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Latest Observations, August 2016

 

 

 

The Coffee Chronicles

NASA’s interest in documenting its missions was not always so strong; Mercury astronaut John Glenn, for example, was forced to buy a cheap 35mm camera at a Cocoa Beach drugstore in 1962 because he alone felt that America’s first orbital spaceflight merited some historical snapshots.
Jonathan Cape, Full Moon, 1999

 

"The Bond Rally Of A Lifetime"
The Cause of Inflation, Lock Up For Infinity? Treasury Haters, Media Bias, Lonely Bulls, Maturity Matters, Three Sterling Qualities, Sovereign Shortages, "The Bond Rally of a Lifetime", and Finally Facing Reality.
Gary Shilling, Gary Shilling's INSIGHT newsletter, August 2016

 

Balanced Portfolio Strategies since 1986
December 1986 to June 2016

Lipper, July 2016

 

The Callan Periodic Table of Investment Returns

Annual Returns for Key Indices Ranked in Order of Performance (1996–2015)

Callan Associates Inc., 2016

 

 

The Coffee Chronicles

""Being wrapped up in breakfast, lunch, dinner came from an agricultural society and the industrial revolution. We don't work on farms, we don't work on assembly lines and I don't think we should eat like we do. I think people will switch to eating when hungry rather than eating on schedule.""
Lunch with the FT: Rob Rhinehart, July 2016

 

Salt in Their Veins
"The social structure of the inland Maine community is unlike anything you might meet with anywhere else. The kids never move out of the town they were raised in, there is no theft, the center of town is the fish store, or the post office."
Victor Niederhoffer, Daily Speculations, July 19, 2016

 

Are You Ready for the Bubble of the 2020s?
"If you look back at the stock market over the past 350 years, you’ll find that in each Century, the Twenties have always enjoyed bull markets in equities; this rings true for the 1720s, the 1820s and the 1920s."
Dr. Brian Taylor, Global Financial Data, July 14th 2016

 

 

Quote

on the Fly

"The British have achieved, accidently, what every central bank is trying to achieve, a fall in one’s domestic currency. What wouldn’t Bank of Japan governor Kuroda sacrifice to achieve the same thing?

Michael Howell, CrossBorder Capital, July 2016

 

 

Total Pages in the Code of Federal Regulations (1950 - 2014)

 

 

Columbian College of Arts & Sciences, Regulatory Studies Center

 

Dividends Tell a Better Story than Corporate Earnings
"Given the confusion that can be created from the two different ways to calculate earnings, we think an old saying among investors perfectly applies: “profit is an opinion, cash is a fact.” "
Oppenheimer Funds, July 5th 2016

 

Germany versus ECB: How Dangerous is the Dispute?
Careful what you wish for. For decades, Germans strongly believed in price stability and an independent central bank. Fate and the European Central Bank (ECB) have granted them both wishes.
Holger Schmieding, Berenberg, 20.04.2016

 

 

The Coffee Chronicles

"You know what, it’s rare when you get to see somebody get stupider before your eyes, but he’s really working at it. So you’ve got to give him credit, it’s not an easy thing to do, but he’s accomplished it!"
Mark Cuban on Donald Trump, Extra TV, June 21st 2016

 

La vraie signification du débat sur le BREXIT
"Les Anglais n’ont aucun problème avec les réalités. Ils ont de grosses difficultés avec les idées". Winston Churchill
Charles Gave, Institut des Libertés, 20 juin, 2016

 

Quote

on the Fly

"As noted, when investors buy bonds for capital gains and equities for yield, something looks wrong!"

Michael Howell, CrossBorder Capital, June 2016

 

 

German 10-year Benchmark Bond: 1807 - 2016

Source: Global Financial Data


Low rates now the problem, not the solution
"Although in relative terms the US has had a good recovery, in absolute terms it has not. (...) Whether we look over the past five years, or whether we look over the past ten years, US productivity growth is close to as weak as it has ever been."

 

 

Fathom Consulting, June 10th 2016

 

 

The Demise of the Zero Yield Bound
"The asymmetry of bond markets was often used to differentiate the performance potential of fixed income and equity investments. Bonds, we were told, had significant downside potential, while their upside was limited by a purported zero yield bound."
Tim Haywood, GAM, June 10th 2016

 

The Death of Equities
"Could the 21st century be reverting back to the condition of stock markets in the 18th and 19th centuries when the capital gains on stocks were minimal or non-existent? Unfortunately, the answer to this question could very well be yes."
Dr. Brian Taylor, Global Financial Data, June 2nd 2016

 

A Third Major Bubble That Looks Set to Finally Burst
"As noted, when investors buy bonds for capital gains and equities for yield, something looks wrong!" 
Michael Howell, CrossBorder Capital, June 2016

 

By this metric, bonds have never been more valuable
"Return is the most salient feature of any asset class, and it’s hard to get happy about 0%. In an asset allocation framework, however, return has different dimensions."
Joe Davis, Vanguard, May 26th 2016

