Asia

Of Bonds and Zombies  (GaveKal)

History

The Panic of 1907, Robert F. Bruner and Sean D. Carr, Wiley, August, 2007.  "Why do market crashes and banking panics happen?  Conventional wisdom on this question has gathered, like iron filings, at two intellectual poles."

Instruments of the Money Market, Timothy Q. Cook and Robert K. LaRoche, Federal Reserve Bank of Richmond, Richmond, Virginia, 1998.  "The major purpose of financial markets is to transfer funds from lenders to borrowers. Financial market participants commonly distinguish between the "capital market" and the "money market," with the latter term generally referring to borrowing and lending for periods of a year or less."

Risk Mismanagement, Joe Nocera, The Washington Post, January 4, 2009.  “The story that I have to tell is marked all the way through by a persistent tension between those who assert that the best decisions are based on quantification and numbers, determined by the patterns of the past, and those who base their decisions on more subjective degrees of belief about the uncertain future. This is a controversy that has never been resolved."  (Financial Firms | Risk Management (VaR and Taleb))

Why Wall Street Always Blows It, Henry Blodget, The Atlantic Online, December, 2008.  “The magnitude of the current bust seems almost unfathomable—and it was unfathomable, to even the most sophisticated financial professionals, until the moment the bubble popped. How could this happen? And what's to stop it from happening again? A former Wall Street insider explains how the financial industry got it so badly wrong, why it always will—and why all of us are to blame.."  (Market History (Career Risk))

2008 Leaves Pensions Underfunded, David S. Hilzenrath, The Washington Post, January 8, 2009.  “The collapse of the stock market last year left corporate pension plans at the largest companies underfunded by $409 billion, reversing a $60 billion pension surplus at the end of 2007, according to a study released yesterday."  (Pensions (2008))

A Quarter When Mutual Fund Rankings Didn't Matter, Mark Hulbert, The New York Times, January 25, 2009.  “Nearly all stock mutual funds had miserable returns in the fourth quarter of 2008 — even those that received excellent grades from the leading fund ranking systems."  (Pensions (2008))

As Firms Flunder, Directors Quit, Joann S. Lublin, The Wall Street Journal, November 21, 2008.  “When DuPont Co. directors named Ellen J. Kullman the company's chief executive starting Jan. 1, she agreed to resign her board seat at General Motors Corp. next June, according to a person familiar with the situation. Now, Ms. Kullman faces pressure from some DuPont directors to quit the GM board sooner because she "lacks time to breathe," the informed person said."  (Corporate Governance (Directors)))

Forecasting the Depression: Harvard Versus Yale, Kathryn M Dominguez, Ray C. Fair, Matthew D. Shapiro, Cowles Foundation Paper 710, The American Economic Review.  “Was the Depression forecastable?  After the Crash, how long should it have taken contempory forecasters to relaize how sever the downturn was going to be?"  (Market History (1929 Crash and Great Depression))

Evolution of an Investor (Michael Lewis), Portfolio, November 19, 2007.  “BLourd got rich picking stocks.  But then he realized that everything he thought he knew about the markets was wrong.  And he's not alone."  (Money Management (Active versus Passive))

The Stock Picker's Defeat, Tom Lauricealla, The Wall Street Journal, December 10, 2008.  “William H. Miller spent nearly two decades building his reputation as the era's greatest mutual-fund manager. Then, over the past year, he destroyed it."  (Money Management (Active versus Passive (Bill Miller)))

Japanese Candlestick Charting Techniques,

Forty Years of American Finance, Alexander Dana Noyes, G.P. Putnam’s Sons, New York, 1909.  “A short financial history of the government and people of the United States since the Civil War, 1865-1907.”   (Market History)

After Losses, a Move to Reclaim Executives’ Pay, Gretchen Morgenson, The New York Times, February 9, 2009.  “Should executives get to keep lavish pay packages when the profits that generated their compensation go up in smoke?  As the financial crisis deepens, what might have been a philosophical question is now the topic of the day. With losses mounting at the nation’s largest financial institutions, years of earnings have been erased, investors have lost billions, thousands of employees have been let go, and taxpayers have been tapped to rescue the financial system. But executives who helped set the problems in motion, or ignored them as they mounted, are still doing fine. Humbled, perhaps, but well paid for their anguish.”  (Executive Pay)

The Index Funds Win Again, Mark Hulbert, The New York Times, February 9, 2009.  “There’s yet more evidence that it makes sense to invest in simple, plain-vanilla index funds, whose low fees often lead to better net returns than hedge funds and actively managed mutual funds with more impressive performance numbers.  Basic stock market index funds generally aspire to nothing more than matching the returns of a market benchmark. So in a miserable year for stocks, index funds may not look very appealing. But it turns out that, after fees and taxes, it is the extremely rare actively managed fund or hedge fund that does better than a simple index fund.”  (Money Management (Active versus Passive)

