Lance on Jul 28 2008 | Filed under: Domestic Equities, Economics, Great Investors, Housing Market, Risk, economy
I apologize ahead of time if this post is a bit intemperate.
Buried around a truism, the New York Times has produced a misleading and rather silly piece on the value of “predictions.”
The thrust of the piece is that predicting the markets and the economy, especially in the short term, is fraught with peril. True enough. [...]
Lance on Jul 07 2008 | Filed under: Asset Allocation, Domestic Equities, Domestic Fixed Income, Economics, Risk, economy
Heavier hitters than myself are slowly lining up to put out estimates of the total losses from the credit crisis more in line with my thinking. Welcome aboard!
Using far more “off the cuff” methods than Nouriel Roubini, the IMF, Jeremy Grantham, John Hussman, UBS, John Paulson or Goldman Sachs, I have been expecting the starting [...]
Lance on Apr 19 2008 | Filed under: Commodities, Economic Indicators, Economics, Energy, Inflation, Latest data, economy
While spending increased in March by 1.8% over a year ago, adjusted for inflation it was way down. The only reason sales were positive was gasoline, though food sales were positive. Even there, that is mostly due to inflation and rising prices of food and staples.
Lance on Apr 07 2008 | Filed under: Domestic Equities, Economic Indicators, Economics, Housing Market, Latest data, economy
Personally I think we have been negative since November. Given the large positive number in the third quarter, the barely above break even number in the fourth quarter virtually guarantees that the economy went negative sometime in November and December. However, if we are not, it is highly likely coming. Here is a graphic which [...]
Lance on Feb 21 2008 | Filed under: Domestic Equities, Domestic Fixed Income, Economics, Federal Reserve, Global Fixed Income, Government policy, Housing Market, Risk, economy, monetary policy
Martin Feldstein, stepping down from heading up the National Bureau of Economic Research since 1977, has piece in the Wall Street Journal that is rather pessimistic about the economic outlook. More tellingly he thinks the recession, if it occurs (and like me, he suspects it has already begun) will be more difficult to stimulate our [...]
Lance on Feb 17 2008 | Filed under: Economics, Government policy, economy
To spending rather than saving. From Atlas Blogged:
NYC Mayor Bloomberg on the federal economic stimulus plan:
They want to send out a check to everybody to stimulate the economy… I suppose it won’t hurt the economy, but it’s in many senses like giving a drink to an alcoholic.
Hey, hey, hey… alcohol a depressant. This is [...]
Lance on Feb 15 2008 | Filed under: Economics, Federal Reserve, Hedge Funds, Latest data, economy, today's links
Bad news for the monolines. FGIC just got downgraded today to AA. That pretty much puts them out of the business of insuring municipal bonds.
NYS Commissioner of Insurance has suggested splitting the Muni bond business from the rest of the insurers. FGIC seems to now think that isn’t a bad idea. Of course, since Elliot [...]
Lance on Feb 14 2008 | Filed under: Economics, Housing Market, monetary policy
So claims Alex Tabarrok. Alex and his blogmate Tyler are two of my favorite bloggers, but on this matter I think Alex is wrong. Unlike for some, his argument doesn’t invite scorn, because humility should teach us that sometimes things are different, and we cannot always fully understand why, at least not until after the [...]
Lance on Feb 11 2008 | Filed under: Asset Allocation, Economics, Great Investors, Housing Market, Risk, Valuation
Jeremy Grantham echoes a few themes here at Risk and Return in this interview with Barron’s:
Secondly, this occurred at a time of what I believe is the first global bubble in pretty well all asset prices, so there is a much greater degree of broad-based vulnerability.
Lance on Feb 10 2008 | Filed under: Economic Indicators, Economics, Housing Market, technology
From the Financial Times:
Global spending on IT goods and services is expected to grow … 6 per cent … according to Forrester Research … This represents a significant slowdown from 12 per cent growth last year.
…
“Our forecast is premised on a mild recession in the US economy in the first two or three quarters of [...]
