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 […]
Read more...This bombshell came courtesy Michael Shedlock, in “Fitch Discloses Fatally Flawed Rating Model“: What follows are excerpts from Absence of Fear, an excellent article written by Robert L. Rodriguez at First Pacific Advisors.We were on the March 22 call with Fitch regarding the sub-prime securitization market’s difficulties. In their talk, they were highly confident regarding […]
Read more...I will let you in on a dirty secret. Appearances to the contrary, this blog isn’t about finance and markets. Its real purpose is to encourage critical thinking, but since I know a wee bit about the financial services industry, I tend to use that as the point of departure. In that vein, it’s important […]
Read more...From the Wall Street Journal: Standard & Poor’s lowered ratings on 498 bonds backed by subprime home loans, comprising the vast majority of the 612 bonds that it earlier this week said it was reviewing for downgrades. The ratings company also said the 612 bonds were originally worth $7.35 billion, not the $12 billion it […]
Read more...That’s the question from Felix Salmon, and like Diogenes looking for an honest man, so far he hasn’t found anyone who has an answer. Salmon is getting close to the dirty secret: no one has an answer. The most they have are some interesting datapoints, factoids, and analyses. At the risk of having someone prove […]
Read more...I find it interesting when factoids that are already in the public domain get treated as if they are news. Stephanie Pomboy, as reported by Barron’s Alan Abelson (hat tip Barry Ritholtz) tells us that there are a lot of adjustable rate mortgages that have no equity. And, of course, if housing prices fall, more […]
Read more...The May retail sales reports, which showed the biggest gain in over a year, was generally greeted by investors as a sign of economic resilience. However, the skeptical sorts, looking at overextended consumers, lousy first quarter GDP stats, not particularly strong (and dubious) job growth reports, argued that if you looked at April and May […]
Read more...A neat little analysis by Ross Eisenbrey at the Economic Policy Institute may be difficult for union foes to explain away. It shows the proportion of workers covered by collective bargaining agreements in major European countries and the US and then shows productivity growth country by country in the same group 1979-2005. Despite being the […]
Read more...Edward Charles Ponzi Jr. occasionally comments at Angry Bear, and a recent submission became a post of its own. Ponzi makes several observations: what we have counted as growth (as in GDP growth) may be largely inflation (that statement is more accurate than you might think after you back out hedonic adjustments); that a lot […]
Read more...The government that told us that there were WMD in Iraq has also told us that payrolls increased by 157,000 in May. We’ve pointed out before that the Bureau of Labor Statistic’s monthly job report has a well established history of being unreliable and overstated. The Business Employment Dynamics report, which is far more detailed […]
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