This document discusses the state of the US economy under President Obama and the policies of the Obama administration. It argues that the economy has stagnated, with 95 million Americans not working, wages stagnant, and declining upward mobility. It attributes this to failed "socialistic" policies and excessive government intervention. The author argues the economy needs inspiration to return to growth and policies that worked previously to boost jobs, wages, home and family formation.
Howard Marks provides a balanced discussion of the current market environment, covering both positives and negatives. On the positive side, the U.S. economy is growing and corporate profits are increasing. However, asset valuations are very high by historical standards and investor behavior has become increasingly risky. Given the high prices and uncertainties, Marks favors a cautious stance rather than aggressiveness. While not recommending getting out of the market, he advocates incorporating more defensiveness into portfolio management strategies.
Michael Durante Western Reserve research compilationMichael Durante
- The document is a letter from Western Reserve Capital Management providing a review of 2009 and outlook for 2010. It discusses the opportunities that arose from the financial crisis and delays in addressing issues like mark-to-market accounting.
- It argues that mark-to-market accounting exaggerated fear and uncertainty during the crisis in ways that were not reflective of the underlying cash flows and credit performance of financial institutions. This created a historic buying opportunity for fundamentally-driven investors.
- Large US banks have recovered strongly but remain undervalued relative to their fundamentals and adjusted book values, presenting continued opportunities according to the analysis.
Michael Durante Western Reserve Blackwall Partners 2011 outlook primer- finalMichael Durante
- Blackwall Partners believes the financial crisis has ended and a new "golden age" for financial stocks is beginning, similar to the period following the 1990s savings and loan crisis.
- Excessive capital reserves built up during the crisis due to mark-to-market accounting will be redeployed, leading to aggressive capital management and benefiting investors.
- Financial stocks currently trade at very low valuations and earnings growth is expected to be much higher than other sectors over the next few years, yet they remain underowned.
Michael Durante Western Reserve Blackwall Partners Camel RaceMichael Durante
The document discusses the outlook for the financial sector following the financial crisis. It argues that banks now have record levels of excess capital and liquidity that will be deployed aggressively, driving strong earnings growth and multiple expansion in financial stocks. The valuation of financial stocks is at historic lows compared to their historic earnings and cash flows. However, fund managers remain significantly underweight financial stocks due to the complexities of bank accounting and lingering effects of the crisis. The document advocates that the set-up is similar to the post-savings and loan crisis period of the 1990s, which saw a powerful rally in financial stocks. It evaluates specific banks like Fifth Third Bancorp using the CAMEL framework to assess their financial strength and outlook.
The document discusses how the US economic growth of the last decade was fueled by consumer spending and easy credit access, but these conditions have now changed in ways that make a return to "normal" unlikely. It argues that earnings and GDP growth depended on factors like monetary policy, asset inflation, and consumer leverage that are no longer applicable. It questions where future earnings, buying power, and credit will come from to support previous levels of economic activity and asset prices.
Michael Durante Western Reserve 2009 review and 2010 outlookMichael Durante
- The document provides an annual review and outlook from 2009 to 2010 for a financial services fund.
- It summarizes that the financial crisis created significant investment opportunities due to delays in government action and uncertainty, but that credit losses were not as severe as feared.
- It argues that mark-to-market accounting exaggerated fear and losses during the crisis, but that bank fundamentals have significantly improved along with credit performance, leaving financial stocks still undervalued.
General Stanley McChrystal was fired by President Obama after unflattering comments he made about administration officials were published in Rolling Stone magazine. The article was able to be published because the freelance journalist who wrote it, Michael Hastings, was not constrained by concerns about burning bridges, unlike beat reporters who rely on ongoing access. This highlights how outsiders can sometimes uncover important stories that insiders miss due to fears of jeopardizing relationships and access.
Us economy goldilocks- 4th oct 2007 published in singapore timessatya saurabh khosla
The author's article that appeared in Business Times, Singapore on Oct 4, 2007 stated that USA Housing, low interest rates and derivatives will lead the global economy into a recession
Howard Marks provides a balanced discussion of the current market environment, covering both positives and negatives. On the positive side, the U.S. economy is growing and corporate profits are increasing. However, asset valuations are very high by historical standards and investor behavior has become increasingly risky. Given the high prices and uncertainties, Marks favors a cautious stance rather than aggressiveness. While not recommending getting out of the market, he advocates incorporating more defensiveness into portfolio management strategies.
Michael Durante Western Reserve research compilationMichael Durante
- The document is a letter from Western Reserve Capital Management providing a review of 2009 and outlook for 2010. It discusses the opportunities that arose from the financial crisis and delays in addressing issues like mark-to-market accounting.
- It argues that mark-to-market accounting exaggerated fear and uncertainty during the crisis in ways that were not reflective of the underlying cash flows and credit performance of financial institutions. This created a historic buying opportunity for fundamentally-driven investors.
- Large US banks have recovered strongly but remain undervalued relative to their fundamentals and adjusted book values, presenting continued opportunities according to the analysis.
Michael Durante Western Reserve Blackwall Partners 2011 outlook primer- finalMichael Durante
- Blackwall Partners believes the financial crisis has ended and a new "golden age" for financial stocks is beginning, similar to the period following the 1990s savings and loan crisis.
- Excessive capital reserves built up during the crisis due to mark-to-market accounting will be redeployed, leading to aggressive capital management and benefiting investors.
- Financial stocks currently trade at very low valuations and earnings growth is expected to be much higher than other sectors over the next few years, yet they remain underowned.
Michael Durante Western Reserve Blackwall Partners Camel RaceMichael Durante
The document discusses the outlook for the financial sector following the financial crisis. It argues that banks now have record levels of excess capital and liquidity that will be deployed aggressively, driving strong earnings growth and multiple expansion in financial stocks. The valuation of financial stocks is at historic lows compared to their historic earnings and cash flows. However, fund managers remain significantly underweight financial stocks due to the complexities of bank accounting and lingering effects of the crisis. The document advocates that the set-up is similar to the post-savings and loan crisis period of the 1990s, which saw a powerful rally in financial stocks. It evaluates specific banks like Fifth Third Bancorp using the CAMEL framework to assess their financial strength and outlook.
The document discusses how the US economic growth of the last decade was fueled by consumer spending and easy credit access, but these conditions have now changed in ways that make a return to "normal" unlikely. It argues that earnings and GDP growth depended on factors like monetary policy, asset inflation, and consumer leverage that are no longer applicable. It questions where future earnings, buying power, and credit will come from to support previous levels of economic activity and asset prices.
Michael Durante Western Reserve 2009 review and 2010 outlookMichael Durante
- The document provides an annual review and outlook from 2009 to 2010 for a financial services fund.
- It summarizes that the financial crisis created significant investment opportunities due to delays in government action and uncertainty, but that credit losses were not as severe as feared.
- It argues that mark-to-market accounting exaggerated fear and losses during the crisis, but that bank fundamentals have significantly improved along with credit performance, leaving financial stocks still undervalued.
General Stanley McChrystal was fired by President Obama after unflattering comments he made about administration officials were published in Rolling Stone magazine. The article was able to be published because the freelance journalist who wrote it, Michael Hastings, was not constrained by concerns about burning bridges, unlike beat reporters who rely on ongoing access. This highlights how outsiders can sometimes uncover important stories that insiders miss due to fears of jeopardizing relationships and access.
Us economy goldilocks- 4th oct 2007 published in singapore timessatya saurabh khosla
The author's article that appeared in Business Times, Singapore on Oct 4, 2007 stated that USA Housing, low interest rates and derivatives will lead the global economy into a recession
She adores hats. She is always very polite and respectful of others. She waves to everyone, and consistently avoids conflict. She is a lady; she is The Queen.
Without a doubt, Queen Elizabeth lives a life quite unlike everyone else in the World – after all, royalty does have its privileges. Yet, when it comes to investing, the Queen is swimming in the same pool of stock market sharks as us common people.
Like everyone else, she pours through her quarterly statements to see how she’s fared. And like everyone else, she loves to make money and simply deplores negative returns. It was rumored that the 2008 crisis hit her particularly hard – over USD 40 million in stock market losses.
This experience must have jilted something, as when The Queen was visiting the esteemed London School of Economics she asked the professor a rather “un-queen” like question – why did economists fail to predict the biggest global recession since the Great Depression?
- In October 2008, global stock markets experienced their worst month since the 1987 crash as fears about the health of the world economy rose sharply. The S&P 500 fell over 23% during the first eight trading days alone.
- The credit crisis that began with the housing bust in the US escalated in September with Lehman Brothers' bankruptcy, igniting a wave of risk aversion across markets. Selling accelerated as investors fled stocks and hedge funds were forced to dump holdings.
- Central banks around the world coordinated unprecedented interest rate cuts and liquidity measures. Governments also allocated over $3 trillion for bailouts and stimulus to stabilize markets and confidence. These actions helped pare losses by month's end.
Michael Durante Western Reserve Blackwall Partners 1Q12Michael Durante
Blackwall Partners posted a 30% return for Q1 2012. They believe financial firms are fundamentally strong but undervalued due to political attacks exaggerating risk. The fundamentals of financials are appealing, with record profits and excess capital. However, low valuations and high volatility make financial stocks a "winning hand". The author argues the equity risk premium has collapsed to levels not seen since WWI and negative yield gaps indicate a bull market. They believe regulations holding back banks will be reduced, allowing earnings growth and higher payouts that will drive financial stock prices and ownership higher over time. However, some volatility is expected in the short term.
