Money and Finance
Lee Kuan Yew: The wise man of the East (LINK)
Philosophical Economics: A New-and-Improved Shiller CAPE: Solving the Dividend Payout Ratio Problem (LINK)
Hussman Weekly Market Comment: Monetary Policy and the Economy: The Case for Rules Versus Discretion (LINK)
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Edward Chancellor: ‘intelligent contrarians’ should follow the capital cycle (video) [H/T Tom] (LINK) Related book: Capital Returns: Investing Through the Capital Cycle: A Money Manager's Reports 2002-15Edward Chancellor: why gold miners...
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Li Lu Adds 3 Mil Shares In BYD On The Day Of Stock Plunge (LINK) On the day that the stock of Chinese electric cars company BYD took a sharp dip, one investor saw an opportunity to buy. Himalaya Capital Investors, an investment vehicle controlled by Li...
- Hussman Weekly Market Comment: Superstition Ain't The Way
“The problem with QE is that it works in practice but it doesn’t work in theory.” - Ben Bernanke, Outgoing Federal Reserve Chairman, January 16, 2014 "When you believe in things that you don't understand, then you suffer. Superstition...
- Hussman Weekly Market Comment: The Outlook Will Shift As Conditions Shift
Our investment outlook will shift as market conditions shift, and we will lean toward a more constructive stance when conditions support it. There are straightforward ways to do that while still remaining careful about larger cyclical risks. Present conditions...
- Hussman Weekly Market Comment: Market Internals Suggest A Shift To Risk-aversion
Market internals deteriorated sharply last week, following an extended period of overvalued, overbought, overbullish conditions where interest-sensitive sectors have been under considerable pressure. At present, the line of least resistance appears downward....
Money and Finance
Links
Lee Kuan Yew: The wise man of the East (LINK)
Related book: From Third World to First: The Singapore Story - 1965-2000"60 Minutes" had three interesting segments last night, including one with Neil deGrasse Tyson (video) (LINK)
Philosophical Economics: A New-and-Improved Shiller CAPE: Solving the Dividend Payout Ratio Problem (LINK)
Hussman Weekly Market Comment: Monetary Policy and the Economy: The Case for Rules Versus Discretion (LINK)
Last week, the Federal Reserve Open Market Committee (FOMC) began its statement on monetary policy indicating that recent data “suggests that economic growth has moderated somewhat.” While the Fed removed the phrase that “it can be patient in beginning to normalize the stance of monetary policy”, the Fed’s weaker view of the economy prompted an immediate retreat in Treasury yields, an abrupt drop in the foreign exchange value of the U.S. dollar, a surge in stock prices, and an upward spike in the dollar price of gold and oil. The basic thesis of all of these moves is that the Fed may wait longer before increasing the rate of interest that it pays to banks on idle cash reserves (viz., “raising interest rates”).
We agree – partly. As I noted a week ago, “From my perspective, it remains unclear whether the Fed will resist the temptation to defer hiking interest rates, given what we observe as a deteriorating economic landscape.” The problem for investors is that along with the initial moves in Treasury yields, the dollar, stocks, gold, and oil that followed the FOMC statement, we also saw credit spreads widen rather than narrow last week, while our measures of market internals continue to show divergences that indicate a shift investor preferences toward increasing risk aversion.
Book of the day: Passion for Reality: The Extraordinary Life of the Investing Pioneer Paul Cabot
- Links
Edward Chancellor: ‘intelligent contrarians’ should follow the capital cycle (video) [H/T Tom] (LINK) Related book: Capital Returns: Investing Through the Capital Cycle: A Money Manager's Reports 2002-15Edward Chancellor: why gold miners...
- Links
Li Lu Adds 3 Mil Shares In BYD On The Day Of Stock Plunge (LINK) On the day that the stock of Chinese electric cars company BYD took a sharp dip, one investor saw an opportunity to buy. Himalaya Capital Investors, an investment vehicle controlled by Li...
- Hussman Weekly Market Comment: Superstition Ain't The Way
“The problem with QE is that it works in practice but it doesn’t work in theory.” - Ben Bernanke, Outgoing Federal Reserve Chairman, January 16, 2014 "When you believe in things that you don't understand, then you suffer. Superstition...
- Hussman Weekly Market Comment: The Outlook Will Shift As Conditions Shift
Our investment outlook will shift as market conditions shift, and we will lean toward a more constructive stance when conditions support it. There are straightforward ways to do that while still remaining careful about larger cyclical risks. Present conditions...
- Hussman Weekly Market Comment: Market Internals Suggest A Shift To Risk-aversion
Market internals deteriorated sharply last week, following an extended period of overvalued, overbought, overbullish conditions where interest-sensitive sectors have been under considerable pressure. At present, the line of least resistance appears downward....