Why We Keep Falling For Financial Scams, Stephen Greenspan, The Wall Street Journal, January 3, 2009.  “There are few areas where skepticism is more important than how one invests one's life savings. Yet intelligent and educated people, some of them naïve about finance and others quite knowledgeable, have been ruined by schemes that turned out to be highly dubious and quite often fraudulent. The most dramatic example of this in American history is the recent announcement that Bernard Madoff, a highly regarded money manager and a former chairman of Nasdaq, has for years been running a very sophisticated Ponzi scheme, which by his own admission has defrauded wealthy investors, charities and other funds of at least $50 billion.”  (Behavior Finance)

Merrill Settles Charges on Conflicts of Interest, Michael R. Crittenden, The Wall Street Journal, January 30, 2009.  “Merrill Lynch failed to disclose certain conflicts of interest to its pension consulting clients, the Securities and Exchange Commission charged on Friday.”  (Financial Firms (Pensions))  Merrill Delivered Bonuses Before BofA Deal

Fannies Last Stand, Bethany McLean, Vanity Fair, February 2009.  “Many believe the government-backed mortgage giants known as Fannie Mae and Freddie Mac were major culprits in the economic meltdown. But, for decades, Fannie Mae had been under siege from powerful enemies, who resented its privileged status, its hard-driving C.E.O.’s, and its huge profits.  Surveying Fannie’s deeply dysfunctional relationships with Congress, the White House, and Wall Street, the author tells of the long, vicious war—involving most of Washington’s top players—that helped propel one of the world’s most successful companies off a cliff.”  (Financial Firms (Government))

Gilt-Edge Pensions, Stephan Fitch, The New York Times, February 16, 2009.  “Don't let anyone tell you the American dream has faded. the truth is the U.S. is still minting lots of millionaires. Glenn Goss is one of them.  Goss retired four years ago, at 42, from a $90,000 job as a police commander in Delray Beach, Fla. He immediately began drawing a $65,000 annual pension that is guaranteed for life, is indexed to keep up with inflation and comes with full health benefits.”  (Pensions)

Risk Management Manual of Examination Policies (FDIC Website) & Risk Management Manual of Examination Policies (PDF)

The Ethics of Liberty, Murray N. Rothbard, New York University Press, New York and London, 1982.

America's Great Depression, Murray N. Rothbard, The Ludwig von Mises Institute, 1963.

Deflation and Liberty, Jorg Guido Hulsmann, The Ludwig von Mises Institute, 2008.

George Carlin's Last Interview

Absolute-Return Funds Promise the Holy Grail, Jane Bryant Quinn, Bloomberg, March 5, 2009.  “Gather round, children, to hear about the investments you’ve been waiting for. They suggest that you might get positive returns in any economic climate, regardless of whether stocks are going up or down.  Wait -- don’t run! It’s not Bernard Madoff or even R. Allen Stanford, the mini-Madoff, who allegedly bilked savers out of $8 billion in supposedly high-rate certificates of deposit. It’s sanctified by hedge funds and brought to you by America’s finest financial engineers. What could be more inspirational than that?”  (Money Management (Absolute Returns))

14 Trading Firms Settle Charges for $69 Million, Dana Henriques, The New York Times, March 5, 2009.  “More than a dozen Wall Street trading firms systematically cheated their customers of millions of dollars by improperly slicing bits of profit from countless trades, federal regulators said on Wednesday.  The Securities and Exchange Commission disclosed the allegations after negotiating settlements. The firms did not admit or deny the charges but agreed to pay a total of more than $69 million in forfeited profits and penalties.”  (Financial Firms)

FINRA Oversees Auction-Rate Arbitrations After Exiting Markets, Darrell Preston, Bloomberg, April 29, 2009.  “The Financial Industry Regulatory Authority, supervising 344 investor arbitration cases over auction-rate bonds, skirted losses from the securities by selling its holdings months before the market collapsed.”  (Financial Firms (Regulations))

Hidden Pension Fiasco May Foment Another $1 Trillion Bailout, David Evans, Bloomberg, March 3, 2009.  “The Chicago Transit Authority retirement plan had a $1.5 billion hole in its stash of assets in 2007. At the height of a four-year bull market, it didn’t have enough cash on hand to pay its retirees through 2013, meaning it was underfunded to the tune of 62 percent.”  (Pensions)

Welcome to Club Fed, Review and Outlook, The Wall Street Journal, August 15, 2006.  “The closest thing to a life-time sinecure is a federal government job, and now it turns out that it’s also a very lucrative way to make a living.”  (Government)  Seminar Information

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