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Seeking Alpha (Free subscription) | 07/17/2008
Kevin S. Price submits: For some time now, we've been noting that the recently-concluded housing bubble wasn't like most of the bubbles that preceded it. Unlike the railroad, telegraph, and dot-com bubbles--which, for all their short-term wreckage, created new infrastructure of immense economic value, as Daniel Gross argues in Pop! --the housing bubble has left behind virtual ghost towns,...
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Seeking Alpha (Free subscription) | 07/16/2008
Kevin S. Price submits: Not enough time Tuesday afternoon to give this the full treatment (in part because Typepad just ate the first version of this post, which, yes, is a problem that's easily overcome with a preemptive copy-and-paste... but still... very annoying). But we ran across two interesting pieces on target-date funds, which have been frequent topics of discussion in this...
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Seeking Alpha (Free subscription) | 07/13/2008
Kevin S. Price submits: A little perspective on hedge funds from BreakingViews (emphasis added in bold ): Some investors might want hedge funds to return consistent, positive returns after fees -- the absolute return model. In reality, many of today's funds actually have plenty of market exposure, be it to stocks, bonds or other asset types. Compared with most of those markets, hedge...
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Seeking Alpha (Free subscription) | 07/11/2008
Kevin S. Price submits: As we've noted before ( here and here , for example), we think PIMCO's Mohamed El-Erian is one of the sanest voices on Wall Street. So when he appeared on yesterday's Squawk Box , we put the DVR to work so we could pass along a few of his most incisive observations. Here's our collection of El-Erian's highlights: "Things are bad because the credit crisis has morphed...
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Seeking Alpha (Free subscription) | 07/09/2008
Kevin S. Price submits: Whatever the squiggly lines look like in the short run, and they're plenty squiggly today, now up sharply on some sort of financials-driven rally, the medium-term prospects for equities are driven by two things: corporate earnings and market multiples . On those all-important questions, here's Merrill's David Rosenberg , a confirmed member of the reality-based...
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Seeking Alpha (Free subscription) | 07/09/2008
Kevin S. Price submits: We've argued repeatedly that investors and advisors should be more aware of the distinction between alpha (idiosyncratic, manager-driven returns that are relatively uncorrelated to any underlying asset class or benchmark) and beta (systematic, market-driven returns that track underlying asset classes or benchmarks). Two recent items suggest that such awareness...
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Seeking Alpha (Free subscription) | 07/02/2008
Kevin S. Price submits: In Sunday's Washington Post , Nancy Trejos assembled a true classic of the "what-should-investors-do-now" journalistic genre . Fortunately, Trejos quotes a couple sane observers, most notably Vanguard's Gus Sauter. But there's enough unhelpfulness in this piece to merit a few observations. First, even the subtitle--"How to Play Your Stocks When They Keep Falling"--implies...
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Seeking Alpha (Free subscription) | 06/30/2008
Kevin S. Price submits: As Barry Ritholtz noted over the weekend, certain media outlets seem determined to find reasons for optimism in equities' recent breakdown . Not that there's anything wrong with that. Who knows. Maybe these will turn out to be "attractive levels." One of these efforts to find a glimmer of short-term hope-- Greg Zuckerman's weekend piece in the Wall Street Journal...
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Seeking Alpha (Free subscription) | 06/30/2008
Kevin S. Price submits: Sifting through a stack of old newspapers over the weekend, we ran across a Wall Street Journal story that gave us fits. This is the sort of work that diminishes public understanding of financial markets, products, and services. It's three weeks old, but we still feel obligated to shed some light on it. In a "Fund Track" item on the allegedly mediocre year-to-date...
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Seeking Alpha (Free subscription) | 06/29/2008
Kevin S. Price submits: Amid Friday morning's sideways action, traders and investors* would be well-served to take a deep breath and evaluate market conditions. Not so much to guess what'll happen in the very short run, but to gain some perspective on the broader lay of the land. Over the last few days, it has become almost cliché to note that sentiment-based measures of market anxiety...
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Seeking Alpha (Free subscription) | 06/09/2008
Kevin S. Price submits: With the major parties' presidential nominees now known, the world's attention turns to the overwrought parlor game of projecting/guessing what will happen if one or the other is elected. Too often, which is to say almost always, these discussions miss some basic features of American political institutions, most importantly that presidents don't impose their pre-existing...
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Seeking Alpha (Free subscription) | 06/06/2008
Kevin S. Price submits: Mark Zandi had it exactly right on Squawk Box this morning (nine and a half minutes into this clip ). As we wrote back in January and February , whether we're in a "recession" or not is sort of a silly question--because people are feeling recessionary (even stagflationary) conditions all around them. Which might help us understand how the May NFP report could...
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Seeking Alpha (Free subscription) | 06/05/2008
Kevin S. Price submits: In light of Thursday's Flow of Funds report from the Fed, which showed a substantial decline in U.S. household wealth in the most recent quarter, we thought the data presented below (courtesy Investment News ) were as timely as ever. Note that for the first time in the post-war period, Americans own less than half of the estimated value of their residential real...
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Seeking Alpha (Free subscription) | 06/02/2008
Kevin S. Price submits: This weekend's Wall Street Journal featured excerpts from an interview with Barton Biggs , a former chief investment strategist at Morgan Stanley. Here's a classic Wall Street hedge (emphasis added in bold ): Conventional wisdom is that the market will test its lows, and go lower again. A really serious bear like George Soros thinks we've seen just the first part...
