The Unknown Wife hung the moon for the Unknown Son's 8th birthday party yesterday.
We took about a dozen of his friends to a nearby place run by a marine biologist from Unknown University. They had tanks with all kinds of crabs, guppy sharks, iguanas, and assorted disgusting looking creatures. Just perfect for an eight year old boy.
The two highlights of his day were:
1) Petting a small (about 18 inches long) shark (it subsequently almost jumped out of the tank, to the kids delight), and
2) Having a 35 lb boa constrictor draped across his shoulders.
This was followed by (of course) pizza, cake and ice cream.
He said it was "the best birthday ever."
Friday Link Dump
It's been a busy Friday - I taught a class this morning and saw an excellent presentation in the afternoon on investments in private equity. The paper presented examined the different types of parties (public pension funds, endowments, private pension funds, etc...) that invest in various types of Private Equity funds (i.e. buyout. early-stage VC or late-stage VC). Its main result was that there are significant differences in the ability of different cohorts of investors to make good choices (even within a given asset class). And the presenter did an outstanding job -- it's always fun to see a real professional at work.
And since he came to our campus for the visit, we got a free meal out of it at the university club (and my mouth felt good enough following my surgery that I could enjoy it).
So, today's Link Dump is a bit late (and a bit sparse). But better late than never. So without further ado:
And it's off-site, so we don't have to clean up. So everyone's happy.
And since he came to our campus for the visit, we got a free meal out of it at the university club (and my mouth felt good enough following my surgery that I could enjoy it).
So, today's Link Dump is a bit late (and a bit sparse). But better late than never. So without further ado:
CFO.com provides a good example of the earnings inflation technique known as "channel stuffing"And now, it's off to another birthday party for the Unknown Son. We did the in-family party yesterday, but today's involves the neighborhood kids and his classmates.
Bloomberg.com reports that bondholders have sued Wendy's over the spinoff of their Tim Horton's Unit. The bondholders claim the spinoff will increase the riskiness of the remaining firm, to their detriment. It's a good example to use in class to illustrate the "shareholder-bondholder agency problem."
Dealbook reposts on recent activities of some well-known activist investors.
David Andrew Taylor brings a very nice (and low-tech) explanation of why an inverted yield curve means that bond investors are predicting a recession.
Geoff Gannon at Seeking Alpha gives some background on the Dow. To paraphrase Inigo Montoya, "I don't think that Index is what you think it is."
The New York Times tells us Kobi Alexander isn't pleased with his accommodations in "U.S. Fugitive in Options Case Displeased By His African Jail." Apparently it's not up to "Club Fed" U.S. White -collar crime lodgings standards.
And it's off-site, so we don't have to clean up. So everyone's happy.
Who are My Picks For the Nobel Prize in Economics
Now that the Vicodin has kicked in, I have some time to post a bit. If I'm feeling o.k., I should probably really be working on academic stuff, but this way I can see just how lucid I am before I go back to writing on the current academic project. After I'm done, l'll put it down for a bit, read my latest Terry Pratchett novel, and then come back to see if I made any sense (or at least, as much as I usually do).
In any event, speculation seems to be heating up for who will get the next Nobel Prize in economics. I'll cast my vote for Eugene Fama of the University of Chicago for his earlier work on market efficiency (and later work on size and market-book effects which seem to contradict his earlier work). If he gets the nod, there's a good chance that his coauthor Kenneth French would share it with him.
A second choice would be The U of Chicago's Richard Thaler for his work in advancing the field of behavioral economics. Since we read several of all three authors' papers in grad school, I'd be happy with any of them (but my favorite would be for Fama to get it).
After typing this, I realize that the pain meds have slightly altered my fine muscle control - I keep hitting the wrong keys. Ah well - that's what spell check (and editing) are for.
Update: I rechecked this piece after a nap (and after a bit more of the anesthesia had worn off). Man on man - I made a lot of errors.
Update (10/3): Welcome to all the folks stopping by from Dealbreaker. com -- if you want a little history behind Financial Rounds, check out the FAQ page.
In any event, speculation seems to be heating up for who will get the next Nobel Prize in economics. I'll cast my vote for Eugene Fama of the University of Chicago for his earlier work on market efficiency (and later work on size and market-book effects which seem to contradict his earlier work). If he gets the nod, there's a good chance that his coauthor Kenneth French would share it with him.
A second choice would be The U of Chicago's Richard Thaler for his work in advancing the field of behavioral economics. Since we read several of all three authors' papers in grad school, I'd be happy with any of them (but my favorite would be for Fama to get it).
After typing this, I realize that the pain meds have slightly altered my fine muscle control - I keep hitting the wrong keys. Ah well - that's what spell check (and editing) are for.
Update: I rechecked this piece after a nap (and after a bit more of the anesthesia had worn off). Man on man - I made a lot of errors.
Update (10/3): Welcome to all the folks stopping by from Dealbreaker. com -- if you want a little history behind Financial Rounds, check out the FAQ page.
Thursday Link Dump- The Wisdom Tooth Edition
Today I get to have a severely impacted wisdom tooth removed - one of the few things I enjoy less than college-wide faculty meetings (at least I can bring hot coffee and papers to grade to the meetings).
On the other hand (What did you expect? I'm trained as an economist, so there's ALWAYS an "other hand"), they do give me some very nice pharmaceuticals to help me cope with the discomfort. So, I will likely not be blogging much today, and if I do, it might not be very lucid (and no comments about my usual level of lucidity).
So, here's the day's Link Dump):
Update: it wasn't too bad. The actual extraction took about 45 minutes, and I didn't recall a bit once the Verced kicked in. The jaw's sore, but the vicodine seems to be handling that o.k. (except I just failed to enter the verification word 3x to post this).
