Most Recent Stingy News
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| Leaving the Euro |
| 05/16/12 5:32 PM EST Permlink | World |
| "Some two decades ago, when Europe’s leaders worked out the details of their grand vision to connect the European Union with a single currency, virtually every economist on this side of the Atlantic — and most of those on the other — figured out that the euro would be fatally flawed." |
| More World: The crazy way Europe measures inflation |
| What price a slowing population? |
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| The crazy way Europe measures inflation |
| 05/16/12 4:46 PM EST Permlink | World |
| "There's a long list of things that could kill the euro zone. But the most deadly might also be the most overlooked. It's the crazy way that Europe measures inflation." |
| More World: What price a slowing population? |
| Lessons of the recession |
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| What price a slowing population? |
| 05/16/12 4:14 PM EST Permlink | World |
| "Nomura has taken a shot at calculating just how significantly population changes can hit GDP ..." |
| More World: Lessons of the recession |
| Price controls in action |
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| Buy Low, Sell High |
| 05/13/12 -3:22 PM EST Permlink | Value Investing |
| "“Buy low, sell high” is often quoted in finance. While its wisdom is hard to question, its application is hardly extensive. To understand why this is so, it is helpful to put ourselves in the shoes of a typical investor." |
| More Value Investing: The devil in HML's details |
| Which price ratio outperforms the EM? |
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| When Julia tried to start a business |
| 05/11/12 7:28 PM EST Permlink | Funds |
| "Last week, the Obama Administration released a campaign piece about the life of Julia, showing how Julia benefited from taxpayer largess and oversight by the state at many points in her life. But the campaign piece was incomplete, and missed the part where Julia attempted to start her own business. Long before she started a web business out of her home, she tried to start a retail business." |
| More Funds: Lessons learned in the wealth management |
| Another look at the performance of active funds |
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| The devil in HML's details |
| 05/11/12 -3:45 PM EST Permlink | Value Investing |
| "This paper challenges the standard method for measuring “value” used in academic work on factor pricing and behavioral finance. The standard method calculates book-to-price (B/P) at portfolio formation using lagged book data, aligns price data using the same lag (ignoring recent price movements), and hold these values constant until the next rebalance. We propose two simple alternatives that use timely price data while retaining the necessary lag for measuring book. We construct portfolios based on the different measures for a US sample (1950-2011) and an International sample (1983-2011). We show that B/P ratios based on timely prices better forecast true (unobservable) B/P ratios at fiscal yearend. Value portfolios based on the most timely measures earn statistically significant alphas ranging between 305 and 378 basis point per year against a 5-factor model itself containing the standard measure of value, as well as market, size, momentum and a short term reversal factor." |
| More Value Investing: Which price ratio outperforms the EM? |
| Which price ratio best identifies value stocks? |
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| The flaws of finance |
| 05/09/12 10:52 PM EST Permlink | Montier |
| "James Montier discusses how bad models, bad behavior, bad incentives, and bad policies interact to create perfect storms for markets" |
| More Montier: What goes up must come down |
| The joy of cash |
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| Red tape keeps poor people out of jobs |
| 05/08/12 10:58 PM EST Permlink | Government |
| "One way to help improve the lives of low income people is to focus on how the government can give them more. Sometimes this can be very effective, and even desirable. But a far less common way is to look at how the government can stop doing stuff that is making them worse off. Occupational licensing is a great example of this." |
| More Government: We're spent |
| Bias in government forecasts |
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| Can Fairfax's bear market strategy work for you? |
| 05/05/12 2:05 PM EST Permlink | Stingy Investing |
| "Prem Watsa is worried about the stock market. In fact, the famed value investor and CEO of Fairfax Financial has hedged his company’s stock portfolio against a market downturn. When an investor as successful as Mr. Watsa adopts such cautious measures, should ordinary investors follow his lead?" |
| More Stingy Investing: Dividend stocks aren't fail-safe |
| Shiller's earnings yield |
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| Another Warren Buffett? |
| 05/05/12 2:04 PM EST Permlink | Buffett |
| "Buffett is a man of character, unequaled in the investment business. He folded his private partnership in 1969 because he didn’t want his investors to be rocked by the bear market he saw coming." |
| More Buffett: Buffett battles cancer |
| Warren Buffett's $50 Billion decision |
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| We're spent |
| 05/04/12 11:48 PM EST Permlink | Government |
| "This is why pleas for 'Stimulus now, austerity later' in the U.S. and Europe have the ring of chalkboard economics: Looks great in (someone's) theory, but out in the real world the market and the citizens see right through it. The biggest economic problems are political: And the biggest political problem is commitment." |
| More Government: Bias in government forecasts |
| Why we must end too big to fail |
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| Berkshire's Charlie Munger speaks |
| 05/04/12 4:27 PM EST Permlink | Munger |
| "Vice-chairman of Berkshire Hathaway Corporation Charlie Munger talks to CNBC's Becky Quick about the consistency of Berkshire, Warren Buffett's health, the company's succession plan and his feelings on the future of the company." |
| More Munger: A conversation with Charlie |
| Basically, it's over |
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| Lessons of the recession |
