Monthly Archives: January 2016

Reasons to avoid despair

Scott Grannis is a champion. I love the way he analyses what is actually going on in the US economy, and draws insightful comparisons between often overlooked economic data. His last sentence sums things up nicely:

“Confidence is rising, there is no shortage of money or credit, businesses are hiring, cheaper energy prices are stimulating more activity, and the housing market is firing on all cylinders. This is not what you would expect to see if the economy were teetering on the brink of another recession.”
-Scott Grannis
LINK

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Goldman Sachs on Millennials

The Millennials – people born between 1980 and 2000 – are the largest generation is US history. The media tends to obsess about them and companies will do anything they can to figure out the magic formula to sell them their products. A couple of things are worth pointing out. I can say with a high degree certainty that millennials didn’t decide that it was all of a sudden super fun to live with mom and dad from 2007 onward. This was due to economic circumstance, not choice. In terms of other paradigm shifts (a very millennial concept…), much is also made of the fact that millennials choose experiences over material goods, and that they choose to share rather than own. This may be so, but we should be careful to overestimate these trends. Often times ‘experiencing’ is cheaper than buying. So is sharing. While services such as Uber are lessening the need for a car, the aspiration among millennials of owning a home is still very strong, which has very positive implications for the recovering US housing sector.

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Pessimism -vs- Optimism… And a Brief Comparison of Hysterical Oil Prophecies

When I began my career as an institutional equity trader in Canada fourteen years ago, commodity prices where just about to make one of the most fantastic runs in market history. China was rising – and it was hungry. Hungry for the copper that would be needed for millions of miles of power lines. Hungry for the uranium that would power their new power stations. Hungry for the nickel and iron that would create the stainless steel needed for millions of cars and household appliances. Most of all, China was hungry for the lifeblood of modern industry and economic growth: oil.

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A rant about historic valuation comparisons. The first of many links to “The Reformed Broker” Josh Brown.

I started reading Josh Brown’s “The Reformed Broker” blog a couple of years ago. I also attended Citywire Berlin in November 2015 where gave a fantastic presentation. In this article, he attacks the tendency of some analysts to hone in on certain market data without attempting a broader conceptualization of what was actually going on.

LINK

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