Anyone like to give odds on whether I make it to my 11:00 lecture tomorrow?
On the other hand (What did you expect? I'm trained as an economist, so there's ALWAYS an "other hand"), they do give me some very nice pharmaceuticals to help me cope with the discomfort. So, I will likely not be blogging much today, and if I do, it might not be very lucid (and no comments about my usual level of lucidity).
So, here's the day's Link Dump):
All About Alpha highlights a paper that attempts to “debunk” several myths about active management.Off to the dentist (groan), and time to be thankful for the wonders of modern pharmacology. In the old days I'd have to make do with a scotch and soda (or two), and this is much more efficient.
Abnormal Returns discusses how there might be insufficient alpha to go around.
Equity Private is yawning over Amaranth.
Chuck Jaffe of Marketwatch highlights some new actively managed ETF offerings, including one based on insider trading patterns.
On Seeking Alpha, Geoff Considine shows how using P/E ratios to screen ETFs doesn't make much sense. He makes some good points about how P/E ratios capture both growth and risk (and the two dimensions are hard to disentangle).
Dan Melson at Searchlight Crusade brings the 411 on buying real estate with 0% down.
Lastly, there were a couple of good Wall Street Journal Articles (online subscription required). In the first, we get the latest episode of "Where's Kobi?" It turns out that they found Kobi Alexander (Comverse Technologies CEO) in Namibia. And he's facing extradition.
In the second article, "Some ETFs start in Europe" we find out that the lighter lighter regulatory burden in Europe has shifted some ETF originatiooverseasrs (kind of like a play opening in New Haven and only later getting to Broadway).
Finally, in this week's "efficient markets aren't" story, the WSJ brings asks "Does Stock By Any Other Name Smell As Sweet?"-- They discuss recent research in the behaviorafinancece vein that indicates that the ease of remembering a company's ticker symbol is associated with its stock market performance. There's also a pretty good picture I'll have to find a way to use in my class somehow.
Update: it wasn't too bad. The actual extraction took about 45 minutes, and I didn't recall a bit once the Verced kicked in. The jaw's sore, but the vicodine seems to be handling that o.k. (except I just failed to enter the verification word 3x to post this).
Anyone like to give odds on whether I make it to my 11:00 lecture tomorrow?
Wednesday Link Dump
Not much to link to today, since I'm doing the Link Dump a bit early this time:
From Marketwatch.com: Michael Oxley of Sarbanes Oxley fame believes that changes will be forthcoming in SOX in the near future that will make it less burdensome for small companies. Personally, I'll take a "wait and see" approach, since my experience is that regulators seldom make regulations LESS burdensome.Time for another cuppa Joe and then off to class. I actually do one of my favorite topics today: active vs. passive management, fund fees and index funds.
From yesterday's Online Wall Street Journal, "Merger Trend Sweeping Big Exchanges Cascades Toward 'Interdealer Brokers'"
Abnormal Returns has a great analogy - it compares the evolution of the ease with which investors can get market returns (i.e. with index funds and ETFs) over time with the ease in getting a meal at a high-end restaurant.
Spitzer is at it again - he just sued mutual fund house J&W Seligman. The thought of him as governor of New York just bothers me.
Craig Newmark at Newmark's Door links to this excellent list of logical fallacies.
This Week's Carnival of The Capitalists
I'm a bit late in the announcing, but this week's COTC is up at Crossroads Dispatches. My three picks of of the week are:
Dave Porter at Pacesetter Mortgage Blog asks and answers the question What Do Mortgage Underwriters DO?Enjoy, and look around when you've read these. There's always lots of good stuff at a Carnival.
Free Money Finance shows how mutual fund fees can cost far more than you think., and advises people to buy index funds.
Dan Melman of Searchlight Crusade talks about loans on modular houses.
Tuesday Link Dump
There's lots of interesting stuff since yesterday both in the Mainstream Media and in the Blogosphere. Some of it is actually useful - I realized it was tome to refinance my mortgage (after all, I've been in the house for almost 3 months already. Herr are the latest tidbits:
First, on the lighter side: Did Bin Laden die from eating tainted spinach? Maybe it was a CIA Plot. And one blogger is trying to engage in what can only be called Elmo Arbitrage.Back to work: I've got data to torture and the English language to mangle (that's called "writing papers, for you non-academics...)
MarketWatch.com discusses how a cooling off in the housing market has resulted in a decrease in the rate on the benchmark Treasury rate. After reading it. I just did my refinance on my house (saved about $1,500 a year). For all you finance and econ faculty out there, the piece has a lot Oof good material for illustrating the Fed, interest rates, and inflation.
There's been a bit of insider-trading related news: Dealbook reports on the not-guilty plea by former hedge fund manager Hilary Shane, who allegedly shorted shares just prior to a private offering by Compudyne. And Marketwatch tells us that the SEC is planning to ramp up enforcement of insider trading in concert with self-regulatory organizations like the NASD and NYSE.
Bloomberg News reports on the increase in FBI investigations related to corporate fraud in general and options backdating in particular.
Political Calculations is finally getting around to putting up an index to all the online tools they've created.
Dan Melson at Searchlight Crusade asks (and answers) the question "Should Negative Amortization Loans Be Banned?"
The Daily Options Report talks about changes in automatic exercise provisions for slightly in-the-money options.
Marketwatch.Com reports on how the SEC is revamping Edgar (their online system for looking up filing information). I was just using it about an hour ago, and it can definitely use a more user-friendly system.
And last, but not least, Jim Mahar at FinanceProfessor.com discusses financial risk management (specifically, fuel hedging by airlines).
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