There is very strong support for the yield curve association, and I’ll link to some sources below. Barry’s analysis is more carefully qualified than that of most of the talking heads on CNBC. Until now, I have always believed in the yield curve as an indicator, and I well know the peril in asking whether […]
Barry is like the farmer who thought the sun would no longer rise after his rooster died. He has observed a correlation and has inferred causation. The yield curve is an indicator of something, not a cause. Ask yourself this question: Would U.S. economic prospects be higher if Asian banks were less willing to buy our bonds?
How many strategists and managers can be contrarian? Why does everyone want to be one? As with many principles, the basic idea is easiest to understand by looking at extremes. At market bottoms (or bottoms in specific stocks, commodities, etc.) no one wants to buy. This is a terrific opportunity because the selling is over. […]
Everyone wants to be a contrarian. Here is an interesting suggestion that a hedge fund can be contrary by selling stocks short. The evidence here is not very convincing, since even those hedge funds that are not labeled as “short only” maintain substantial short positions and use leverage. But first, take a look at the […]
Here’s an interesting topic from Barry Ritholtz’s site, The Big Picture. Link: What are the odds of 2006 being a positive year?. I just had an interesting conversation with Mike Panzner, Director of Institutional Sales Trading at Rabo Securities. Mike is a quant who has an interesting take on the markets. Assuming the SP 500 […]