Money and Finance
- Nassim Taleb And Company Optionality…
Via ValueWalk: [For a third rule] I’d say, look for companies that have optionality….Optionality means to have more upside than downside because the company has options. An “option” in this sense acts like a financial option, and a financial...
- Benjamin Roth Quotes (gold Standard)
From The Great Depression: A Diary. These quotes are from November/December of 1931: “During past week wheat went up from 40¢ to 80¢ per bushel. Stocks also push up and claim is made that in 1873 and in 1893 the turn for better came with the rise...
- Gmo: Capturing Domestic Demand In Emerging Markets: Neither Small Caps Nor Multinationals Are A Good Proxy - By Arjun Divecha
As a complement to his article published in the FT on Jan. 4, Arjun Divecha fleshes out more fully his argument that buying emerging small cap stocks or large multinationals is not the best way to tap into domestic demand in emerging markets......Excerpt:...
- Greenlight Capital Re's Earnings Call Transcript
Found via Santangel’s Review. The comments below are from David Einhorn. As the market retreated over the past few months, we added to a few of our existing long positions, found a few new investment opportunities primarily in the technology and auto...
- Annaly Salvos: On The Value Of Insurance
How to value gold is an age old frustration. As every schoolboy knows, it yields nothing and so can’t be valued on cash flows. It has very little industrial use. There is, however, a natural human tendency toward the use of currency so gold is an obvious...
Money and Finance
GMO Emerging Thoughts: Present and Emerging Risks to the Gold Trade - By Amit Bhartia and Matt Seto
The notion of gold as a hedge against systemic risks is flawed. We believe that the concept of gold’s role as an insurance policy needs to be narrowed significantly.
Last year we argued that relying on conventional wisdom to analyze gold price movements is naive. Conventional wisdom would lead us to believe that gold price movements are driven solely by the actions of developed markets’ central banks. We believe this view is misinformed and that the available data does not support it.
In that paper, we argued instead that the key driver of the significant rise in gold prices since 2000 has been the emerging markets consumer. Between 2000 and 2010, consumers in emerging markets accounted for 79% of total demand. Conversely, ETF purchases accounted for only 7.5% of demand and central banks in aggregate were net sellers.
This expanded framework demonstrates that gold is also positively exposed to pro-cyclical factors in the emerging markets. Moreover, given the cyclical challenges gold’s key consumers may be facing, the value of gold as insurance should be questioned.
Over the past 13 years, the impact of emerging markets on gold prices was unequivocally positive: emerging markets drove gold prices higher. However, this has not always been the case through history and, we believe, will not always be the case going forward. Emerging markets can be both a positive and a negative driver.
- Nassim Taleb And Company Optionality…
Via ValueWalk: [For a third rule] I’d say, look for companies that have optionality….Optionality means to have more upside than downside because the company has options. An “option” in this sense acts like a financial option, and a financial...
- Benjamin Roth Quotes (gold Standard)
From The Great Depression: A Diary. These quotes are from November/December of 1931: “During past week wheat went up from 40¢ to 80¢ per bushel. Stocks also push up and claim is made that in 1873 and in 1893 the turn for better came with the rise...
- Gmo: Capturing Domestic Demand In Emerging Markets: Neither Small Caps Nor Multinationals Are A Good Proxy - By Arjun Divecha
As a complement to his article published in the FT on Jan. 4, Arjun Divecha fleshes out more fully his argument that buying emerging small cap stocks or large multinationals is not the best way to tap into domestic demand in emerging markets......Excerpt:...
- Greenlight Capital Re's Earnings Call Transcript
Found via Santangel’s Review. The comments below are from David Einhorn. As the market retreated over the past few months, we added to a few of our existing long positions, found a few new investment opportunities primarily in the technology and auto...
- Annaly Salvos: On The Value Of Insurance
How to value gold is an age old frustration. As every schoolboy knows, it yields nothing and so can’t be valued on cash flows. It has very little industrial use. There is, however, a natural human tendency toward the use of currency so gold is an obvious...