The document discusses 10 major themes for 2010 and beyond related to offsetting economic forces. Some of the key themes discussed include: 1) The US dollar may be neutral in early 2010 but weaken later in the year as US economic weakness persists relative to other economies. 2) Rising US government borrowing needs may be offset by increasing consumer savings and shifts to fixed income. 3) The need for the US to cut spending and raise taxes may be offset by the US simply printing more money to avoid difficult political choices.
The document discusses the housing bubble and its causes. It argues that loose monetary policy and government policies promoting homeownership led to a misallocation of resources and artificial inflation of housing prices. This created a bubble that has now burst, leading to an economic recession. In the long run, there is a concern that the government failures that caused the crisis will not be admitted and more power will be given to the same mechanisms that caused the problems.
The document summarizes the performance of the Western Reserve Master Fund for the first quarter of 2010. It rose 22.3% gross and 18.2% net, outperforming benchmarks. It also provides background on Charles Mackay's 1841 book "Extraordinary Popular Delusions and the Madness of Crowds" and discusses how recent economic events could be added to the book. The document then analyzes specific investments in the fund's portfolio, including Citigroup and Wells Fargo, focusing on their earnings power, cash flows, and valuation using a pre-tax, pre-provision income approach.
Agcapita is Canada's only RRSP and TFSA eligible farmland fund and is part of a family of funds with almost $100 million in assets under management. Agcapita believes farmland is a safe investment, that supply is shrinking and that unprecedented demand for "food, feed and fuel" will continue to move crop prices higher over the long-term. Agcapita created the Farmland Investment Partnership to allow investors to add professionally managed farmland to their portfolios. Agcapita publishes a monthly agriculture briefing.
The document summarizes the outlook for markets in 2009. It believes the recession will persist through 2009 with a weak recovery. Government stimulus plans aim to boost spending but the effects may be delayed. The Federal Reserve has increased money supply but must remove excess cash to avoid inflation. Consumers are saving more due to debt and falling asset values, which may slow growth but support bond prices. Global trade and capital flows are also slowing. The outlook calls for a challenging year with opportunities in quality companies and bonds offering higher yields. Flexibility will be needed to respond to changing opportunities and risks.
Fears of the U.S. economy falling off a “fiscal cliff” have been percolating among investors, conjuring up frightening images of a deep recession. But the chances of it actually happening in its entirety are slim, say Allianz experts.
The state of the us economy marco annunziata ge market sense 1 nov12neiracar
The US economy continues to show resilience despite uncertainty from the upcoming fiscal cliff. Private consumption has strengthened due to improvements in the housing market and labor market. However, business investment and hiring remain constrained by policy uncertainty, particularly regarding how the large budget deficit will be addressed in the long run. If major fiscal policy issues can be resolved decisively in 2013, businesses may increase spending and hiring to boost economic growth. But continued uncertainty risks prolonging the current sluggish recovery.
1) The document reviews market conditions in 2009, noting the extreme pessimism and economic deterioration due to the financial crisis. While 2009 saw gradual economic improvement, conditions are still challenging, with high unemployment.
2) Conditions have improved modestly in 2010, including increased corporate spending and consumer confidence, and reopening of credit and equity markets. However, risks remain like potential inflation or regulatory changes.
3) For composting and organics recycling companies, gradually improving conditions may increase access to capital through debt or equity financing. Smaller companies should prepare for fundraising to take advantage of improving opportunities.
Global Macro-economics, Trends, Portfolio ImplicationsNikunj Sanghvi
My presentation to the Bombay Chartered Accountants' Society International Economic Study Circle on Global macro-economics, trends, portfolio implications
Aug 7th 2013
Mumbai, India
This document summarizes concerns about vulnerabilities in China's credit system that could lead to financial crisis. It notes that China has experienced an enormous credit boom in recent years, with total credit growing to over 190% of GDP. Much of this credit growth has been driven by lending to local government financing vehicles and the property sector, fueling a potential real estate bubble. The rapid growth of shadow banking further obscures risks. The document argues China's financial system exhibits indicators of fragility like excessive credit growth, moral hazard, related party lending, and loan forbearance that could make the system vulnerable to a credit crunch or bust.
The document summarizes a careers event at NUI Galway that discussed opportunities and strategies for finding jobs in Ireland's growing energy sector. It provides tips on using social media and other job search methods effectively, building strong CVs and cover letters, and preparing for competency-based interviews. The energy sector is expected to treble the number of jobs by 2020 to help reduce emissions, offset rising costs, and exploit Ireland's energy resources and export markets. Networking, maintaining an online presence, and demonstrating relevant skills and experiences are important for landing a position.
The gallery Vazrazdan is inviting visitors to see the third painting exhibition by the curatorial project "21st century. Bible and Artists" featuring works by Ivan Milushev from May 28 to June 10, 2013. Milushev creates extraordinary figurative works maintaining an enigmatic quality over the years through distinctive line features and eyes that are empty yet fascinating. His humanist works do not judge or reprimand, but forgive, showing a childlike sensitivity through soft, rounded distortions of figures presented nude but natural.
O documento descreve as atividades de rotina e eventos planejados para as salas de aula de diferentes séries em setembro, incluindo aulas de hora cívica sobre trânsito, poesia brasileira e parcerias comunitárias.
The document discusses several theories related to development and underdevelopment, including neoliberalism, dependency theory, and world systems theory. It provides background on the key figures and concepts within dependency theory, such as Andre Gunder Frank and Fernando Henrique Cardoso. It also summarizes Wallerstein's world systems theory, which divides countries into cores, semi-peripheries, and peripheries. Modernization theory is discussed as well, including its assumptions about development as a progressive, homogenizing process. Criticisms of these theories are noted, such as that development is not necessarily unidirectional and traditional and modern values can co-exist.
The Vazrazdane gallery invites visitors to view an exhibition of paintings by Violeta Radkova titled "Déjà vu" from April 8th to 21st, 2014. The exhibition will feature Radkova's new series of paintings continuing her exploration of the mysteries within intimate interiors and street exteriors. Her works depict an ambiguous world where everything whispers "yes" and "no" simultaneously through the use of golden hues blending different shades. The paintings show houses inhabited by romantic longings, still lifes, memories, and nude women like a dream.
Dokumen ini berisi curahan hati seorang siswi SMA kelas XII tentang perasaan galau dan cinta. Ia menjelaskan bagaimana rasanya galau ketika harus menghadapi masalah sedih sendirian tanpa dukungan orang lain, serta sakitnya melihat orang yang disayangi bersama orang lain. Dokumen ini juga menyertakan beberapa kalimat tentang arti cinta sejati yang abadi dan komitmen dalam hubungan.
She adores hats. She is always very polite and respectful of others. She waves to everyone, and consistently avoids conflict. She is a lady; she is The Queen.
Without a doubt, Queen Elizabeth lives a life quite unlike everyone else in the World – after all, royalty does have its privileges. Yet, when it comes to investing, the Queen is swimming in the same pool of stock market sharks as us common people.
Like everyone else, she pours through her quarterly statements to see how she’s fared. And like everyone else, she loves to make money and simply deplores negative returns. It was rumored that the 2008 crisis hit her particularly hard – over USD 40 million in stock market losses.
This experience must have jilted something, as when The Queen was visiting the esteemed London School of Economics she asked the professor a rather “un-queen” like question – why did economists fail to predict the biggest global recession since the Great Depression?
- In October 2008, global stock markets experienced their worst month since the 1987 crash as fears about the health of the world economy rose sharply. The S&P 500 fell over 23% during the first eight trading days alone.
- The credit crisis that began with the housing bust in the US escalated in September with Lehman Brothers' bankruptcy, igniting a wave of risk aversion across markets. Selling accelerated as investors fled stocks and hedge funds were forced to dump holdings.
- Central banks around the world coordinated unprecedented interest rate cuts and liquidity measures. Governments also allocated over $3 trillion for bailouts and stimulus to stabilize markets and confidence. These actions helped pare losses by month's end.
Michael Durante Western Reserve Blackwall Partners 1Q12Michael Durante
Blackwall Partners posted a 30% return for Q1 2012. They believe financial firms are fundamentally strong but undervalued due to political attacks exaggerating risk. The fundamentals of financials are appealing, with record profits and excess capital. However, low valuations and high volatility make financial stocks a "winning hand". The author argues the equity risk premium has collapsed to levels not seen since WWI and negative yield gaps indicate a bull market. They believe regulations holding back banks will be reduced, allowing earnings growth and higher payouts that will drive financial stock prices and ownership higher over time. However, some volatility is expected in the short term.
The document discusses 10 major themes for 2010 and beyond related to offsetting economic forces. Some of the key themes discussed include: 1) The US dollar may be neutral in early 2010 but weaken later in the year as US economic weakness persists relative to other economies. 2) Rising US government borrowing needs may be offset by increasing consumer savings and shifts to fixed income. 3) The need for the US to cut spending and raise taxes may be offset by the US simply printing more money to avoid difficult political choices.
The document discusses the housing bubble and its causes. It argues that loose monetary policy and government policies promoting homeownership led to a misallocation of resources and artificial inflation of housing prices. This created a bubble that has now burst, leading to an economic recession. In the long run, there is a concern that the government failures that caused the crisis will not be admitted and more power will be given to the same mechanisms that caused the problems.