| 05/03/12 12:57 PM EST Permlink | World |
| "In fact, today’s economic troubles are not simply the result of inadequate demand but the result, equally, of a distorted supply side. For decades before the financial crisis in 2008, advanced economies were losing their ability to grow by making useful things. But they needed to somehow replace the jobs that had been lost to technology and foreign competition and to pay for the pensions and health care of their aging populations. So in an effort to pump up growth, governments spent more than they could afford and promoted easy credit to get households to do the same. The growth that these countries engineered, with its dependence on borrowing, proved unsustainable. Rather than attempting to return to their artificially inflated gdp numbers from before the crisis, governments need to address the underlying flaws in their economies." |
| More World: Price controls in action |
| Richard Koo presentation |
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| What was the very first hedge fund? |
| 05/01/12 3:14 PM EST Permlink | Graham |
| "The legendary economist and investor Benjamin Graham is widely known as the father of value investing. He may also be the father of the hedge-fund industry. While most historians and industry professionals credit Alfred Winslow Jones with launching the first hedge fund in 1949, some people, including Graham’s protege, Warren Buffett, disagree." |
| More Graham: What would Graham say about Goldman? |
| What Graham thought of IBM |
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| Which price ratio outperforms the EM? |
| 05/01/12 3:10 PM EST Permlink | Value Investing |
| "Having just anointed the enterprise multiple as king yesterday, I’m prepared to bury it in a shallow grave today if I can get a little more performance. Fickle." |
| More Value Investing: Which price ratio best identifies value stocks? |
| Howard Marks at NYSSA |
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| Which price ratio best identifies value stocks? |
| 05/01/12 3:07 PM EST Permlink | Value Investing |
| "Which price ratio best identifies undervalued stocks? It’s a fraught question, dependent on various factors including the time period tested, and the market capitalization and industries under consideration" |
| More Value Investing: Howard Marks at NYSSA |
| Leucadia Letter |
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| Price controls in action |
| 04/30/12 10:46 AM EST Permlink | World |
| "Similar problems have played out with other agricultural products under price controls, like lags in production and rising imports for beef, milk and corn. Waiting in line to buy chicken and other staples, Jenny Montero, 30, recalled how she could not find cooking oil last fall and had to switch from the fried food she prefers to soups and stews. “It was good for me,” she said drily, pushing her 14-month-old daughter in a stroller. “I lost several pounds.”" |
| More World: Richard Koo presentation |
| Greece: same old high yields |
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| Cutting back on bonds |
| 04/28/12 5:54 PM EST Permlink | Bonds |
| "The strongest consensus I could find relates to interest rates. There are few managers who aren’t running light on bonds and/or keeping their maturities short (including holding cash) to protect against rising rates. Carl Hoyt at Seymour Investment Management used Warren Buffett’s words to make the point. “Current rates … do not come close to offsetting the purchasing-power risk that investors assume. Right now bonds should come with a warning label.”" |
| More Bonds: The constancy of safe asset demand |
| The rally that wouldn't die |
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| Mawer Q1 |
| 04/28/12 5:48 PM EST Permlink | Real Estate |
| "In Fairfax Financial’s Annual Letter to Shareholders, Prem Watsa observes, “there are more condos in construction in Toronto than in the 12 major cities in the U.S. combined, including New York and Los Angeles.” According to the Toronto Real Estate Board, the average condominium in the City of Toronto went for $361,488 in the fourth quarter of 2011, up 7% year-over-year. Condo sales were up 10.5% year-over-year. The average sales price to list price registered 98%, which is well above the historical long-term average. The Toronto condo market is hot. Looking at the situation from a national perspective, the Canadian Real Estate Association reported that the average house price in Canada was $372,763 in February 2012. This compares to the $203,100 average price reported by the National Association of Realtors in the United States. Our question is simple: why should the average house in Canada sell for 84% more than the average house in the United States over the long run?" |
| More Real Estate: Real house prices |
| Owning too much real estate |
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| Real house prices |
| 04/28/12 5:45 PM EST Permlink | Real Estate |
| "The Shiller graph has suggested to many observers that house prices track inflation (i.e. that house prices adjusted for inflation are stable - except for bubbles). Last year I pointed out the slope depends on the data series used, and that if Professor Shiller had used either Corelogic or the Freddie Mac house prices series, before Case-Shiller was available, there would a greater upward slope to his graph." |
| More Real Estate: Owning too much real estate |
| Pity about your retirement |
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| Corruption Law |
| 04/28/12 5:32 PM EST Permlink | Law |
| "Increasingly, the FCPA has become a tool for American prosecutors to police the world's large multinationals. Corporations whose shares trade on American exchanges are considered fair targets. So are corrupt transactions that pass through American banks. Using that theory, the Justice Department brought a case against against Japan's JPC, a company that, as the Shearman and Sterling report put it, had 'no apparent commercial connection with the United States whatsoever.' Rather than test the government's arguments in court, and risk criminal convictions for their executives, most companies have chosen to settle using deferred prosecution agreements." |
| More Law: Keep it simple |
| Protest SOPA/PIPA |
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