Quantifying the Economic Impact of Housing Declines

Everyone wants to know about housing and the economy.  Is the sub-prime lending issue something that will extend to other mortgage classes?  How much might home prices fall?  Will the impacts lead to reduced consumer spending and an even greater economic effect? Doug Kass, the popular hedge fund manager noted for his skill in short […]

Read More

Mortgage Availability and Personal Consumption: Round Three

Background During my vacation, Doug Kass posted again on the topic of housing and personal consumption.  His analysis can be divided into two parts.  Part one "replied" to our analysis and part two elaborated further his reasoning about the connection, the causal model, and what he expected to happen. Here is what he wrote: Many, […]

Read More

Disciplined and Regular Portfolio Review: A Best Practice

A regular review of holdings is an extremely important part of investment management.  While every manager follows daily news, it is a best practice to ask whether new candidates are better than current holdings. In our portfolios we sell stocks when our original investment thesis breaks down or when the stock appreciates so much that […]

Read More

Misusing the Most Powerful Computer

There is a perfect storm tempting many traders and investors.  The increased power of computers, the easy availability of data, and the user-friendliness of software have made it possible for nearly anyone to backtest trading systems.  The result is that people with no background or training in research methods are using the most powerful tools, […]

Read More