The document summarizes the performance of the Western Reserve Master Fund for the first quarter of 2010. It rose 22.3% gross and 18.2% net, outperforming benchmarks. It also provides background on Charles Mackay's 1841 book "Extraordinary Popular Delusions and the Madness of Crowds" and discusses how recent economic events could be added to the book. The document then analyzes specific investments in the fund's portfolio, including Citigroup and Wells Fargo, focusing on their earnings power, cash flows, and valuation using a pre-tax, pre-provision income approach.
Agcapita is Canada's only RRSP and TFSA eligible farmland fund and is part of a family of funds with almost $100 million in assets under management. Agcapita believes farmland is a safe investment, that supply is shrinking and that unprecedented demand for "food, feed and fuel" will continue to move crop prices higher over the long-term. Agcapita created the Farmland Investment Partnership to allow investors to add professionally managed farmland to their portfolios. Agcapita publishes a monthly agriculture briefing.
The document summarizes the outlook for markets in 2009. It believes the recession will persist through 2009 with a weak recovery. Government stimulus plans aim to boost spending but the effects may be delayed. The Federal Reserve has increased money supply but must remove excess cash to avoid inflation. Consumers are saving more due to debt and falling asset values, which may slow growth but support bond prices. Global trade and capital flows are also slowing. The outlook calls for a challenging year with opportunities in quality companies and bonds offering higher yields. Flexibility will be needed to respond to changing opportunities and risks.
Fears of the U.S. economy falling off a “fiscal cliff” have been percolating among investors, conjuring up frightening images of a deep recession. But the chances of it actually happening in its entirety are slim, say Allianz experts.
The state of the us economy marco annunziata ge market sense 1 nov12neiracar
The US economy continues to show resilience despite uncertainty from the upcoming fiscal cliff. Private consumption has strengthened due to improvements in the housing market and labor market. However, business investment and hiring remain constrained by policy uncertainty, particularly regarding how the large budget deficit will be addressed in the long run. If major fiscal policy issues can be resolved decisively in 2013, businesses may increase spending and hiring to boost economic growth. But continued uncertainty risks prolonging the current sluggish recovery.
1) The document reviews market conditions in 2009, noting the extreme pessimism and economic deterioration due to the financial crisis. While 2009 saw gradual economic improvement, conditions are still challenging, with high unemployment.
2) Conditions have improved modestly in 2010, including increased corporate spending and consumer confidence, and reopening of credit and equity markets. However, risks remain like potential inflation or regulatory changes.
3) For composting and organics recycling companies, gradually improving conditions may increase access to capital through debt or equity financing. Smaller companies should prepare for fundraising to take advantage of improving opportunities.
Global Macro-economics, Trends, Portfolio ImplicationsNikunj Sanghvi
My presentation to the Bombay Chartered Accountants' Society International Economic Study Circle on Global macro-economics, trends, portfolio implications
Aug 7th 2013
Mumbai, India
This document summarizes concerns about vulnerabilities in China's credit system that could lead to financial crisis. It notes that China has experienced an enormous credit boom in recent years, with total credit growing to over 190% of GDP. Much of this credit growth has been driven by lending to local government financing vehicles and the property sector, fueling a potential real estate bubble. The rapid growth of shadow banking further obscures risks. The document argues China's financial system exhibits indicators of fragility like excessive credit growth, moral hazard, related party lending, and loan forbearance that could make the system vulnerable to a credit crunch or bust.
The document summarizes a careers event at NUI Galway that discussed opportunities and strategies for finding jobs in Ireland's growing energy sector. It provides tips on using social media and other job search methods effectively, building strong CVs and cover letters, and preparing for competency-based interviews. The energy sector is expected to treble the number of jobs by 2020 to help reduce emissions, offset rising costs, and exploit Ireland's energy resources and export markets. Networking, maintaining an online presence, and demonstrating relevant skills and experiences are important for landing a position.
The gallery Vazrazdan is inviting visitors to see the third painting exhibition by the curatorial project "21st century. Bible and Artists" featuring works by Ivan Milushev from May 28 to June 10, 2013. Milushev creates extraordinary figurative works maintaining an enigmatic quality over the years through distinctive line features and eyes that are empty yet fascinating. His humanist works do not judge or reprimand, but forgive, showing a childlike sensitivity through soft, rounded distortions of figures presented nude but natural.
O documento descreve as atividades de rotina e eventos planejados para as salas de aula de diferentes séries em setembro, incluindo aulas de hora cívica sobre trânsito, poesia brasileira e parcerias comunitárias.
The document discusses several theories related to development and underdevelopment, including neoliberalism, dependency theory, and world systems theory. It provides background on the key figures and concepts within dependency theory, such as Andre Gunder Frank and Fernando Henrique Cardoso. It also summarizes Wallerstein's world systems theory, which divides countries into cores, semi-peripheries, and peripheries. Modernization theory is discussed as well, including its assumptions about development as a progressive, homogenizing process. Criticisms of these theories are noted, such as that development is not necessarily unidirectional and traditional and modern values can co-exist.
The Vazrazdane gallery invites visitors to view an exhibition of paintings by Violeta Radkova titled "Déjà vu" from April 8th to 21st, 2014. The exhibition will feature Radkova's new series of paintings continuing her exploration of the mysteries within intimate interiors and street exteriors. Her works depict an ambiguous world where everything whispers "yes" and "no" simultaneously through the use of golden hues blending different shades. The paintings show houses inhabited by romantic longings, still lifes, memories, and nude women like a dream.
Dokumen ini berisi curahan hati seorang siswi SMA kelas XII tentang perasaan galau dan cinta. Ia menjelaskan bagaimana rasanya galau ketika harus menghadapi masalah sedih sendirian tanpa dukungan orang lain, serta sakitnya melihat orang yang disayangi bersama orang lain. Dokumen ini juga menyertakan beberapa kalimat tentang arti cinta sejati yang abadi dan komitmen dalam hubungan.
This document contains a science test for 8th grade students. It has multiple choice questions about the eye of a hurricane, the products of respiration, how plants transport water, and the final stage of sewage treatment. It also defines terms like contaminants, thunderstorms, and exhalation. The short answer questions ask about why an athlete breathes faster after a race, why blood circulates, why oils and fats should not be released in drains, and defines sewage. The document contains diagrams of the human circulatory heart and excretory system.
Dokumen tersebut membahas tentang cara menyambungkan internet menggunakan modem eksternal dengan langkah-langkah sebagai berikut: (1) siapkan computer/laptop dan modem yang dalam keadaan baik dan terisi pulsa, (2) pastikan terdapat port untuk menyambungkan modem, (3) nyalakan computer/laptop, (4) colokkan modem ke port maka computer akan mendeteksi modem secara otomatis.
O documento descreve as sete principais figuras envolvidas no caso dos "Vistos Gold" em Portugal, incluindo Miguel Macedo, ex-ministro do Interior acusado de corrupção, Manuel Palos do SEF, e António Figueiredo do Instituto dos Registos e Notariado, acusado de chefiar uma rede para selecionar imóveis para chineses.
V b одд. ОУ Свети Климент Охридски-Бутел, Скопје одд. наставник Сузана Младенова (изработки од моите ученици). Примена на ИКТ во секојдневни активности на часот, домашни задачи, проектни активности.
Reorientasi berisi komentar evaluatif atau simpulan mengenai peristiwa yang diceritakan sebelumnya. Bagian reorientasi bersifat opsional dalam teks biografi. Pada penyajian teks biografi, dapat dilihat alur, sudut pandang penceritaan, gaya dan fokus penceritaan. Otobiografi adalah riwayat hidup yang ditulis sendiri oleh tokoh tersebut.
Emotional disturbances are characterized by physical, communication, behavioral, and academic issues as well as hyperactivity. Symptoms include depression, anxiety, fatigue, appetite and sleep problems, and poor self-image or suicidal thoughts. While heredity, brain disorders, diet, and family functioning have been hypothesized as causes, research has not shown any single direct cause. Emotional disturbance is defined by an inability to learn, build relationships, exhibit appropriate behavior or mood, according to IDEA. Teachers, parents, and policymakers can help by setting clear expectations, maintaining a positive learning environment, providing meaningful learning experiences, consulting professionals, and recognizing students' positive qualities.
Challenges in Technology Transfers of API ManufacturingMutyala Naidu G
- Eisai, a Japanese pharmaceutical company, transferred technology for manufacturing two APIs from Japan to its new facility in Vizag, India.
- Key challenges included cultural and communication differences, regulatory approvals, technical details, training, raw materials, and process validation.
- Through careful planning, frequent communication, cultural training, manufacturing trials, and involvement of leadership, Eisai was able to successfully overcome these challenges and establish robust API manufacturing capabilities in India.
Instructions1. On the top of the page, provide the article citat.docxnormanibarber20063
Instructions
1. On the top of the page, provide the article citation in current APA format.
On the next line down, type the topic of your articles: (Gross Domestic Product (GDP)
in all caps and bold format.
2. In a double-spaced document, briefly explain the author’s purpose for writing the article. One way to understand the author’s purpose is to ask yourself why he or she wrote it. (For example, consider current and future events, politics, or anything else that may have inspired the article.)
3. Summarize the article(The criminality of Wall Street), focusing on the discussion of the topic the article addresses. Incorporate relevant economic theory that is present so that discussion of the article content is clear.
Article: The Criminality of Wall Street
Tabb, William K. Monthly Review66.4 (Sep 2014): 13-22.
