Tuesday, December 18, 2007

Jim Cramer: Mad No More?

Jim Cramer: Mad No More?:
"How about this for a new surprise? Jim Cramer, sober-minded personal finance guru.

It creates some contradictions. The hyperactive stockpicker on CNBC's Mad Money has a new book out advising most readers not to buy individual stocks at all"
Wow. A Christmas miracle? Or more likely he has known it all along and realized that picking stocks makes for better TV.

Saturday, December 08, 2007

Freakonomics Being Documentary-ized « FirstShowing.net

Indie Spotlight: Freakonomics Being Documentary-ized « FirstShowing.net:
"...an upcoming adaptation of the New York Times Bestseller by Steven Levitt and Stephen J. Dubner - Freakonomics. The catch is that a group of documentary directors are teaming up to make a documentary based on Freakonomics, with each making a 15 minute segment based off of a couple of chapters."
I cannot remember the last movie I went to, but this might have to be the next one I go to.

Thanks to Mike for sending this to me.

Friday, December 07, 2007

The Anatomy of Financial Crises: Understanding Their Causes and Consequences - Knowledge@Wharton

Gee, I may have to ask Santa for this one. It looks VERY good!

The Anatomy of Financial Crises: Understanding Their Causes and Consequences - Knowledge@Wharton:
"Crises have been a feature of the financial landscape for hundreds of years. They often appear with little warning, as the sub-prime mortgage crisis of 2007 and the Asian crisis of 1997-1998 illustrate. It's not always clear what causes crises, whether they can be avoided and how their impact can be reduced. A recent book, titled Understanding Financial Crises (Oxford University Press), by Wharton finance professor Franklin Allen and Douglas Gale, a professor of economics at New York University, tackles this subject from a number of different angles"

Thursday, December 06, 2007

Stocks rise when sun shines | Dallas Morning News | News for Dallas, Texas | Business

We've talked about this several times in class so when I stumbled upon this in the Dallas Morning News (it is orignally from the Washington Post) I figured I better share it!

Stocks rise when sun shines | Dallas Morning News | News for Dallas, Texas | Business:
"In a study of 26 stock markets around the world between 1982 and 1997, researchers David Hirshleifer and Tyler Shumway showed that the annualized average return on perfectly sunny days was 25 percent, while the annualized average return on overcast days was only 9 percent."
" Mark J. Kamstra, a finance professor at York University in Toronto, argued that seasonal variations in the markets might be related to seasonal affective disorder."
and finally:
"Given the transaction costs of buying and selling stocks, Dr. Hirshleifer said, it's impractical to use sunshine as a stable investment strategy.

But an investor who's planning to sell some stocks anyway might want to time the sale to a sunny day of the week instead of a cloudy day.

"The main lesson for investors is something broader," Dr. Hirshleifer said. "It is important to discount for your moods in making investment decisions.""

Well this is one way to make sure people pay their loans!

Yeah...well I guess...hope this one is not true, but given the high default rates we are seeing, maybe...lol...

Loan thugs strike again, bash up 58-year-old professor- Hindustan Times:
"THE POLICE are investigating charges leveled by a professor of a reputed engineering college against a multinational bank, which allegedly sent a pack of intimidating loan recovery agents to hound him. Prof J.S. Kalra of the Delhi College of Engineering said in his complaint to police that the agents abused and beat him up outside the Indraprashta University campus in north Delhi for delaying monthly installments of a loan."
I will not say the name of the bank, but it is in the article for those interested.

Monday, December 03, 2007

Yet more reasons on why there are more Buys than Sells

Bloomberg.com: Exclusive:
"Shrinking fees from brokerage commissions mean fewer dollars for research and more pressure on analysts to hang on to paying customers such as hedge funds. While clients care little for ratings, they covet meetings with company executives -- audiences that favored analysts can deliver. As a result, ``sell'' ratings on Wall Street are even scarcer than four years ago, when 10 securities firms paid $1.4 billion to settle allegations by then-New York Attorney General Eliot Spitzer that they used research to improperly promote stocks."
And lest we forget, remember the reported death threats.

NYSE fights to maintain once crowded trading floor

AFP: NYSE fights to maintain once crowded trading floor:
"The computer age has wiped out the need for human traders in many stock markets around the world, but the New York Stock Exchange is fighting to ensure the survival of its historic trading floor. At 11 Wall Street behind the NYSE's imposing white marble facade, about 1,500 dealers continue to buy and sell shares on the exchange's trading floor. 'That's good for the visibility. It's a symbol,' said Patrick Healy....

"The floor as we knew it is dead," said James Angel, a finance professor at Georgetown University."

Saturday, December 01, 2007

Blaine Lourd Profile - Executive Articles - Portfolio.com

What a great article! Inherently readable, a great story, and even ends up with a happy ending. I usually hate to give away the story, but in this case I will. It is the story of a stereotypical stock broker who sees the light and realizes that indexing is generally a better idea.

Blaine Lourd Profile - Executive Articles - Portfolio.com:
"As a group, professional money managers control more than 90 percent of the U.S. stock market. By definition, the money they invest yields returns equal to those of the market as a whole, minus whatever fees investors pay them for their services. This simple math, you might think, would lead investors to pay professional money managers less and less. Instead, they pay them more and more...Nobody knows which stock is going to go up. Nobody knows what the market as a whole is going to do, not even Warren Buffett. A handful of people with amazing track records isn’t evidence that people can game the market. Nobody knows which company will prove a good long-term investment. Even Buffett’s genius lies more in running businesses than in picking stocks. But in the investing world, that is ignored. Wall Street, with its army of brokers, analysts, and advisers funneling trillions of dollars into mutual funds, hedge funds, and private equity funds, is an elaborate fraud."
And later on some so-called experts:
" There's a shelf of financial bestsellers whose titles now sound absurd: Ravi Batra's The Great Depression of 1990; James Glassman's Dow 36,000; Harry Figgie's Bankruptcy 1995: The Coming Collapse of America and How to Stop It. There’s BusinessWeek’s 1979 description of "the death of equities as a near permanent condition,"

and after he finds DFA (yeah Eugene Fama's firm) and comes to realize that indexing is probably the way to go.
"I think more and more brokers will move to an efficient-markets strategy, because all of their products go bad. They just do...

BTW, IF I haven't convinced you to read it, consider this: it was written my Michael Lewis (Of MoneyBall fame) which should be reason enough to read it even if it were on checkers.

Thanks to Greg for pointing this out to me! (two Portfolio.com articles in one day, definitely not random ;) )