Stingy Investor The Rothery Report
  Home | Articles | Screens | Brokers | Tools | Links | Free Letters | Rothery Report
 
Topics
  Academia
  Accounting
  Banks
  Behaviour
  Bonds
  Books
  Brokers
  Christmas
  Crime
  Debt
  Derivatives
  Disaster
  Dividends
  DRPs
  Economics
  Economy
  Fun
  Funds
  Government
  Growth Investing
  Halloween
  Health
  Indexing
  Law
  Management
  Markets
  Real Estate
  Retirement
  Stingy Investing
  Stocks
  Taxes
  Thrift
  Trusts
  Value Investing
  Wealth
  World

Personalities
  Warren Buffett
  Benjamin Graham
  Charlie Munger
  David Dreman
  Martin Whitman
  Tweedy Browne
  James Montier
  John Dorfman
  Seth Klarman
  Nassim Taleb
  James Grant
  John Bogle
  Bill Gross
  Tim Cestnick
  Norm Rothery

Article Archive
  2001
  2002
  2003
  2004
  2005
  2006
  2007
  2008
  2009
  2010
  2011
  2012
  2013
  2014




Stingy News Article Link

The confidence game
10/19/08 Permlink | Grant
"In the past two weeks, governments in Asia, Europe and the U.S. have effectively nationalized vast swaths of banking. Central banks have ramped up their money printing. In the past week alone, the Fed's balance sheet swelled by $179 billion, to a grand total of $1.77 trillion. In announcing such radical measures, intervening governments never fail to invoke confidence. They say they must restore it. Destroying confidence, however, is what governments do best. And the confidence they can restore is usually the kind that got us where we are today. Inflation and moral hazard led directly to the immense overvaluation of equities and residential real estate -- and of the bloating of the leverage that sustained those prices. Yet, to cure what ails us, credit creation and the public guarantee of banking liabilities are the policies today most favored."



More articles on the same topic . . .

America's default on its debt is inevitable
10/13/13 Permlink | Debt Grant
"This is the unsustainable conceit of the world's superpower-cum-super debtor. By deed, if not audible word, we Americans say: 'The greenback is the world's great monetary brand. You have no choice but to use it. Like it or lump it.' But the historical record of paper currencies is clear: Governments always over-issue it. The people finally do lump it."

Grant vs Rosenberg
04/04/10 Permlink | Bonds Grant
"Terrific debate on whether US Treasuries are overvalued between James Grant and David Rosenberg"

Requiem for the dollar
12/05/09 Permlink | Markets Grant
"Ben S. Bernanke doesn't know how lucky he is. Tongue-lashings from Bernie Sanders, the populist senator from Vermont, are one thing. The hangman's noose is another. Section 19 of this country's founding monetary legislation, the Coinage Act of 1792, prescribed the death penalty for any official who fraudulently debased the people's money. Was the massive printing of dollar bills to lift Wall Street (and the rest of us, too) off the rocks last year a kind of fraud? If the U.S. Senate so determines, it may send Mr. Bernanke back home to Princeton. But not even Ron Paul, the Texas Republican sponsor of a bill to subject the Fed to periodic congressional audits, is calling for the Federal Reserve chairman's head. I wonder, though, just how far we have really come in the past 200-odd years."

From bear to bull
09/21/09 Permlink | Markets Grant
"Though we can't see into the future, we can observe how people are preparing to meet it. Depleted inventories, bloated jobless rolls and rock-bottom interest rates suggest that people are preparing for to meet it from the inside of a bomb shelter."

Grant's summer break
08/21/09 Permlink | Grant
"This compilation of recent articles, the first annual Grant's Beachhead issue, is for you."

Is the medicine worse than the illness?
12/20/08 Permlink | Government Markets Grant
"The world ran out of trust in 2008 -- but there is no shortage of money because the Fed is printing like mad. It's the wrong approach, with potentially dire consequences, says James Grant."