The current stage of capitalism is characterized by the increased power of finance capital. How to understand the economics of this shift and its political implications is now central for both the left and the larger society. There can be little doubt that a signature development of our time is the growth of finance and monopoly power.1
In 1980 the nominal value of global financial assets almost equaled global GDP. In 2005 they were more than three times global GDP.2 The nominal value of foreign exchange trading increased from eleven times the value of global trade in 1980 to seventy-three times in 2009.3 Of course it is not certain what this increase means, since such nominal values can fluctuate widely, as we saw in the Great Financial Crisis. They cannot be compared directly and without all sorts of qualifications to the value added in the real economy. But they do give an impressionistic sense of the enormous magnitude by which finance grew and came to dominate the economy. Between 1980 and 2007, derivative contracts of all kinds expanded from $1 trillion globally to $600 trillion.4 Hedge funds and private equity groups, special investment vehicles, and mega-bank holding companies changed the face of Western capitalism. They also brought on the collapse from which we still suffer. Ordinary people may not be acquainted with the numbers (and even those best informed are not sure of their significance), but people generally understand in different and often deep ways what has been happening: namely, an ongoing process of financialization that has come to dwarf production.
What is particularly important is that despite the huge bubble created by this metastasizing growth of finance, the economy did not expand as rapidly as it had in the postwar years, before the goods producing industries lost ground in terms of employment to other sectors of the economy, and when government spending was used actively to promote growth. While the nature of much of the growth that occurred then is certainly open to criticism from all sorts of standpoints, at the time there was widespread understanding in policy circles that government spending was.
The document provides a seasonal market outlook and review of global markets in Q4 2014 and for the year as a whole. Key points:
- Global stock markets fell sharply in mid-December due to falling commodity prices but recovered by Christmas. The FTSE 100 ended 2014 down 2.7%.
- Mining stocks and food retailers struggled while utility companies performed well, benefiting from growing demand for income and declining rate expectations.
- Commodity prices are expected to remain weak in 2015 due to slowing demand from Europe and China and increased supply, particularly of oil from US shale production.
- The US presidential election of Donald Trump was unexpected but may not lead to significant changes in policy due to constraints on implementing radical changes.
- Trump's economic proposals include tax cuts to boost growth, but the current global situation is different than in Reagan's time and tax cuts may not have the same effect.
- The world economy is now more complex and interconnected, influenced by events like conflicts in the Middle East, so outcomes are less predictable than in prior models and small decisions can have large impacts through amplification. Predicting the effects of Trump's policies is difficult in this new economic environment.
Watch the following video and respond to the questions belowhtt.docxmelbruce90096
Watch the following video and respond to the questions below:
https://www.youtube.com/watch?v=ImQrUjlyHUg
(1) What is your opinion of Mark Pagel's explanation of language and humanity? (i.e., do you think his explanation of the evolution of language adequately addresses how humans have been impacted by the ability to communicate).
(2) How do you think "social learning" has influenced humanity? (think of the good and bad).
(3) Are there any additional thoughts that came to mind as you were watching this video?
Don’t Look Back in Anger at Bailouts and Stimulus
By Alan S. Blinder And Mark Zandi
The Wall Street Journal
Oct. 15, 2015 6:32 p.m. ET
Former Federal Reserve Chairman Ben Bernanke in an Oct. 6 interview on the Fox Business Network. PHOTO:
RICHARD DREW/ASSOCIATED PRESS
Without the emergency measures of 2008-09, the U.S.
economy would be far worse off today.
The publicity surrounding former Federal Reserve Chairman Ben Bernanke’s memoir prompts a
look-back at the stunning array of policy responses promulgated by the Fed, Congress and two
administrations to avert catastrophe during the financial crisis in 2008-09. This is important
because many of these initiatives haven’t aged well in the eyes of politicians and the public.
TARP, fiscal stimulus, quantitative easing and auto bailout remain dirty words to many people
who increasingly blame them for prolonging the Great Recession and the slow pace of recovery.
But in a study released Thursday for the Center on Budget and Policy Priorities, we found the
reverse to be true: These extraordinary policies ended the crisis and jump-started an economic
recovery that is stronger in the U.S. than in most countries.
Specifically, we estimate that:
• The peak-to-trough decline in real gross domestic product, which was barely more than 4%,
would have been close to a stunning 14%.
• The contraction would have lasted three years, more than twice as long as it did.
Don’t Look Back in Anger at Bailouts and Stimulus
By Alan S. Blinder And Mark Zandi
The Wall Street Journal
Oct. 15, 2015 6:32 p.m. ET
• More than 17 million jobs would have been lost, about twice the actual number.
• Unemployment would have peaked at just under 16%, rather than at 10%.
• The federal budget deficit would have ballooned to $2.8 trillion, equal to 18% of GDP,
compared with its actual peak of 10%.
• Today’s economy would be far weaker than it is—with real GDP about $800 billion lower, 3.6
million fewer jobs, and unemployment still at 7.6%.
The overwhelming nature of the fiscal and monetary policy responses is the main reason we
didn’t suffer a much-worse fate. Yet history is in danger of giving the powerful 2008-09
responses a misguided Bronx cheer.
Start with TARP. The Troubled Asset Relief Program was deeply unpopular in part because it
was so large—a $700 billion bailout fund—and aimed primarily at “Wall Street.” It felt wrong to
bail out guilty parties, and many.
Week 6 Discussion 1: Presidential Advisor
Required Resources
Read/review the following resources for this activity:
Textbook: Review Chapter 2, 3 (pp. 56-59), 13
Lesson
Additional scholarly sources you identify through your own research
TEXTBOOK:
Magstadt, T. (2017). Understanding Politics: Ideas, institutions, and issues (12th ed.). Boston, MA: Cengage.
Post Instructions:
You are an advisor to the President tasked with cutting at least $300 billion from the budget. The president wants your recommendations to cut lines, not large categories. Explain why you chose those cuts.
Note: THESE ARE NOT TRUE US BUDGET NUMBERS!
.
DOMESTIC PROGRAMS AND FOREIGN AID
Cut some foreign aid to African countries
$17 billion
Eliminate farm subsidies
$14 billion
Cut pay of civilian federal workers by 5 percent
$14 billion
Reduce the overall federal workforce by 10%
$12 billion
Cut aid to states by 5%
$29 billion
MILITARY
Cut the number of nuclear warheads, and end the "Star Wars" missile defense program
$19 billion
Reduce military to pre-Iraq War size and further reduce troops in Asia and Europe
$25 billion
Cancel or delay some weapons programs
$19 billion
HEALTHCARE
Enact medical malpractice reform by reducing the chances of large malpractice verdicts
$ 8 billion
Increase the Medicare eligibility age to 68
$ 8 billion
Raise the Social Security retirement age to 68.
$ 13 billion
EXISTING TAXES
Return the estate tax to Clinton-era levels, passing on an estate worth more than $1 million to their heirs would have portions of those estates taxed.
$ 50 billion
End tax cuts for income above $250,000 a year
$ 54 billion
End tax cuts for income below $250,000 a year
$ 172 billion
Payroll tax increase for people making over $106,000 annually contributing more to Social Security and Medicare.
$ 50 billion
NEW TAXES
Institute a Millionaire's tax on income above $1 million
$ 50 billion
Add a national 5% sales tax
$ 41 billion
Add a tax on carbon emissions
$ 40 billion
Tax banks based on their sizes and the amount of risk they take.
$ 73 billion
Total gap covered by your budget plan
$_________________
Use evidence (cite sources) to support your response from assigned readings or online lessons, and at
TWO
outside scholarly source.
Summary for discussion post:
Imagine that you’re a high-ranking advisor to the President of the United States (If it helps think of a generic president, not the actual person in the White House), and you’re tasked with cutting at least $300 billion from the budget.
The president wants your recommendations to cut lines, not large categories. Explain why you chose those cuts.
Be sure to list the options you chose with their totals and your overall total as well. Reaching $300 Billion is tough, so I want you to get your total somewhere between $290 - 310 Billion.
-----------------------------------
As you start, this hypothetical budget has a shortfall (or gap ...
Michael Durante Western Reserve research compilationMichael Durante
This document provides a summary and outlook from Western Reserve Capital Management for their investors. It discusses the opportunities that emerged from the financial crisis in 2009 and how markets have stabilized. It analyzes factors like the delay in addressing mark-to-market accounting, the politicization of TARP, and recovery in the housing and credit markets. It argues financial stock valuations remain very attractive relative to fundamentals. The document also provides commentary from Bob McTeer supporting that TARP ultimately benefited taxpayers.
Week 6 Discussion 1: Presidential Advisor
Required Resources
Read/review the following resources for this activity:
Textbook: Review Chapter 2, 3 (pp. 56-59), 13
Lesson
Additional scholarly sources you identify through your own research
TEXTBOOK:
Magstadt, T. (2017). Understanding Politics: Ideas, institutions, and issues (12th ed.). Boston, MA: Cengage.
Post Instructions:
You are an advisor to the President tasked with cutting at least $300 billion from the budget. The president wants your recommendations to cut lines, not large categories. Explain why you chose those cuts.
Note: THESE ARE NOT TRUE US BUDGET NUMBERS!
.
