Monthly Archives: October 2011

Baby Toursim: US Problem or Opportunity?

Brian Williams’ new show, Rock Center, broadcast this evening with a piece on wealthy foreign pregnant women–many Chinese–who are coming to the US to give birth so that their children can receive citizenship and a Social Security card. Many are outraged … Continue reading

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Counterfactual Friday: The CAPE

Current Market Perspective: Moderately bearish based on three pieces of information: Our bottom-up security selection process is revealing few bargains; Total public and private debt in developed countries is unsustainably high relative to GDP and will require long, painful de-leveraging … Continue reading

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Credit Default Swaps and “Credit Events”

In my old job where we acted as sellers of protection in credit default swaps (more often than as buyers, anyway), we used to fight like hell to ensure that any restructuring of bank loans was not considered a “credit event” … Continue reading

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“First, Get a Trillion Euros…”

The market is soaring today on the Greek bailout plan, or should we say the European bailout plan because, lest we forget, there are several more countries that still need a bailout. The plan is amusing to me, though I should … Continue reading

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So, You Think You Can Be a Great Short Seller

I am about to cover the final leg of my NFLX short, which I had in place for over one year. Are you one of the many who saw this coming? Did you expect a 75% drop in price since … Continue reading

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Power Laws at Work in Financial Markets

I am working on a good post for the first “Counterfactual Friday.” Unfortunaltely it will probably not be posted until Monday. In the meantime enjoy the following: I have attached a link to a terrific article on power law distributions and … Continue reading

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Just What is Seth Klarman up to? It May not be What Optimists Believe

Apparently, Seth Klarman is in the market for capital. This is always news because Klarman has a reputation for shunning capital from new investors and frequently returning excess capital to existing investors. However, the author of the attached story has … Continue reading

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Rumors Drive the Market Upward Again

As I have written before, any news rumor is good news for the market; the aftershock of disappointment is likely to be much more pronounced. From a Dow Jones Newsire report published online at 5:17pm today: On Tuesday, the market … Continue reading

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Why All the Cheer?

I am an optimist by nature, and I hope a rational one in the Matt Ridley vein. But, I do not understand the optimism in the market in the last seven trading days (plus forty-five minutes). Markets are up over … Continue reading

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What is Behind the Market’s 12% Jump in One Week?

At 3:15 pm on October 4, the S&P 500 was at 1081.89. By 4:oo pm it finished at 1123.95, up 3.89% in forty-five minutes. To put that in perspective, the market was in the 1081 range in October 1998. So, … Continue reading

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