admin June 6th, 2008
One set of statistics that is impossible to distort are currency exchange rates, which have provided a somber report card on America’s economic fortunes. Not able to manipulate these numbers, the authorities instead distort their meaning, and have attempted to convince Americans that a weak dollar is in the national interest.
admin June 4th, 2008
Warren Buffet and the Crude Oil Crisis
The crude oil chart shown below shows an upside “channel buster” created a temporary exhaustion of the uptrend. Channel busters typically signify tops and turning points in an established trend. This recent channel buster has brought some welcome and much needed relief to what has been a nearly continuous rise in the oil price since February. For now, the 135.00 level remains the benchmark resistance that should keep a lid on the oil price in the near term.
…
Any observer of the history of commodity bull markets will notice that every time a major commodity establishes a long-term rising trend, the stories in the popular press are always “bent to fit the head” of the prevailing trend. The so-called Peak Oil Theory is no exception. What history also teaches is that sooner or later, supply has a way of coming out of the most mysterious cracks and crevices. When it does, it invariably spoils the party for the perma-bulls, who foolishly envision a never-ending rise in the price of their favorite commodity.
…
admin June 4th, 2008
Nassim Nicholas Taleb: the prophet of boom and doom
He has rules. In California he hires bikes, not cars. He doesn’t usually carry his BlackBerry because he hates distraction and he really hates phone charges. But he does carry an Apple laptop everywhere and constantly uses it to illustrate complex points and seek out references. He says he answers every e-mail. He is sent thousands. He reads for 60 hours a week, but almost never a newspaper, and he never watches television.
“If something is going on, I hear about it. I like to talk to people, I socialise. Television is a waste of time. Human contact is what matters.”
…
And what he knows does not sound good. The sub-prime crisis is not over and could get worse. Even if the US economy survives this one, it will remain a mountain of risk and delusion. “America is the greatest financial risk you can think of.”
…
The central point is that we have created a world we don’t understand. There’s a place he calls Mediocristan. This was where early humans lived. Most events happened within a narrow range of probabilities – within the bell-curve distribution still taught to statistics students. But we don’t live there any more. We live in Extremistan, where black swans proliferate, winners tend to take all and the rest get nothing – there’s Bill Gates, Steve Jobs and a lot of software writers living in a garage, there’s Domingo and a thousand opera singers working in Starbucks. Our systems are complex but over-efficient. They have no redundancy, so a black swan strikes everybody at once. The banking system is the worst of all.
…
And you and me? Well, the good investment strategy is to put 90% of your money in the safest possible government securities and the remaining 10% in a large number of high-risk ventures. This insulates you from bad black swans and exposes you to the possibility of good ones. Your smallest investment could go “convex” – explode – and make you rich. High-tech companies are the best. The downside risk is low if you get in at the start and the upside very high. Banks are the worst – all the risk is downside. Don’t be tempted to play the stock market – “If people knew the risks they’d never invest.”
…
admin July 22nd, 2007
¿Pero por qué la vivienda usada sí que ha seguido subiendo, aunque poco? Para mí hay varios motivos: las promotoras tienen mejor información que los particulares y saben que los precios bajarán más; además, tienen márgenes de beneficio más altos y pueden rebajar sin perder dinero. La vivienda de segunda mano tiene un precio opaco, gran parte se entrega en B. Las cifras de precios de vivienda usada no valen apenas nada. Ya hace tiempo que dijimos que las rebajitas serían más rápidas en la vivienda nueva, y aquí está.
…
.. aparecen dos gráficas que hielan la sangre.
La primera confirma la tesis del octubre rojo. Fijaros en la línea azul: a partir de finales de septiembre las hipotecas ya caen a valores absolutos negativos. El torniquete de Trichet está cortando rápidamente la hemorragia:
La segunda gráfica muestra en la línea roja las hipotecas dadas a “los hogares”. Es decir, a los particulares. El frenazo se ve claramente. La línea azul, en cambio, muestra el “crédito privado”, es decir, a empresas. Pero fijaros en la línea verde: el crédito hipotecario cae casi de forma vertical. No ha habido un bajón tan abrupto ni en la crisis del 93:
La interpretación que alguien ha dado en Idealista me parece bastante convincente: la Banca se encuentra entre la espada y la pared. Si aparece diciendo que los precios van a bajar, puede precipitar el colapso, se desploman los precios, no se vende nada, los promotores no les pueden devolver lo que les deben, aunque intenten embargar esas promociones su precio de mercado será mucho menor que el capital a devolver.
admin June 16th, 2007
Which bad habits do companies commonly acquire?
I would put arrogance at the top of the list. Success, especially extraordinary or unexpected success, tends to boost the egos of companies, just as it does of individuals. These companies tend to be highly féted and their reputations exaggerated by the media, and that’s bad news. There are enough write-ups on the rise of arrogance at Enron and Worldcomm, for instance.
Next would be complacency. When companies owe their success to monopoly situations, they stand in danger of taking their success for granted — like Hindustan Lever, until recently, for instance.
This is also true of monopolies of distribution — as in DeBeers — monopolies of regulation — BSNL — or when the government owns the business — Air-India. When you become complacent, you allow competitors to identify niche areas where they can establish themselves, and from there, take on the whole market. In such cases, your success breeds failure.
The third common bad habit is turf wars. As companies grow bigger, there is an increasing danger of internal battles. Whether it is dissension between divisions, as in General Electric, or family feuds as seen in so many Indian companies, the result must inevitably be suboptimal.