Grant sees 'disastrous inflation'
12/05/08 Permlink | Markets Grant
A Bloomberg audio podcast of a conversation with James Grant

James Grant pops Greenspan's bubbles
11/24/08 Permlink | Books Grant
"Such proofs of Grant's foresight -- the power of mind over mania -- fill his new anthology, 'Mr. Market Miscalculates,' a bracing tonic as U.S. equities suffer what may prove their worst year since 1931. We've all met Mr. Market. He's the manic-depressive business partner invented by value investor Benjamin Graham. When the sun is shining, he urges you to sell him your share of the business. When night falls, he begs you to buy him out. Price is no object. Grant's omnibus offers a blow-by-blow account of one man's battle with this crank, from dot-com binge to mortgage meltdown."

Why no outrage?
07/21/08 Permlink | Markets Government Grant
"Through history, outrageous financial behavior has been met with outrage. But today Wall Street's damaging recklessness has been met with near-silence, from a too-tolerant populace, argues James Grant"

Value's day once more
12/08/07 Permlink | Value Investing Grant
"Is anyone happy? Well, value investors ought to be. To their way of thinking bear markets are heaven-sent. Of all people, the disciples of Benjamin Graham and David L. Dodd understand the investment appeal of everyday low prices. They like it when stocks and bonds go on sale. They are the Wal-Mart shoppers of Wall Street."

Bet the house
12/12/06 Permlink | Grant
"By a margin of almost 2-to-1, economists surveyed by WSJ.com last month judged that the worst of the residential real estate slump was history. House prices will soften in 2007, the sages predicted, but by only a little bit. In fact, 20 of the 49 respondents forecast a rise. Ebenezer Scrooge was a mortgage banker, and the arguments I am about to marshal for a hard landing in housing might sound un-Christmaslike. But during the just-pricked bubble, it wasn't the Scrooges and the Marleys who lent more than 100% of the purchase price of a house without bothering to verify the income or employment of the applicant, or even to insist that he or she pay down a little bit of the principal now and then. House prices soared on the wings of the modern, optimistic, growth-obsessed mortgage industry."

Stocks for inflatophobes
05/09/05 Permlink | Grant
"The CPI is way understated. Amid today's monetary laxity, oil, tobacco and gold shares from overseas will serve you quite well."

Un-Real Estate
04/25/05 Permlink | Grant
"One real estate sage says he has never seen such "aggravated excess liquidity." That's where too much cash is chasing too few buildings."

Happy Anniversary, Mr. Market
09/30/04 Permlink | Grant
"This is a big year for market anniversaries--75 years since the Great Crash of 1929; one year since the start of a bond bear market."

A hazardous haven
08/15/04 Permlink | Grant
"Following is a cautionary look at a refuge-that-isn't: the two dozen (and counting) mutual funds that invest in speculative-grade bank loans. With these claims--also known, a little confusingly, as leveraged loans--Wall Street has created a kind of trifecta of unfavorable terms. The yields on offer are small. The opportunity for price appreciation is nil. And the risks to principal are clear and present. What less could you want?"

The used-car indicator
05/22/04 Permlink | Grant
"An example of how badly the rate of inflation is gauged: When the government says car prices are weak, it is doing no more than reporting the effect of its own cheap money."

Market for speculators
04/01/04 Permlink | Grant
"They may be right, and they may be wrong, but in either case they are guessing. Twenty years ago the bulls didn't have to dream up forecasts. They only had to compare the reward for being right (immense) with the cost of being wrong (affordable). Today it's the other way around. The reward for being right is modest; the cost of being wrong, potentially ruinous."

Forget TIPS
03/19/04 Permlink | Grant
"They no longer protect against rising prices much, with the inflation-adjusted yield half of what it was in 2002. Meanwhile, the CPI is bad at gauging inflation."

What high yields?
01/24/04 Permlink | Grant
"The average ten-year junk bond gives you less than 6.5%. Meanwhile 80% of junk trades above par, and 63% above the call price. Investors are oblivious to the dangers."

The case for silver
12/14/03 Permlink | Grant
"Gold may well be a better monetary asset, but the white metal has many more practical uses, from the arts to medicine. And its consumption exceeds its output."

