega and Patek Phillipe, use actions to establish high price points for their wares by acting as anonymous shill bidders. Understandably, buyers who realized that the makers (ie, the sellers) were bidding against them, they were outraged: Demand […]
Read more...According to Bloomberg (hat tip 2Blowhards), well-groomed men do better financially than their rumpled peers. And contrary to popular perception, the impact is greater for men than women. Note that the study measured time spent on primping, and made no effort to assess the efficacy of those efforts. Perhaps the seemingly lower economic impact of […]
Read more...We’ve never understood why regulation has such a bad name in America. Yes, there are all kinds of terrible specific implementations of the concept “regulation.” But the difficulty of getting it right doesn’t mean the concept should be rejected out of hand, since it turns out the alternative of “no regulation” isn’t so hot. And […]
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