Number four on my list is volume obsession. This is a common problem with successful companies — they compromise on margins for the sake of further growth. Typically, value addition by a company accounts for about 30 per cent of the cost — 10 per cent each as the cost of management, labour and capital. The remaining 70 per cent is procurement costs.
So, when you increase volumes at the cost of your margins, you are actually helping your input providers (your suppliers) grow: they are making money at your expense. For instance, in the PC business, the value addition is only 11 per cent; 89 per cent is all procurement, of which 79 per cent goes to Intel and Microsoft who are making fat profits while the PC assemblers, including IBM, HP and Dell, struggle.
What about the more uncommon self-destructive practices?
Those are denial, competency dependence and competitive myopia.
What do companies deny?
Most successful companies tend to deny new realities. Such as, right now, many (if not most) companies are denying the ongoing Green Movement
admin June 14th, 2007
Los chismes del mundillo de Hedge Funds (Cárpatos - 14 de Junio de 2006 - 14:08)
Todo el mundo manejando esta estadística que publica hoy “Sentiment Trader” según la cual el martes el 80%s de los valores del NYSE cerraban en territorio negativo, mientras que ayer el 80%s de los valores lo hacían en positivo. En los últimos 40 años solo se ha visto una vuelta así en cuatro ocasiones, el 6 de Junio de 1967, el 28 de marzo de 1980, el 5 de abril de 1994 y ahora. En todos los casos, los precios retrocedieron de nuevo al nivel de los mínimos y estos resistieron.
Al cabo de un mes se subía en todos los casos con una media de 2,6 %s y tres meses después el 7,2 %s.
admin June 11th, 2007
Nadie conoce exactamente la magnitud del ‘carry trade’ sobre el yen, pero las evaluaciones más conservadoras hablan de al menos 200.000 millones de dólares.
…
el carry trade es ‘un juego de escalada en la imprudencia, ya que solamente da réditos cuando la gente sigue colocando dinero’, por lo que ‘no hay duda alguna de que todo esto acabará muy mal’.
…
Según Krygier, la actual situación se parece a la de 1998. Entonces, un yen muy débil se apreció bruscamente en un 20% en tres días, ya que la crisis financiera rusa y la perspectiva de alzas de tipos en Japón provocó un desenfrenado desmantelamiento de los ‘carry trades’.
…
‘Asistiremos a una masiva retirada de liquidez mundial’, explica Shepperd, según el cual ‘los mercados en Estados Unidos y en Europa, que aparentemente gozan de buena salud, podrían sufrir graves pérdidas’
admin June 11th, 2007
Ahora que ha entrado junio por la puerta grande es el momento de volver a recordar a Lord Overstone. Pronunció y dejó escritas siete palabras mágicas sobre el discurrir de los ciclos bursátiles: tranquilidad, mejora, confianza, prosperidad, excitación, convulsión y presión. Los seguidores del banquero Lord Overstone dicen que el estadio actual es el de la confianza y que, curiosamente, es el más difícil de predecir y asegurar, porque la confianza es un estado de ánimo, pura psicología, sujeta a multitud de fuerzas que la hacen tambalear a cada instante. La volatilidad será la peor compañera de viaje en este estadio, aunque resulte paradójica la combinación.
admin May 28th, 2007
For many years, I’ve been troubled by a conundrum: If mutual fund investors are not earning the market return, even adjusting for expenses, who is taking the winning side of their transactions?
The authors concluded that “the value of a sophisticated investor derives from the private information he brings to the process.” (Italics added.)
Rather than “private information,” I suspect what they meant was “private evaluation.”
If you want to earn high investment returns, you’re going to have to look far from the overgrazed investment commons... examined the investment returns of various organizational structures, reasoning that if investment skill was to be found anywhere, it would indeed be in the wild and wooly world of private equity. Their results were stunning. As expected, banks, insurance companies, investment companies, private advisors, and corporate pension funds did not do terribly well. Public pension funds did a little better, and one group-endowments-did spectacularly well, with returns 21% better than average.
Swensen described his pleasure at knowing that he made it possible for many more poor students to attend Yale: “In the finance world it is very easy to measure winning and losing in dollars and cents. That has always seemed to be an inadequate measure. The quality of life is a better way to measure winning and losing. Money is only one element of that.”And speaking of successful money managers, while Warren Buffett has not exactly taken the same vow of “poverty,” he does share Swensen’s otherworldliness, living in the same modest house for several decades, fitting out his living room at the Omaha Furniture Mart, and subsisting on Coke and cheeseburgers. Is there a connection between Buffet and Swensen’s relative disdain of the material world and their brilliance as money managers and, more generally, of the superior performance of endowments and public pension plans?
You bet there is. Cognitive psychologists have long known that we are very poor judges of what makes us happy: the pleasure from money, fame, possessions, and power turns out to be quite transient (and so is the pain from things which we think would permanently sadden us: the depression caused by sudden, permanent blindness or paraplegia, for example, is surprisingly short-lived).
Three things provide long-lasting satisfaction, as quantitatively measured by academic psychologists: autonomy, meaningful contact with others, and the development and exercise of competence. Cognitive researchers loosely refer to fame, fortune, and power as “external rewards,” and autonomy, connectedness, and competence as “internal rewards.”
The message for small investors is clear. Begin with the assumption that you value your independence, family, friends, and intellectual and physical development, and do not want to spend the rest of your life buying and managing small machine tool shops and insurance offices, or financing chip, software, and Internet startups.
Powered by Zoundry
Un paseo por el trading
Lo que leo por ahí.
There are 61 Posts and 4 Comments so far.