 

 

 

Alice in Quantumland: A Charming Illustrated Allegory of Quantum Mechanics by a CERN Physicist

This book is an allegory of quantum physics, in the dictionary sense of “a narrative describing one subject under the guise of another.”
Maria papova, Brain Pickings, January 2014

 

 

Japan: in search of a virtuous cycle
"But perhaps the usefulness of Abenomics will have been to provide a workable game plan for a managed economic decline, in which bond investors pay the Japanese government to borrow."
Lombard Odier, Investment Strategy, 2nd quarter 2016

 

All that fun for nothing!
"With surprising regularity, financial markets provide the opportunity to drop that phrase as a deadpanned summary of recent events."
Jeffrey Knight, Columbia Threadneedle Investments, April 25, 2016

 

Cyprus versus Greece: a lesson in Eurozone reform
Holger Schmieding, Kallum Pickering, Berenberg, April 1st, 2016

 

The Coffee Chronicles

Did you ever notice how sometimes all day Wednesday, you keep thinking it's Thursday? And it happens over and over all day long. And then the next day, you're all right again..
....

Do you ever find yourself standing in one of the room in your house, and you can’t remember why you went in there?
George Carlin, Little Moments

 

 

Health Care Stock Returns Outpacing Rise In Health Care Expenses
Bob Carey, First Trust Advisors L. P., April 21, 2016

 

Traffic jam of executive aviation

Phoenix Sky Harbor airport in Arizona Super Bowl 2015

 

China’s monthly investment data provide first concrete evidence of ‘doubling down’
"Official data published last week confirmed that investment by state-owned enterprises surged during the first three months of this year, with the scale of the turnaround strongly reminiscent of the early 2009 period. "
Fathom Consulting, News in Charts, April 21, 2016

 

A Snapshot of Growth vs. Value Investing

Bob Carey, First Trust Advisors L. P., April 19, 2016

 

The People in Your Neighborhood: Social Interactions and Mutual Fund Portfolios
Veronika K. Pool, Noah Stoffman, Scott E. Yonker, The Journal of Finance, December 2015

 

The Global Liquidity Trap Turns More Treacherous
The adoption of negative interest rates will do little to stimulate growth. 
Scott Minerd, Chairman of Investments and Global CIO, Guggenheim Partners, April 07, 2016

 

United States 10-year Bond Constant Maturity Yield

1790 to 2010

Global Financial Data

 

Who you think the best candidate for the economy would be?

“Bernie Sanders”

"Without a doubt? Why is that?"
“No question.”

Asher Edelman, on whom the Gordon Gekko corporate raider character was based in the 1987 movie, Wall Street , interview on CNBC’s Fast Money, March 12, 2016

 

 

 

Cheats and Deceits

How Animals and Plants Exploit and Mislead.

 

"Many early naturalists, including Charles Darwin and his contemporaries, were all too aware that the natural world is not a harmonious place. While we often see instances of apparent cooperation, selfishness and exploitation rule the day." Read more

Martin Stevens, Oxford University Press, February 2016

 

 

Quote

on the Fly

"A severe depression such as 1920-21 is outside the range of probability. We are not facing a protracted liquidation"

Harvard Economic Society, a few days after the 1929 crash, the society closed its doors in 1932.

 

 

The Panic of 1792

The first attempt at a stock corner in the United States came at the birth of the American stock market, occurring even before the New York Stock Exchange had been established.

Dr. Brian Taylor, Global Financial Data, February 28th 2016

 

The Global Economy Didn’t Change Last Year, Views of QE Did
The stock market is still viewed as if it were a discounting mechanism, a system where information is processed and priced to deliver insight about the fundamental state of liquidity, markets, and the economy. That view has always been debatable, but never more so than the whole of this century so far. Read more
Jeffrey P. Snider, Alhambra Investment Partners, April 11th 2016

 


 

Asset Management Switzerland 2015

 For professional investors only

 

 

 

 

Pension Funds Guide
Switzerland 2015

 For institutional investors only

pdf Version

 

Themes

 

Asia

Bonds

Bubbles and Crashes

Business Cycles
Central Banks

China

Commodities
Contrarian

Corporates

Creative Destruction
Credit Crunch

Currencies

Current Account

Deflation
Depression 

Equity
Europe
Financial Crisis
Fiscal Policy

Germany

Gloom and Doom
Gold

Government Debt

Historical Patterns

Household Debt
Inflation

Interest Rates

Japan

Market Timing

Misperceptions

Monetary Policy
Oil
Panics
Permabears
PIIGS
Predictions

Productivity
Real Estate

Seasonality

Sovereign Bonds
Systemic Risk

Switzerland

Tail Risk

Technology

Tipping Point
Trade Balance

U.S.A.
Uncertainty

Valuations

Yield