Lance on Feb 08 2008 | Filed under: Economic Indicators, Economics, economy
Our firm has a long history with Russell Investments , and my personal relationship with the firm goes back all the way to 1983, so I have a great deal of interest in their research.
Michael Dueker is a senior portfolio strategist at Russell and has an interesting model for predicting recessions which he discusses at [...]
Lance on Jan 30 2008 | Filed under: Economic Indicators, Economics, Federal Reserve, Latest data, Risk, today's links
The GDP numbers came out yesterday. For a breakdown, including the inflation component, go here. For the announcement from the BEA go here. The Fed also cut rates by 50bps. Here is the Journal’s story.
Reactions:
Barry Rithotlz- Q4 GDP: El Stinko!
• Consumption slowed to 2% from 2.8% in Q3; I suspect that only partly reflects real [...]
Lance on Jan 28 2008 | Filed under: Economics, Latest data
From The Big Picture
Banks May Need $143 Billion for Insurer Downgrades: Banks that raised $72 billion to shore up capital depleted by subprime-related losses may require another $143 billion should credit rating firms downgrade bond insurers, according to analysts at Barclays Capital. Banks will need at least $22 billion if bonds covered by insurers led [...]
Lance on Jan 25 2008 | Filed under: Domestic Equities, Economic Indicators, Economics, Market Data
As I noted earlier, Dale Franks was curious about how Harley Davidson (HOG) would do on its latest earnings release:
One earnings report to watch this week, though, is Harley-Davidson (HOG). It’s a solid company with a loyal customer base—I’m one of them actually—but, motorcycles are a luxury item. For every guy [...]
Lance on Jan 25 2008 | Filed under: Absolute Return, Asset Allocation, China, Domestic Equities, Economic Indicators, Economics, Federal Reserve, Global Equity, Hedge Funds, International Equities, Latest data, Risk, today's links
Morningstar takes a look at the Long/Short category of mutual funds. They, like I, appreciate John Hussman.
China turned in yet another double digit year:
China’s economy grew by 11.4 per cent in 2007, the highest pace in 13 years, but the trend of decelerating exports to a slowing US recorded in the final two quarters is [...]
Lance on Jan 24 2008 | Filed under: Economics, Housing Market, Latest data
(Cross Posted at Risk and Return)
Of course prices have just started to decline. First you have to have sales volume decline and inventory build up:
Sales of existing homes fell in December, closing out a horrible year for housing in which sales of single-family homes plunged by the largest amount in 25 years. The median home [...]
Lance on Jan 24 2008 | Filed under: Economics, Federal Reserve
Contra David Merkel, Amity Schlaes says a choice can be made, and Bernanke’s worry should be inflation.
Update: David left me a comment, so I am going to include it, and my response:
I’m not saying regulators won’t be forced to make a choice, or what that choice might be. My opinion on what should be done [...]
Lance on Jan 23 2008 | Filed under: Domestic Equities, Economic Indicators, Economics, Housing Market
Dale Franks gives his rundown on what to look for going forward from the economy, and the implications for investors:
We’ve dropped off about 20% from the stock price highs of October, so we’re about due for a rally. Especially with the Fed obliging everyone with rate cuts. At this point, though, I’d look askance at [...]
Lance on Jan 23 2008 | Filed under: Domestic Equities, Economic Indicators, Economics, Federal Reserve, Global Equity, Government policy, Housing Market, International Equities, Latest data, Market Data, Risk, monetary policy
Like me, Barry Ritholtz sniffed a whiff of panic in the Fed’s actions yesterday. The question he asks is why they acted before their meeting. Here are his questions, all good. I have pretty much stolen the whole post. Hopefully Barry will not mind:
What does this mean for investors. Quite a number of things – [...]
Lance on Jan 22 2008 | Filed under: Economics, Federal Reserve
From The New York Times:
WASHINGTON (AP) — The Federal Reserve, confronted with a global stock sell-off fanned by increased fears of a recession, cut a key interest rate by three-quarters of a percentage point on Tuesday.
Quicker and larger than expected. I am curious whether investors will, at the margin, consider this a move to celebrate [...]
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