Earlier this year, two law professors at the University of California, Berkeley School of Law took issue with of all things Tobin’s Q. Though named for James Tobin, the idea had been introduced much earlier by several people. Tobin popularized one view of the concept. Robert Bartlett and Frank Partnoy objected to many of the contemporary uses. To judge firm [...]
When it comes to the stock market and the corporate cash flow condition, our attention is usually drawn to stock repurchases. With good reason. These controversial uses of scarce internal funds are traditionally argued along the lines of management teams identifying and correcting undervalued shares. History shows, conclusively, that hasn’t really been true. Last year’s tax reform law was meant [...]
We have ample enough evidence for the efficacy, or inefficacy really, of tax cuts as fiscal stimulus. They have been deployed numerous times all over the world the last ten years, and the results have been nearly identical in all. Most charitably, proponents have been left with some form of “jobs saved” to describe, counterfactually, how if they had not [...]
By Jeffrey Snider & Joseph Calhoun Late 2014/early 2015 will perhaps be the closest to a real recovery from the Great “Recession” we shall see in this cycle. Q1 2015 marked the peak year over year growth rate of GDP in this recovery at 3.76%. That rate compares quite unfavorably with even the feeble post dot com crash recovery high [...]
Real GDP in the US was revised up to 1.41% quarter-over-quarter (annual rate), still the fourth of the last six to be less than 1.5%. While economists and policymakers have taken to judging the economy by its downside, that is only because the extent of the global problem is revealed by complete absences of an upside. The occasional decent quarter [...]
When Apple introduced the first iPhone in January 2007, the 8 gig model retailed for $599. The company cut the price to $399 that September in an alliance with AT&T. The 8 gig iPhone 3G that debuted in July 2008, just eighteen months later, was set at $199, and less than a year after that was suggested to retail at [...]
Last week's employment report raised the odds of a December rate hike considerably and the consensus at this point seems to be that it is a done deal. The employment report was pretty good with the unemployment rate down to 5%, 271,000 jobs added and a pay hike to boot. Year over year average hourly earnings are now up 2.4%, [...]
It was a nasty week for investors with almost no place - or at least no logical place - to hide. Of the 16 broad market ETFs I monitor on a daily basis, only one, was higher on the week - IWM, the Russell 2000 small cap ETF. That's what I mean by no logical place to hide. When the [...]
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 Christie's auction recently, a [...]
For policymakers a sense of timing doesn’t appear to be among the highest qualities demanded. That certainly applies to almost every economic proclamation that has come out of any central bank globally, as they both fail to ever see forming recession and always proclaim recoveries that don’t happen to exist. It’s not just a matter of jumping the gun, it [...]
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