When to buy, when to sell
11/19/03 Permlink | Grant
"If you bought low, now that the stock market has risen again, do you sell high? Or wait for it to go still higher? One problem: The market might not get much higher."

The dollar meltdown
09/27/03 Permlink | Grant
"The Fed is working hard to cheapen the dollar, specifically against the yuan. Here's how to make the Chinese currency work for you."

Reaching for yield
06/24/03 Permlink | Grant
"People believe that bonds are inherently conservative. Not so. They are conservative at a price, and these aren't the right prices."

The money printers
06/09/03 Permlink | Grant
"Fearing Japan-style deflation Greenspan's Fed is buying Treasurys with dollars it mints for that purpose. Bondholders and other creditors should beware."

Deflation cure sickens dollar
05/11/03 Permlink | Grant
"The Federal Reserve is acting as if the U.S. were facing Japan-style deflation. With the CPI up 3%, the real problem is in the other direction."

Battling the fog of finance
03/25/03 Permlink | Grant
"But it isn't the fog of war that has shortened the vision of our monetary policymakers. It's rather the fog of finance, particularly the long legacy of America's greatest stock-market bubble. The truth about the three-year decline in stock prices and the hot-and-cold-running economy is that they have their roots in prosperity, not in war."

Perils of prophecy
01/26/03 Permlink | Grant
"I have only one forecast concerning the future: It will unfold. I am not prepared to be more specific. Of all the bad months in which to try to predict the unpredictable, January is the worst. People are still eating Thanksgiving leftovers when the usual experts are rounded up to be asked the standard end-of-year questions. Where will the stock market be one year hence? The bond market? The CPI? A barrel of West Texas intermediate? Knowledgeable as they are, the experts are deficient in one point of information. They don't know anything more about the future than we do."

Stocks on stilts
12/11/02 Permlink | Grant
"The entire U.S. is heavily leveraged. Now the bulls want you to leverage still more, mortgaging the house to buy stocks--even if you have to pay 50 times earnings to get them."

Bubble trouble
12/11/02 Permlink | Grant
"Investing in fallen tech stocks is hard when both Wall Street firms and investors are scared of them. But the question is: Do you have a strong stomach?"

Why James Grant will never be Louis Rukeyser
10/29/02 Permlink | Grant
"One of the striking things about the financial press during a bear market is what isn't in it: bona fide financial celebrities."

Treasurys crap game
10/17/02 Permlink | Grant
"U.S. government bonds are great havens for those suffering from equities. Great, that is, unless yields pop back up to 6%. Don't count on a Japan scenario."

The case for cash
07/17/02 Permlink | Grant
"Beating the S&P 500 since before the 2000 stock market top, U.S. Treasury bills are more than just a sanctuary. And now is when keeping some dry powder makes sense."

Flawed giants
02/12/02 Permlink | Grant
"Fannie Mae and J.P. Morgan Chase seem mighty. But their stocks are cheap for good reason. Their risk exposure is huge, with a big reliance on derivatives."

Are we there yet?
01/09/02 Permlink | Grant
"Like unhappy families, every recession is different. Some are short and shallow, others protracted and deep. Since the early 1950s none has lasted for more than 16 months. If this one were to match the record jointly held by the slumps of 1973-75 and 1981-83, it would end in July 2002."

What deflation?
12/13/01 Permlink | Grant
"An iron law of government regulation holds that a would-be regulator can fix either the price or the quantity of a chosen commodity but not both at once. To enforce a very low funds rate, the Fed must supply an awful lot of funds"

Blind seers
12/06/01 Permlink | Grant
"Ignorance about tomorrow is a constant of human affairs. Submission to this truth is what's variable. In finance, submission entails a healthy fear of leverage and a decent respect for the relation of price to earnings."

The Stingy News Weekly

Article Archive

Submit a Story

 
About Legal Contact Us
Disclaimers: Consult with a qualified investment advisor before trading. Past performance is a poor indicator of future performance. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. More...