Wednesday, March 31, 2010
Graph by Haver Analytics (Click to enlarge). Friday's employment report is expected to show an increase of between 75,000 and 300,000 non-farm jobs (Bloomberg estimates). The upper end of this range would be good to see since job creation has been the bugaboo of this recovery. Some attention will be paid to the government sector where,on net,jobs have been lost despite hiring tens of thousands of census workers.
One concern do-it-yourself investors sometimes express to me is their weakness in understanding the macroeconomy. With that in mind I present an explanation of the unemployment rate calculation by Salman Khan. If you are not familar with his work you are in for a treat. You can practically get a college education viewing his youtube videos.
Tuesday, March 30, 2010
I needed a way to formally stay in touch with the markets. I began keeping a weekly data piece (actually 4 pages) that tracks yields, a couple of currencies, economic data and a few other things that I like to look at. I also write a short summary on the market. I update it every day--which only takes a few minutes. Sometimes, in the summary, I write down where I think stocks and/or bonds are headed or I make some other prediction.
I have found this to be a useful exercise and recommend it. I find it interesting to go back and see what I once believed. I've become convinced that investors are biased in what they think they once believed. This exercise keeps me up with the market, and it even keeps me up with making tables/cutting and pasting in Word etc.
If you are interested in the data I collect, drop me a line and I will email you the most recent piece. This is not an ongoing offer; it is intended to show you concretely what I am talking about. The data you will want to collect will obviously be different from what I collect.
Monday, March 29, 2010
Sunday, March 28, 2010
Saturday, March 27, 2010
3/5 3/12 3/19 3/26
10 yr.German 3.16 3.17 3.11 3.15
10 yr. Italy 3.95 3.96 3.95 3.92
10 yr. UK 4.06 4.1 3.95 4.04
10 yr. Japan 1.32 1.35 1.37 1.38
10 yr Australia 5.48 5.69 5.68 5.75
10 yr.U.S. 3.68 3.7 3.69 3.85
Friday, March 26, 2010
Duh! Not only are you privy to a sizeable subsidized spread but also, if the risks don't play out, the American taxpayer bails you out and even pays your bonuses! Come on, what's not to like?
Thursday, March 25, 2010
Monday, March 22, 2010
The Mess That Greenspan Made: Maestro no more
Friday, March 19, 2010
Thursday, March 18, 2010
Wednesday, March 17, 2010
Along these lines, Kiplingers has a neat little quiz on investor psychology at
Happy St. Patrick's Day!!!!!!!!!!!!!!!!!!
Tuesday, March 16, 2010
Friday, March 12, 2010
Their wording in the first paragraph is interesting: ". . .with one money manager subcontracting to another . . . ." Something to keep in mind when the advisor puffs up and proclaims that he or she is a fiduciary and the Investment Agreement is non-assignable.
Tuesday, March 9, 2010
This is my first attempt at a video post, so it's a bit crude; but I hope viewers will bear with me. In reviewing it, I see I emphasized the trading costs of active mutual fund managers; but I should point out that would also be true of any manager who engages in active trading.
Saturday, March 6, 2010
More and more brain research is showing that there are mental illusions similar to the well known visual illusions. I am coming to believe that this is true in the investment markets. It appears that it is fairly easy to beat the market - walk into any bar and half the people there believe they could beat the market if they had money to invest- but in fact it is very difficult over the long run. This doesn't preclude the fact that there will of course be people that outperform but as has been frequently noted the percentage corresponds to what would be expected from the laws of probability. What it means is that the odds of picking a manager who outperforms over the long run is difficult.
Check out this link on illusions etc.
Happy March 9th anniversary.
Tuesday, March 2, 2010
I will mention funds and exchange traded funds (ETFs) from time to time. These are not recommendations, and I may own some of them.
I offer investment management services (http://rwinvestmentstrategies.com/), but my main interest is getting investors to the point where they can manage their own funds.