An article in Business Week, “The Coming Consumer Crunch,” had a bit of information that was news to me. The government, that is the Bureau of Labor Statistics, includes some rather large items in consumer spending that many of us would not include: The reason is that much of what the government counts as consumer […]
Read more...I must have problems with authority. One of my forms of recreation is looking out for statistics, particularly government releases, that don’t seem to comport with reality. Fortunately, I have plenty of good company in this endeavor, including (but far from limited to) Barry Ritholtz, Michael Shedlock, Dean Baker. A frequent target is the nonfarm […]
Read more...The Financial Times notes in a story today,”Credit squeeze pushes ECB to peg rates,” that the European Central Bank refrained from its inclination to increase rates to combat increasing inflation. One has to wonder whether the failure to increase rates is out of the recognition that a hike would put more downward pressure on the […]
Read more...Pretty much everyone who reads the financial press knows that investment banks are stuck with large LBO fundings and commitments that are under water. That means that. properly accounted for, the reduction in value of these positions is a loss. Yet there are increasingly indications that the soon-to-be released third quarter earnings may not be […]
Read more...Given that it is now September, and in most communities, the residential selling season is March to October, the forecast by the National Association of Realtors, that the housing recession will continue into 2008, hardly merits the term “forecast.” It’s closer to being facts on the ground. NAR is optimistically calling for a bottom in […]
Read more...Those who have been following the job creation story weren’t surprised at the weak BLS employment (the so-called “non-farm payroll”) report today, or by the fact that it revised the results for the last three months downward by 81,000. Various commentators (see here, here, and here) have observed that the rises reported in recent months […]
Read more...Will someone, please, teach the reporters at the Wall Street Journal the basics about scientific research? I know it’s hard finding stuff to write about day in, day out. But the story “Scholars Link Success of Firms To Lives of CEOs” is a travesty. The centerpiece of the article is a study by Morten Bennedsen, […]
Read more...Below are some excerpts from a good piece by Kenneth Rogoff on the Guardian’s website, which discusses why Bernanke thinks the Fed has no business worrying about asset prices, but argues that the lousy quality of macroeconomic data means policy makers ought to consider the information embedded in market prices: A bit of intellectual history […]
Read more...BreakingViews (free subscription required) reports that the degree of deleveraging of corporate balance sheets may be exaggerated. Yet another reason to look at stocks with a wary eye. Readers may know that the level of corporate borrowings relative to their equity and total assets has fallen since 2002. For example, Standard & Poors reports that […]
Read more...Doing some weekend catch-up, and a reader pointed me to a very good post by Barry Ritholtz, which confirms something I’ve believed but haven’t gone to the trouble to prove, namely, that unemployment is much higher than the government releases would have one believe. Full disclosure: I’m skeptical of quite a few government stats: GDP […]
Read more...A solid article in ComputerWorld tells us that data theft is getting worse. In the ongoing struggle between the security mavens and the data thieves, the bad guys are gaining ground. They are getting more shrewd at targeting victims, even buying marketing lists to hone in on the affluent. They are also careful to avoid […]
Read more...In case you haven’t come across it yet, I highly recommend the blog Overcoming Bias, where a number of academics write about epistemology. Given how we are bombarded with new factoids, studies, and commentary on a daily basis, it’s helpful to consider the views of those who think about the nature of knowledge and the […]
Read more...On August 12, in a post titled, “The Subprime Meltdown Hits Quant Hedge Funds,” DeLong summed up the quant attitude: “Our strategy is fine. We were just hit by a sixteen-standard-deviation event.” “Then it didn’t happen: the universe isn’t old enough for even one sixteen-standard-deviation event to have ever happened.” Tails are fat. From an […]
Read more...Apologies to be somewhat late to this item and more terse (and spare on links for some of the arguments) than I’d normally be (I’m at sea and the satellite connection is pricey). Monday, the Financial Times reported that a poll it commissioned jointly with Harris found widespread international opposition to globalization, as well as […]
Read more...Even the relentlessly upbeat National Association of Realtors is predicting that 2007 will be the first year since the Great Depression to witness a decline in housing prices. With lackluster-to-bad real estate tidings a daily staple, the Associated Press tells us, in “Housing sales may be worse than data show,” that even that information is […]
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