By Monty Pelerin, on January 6th, 2010 Below is a link to a wonderful collection of forecasts for the New Year from The Big Picture.
It includes forecasts/commentary from Wall Street Banks, Hedge Funds, Investment Advisors, as well as investment ideas and potential problems. International is also dealt with.
You can get the information by clicking on Guide to 2010 Outlooks
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By Monty Pelerin, on December 21st, 2009
Stocks 1999-2009: Worst. Decade. Ever.
By Barry Ritholtz – December 21st, 2009, 6:00AM
From today’s WSJ, comes this (amusing) article about the past decade: Its the worst equity performance in nearly 2 centuries.
Why do I say amusing?
Because despite what many fools and asshats were claiming in the 1990s, stocks can only gain so much relative to earnings. Sure, other factors like population growth, economic expansion, productivity gains, all matter on the margins, but the bottom line is Earnings. But over the long haul, there is only so far you can run ahead of historical median rates of return.
The current horrific decade lost half a percent each year on average versus average annual returns of about 10-12% over the past century. Why? This under-performance is payback for the massive gains in the salad days of the late 1990s. As the table at right shows, the gains were far above median.
There is only so far you can deviate from the historical mathematical norm before mean reversion rears its ugly head.
Here’s the WSJ:
“Even with the rebound this year, the U.S. stock market is on the verge of posting its worst performance for any calendar decade in nearly 200 years of American stock-market history.
Investors would have been better off investing in pretty much anything else, from bonds to gold or even just stuffing money under a mattress. Since the end of 1999,
Continue reading Anything But Stocks
By Monty Pelerin, on November 18th, 2009
Image via Wikipedia
Image via Wikipedia
Barry Ritholtz, in a post entitled Special Inspector General: NY Fed Screwed Up AIG Bailout, argues that the government can’t seem to get it right even when they have a no-brainer: “The Federal Reserve Bank of New York, in a desperate headlong rush to rescue American International Group, screwed the pooch. Despite holding all of the cards, cash and power, they still managed to manuver themselves into a corner with “little negotiating room.”
Ritholtz and others implicitly assume that the government’s definition of “right” was consistent with the taxpayer’s definition. If getting it right, however, were defined as bailing out financial cronies at the expense of taxypayers, then the NY Fed (then headed by Tim Geithner) performed magnificently.
Motives are mere speculation. It seems to be that Tim Geithner, with regard to this matter, was either incompetent or deliberately bailed out his buddies. Neither alternative is comforting because the taxpayer loses both ways. Geithner, however, won receiving a promotion to Treasury Secretary. At least now he pays his taxes (we think). What a great country! For everyone except the taxpayers.
Some related articles:
Watchdog: Gov’t May Have Overpaid to Bail out AIG (abcnews.go.com)
Geithner Strikes Back (blogs.wsj.com)
Jill Schlesinger: TARP Audit Finds Geithner Gave Away The Farm (huffingtonpost.com)
Continue reading Geithner Fails, Gets Promoted and Taxpayers get Screwed
By Monty Pelerin, on October 31st, 2009
Image via Wikipedia
Here is another, similar take on my previous post. This one via The Big Picture. The frightening thing, at least to me, about Rosner’s commentary, is less the stupidity of the legislation than the abrogation of Congressional oversight in future decisions. If we had a Constitution, clearly such a policy would be deemed unconstitutional. Doesn’t even seem to phase these three. Where are we heading? Think Banana Republic with ICBMs.
Nice job calling out them weasels and the clowns.
Joshua Rosner, managing director at Graham Fisher & Co., talks with Bloomberg’s Matt Miller and Carol Massar about proposed U.S. financial stability legislation. Banks, hedge funds and other financial firms that hold more than $10 billion in assets would pay to rescue companies whose collapse would shake the financial system under draft legislation crafted by a House panel.
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click for video
Source: Bloomberg
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If the legislation goes through, the Obama administration may end up being just as ruinous, if not more so, than the Bush administration.
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Friedrich von Hayek
Friedrich von Hayek founded the Mont Pelerin Society.
“Monty Pelerin” is a pseudonym chosen by this blogger to convey general agreement with the philosophy, goals and spirit of the Mont Pelerin Society. No other connection exists between the blogger and the Society.
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