DOMESTIC PROGRAMS AND FOREIGN AID
Cut some foreign aid to African countries
$17 billion
Eliminate farm subsidies
$14 billion
Cut pay of civilian federal workers by 5 percent
$14 billion
Reduce the overall federal workforce by 10%
$12 billion
Cut aid to states by 5%
$29 billion
MILITARY
Cut the number of nuclear warheads, and end the "Star Wars" missile defense program
$19 billion
Reduce military to pre-Iraq War size and further reduce troops in Asia and Europe
$25 billion
Cancel or delay some weapons programs
$19 billion
HEALTHCARE
Enact medical malpractice reform by reducing the chances of large malpractice verdicts
$ 8 billion
Increase the Medicare eligibility age to 68
$ 8 billion
Raise the Social Security retirement age to 68.
$ 13 billion
EXISTING TAXES
Return the estate tax to Clinton-era levels, passing on an estate worth more than $1 million to their heirs would have portions of those estates taxed.
$ 50 billion
End tax cuts for income above $250,000 a year
$ 54 billion
End tax cuts for income below $250,000 a year
$ 172 billion
Payroll tax increase for people making over $106,000 annually contributing more to Social Security and Medicare.
$ 50 billion
NEW TAXES
Institute a Millionaire's tax on income above $1 million
$ 50 billion
Add a national 5% sales tax
$ 41 billion
Add a tax on carbon emissions
$ 40 billion
Tax banks based on their sizes and the amount of risk they take.
$ 73 billion
Total gap covered by your budget plan
$_________________
Use evidence (cite sources) to support your response from assigned readings or online lessons, and at
TWO
outside scholarly source.
Summary for discussion post:
Imagine that you’re a high-ranking advisor to the President of the United States (If it helps think of a generic president, not the actual person in the White House), and you’re tasked with cutting at least $300 billion from the budget.
The president wants your recommendations to cut lines, not large categories. Explain why you chose those cuts.
Be sure to list the options you chose with their totals and your overall total as well. Reaching $300 Billion is tough, so I want you to get your total somewhere between $290 - 310 Billion.
-----------------------------------
As you start, this hypothetical budget has a shortfall (or ...
Fasanara Capital | Investment Outlook
1. The Future Is Wide Open: Avoid The ‘Illusion Of Knowledge’ Trap
The single most dangerous thinking trap / optical illusion for investors today is to look at Trump, Brexit and Italy Referendum as non-events, buried in the past. We believe that 2017 may likely be driven by the same factors that failed to shape 2016. The non-events of 2016 are likely to be the drivers of 2017. Finally, we will get to find out if Brexit means Brexit, if Trump means Trump, if a failed Italian referendum means early elections and a membership of the EMU in jeopardy down the line.
2. Structural Shift: These Are Transformational Times
The macro outlook of the next years will be influenced the most by these structural trends:
› Protectionism, De-Globalization & De-Dollarization. In Pursuit of Inclusive Growth
› End of ‘Pax Americana’. The ascent of China. Geopolitical risks on the rise
› End of ‘Pax QE’. Markets without steroids, but still delusional.
› 4th Industrial Revolution: labor participation rate falling from 63% to 40% in 10 years?
3. Our Baseline Scenario: Bubble Unwind, Equities and Bonds Down
Starting this 2017, our major macro convictions are as follows:
› Global Tapering to progress
› US Dollar to keep grinding higher
› European Political Instability to worsen
› US Equities to weaken
Despite hopes that the anti-QE rhetoric would die down, the noise continued last week, and unfortunately, become more political. One of the key aspects of the Fed is its independence. The Fed is answerable to Congress, and ultimately, to the American people. However, it is not controlled by Congress – nor would we want it to be controlled by Congress. Attacks on the Fed and its latest round of asset purchases aren’t helping.
Michael Durante Western Reserve 2009 review and 2010 outlookMichael Durante
- The document provides an annual review and outlook from 2009 to 2010 for a financial services fund.
- It summarizes that the financial crisis created significant investment opportunities due to delays in government action and uncertainty, but that credit losses were not as severe as feared.
- It argues that mark-to-market accounting exaggerated fear and losses during the crisis, and that bank stocks remain undervalued relative to fundamentals now that the crisis has subsided and losses were not as bad as estimated.
Michael Durante Western Reserve spring 2010 reviewMichael Durante
The document summarizes the performance of the Western Reserve Master Fund for the first quarter of 2010. It rose 22.3% gross and 18.2% net, outperforming benchmarks. It also provides background on Charles Mackay's 1841 book "Extraordinary Popular Delusions and the Madness of Crowds" and discusses how recent economic events could be added to the book. The document then analyzes specific investments in the fund's portfolio, including Citigroup and Wells Fargo, focusing on their earnings power, cash flows, and valuation using a pre-tax, pre-provision income approach.
The Western Reserve Master Fund rose significantly in Q1 2010, outperforming benchmarks. As of late April, the fund's year-to-date return was 40.1%. The document discusses Charles Mackay's 19th century book on economic bubbles and irrational behavior. It argues the recent financial crisis would make a good addition to Mackay's work. Several bank stocks, including Citigroup, are highlighted as attractive long investments due to inaccurate fair value accounting and an improving credit outlook.
The document is a newsletter discussing the state of the US economy from the perspective of an economic analyst, Mike Lathigee. It summarizes that while official reports claim the economy is recovering, the reality is that inequality is growing as the rich get richer and the middle class and poor get poorer. Unemployment and other key economic indicators show most Americans are worse off than during the 2008 recession. It recommends investors increase their holdings of physical gold and silver to 10% of their portfolio as a hedge against potential economic troubles in the future.
Is the Fed blowing bubbles to cover up growing inequality.... again?Yannick Naud
1) The document discusses rising income inequality in the US and how the Fed has responded by creating housing bubbles to disguise the fact that the middle class is not benefiting from economic growth and to boost consumption.
2) It analyzes recent data showing that the top 1% captured 95% of income gains in the US recovery while the bottom 99% saw little growth. Inequality is surging to new highs not seen since before the Great Depression.
3) High and rising inequality has negative economic and social consequences like reduced economic growth and mobility if it passes a certain point, according to studies and economists cited in the document.
The document discusses the US national debt and argues that under the current global financial system, meaningfully reducing the debt is impossible. It says the debt is viewed differently than traditional loans and can only be reduced through major technological or economic changes. It also notes that the debt level alone is an incomplete picture, and as a percentage of GDP, the US debt is manageable given low interest rates and economic growth exceeding the inflation rate. The best approach is maintaining low rates and prioritizing growth over direct repayment through fiscal policy changes.
The document summarizes Ben Bernanke being named TIME's Person of the Year for 2009. It discusses past TIME Person of the Year selections and how they have sometimes served as contrarian indicators, with the stock market or country of the subject often facing difficulties afterwards. It provides several examples from previous years to support this.
The document discusses the need for ICT corporations to shift their focus from financial systems to economics in light of global economic shifts. It notes the job losses in the ICT sector, especially at Microsoft, and argues economics should guide business decisions more than politics. The US economy is analyzed and found to have significant debt issues, calling into question its status as sole world leader. The document advocates for ICT companies like Microsoft to assess local markets, focus on the bottom two thirds of consumers, and develop strategies guided by economic principles rather than just maintaining the same approaches.
The US debt ceiling's impact on the stock market is significant. Explore and figure out the relationship between the debt ceiling and stock market dynamics.
Similar to Blackwall partners 2 qtr 2016- transient volatility part iii (20)
This document discusses the overreliance on EBITDA as a measure of firm profitability and valuation. It explores how EBITDA fails to accurately reflect real operating costs like recurring working capital needs and capital expenditures. While EBITDA was rarely used before the 1980s leveraged buyout boom, its use expanded as it inflated valuations and debt capacity. However, EBITDA does not correlate with cash flow for most firms as it does not account for important expenses. The document concludes that more thorough analysis is needed beyond EBITDA to determine a firm's fair valuation.
This document discusses the overreliance on EBITDA as a measure of firm profitability and valuation. It explores how EBITDA fails to accurately reflect real operating costs like recurring working capital needs and capital expenditures. While EBITDA was rarely used before the 1980s leveraged buyout boom, its use expanded as it inflated valuations and debt capacity. However, EBITDA does not correlate with cash flow for most firms as it does not account for important expenses. The document concludes that more thorough analysis is needed beyond EBITDA to determine a firm's fair valuation.
Michael Durante Western Reserve March 2011- Camel RaceMichael Durante
The document discusses the outlook for US financial stocks, arguing they are historically undervalued relative to their earnings growth potential and balance sheet strength following the financial crisis. It notes banks now have more capital than any time since the 1930s, and excess capital reserves will need to be redeployed, likely driving the most aggressive reinvestment in US financial history. The document analyzes specific banks like Fifth Third Bancorp to demonstrate historically high capital levels and improving asset quality based on regulatory reports, concluding financial stocks present a major valuation opportunity.
The fund regained some losses in Q3 but remains down for the year due to its focus on services stocks while the broader market has been led by cyclical stocks. The author believes services stocks are very undervalued currently and that tightening credit will hurt cyclical stocks more. The fund has upgraded its portfolio by adding to financial stocks beaten down in the summer panic. The author sees the current environment as one of the best opportunities in services stocks in over a decade and thinks the fund holds its most profitable portfolio ever.
- The second quarter of 2006 was difficult for stocks, with the S&P 500 down 2% and NASDAQ down over 7%. Western Reserve Hedged Equity declined 1.7% net for the quarter.
- Year-to-date, WRHE has gained 7% gross versus 2% for the S&P 500 and a negative 1.5% for the NASDAQ, maintaining net exposure of half the market.
