I’ve got an article up on TIME.com about “secular bear markets” and Graham and Buffett and stuff. It will hold no surprises for those versed in value-investor lore. But, in a sad commentary on our times, I’m told that many readers of the Internets are not versed in value-investor lore.
The basic message is that while this is a dangerous …
Commenter Linda S, who has an exasperating habit of asking questions that I don’t really know the answers to, asks regarding credit default swaps:
I … have read articles that suggest that these swaps not only give people an incentive to drive a company into bankruptcy but that it provides a huge incentive to make sure the company is
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When I worked at Fortune I used to go down to Washington to talk to Alan Greenspan about once a year. I wasn’t really trying to report on what the Fed was up to, so the conversations could range all over the place. I remember one very clearly in which Greenspan stated his opinions on the utility of regulation.
His view was that there …
A reader writes:
I’ve asked brokers, finance wizards and total strangers to explain what the stock market does. Yes, I understand that when a business issues new shares, it gets capitalized. And when a business folds, shareholders get the (ha ha) liquidation dividend. I also acknowledge that there needs to be some sort of vehicle for
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The calm and and less-painful-than-expected conclusion of the big auction of Lehman Brothers’ credit default swaps has led to some talk that maybe the role of CDSes (CDSs? CDS?) in bringing on our current financial near-debacle has been wildly overblown.
Making the case perhaps even more strongly is Ben Stein’s Yahoo column from last …
I’ve been meaning for a while to put a plug in here for Arnold Kling, who has delivered some of the most consistently provocative commentary on the financial freakout over the past couple of months. Much of Kling’s appeal has to with his possibly unique-on-this-planet combination of knowledge, experience and attitude. He’s a product of …
For several years now, a few smart people–Morgan Stanley’s Stephen Roach is the first to spring to mind, but there were others–have been arguing that the Federal Reserve ought to do more to rein in the creation of asset price bubbles. Alan Greenspan, after making a tentative attempt at bubble management with his famous “irrational …
When last I checked, the Official Financial Indicator of the Panic of ’08, the TED spread, had dropped below 3. The TED spread measures the gap in interest rates between three-month T bills and three-month LIBOR, and it hasn’t closed below 3 since Sept. 26. Of course, it was in the 1 to 1.1 range in the weeks before the Lehman …
The call came Saturday evening before dinner. Curious Capitalist Jr. (who is 9) picked up. The caller asked to speak to a grownup. He handed the phone to Mrs. Curious Capitalist.
Mrs. CC sat there answering questions for a while. From the answers, they seemed like very strange questions. After a while CC Jr. came to me in the kitchen, …
I quoted the warnings of veteran money manager Jeremy Grantham a couple of times in the lead-up to the current financial mess. My favorite came in July 2007 when Grantham described the minor jitters that had hit markets several times already that year:
Rather like a brontosaurus that has been bitten on the tail and most of the body
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For obvious reasons, I’ve been getting a lot more reader e-mail than I used to. Which is great, except that I’m now way behind in answering. So here’s a good one one from a week ago that has only gotten more relevant with the passage of time:
One of the economic issues that really disturbs me is the movement in gasoline prices. Over the
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As already noted here, FT economics columnist Martin Wolf has a new book out called Fixing Global Finance. It’s not really about the current crisis, but it is about the giant imbalances in global capital flows that Wolf thinks were the biggest cause of the current crisis. I went to a breakfast with Wolf on Thursday, and he explained with …
