McKinsey Gives “Dare to Be Great” Speech to Private Equity Investors as Returns Fall
McKinsey has issued a new report on the private equity industry that ought to give any investor cause for pause.
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The Real Problem with High Frequency Trading
While Michael Lewis’ book Flash Boys is sensationalistic and simplistic, it may goad regulators into action, particular since many knowledgeable observers have been making similar arguments for years. But let’s hope they focus on the real issues.
Read more...Latest Froth Indicator: Micro Private Equity Funds, aka “Search Funds”
Who in their right mind would want to invest in a search fund?
Read more...SEC is Kinda Thinking About Doing Something About High Frequency Trading
Why the SEC’s latest trial balloon about what it might do about high frequency trading is an embarrassment.
Read more...Cathy O’Neil: Let’s Stop Talking About HFT for a Little While
Why the brouhaha about HFT distracts attention from much bigger Wall Street abuses.
Read more...Private Equity’s Lake Woebegon Fallacy: All Investors Are Above Average
How absurd are the goals of the pension funds that invest in private equity? Plenty absurd, it turns out.
Read more...Michael Lewis’ Repeat Omission: No Crimes Were Committed
In Flash Boys, Michael Lewis has again launched a book that hews to his established formula: colorful outsiders take on a big bad entrenched establishment and win. Even though Lewis seems assured of having yet another best-seller, this book is getting more criticism than his works usually do. Put it this way: when commentators as diverse as Felix Salmon, Matt Levine, and Pam Martens feel compelled to object, it looks like Lewis has overfitted this tale to his blockbuster formula.
Read more...Understanding the Confidence Fairy
Why you should be skeptical when economists and policy-makers talk about the value of reducing uncertainty which is code for invoking the confidence fairy.
Read more...Los Angeles Public Pension Fund Tells Us It Is a Happy, Trusting Victim of Investment Managers
Our efforts to learn more about the private equity industry are revealing how determined public pension funds are to hiding as much as they can, even when they don’t have a legal leg to stand on.
Read more...Prominent Retiree Chides CalPERS for Repeating Conduct that Led to Past Private Equity Scandals
CalPERS retiree Tony Butka wrote a letter to CalPERS’ board describing why he is disturbed over how CalPERS is stonewalling my data request.
Read more...Tax Havens Make US and Europe Look Poorer than They Are, Exaggerate Size of “Global Imbalances”
Peculiarly, despite the importance of tax havens, a pathbreaking paper published in 2013 by Gabriel Zucman of the Paris School of Economics, The Missing Wealth of Nations: Are Europe and the U.S. Net Debtors or Net Creditors? (hat tip Dikaios Logos) has received perilous little attention. Perhaps that’s because, among other things, it undercuts the Bernanke-flattering claim that “global imbalances” were a major driver of the financial crisis.
Read more...Marshall Auerback: When is a Bubble a Bubble?
Bubbles have become a major focus of discussion in today’s financial markets. But very few people actually define what they mean when describing this financial phenomenon.
Read more...Bubble-logic and the Fed’s “To Taper or Not to Taper”
One of the amusing things right now is that there isn’t much debate in equity-land as to whether to be long or not.
Read more...401(k) Plan Abuses Finally Coming to Light
I doubt that I’m unusual in being a finance type who has heard about 401 (k) abuses and bad practices for a very long time. So it’s gratifying to see the Financial Times that something is finally being done to try to curb this behavior. But that is hardly the full extent of what is rotten in retirement fund land.
Read more...Whistleblower Describes How Private Equity Firms Flagrantly Violate SEC Broker-Dealer Requirements
Last week, Crain’s Business Daily and Fortune reported that a whistleblower has provided the SEC with evidence of massive, ongoing violations of securities laws, specifically, the Securities Exchange Act of 1934, by several unnamed private equity firms.
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