Unprecedented? Yes. This time is different. If you look at the chart below – 300+ years of short-term Bank of England interest rates – you see in what unusual times we live. From 1700 rates were about 5% for 130 years. Then for about 130 years they fluctuated between 2½% [...]
Expect the Unexpected. Yogi Berra said it: The future ain’t what it used to be. Marcel Proust said it: Toujours l’inattendu arrive (the unexpected always happens). Nassim Nicholas Taleb, author of The Black Swan, said it: The inability to predict outliers implies the inability to predict the course of history. [...]
What they said. “No” said the Irish on February 25, 2011. They ejected Fianna Fail, the largest party in Ireland since 1927 and replaced it with Finn Gael. “No” said the Italians on November 12, 2011. They sent away Silvio Berlusconi who served on and off for a cumulative 10 [...]
Consider this. Reuters now allows reporters to tweet first, file a story later. Reuters has editors to check facts before they’re tweeted. But it sees Twitter’s 140-million user base as a key complement to the newswire. 1 According to the Pew Research Center, while social media are only an incipient [...]
“It’s been said that 90 percent of the data that exists today was created in the last two years.”1 Attention! Attention! If you don’t know about Big Data you will. If you do know, you will as well. Even if the opening quote is a wild, back-of-the-envelope guesstimate, as I [...]
“Fascinating!” US corporate profits, as a % of GDP, have recently been close to their highest levels in 62 years – 10% of GDP. Only twice before in 62 years have they hit these peaks. Once in 1951-2. A second time just five years ago in 2007-8. That’s what the [...]
What we think. “Entrepreneur” means “young”. “Entrepreneur” means “energy.” “Entrepreneur” means “new.” Right? I was sent an article by The Economist1 that cites various studies showing that: There are more successful entrepreneurs over 50 and 60 than commonly thought. The ratio of older to younger successful entrepreneurs is about 2-to-1. [...]
On the field. “What would you do if the referee joined the game? Started playing for one side? It’d sure be a different game wouldn’t it? That’s what’s bothering us. When the referee becomes a player, the game changes. You either play or you leave. If you play, you’d better [...]
There are two facts about China – and because they’re big facts let’s call them mega-facts. Both are reflected in or can be derived from the charts below. MEGA-FACT #1 (the left chart). Over the past 9 years, since 2003, China’s balance of trade has become more volatile; plus exports [...]
Collision alert. Air Traffic Control system radars show when two planes are at the same altitude and headed for collision. Investment risk managers develop analogous equipment. This week, depending on the equipment you have, warnings have been flashing for the first time in a long time that a destabilizing event [...]
“But what makes it different?” asked a business colleague and friend about a fund we are launching. He could just as well have been asking me what makes upcoming Windows 8 different? What makes Mitt Romney different? Because whenever you want to sell anything – a fund, a product, a [...]
For 60 years, when the economy went down, government stepped in. It stepped in with automatic programs – unemployment insurance. It stepped in with one-time spending programs. This was the Keynesian formula. When the economy was operating at less than 100%, the government needed to spend to bring it back [...]
Who gets what? Greece has a lot of sand. Europe for weeks now has drawn a line it. And yesterday the line was tested and held. Those-in-charge of Greece voted into law the austerity measures Europe wanted. Those-in-charge of Greece will get to convert existing debt into less debt (the [...]
“Bear any burden, meet any hardship.” Since 2010 the euro-crisis has reached boiling points every few months. During those rolling-boil moments – when things are at their tensest – we always hear from Mrs. Merkel, Mr. Sarkozy or some other senior EU official words that sound like this: “We (those [...]
Why the bulls are out. The bulls are out and for good reason. Money is shooting out of the Fed and the ECB fire hoses at super-high pressure. The Fed upped the pressure with yesterday’s decision to leave interest rates at near-zero until the end of 2014 (past Ben Bernanke’s [...]
Next Big Things. Next Small Things. I have always spent quality time trying to figure out The Next Big Thing – which usually turns out to be several Next Big Things. For example, in the 80s and 90s the decline of inflation and its consequences; corporate restructuring and its consequences; [...]
The title is unsubtle to make three points. The first being that central bankers very often know less than they think they do. The second that, given their need to inspire confidence and authority, they can’t say the whole truth and nothing but the truth. The third being that they [...]
Silly Putty. Silly Sovereigns. Remember Silly Putty? Looked like real putty. Felt like real putty. But unlike real putty, when rolled up into a ball and thrown onto a hard surface, it didn’t go splat! It bounced way up like an India rubber ball! Wondrous as Silly Putty was, there [...]