- The author believes quality stocks are cheap while cyclical stocks are overvalued, and the portfolio is well positioned for long-term gains as the market recognizes this discrepancy. Short opportunities exist in overvalued cyclical areas.
This document provides a quarterly report for Western Reserve Hedged Equity (WRHE) fund for the second quarter of 2005. It summarizes the fund's performance for various periods and compares it to market benchmarks. It also discusses the fund's investment strategy and outlook, including being bullish on growth stocks and bearish on "conventional value" stocks that they believe have formed a bubble with overvalued valuations. The document analyzes various companies and sectors that the fund has investments in, both long and short positions.
Michael Durante Western Reserve WRHE 2Q04 letterMichael Durante
Western Reserve Hedged Equity, LP declined 1.5% in the second quarter but is up 3.6% for the first half of 2004. The fund's long positions saw strong earnings but disappointing stock performance, while short positions underperformed. The manager expects market volatility to continue but remains focused on identifying undervalued companies with strong fundamentals and high recurring revenues.
Michael Durante Western Reserve Basel III western reserve- commentaryMichael Durante
The document discusses proposed new international bank capital standards under Basel III. It notes that:
- Basel III sets total risk-based capital at 8%, tier 1 capital at 6%, and common equity tier 1 at 3.5-4.5%
- US banks already far exceed these standards, with the largest banks having tier 1 capital ratios around 12%
- This means 61 of 62 major US banks will not need to raise capital to meet the 2019 requirements
- In contrast, the standards are being lowered to give European banks more time to comply as their capital levels are further behind those of major US banks
FAS 157, a fair value accounting rule, requires banks to mark assets to their current market value, even if the market is illiquid. Some argue this is forcing banks like Citigroup and Merrill Lynch to overstate losses on investments like CDOs backed by subprime mortgages. However, others counter that marking assets to realistic current values provides transparency and that banks should have considered market risks rather than relying on theoretical values. While the intent of the rule is transparency, its effect during a crisis may be exacerbating banks' problems, according to critics like Blackstone co-founder Stephen Schwarzman.
The document lists over 100 individuals and entities that submitted comments to the SEC regarding its study on mark-to-market accounting between June 2009 and November 2008. The comments came from academics, companies, trade associations, and individuals from fields including accounting, finance, appraisal, and government.
Michael Western Reserve financial reform primer- march 2010Michael Durante
This document summarizes potential outcomes of ongoing debates around financial services reform in the US Senate. It argues that the Senate will likely expand the Federal Reserve's oversight role over large financial institutions and its authority to resolve "too big to fail" institutions. It also predicts the Senate will establish an advisory council for the Federal Reserve but leave it with independent authority. A new consumer protection agency may be established but with limited powers housed at the Federal Reserve. Proposals for new bank taxes and an strict "Volcker Rule" will likely be watered down or rejected.
Michael Durante Western Reserve research analysis- camel exampleMichael Durante
The document summarizes research on potential long and short investment opportunities in Citigroup, Wells Fargo, JP Morgan, Capital One, and China. For the long opportunities, it analyzes factors like capital adequacy, asset quality, management strength, earnings power, and liquidity. It argues that Citigroup, Wells Fargo, JP Morgan, and Capital One present attractive valuations based on their pre-tax, pre-provision earnings and balance sheet strength. For the short opportunity, it argues that China's economy is being artificially propped up through excessive credit growth, which will lead to a pile of bad debt and a sharp market reversal as this credit stimulus is unsustainable without real end market demand from the West
The document provides a quarterly review from Western Reserve Master Fund, LP for the first quarter of 2009. It summarizes that the fund declined approximately 13% for the quarter, compared to declines of around 34% for S&P financial indexes. Stocks were initially driven down by fear over new government policies, but stabilized by the end of the quarter. The document argues that financial stocks currently sit at depressed values and represent opportunities for strong future returns as the economy recovers.
Michael Durante Western Reserve Q109 update letterMichael Durante
The document provides an update on the performance of Western Reserve Master Fund, LP for the first quarter of 2009. It discusses the fund's performance in 2008, noting it was down only 3% while comparable indexes fell around 60%. It also discusses the negative feedback loop created by mark-to-market (MTM) accounting standards, which have led to inaccurate asset write-downs and exacerbated the financial crisis. The document argues that MTM accounting should be suspended and replaced with cash flow-based accounting in order to stabilize the financial system and economy.
The document discusses the performance of the Western Reserve Master Fund in 2008. It summarizes that the fund was down only 3% for the year, while comparable indexes fell around 60%. It attributes this to successful short positions that gained over 40% offsetting long position losses of around 35%. The document then discusses flaws with mark-to-market accounting requirements, arguing they have exacerbated the financial crisis by forcing banks to hoard cash and restrict lending. It advocates suspending mark-to-market in favor of mark-to-maturity accounting based on actual cash flows to restore liquidity to the financial system.
- WRHE had a poor third quarter, declining 3.8% net due to underperformance of services stocks as hurricanes and oil dominated the market.
- Services stocks are at extremely low valuations with high fear levels baked in, but fundamentals remain strong with stable credit markets, employment, and liquidity.
- The US economy remains flexible and services-led, driven by technology and finance, and will manage through hurricane impacts despite perceptions that it is finished.
- WRHE believes conditions are at extremes and change is likely, and that services stocks will reassert leadership and "catch up" with earnings growth when the market refocuses on fundamentals.
- The Western Reserve Hedged Equity Fund had a disappointing year in 2005, returning -3.9% gross and -4.3%/ -4.5% net for Class A and B shares respectively, due to macro factors driving a narrow, momentum-based market that favored commodities over the fund's focus on undervalued service sector stocks.
- The fund's technology, business services, and specialty real estate investments underperformed despite strong company fundamentals, and the fund lacked exposure to the commodity boom.
- Looking ahead, the manager remains confident in the fund's strategy of investing in high-quality, recurring revenue businesses and believes the recent outperformance of low-quality, commodity firms is uns
- The Western Reserve Hedged Equity fund returned 20% gross and 16% net for 2006, and 9% gross and 7% net for Q4 2006. Since inception, the fund has outperformed market indexes after fees.
- The author believes the recent commodity bubble will unwind and benefit high quality domestic stocks that were ignored during the boom. However, economic growth is expected to remain low.
- A new long position was acquired in Willdan Group, a professional services firm providing engineering and public finance consulting to local governments, which is expected to continue growing due to infrastructure spending and market fragmentation. The stock currently trades at a significant discount to peers based on earnings and cash flow estimates.
"Does Foreign Direct Investment Negatively Affect Preservation of Culture in the Global South? Case Studies in Thailand and Cambodia."
Do elements of globalization, such as Foreign Direct Investment (FDI), negatively affect the ability of countries in the Global South to preserve their culture? This research aims to answer this question by employing a cross-sectional comparative case study analysis utilizing methods of difference. Thailand and Cambodia are compared as they are in the same region and have a similar culture. The metric of difference between Thailand and Cambodia is their ability to preserve their culture. This ability is operationalized by their respective attitudes towards FDI; Thailand imposes stringent regulations and limitations on FDI while Cambodia does not hesitate to accept most FDI and imposes fewer limitations. The evidence from this study suggests that FDI from globally influential countries with high gross domestic products (GDPs) (e.g. China, U.S.) challenges the ability of countries with lower GDPs (e.g. Cambodia) to protect their culture. Furthermore, the ability, or lack thereof, of the receiving countries to protect their culture is amplified by the existence and implementation of restrictive FDI policies imposed by their governments.
My study abroad in Bali, Indonesia, inspired this research topic as I noticed how globalization is changing the culture of its people. I learned their language and way of life which helped me understand the beauty and importance of cultural preservation. I believe we could all benefit from learning new perspectives as they could help us ideate solutions to contemporary issues and empathize with others.
Abhay Bhutada, the Managing Director of Poonawalla Fincorp Limited, is an accomplished leader with over 15 years of experience in commercial and retail lending. A Qualified Chartered Accountant, he has been pivotal in leveraging technology to enhance financial services. Starting his career at Bank of India, he later founded TAB Capital Limited and co-founded Poonawalla Finance Private Limited, emphasizing digital lending. Under his leadership, Poonawalla Fincorp achieved a 'AAA' credit rating, integrating acquisitions and emphasizing corporate governance. Actively involved in industry forums and CSR initiatives, Abhay has been recognized with awards like "Young Entrepreneur of India 2017" and "40 under 40 Most Influential Leader for 2020-21." Personally, he values mindfulness, enjoys gardening, yoga, and sees every day as an opportunity for growth and improvement.
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BONKMILLON Unleashes Its Bonkers Potential on Solana.pdfcoingabbar
Introducing BONKMILLON - The Most Bonkers Meme Coin Yet
Let's be real for a second – the world of meme coins can feel like a bit of a circus at times. Every other day, there's a new token promising to take you "to the moon" or offering some groundbreaking utility that'll change the game forever. But how many of them actually deliver on that hype?
2. Elemental Economics - Mineral demand.pdfNeal Brewster
After this second you should be able to: Explain the main determinants of demand for any mineral product, and their relative importance; recognise and explain how demand for any product is likely to change with economic activity; recognise and explain the roles of technology and relative prices in influencing demand; be able to explain the differences between the rates of growth of demand for different products.
