201508.23
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The Mysterious Selloff

Why was the stock market down almost 6% last week? I know what you’re thinking – has this guy been under a rock somewhere? But I’m serious. I know what all the pundits, commentators and talking heads are saying about the immediate cause. It’s about the China devaluation and the knock on effect in other…

201507.19
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Bailout – “the Greequel”

The Greek government, EU, IMF and ECB agreed to new terms for a third bailout. As I see it, there are two very important items for markets today. The Greek government will be selling assets to pay down debt and re-capitalize the banking sector. Creditors essentially accessed the Greek collateral they were seeking. In return, the…

201506.28
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The Market Waits For No One

Our lens suggests that the very low interest rates that have prevailed for so long may not be “equilibrium” ones, which would be conducive to sustainable and balanced global expansion. Rather than just reflecting the current weakness, low rates may in part have contributed to it by fuelling costly financial booms and busts. The result…

201506.21
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Greek Scenario Analysis

Here is a simple conditional probability table one might use to gauge the potential risks and rewards stemming from the Greek credit negotiations. The table considers 3 paths which may arise from ongoing talks. It assigns a probability for each and what an investor might expect for market returns under each scenario. Given recent events, the…

201505.17
5
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Let Them Eat Cake

It’s very decorative, it’s very large, it looks very expensive, it’s very splashy. I’d identify the new owner as being very rich, and it’ll brighten up his expensive apartment. Would you want any more reasons? John Richardson, Picasso biographer on why Les Femmes d’Alger (Version O) is worth the $179 million it fetched at a…

201411.09
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Political Economy

I hate to do it, but I’m going to have to write about politics this week. Believe me, it isn’t something I relish, but in light of the recent election, it would be dereliction of duty to ignore the elephant and donkey in the room. Let’s get this out of the way right up front;…

201411.06
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The True State of Recovery

With all the election post-mortems flying about, there really only needs to be reference to pre-mortems that predicted such results. Even typically leftist media outlets have seen the “message” for what it was. From The DailyBeast: Yes, the stock market is booming but overwhelmingly Americans are unhappy with their economic situation—and for good reason. Wages…

201405.26
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It’s Really Quiet Out There

The S&P 500 made a new high last week, finally closing over the 1900 level. European stocks were also higher on the week and have continued the rally today even after election results over the weekend showed an uncomfortable gain for some parties that are, well, let’s just say that some of their ideas are…

201404.22
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The Unearned Age of Certainty

In continuing yesterday’s pointed critique of the current state of monetarism, there is another element to consider here. To reiterate, last year the yen devaluation was unquestionably seen as a catalyst toward rebirth of Japan Inc, and thus Japan economically (and maybe even demographically). This sentiment was as ubiquitous as it was accepted on faith:…