10 Wednesday AM Reads

Nice recovery yesterday leads to green futures today for our morning train reads:

• Don’t fight the 4 Feds: Rout Puts Bond Bears on Wrong Side of Central Banks (Bloomberg)
• Index funds killed the mutual fund star (MarketWatch)
• What 50 Years of Data and the Grateful Dead Say About the Economy (Bloombergsee also American Meritocracy Isn’t What It Used To Be (Real Time Economics)
• The NFL Thinks You’re Stupid: League Shows Low Regard for Fan, Media Intelligence in Statement on Patriots’ Penalty (Football By Football)
• David Letterman Leaves His Successors a Rich Comedic Bequest (NY Times)

Continues here

 

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Discussions found on the web:
  1. VennData commented on May 13

    Bond market moves make sense given liquidity

    http://www.reuters.com/article/2015/05/12/usa-fed-williams-markets-idUSL1N0Y31YR20150512

    Traders are getting more anxious about a lack of market liquidity

    http://www.businessinsider.com.au/traders-are-getting-more-anxious-about-a-lack-of-market-liquidity-2015-5

    ROFL! OK if there is “not enough liquidity” then it’s a free lunch to buy volatility. Buy as much as you can since it’s a no brainer. The Pundits are guaranteeing you this is a big, hug problem, so vol should be expense (it isn’t) and getting much, much more expensive in the future (We’ll see.)

    • Jojo commented on May 14

      Thanks for that link. Very interesting….

  2. Molesworth commented on May 13

    http://time.com/3849660/deflategate-new-england-patriots-tom-brady-football/
    Time surreal takeaways from NFL Brady mess.
    I follow F1.
    Now there’s a good clean honest and honorable sport.
    No back stabbing or cheating there.
    Competent unbiased management.

    Re Bartlett piece.
    Wasn’t Jack Welch the star CEO who most drove the idea that shareholder value is the primary function of the corporation?
    Has he really changed his mindset?
    I don’t follow him any more than I follow NFL but I don’t see him pounding the desk for workers’ right.

  3. VennData commented on May 13

    The Left Wing hypocrisy.

    “…Obama said: “You know, the truth of the matter is that Elizabeth is a politician like everybody else, and she’s got a voice that she wants to get out there. I understand that, and on most issues, she and I deeply agree. On this one, though, her arguments don’t stand the test of fact and scrutiny. On Tuesday, Brown said Obama’s remarks were “disrespectful” and the president was making this fight “more personal than he needed to.” He also suggested Obama was being sexist by using Warren’s first name in the interview “when he might not have done that for a male senator.”

    http://onpolitics.usatoday.com/2015/05/13/sherrod-brown-obama-warren/

    So Elizabeth Warren can call out Citibank execs and that’ snot personal, but the President can’t say she’s wrong without it being personal?”

    Brown to apologize to Obama…

    http://blogs.wsj.com/washwire/2015/05/13/josh-earnest-sherrod-brown-will-apologize-to-obama-over-elizabeth-warren-comments/

    Stop this nonsense, pass the Free Trade Authorization bill and START TALKING ABOUT INFRASTRUCTURE!

  4. rd commented on May 13

    Re: Wealth inequality

    One thing I didn’t see discussed in the wealth analysis was offshore wealth. Only the top 1% are likely to have significant accounts or holdings internationally that are not registered with a US broker or bank. Once the IRS started going after tax haven accounts, it became apparent that there were large sums lurking offshore that are unlikely to be reflected in US statements until the last couple of years. It has also been pretty clear that the banks had a very well oiled operation to assist in sending money overseas to avoid US taxes – the advent of easy electronic transfers and Internet access to accounts made the process much simpler over the past 20 years. You didn’t have to fly to the Caymans with a suitcase of bills anymore.

    • willid3 commented on May 13

      that just means that the way to export your cash was made available to those who werent uber rich

  5. rd commented on May 13

    Re: Deflategate

    The primary thing that has struck me about the Deflategate investigation and the ball inflation rule is that there is only a 1 psi range that is permissible and the equipment used by the league to measure it has a measurement range of over a third of that range between two gages used by the refs. A ball measured to be a the mid-range of 13.0 psi, could actually be almost underinflated or overinflated as another gage could measure 12.6 or 13.4 psi. If the ball inflation pressure is critical, the gages measuring it should be far more accurate than that (I would think 0.1 psi or less accuracy). Their current methodologies are like competing in the biathlon with a shotgun.

    • willid3 commented on May 13

      course the whole scheme the NFL uses for footballs allows for teams to cheat. cause they bring their footballs. and the process for validation is very lack. at least its better than before where the home team always brought them.

  6. rd commented on May 13

    The Smart Beta brawl continues: http://www.marketwatch.com/story/bucket-of-cold-water-dumped-on-this-hot-investing-strategy-2015-05-13?mod=MW_story_top_stories

    I don’t think we will know how this plays out until we have seen a solid market cycle play out. Cap-weighted indices tend to do very well in bull markets, while the value types of approaches often do better through an entire market cycle.

    However, it is pretty clear that comparing back-tested index returns requires an outperformance of about 0.5% or more for decade-plus returns since most of the smart beta mutual funds and ETFs generally charge 0.3% or more in annual ER and will make a portfolio more complex to manage, often with more trading costs.

    In theory there is no difference between theory and practice. In practice there is. – Yogi Berra

  7. willid3 commented on May 13

    wonder how much longer AZ will have its biggest universities>:
    ]http://www.azcentral.com/story/news/arizona/politics/2015/05/13/midnight-arizona-tops-nation-college-cuts-tuition-hikes/27221021/

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