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
Abhay Bhutada Leads Poonawalla Fincorp To Record Low NPA And Unprecedented Gr...Vighnesh Shashtri
Under the leadership of Abhay Bhutada, Poonawalla Fincorp has achieved record-low Non-Performing Assets (NPA) and witnessed unprecedented growth. Bhutada's strategic vision and effective management have significantly enhanced the company's financial health, showcasing a robust performance in the financial sector. This achievement underscores the company's resilience and ability to thrive in a competitive market, setting a new benchmark for operational excellence in the industry.
1. Elemental Economics - Introduction to mining.pdfNeal Brewster
After this first you should: Understand the nature of mining; have an awareness of the industry’s boundaries, corporate structure and size; appreciation the complex motivations and objectives of the industries’ various participants; know how mineral reserves are defined and estimated, and how they evolve over time.
1. Elemental Economics - Introduction to mining.pdf
Blackwall partners 2 qtr 2016- transient volatility part iii
1. BlackwallPartners2016 Update: Transient Volatility, Part III May 4, 2016
Learn to Love the Bomb (and Accept Transient Stock Volatility), Part III
Almost four years after we published the last installment of ‘Learn to Love the Bomb’, not much has changed (as we
had anticipated). President Obama was re-elected and consequently – our national fiscal policies have stayed the tired,
old socialistic train wreck any intellectually honest person (economist or not) would have expected. Our lack of recent
commentary is directly related. It took longer than we would have liked, but real change finally is afoot.
At present, we are living through the now statistically worst decade for the U.S. economy since the thirties. No surprise
to us. The fact voters insisted upon proving this empirically by re-electing the Obama administration is a question for
future historians and social scientists. ‘New Deal’, ‘Fair Deal’ or Obamanomics, all are identical in nature and
outcome. Today, approximately ninety-five million (95 million) adult Americans of ripe working age and ability are
not working. We are told to believe that these folks have chosen voluntarily to stay at home to “paint”. Those working
haven’t seen their wages rise in over a decade. There is virtually no upward mobility and new college grads face the
worst job market on record. The current generation now is widely expected to be the first in American history to
underperform their parents (and grandparents). If you’re Feeling Japanese… of late it’s because we are with one
important caveat (explained momentarily).
U.S. Velocity of Money Continues Grinding Slower
Nearly all sectors of the economy are experiencing revenues that range from stagnant to deteriorating. The resultant
prevailing strategy for most of these firms (confirmed by their investor presentations) is to milk the cow dry with
outsized dividend payouts and earnings-per-share growth engineered via massive (and we see as wasteful) stock
repurchases. The result is a self-fulfilling perpetual recession. The accompanying chart of the velocity of money in
America, courtesy of our alma mater the Federal Reserve, captures this tragic economic outcome.
For now, short-sighted investors appear willing to punish corporate executives if they were to re-engage in investing in
growth, hence the record profit margins and tax receipts via cutting every possible expense (including CapEx) to prop
up current earnings. Market participants don’t seem to note this very obvious red herring. For every action (Obama
e.g.), there is a reaction (“new norm”) and it’s crippling the economy. Working capital is being unproductively
redirected away from investing in growth and blown on current dividends; capital expenditures are wasted on the
instant gratification of stock retirement. As for the future? It was Keynes who only focused on his own death and his
followers could care less what happens after theirs. Socialism is for the here as in ‘right now.’ So are dividends and
2. stock repurchases. They are the stuff of “buggy whip” makers. They are not a measure of the potential for a greater
future. The markets are riding an unsustainable narrative.
The broader stock market anymore is an extension of the bond market driven by ultra-low interest rates and hence
unsustainable discounts. Current Fed policy is but a mere reaffirmation and why stocks float higher in-step with the
grave economic realities. This is the greatest interest rate risk bubble in mankind’s relatively short, but eventful history.
Today, our large city landscapes once again are dotted ubiquitously with construction cranes but conspicuously without
underlying growth in the economy to justify their existence. Increasingly, hordes of investors clamor to invest in ‘safe
haven’ buildings (REITs) which in it of themselves are rather unproductive allocations of capital. Like bonds and
dividend discounted equities, it’s all just part-in-parcel to this rate risk bubble of which we speak. We’re confident the
coming dividend discount or “cap rate” valuation reset will make the oil patch bludgeoning look almost agreeable.
We now sit atop in excess of $30 trillion (with a “t”) in mostly passive commercial real estate investments in America.
The average capitalization rate is estimated at about 3.8%. God forbid we ever again see the U.S. 10-year Treasury
note yielding above 3.8%. Under President Obama, it’s below 2%. Almost all the new job openings at say a Goldman
Sachs (NYSE - GS) are in their burgeoning real estate groups (we actually track this sort of thing…). The rest are in
compliance jobs to keep up with stifling new regulation. Wall Street now may fear the Trump (growth) and prays for
Clinton (stagnation). Most fund managers we speak with believe the latter is a shoe-in because thinking otherwise is
unnerving to their current portfolio positioning. We might suggest investors should at least consider preparing for a
change.
Some time ago, we began referring to President Obama as “Captain Zero” for his economic success. It wasn’t intended
to be mean spirited. That’s actually the number. As a result of this administration and their policies, the Fed has had
little choice but to keep us at or near zero, apropos to what now is the longest and deepest monetary ease ever
perpetrated upon a fractional reserve banking system. It’s testing the system and altering capital allocation in a very
dangerous manner. The national debt is a bomb…
U.S. commercial banks are sitting on roughly $2 trillion in ‘excess reserves’ [above the 3% minimum] in their Fed
member accounts and some central bankers, including the Fed, are looking at charging fees on this excessive liquidity,
now commonly referred to as “negative interest rates”. Confused? You should be. As if punishing ‘excess reserves’
will alter the supply and demand for credit (leverage) in broken economies now worldwide. Monetary policy is highly
limiting after-all. It cannot supplant or overcome socialistic largesse.
Consumer bank deposits are sitting at a record $10 trillion, proving stagnation like growth rolls downhill with
confidence in tow. Most don’t feel in the mood to do anything productive and who could blame them? Housing has
gone nowhere now since 2010. Marriage and birth rates are at Depression-era lows. Why? Nobody feels confident
enough in the economy and their job to get married, have a baby and buy a dang house. That is the stuff real economic
recoveries are made of…
We’re not altogether certain where this president’s Council of Economic Advisors studied economics or if at all. But
some voters (the question is whether enough) seem finally to be asking that same question whether they realize it or
not.
We could have skipped the commentary and merely published the chart of the velocity of money found on Page 1, but
we can’t help ourselves. And nobody ever talks about that critical variable. So, we will…
As the chart clearly displays, the “churn” or turnover in reasonably liquid capital (M2) has essentially grinded to a halt.
It’s actually the lowest M2 stagnation since the measure first was observed. But we actually remain quite optimistic as
this still is the largest store of fungible capital in history. It merely needs to be inspired! The very caveat we proposed
earlier which differentiates us from our European and Japanese friends. We’re still very very very rich!
The Federal Reserve estimates America’s private sector remains quite wealthy – worth roughly $85 trillion, net. While
granted, $30 trillion plowed into commercial real estate is a concern; no other economy in the world sports such
enormous potential for a turnaround. Thankfully, the years where we were not a practicing “social democracy” have
been rather recent. So, the private sector has not been confiscated by the government, yet (this is what Senator Sanders
3. has his beady eyes on e.g.). And the young (Millennials or “Echo Boomers”) are now the largest group of Americans
ever. Thanks to Reaganomics, we’re a young nation. Nobody talks about that either. Our youth need to be inspired!
Inspired to get married, have a kid and buy a dang house. Economics is a rather easy subject. It should be an ‘easy A.’
It just happens that there’s a rather large debate buzzing throughout the country this year (once we get past deliberating
little hands, big ears and get past an FBI investigation or two). The political debate centers on whether we continue
the current strategy or return to the one that worked. That subject used to be an easy A too (the schools in which you
matriculated being the risk variable).
The following is what we wrote in July 2012 upon a similar proposition in that major election year. We clearly hoped
voters had caught on by 2012 but worried that they had not. So, here we go again… We definitely like where the
debate is heading – clear contrasts now that we’re down to the final two.
-----------------------------------------------------------------------------------------------------------------------------------------------
The second quarter 2012 was a tough one. Suffice it to say, financial stocks were pushed around by global headline
risk. The explanation is simple – idiosyncratic fear has returned and resides at all-time highs (yet again). As a
follow-up to our recent assessment that many market participants were either neglecting or mistaking altogether
systematic risk (“beta”) with diffident and turbulent volatility in financials, we found the following research from
Russell Investments (below) very insightful and congruent with our own analysis. Clearly, there is an epic opportunity
in the deeply under-valued Financial sector which is currently nothing less than a “three sigma” volatility event.
As Russell researchers have illustrated below, beta and volatility can be two very different issues facing fund managers
when those metrics become uncorrelated (which is very unusual). Beta captures “systematic risk” or risk relative to the
broader market (to changing economic conditions). Aberrant volatility (above or below that of beta) would indicate the
existence of intangibles often referred to as “idiosyncratic risk.” Systematic risks are known, while idiosyncratic risks
are intangible and thus unknown or at least unpredictable. In fact, idiosyncratic factors perpetuate substantial “market
timing” issues as their very existence in a sector will typically push investors away in an effort to avoid the heightened
volatility. Such is the issue facing financial stocks today. There is an abundance of macro inefficiencies that exist
where the greatest value resides! If low volatility is that which you desire? Then you will pay through the nose for it
and risk permanent losses! But if great value is what you seek, it is available… but it comes with transient high
volatility caused by idiosyncratic factors.
High-Beta v. High-Volatility Index Sector Exposures (%)
Russell Investments 2011
Source: Russell Investments and BlackwallPartners LLC
4
9
14
19
24
29
Russell 1000 Weight US Larg Cap High Beta % US Large Cap High Volatility %
GREEN arrows represent extraordinary
standard deviations above the empirical norm
between systematic risk (“beta”) and
idiosyncratic risk (excess “volatility”).
4. In today’s highly volatile climate for stocks, systematic and idiosyncratic risk have become “unhinged” in several
sectors and in both directions. This is creating an extremely rare and compelling arbitrage opportunity. This extreme
decoupling phenomenon points to the likelihood of extraordinary upside in the Financials, but at the cost of some
short-term idiosyncratic-driven volatility, while other sectors showcase hidden systematic risks by their lack of
volatility just the same.
The Russell analysis highlights the stark disparity between excess volatility and systematic risk (i.e. greater than
average market/economic risk) across different sectors within the broader market. As Russell’s research suggests,
volatility where it has decoupled from beta – is driven almost exclusively by “less measurable” factors such as
political uncertainty which certainly has been the case of late. Russell goes on to say - “It is important to point out
that sector exposure to high-volatility stocks may be more time-period-dependent.” In other words, elevated
volatility is event dependent and thus transient and not systematic.
Volatility Index by Sector Exposures (%)
v. Price/Cash Flow Multiple
Source: Russell Investments and BlackwallPartners LLC
The chart above recasts the Russell findings to compare the valuation of each sector relative to its volatility. This chart
speaks volumes. If one wants low volatility stocks, one has to accept extreme valuations for them. If investors want
value, then one must accept high volatility. The only sector that strikes more of a balance is Technology.
REITs and Utilities are especially expensive. The opposite is true of Financials, they are being given away to avert
volatility. The Energy sector looks cheap only if you think that the commodity is stable. And Durables are
precarious as the commodity boom and insatiable desire by investors to be long China (as their “risk-on” trade) has
created an imbalance in that sector where volatility is too low relative the sector’s empirical beta, suggesting
oversubscription or overconfidence in China’s authoritarian economy. Generally speaking, it is the high priced (over-
valued) stocks which should be showing the greatest volatility, but not the case currently. This is an idiosyncratic-
driven cycle, namely US political uncertainty. It’s masking certain systematic risk (such as interest rate risk) and any
sudden change in the political landscape could reverse cash flows very sharply and adversely to those sectors where
2 7 12 17 22 27
Financials
Cons. Discretionary
Energy
Durables
Technology
Healthcare
Cons. Staples
Utilities
REITs
SPDR Dividend
US Large Cap High Volatility % Price/Cash Flow Multiple (X)
High Valuation;
Low Volatility
Low Valuation;
High Volatility
5. low volatility and high valuation coexist, while enormously favorable to those sectors where volatility greatly exceeds
empirical beta, namely in the Financials.
On balance, investors might incorrectly conclude that recent elevated volatility in Financials is decidedly indicative
of new, more pronounced systematic risk. This is not the case. In fact, Financial fundamentals have been
substantially improving since the crisis occurred (this is well documented). Nevertheless, investors are currently
mistiming the financial sector by unwittingly attempting to avoid transient volatility by running straight into
the arms of high priced, low volatility sectors. These high-priced sectors are where systematic risk is essentially
“masked” merely by the lack of volatility and the trade is getting ever more crowded.
This migration of capital flows away from “perceived risk factors” easily can and is (in our view) increasing market
timing risk as well as systematic risks for many investors. This includes heightened valuation risk to any change in the
economy (especially interest rates sensitive or historical ‘safe haven’ groups as noted). Investors have presumed for
some time now that interest rates will never change. As such, they may be zigging when they should be zagging.
Chasing sectors with excessive valuation merely as a function of the sector’s low volatility is itself also idiosyncratic
behavior.
A simple way to read into the Russell analysis is to assume that those sectors where volatility exceeds systematic risk
(beta) are the most under-valued (low risk, high reward) while those where systematic risk (beta) is higher than
volatility are likely to be excessively over-valued (high risk, low reward). This concurs with our fundamental
research and Russell’s analysis proves it empirically. Excess volatility now trumps existential valuation and thus
systematic risks now are all but being ignored.
The fact that Bonds, Utilities and REIT equities are trading at or near record high valuations (amid record low
volatility) are prime cases-in-point. Does their lack of volatility imply less systematic risk to changing economic
conditions? What would happen if say – interest rates were to begin to rise even modestly due to changing economic
conditions? Would that not incur significant valuation at risk already predicted by their current low volatility relative
their empirical beta? We certainly think so.
The Internet bubble is a good example or the tulip mania in Holland. Both were examples of systematic risks ignored.
Recent short term bond auctions in Germany, France and the United States at negative interest are a “tell” perhaps...
examples of a heightened “blind” systematic risk appetite. In each case, the systematic risk ignored was valuation;
while the idiosyncratic symptom identified and either welcomed or averted was high transient volatility or lack
thereof.
A “Three Sigma Event”… Already Discounted!
The presence of this “confusion” between systematic risk and idiosyncratic risk is evident in the current extreme
volatility of Financials. This volatility is several standard deviations (“sigma”) above its norm as measured by
empirical beta. This has resulted in a severe “volatility aversion” reaction by investors, pushing fund managers out of
the sector. This deep under ownership has resulted in record depressed valuations, thus where the extraordinary return
potential lies. This “buyers strike” exists despite the fundamental attractiveness of record builds of capital, reserves
and cash on bank balance sheets as well as valuations below “going concern value” as we have highlighted
extensively in previous musings.
The Russell statisticians captured some astonishing findings not particularly surprising to us. Financial stocks
represent nearly a full third of the Russell 1000’s volatility despite representing less than 10% of the beta and
only one-tenth of the sector’s representation within the index.
In empirical terms, Financial stock volatility of this magnitude (250% of its empirical beta) would not be seen 95% to
99.7% of the time. It is a three sigma event (an historical outlier the equivalent of a highly unheard of event). The
simple analogy is that a hurricane Katrina had a far higher probable outcome than the current deviation
between financial stock volatility and its empirical sensitivity to market risk (beta).
6. In contrast, REIT volatility e.g. is near ZERO despite the historic level of systematic risk (beta) to changes in
interest rates (economy). The attraction for investors is low volatility (and some yield) and thus investors have been
clamoring to own REITs despite being currently priced at RECORD multiples of cash flow, implying absurdly
low capitalization rates. The same scenario applies to some key bond markets. In these cases, no systematic or
economic sensitivity risk is implied in their valuations. NONE!
We believe financials offer what perhaps is the greatest disconnect between systematic risk and volatility
perhaps recorded. Valuations of financials remain at unsustainably low multiples of free cash flow with implied
yields topping 25%-30%. In stark contrast, REITs yield 2%-3% and benchmark bonds well under 2%.
As previously mentioned, we view “market timing” as a function of the wide imbalances between beta and volatility
across a myriad of sectors in the market to be the larger unspoken risk. This is the same collective “group think” that
masked imbalances that gave us the tech stock boom and bust of the late 1990’s. Investors are “crowded” en mass
into the same low volatility trade which is masking heightened valuation risks to any change in the economic
environment. Investor emotion and “less measurable” factors like political climates have a tendency to distract
investors caught in the moment. The current market imbalances between systematic risk and volatility offer an historic
risk/reward arbitrage opportunity.
For Financials, the “less measurable” or intangible factor primarily is the current politicized attacks on the
financial sector. This intangible or “idiosyncratic risk” has been more than “priced-in” to the financial sector and
there is no abundance of assurance that the current administration will remain in power beyond this coming
November. The unremitting “bank bashing” tactics of progressive governments have become all too politically
transparent – the LIBOR scandal and/or the hedging loss at J.P. Morgan e.g. These all serve as mere Kabuki theatrics
at a time when incumbent politicians, reeling from weak economies and poor re-election prospects are in dire need of
a “straw man.”
The idiosyncratic risk reflected in the historic imbalance between financial stock volatility and beta is the direct
byproduct of this “straw man” phenomenon. And we are confident that its days are numbered. Regrowth of the
economy tends to overtake petty politics come election time as voters have an uncanny penchant for insisting on it at
critical moments in our economic history such as 1952 and 1980, where political realignment was necessary. Political
realignment is no different than the self-correcting mechanism of the market. The same math (or voting models) can
be applied when imbalances this extreme are evident. Candidates invariably are drawn into the center of the empirical
electoral distribution or they lose elections.
After the 2QTR Sell-Off, Valuations Again Remarkably Favorable…
With the average price-to-tangible-book (P/TBV) values for the largest US banks at just 0.66x, the market is
not far off recent trough levels of 0.60x reached in March 2009 and well off March 2012 highs of nearly 1.0x
TBV. We continue to favor many regional banks trading well below book value and at no deposit premium
(no intrinsic value). The bad news emanating from both European and American policy makers is more than
priced into the group – setting up for highly favorable reward when any hint of market imbalances show the
slightest ray of headline (idiosyncratic) risk abatement.
And then there’s that election coming-up soon too… [Well, that part didn’t go the way in which we had
hoped].
Regards,
Michael P. Durante
Managing Partner
Blackwall Partners LLC