I’ve been going through my 2007 posts to select the best ones for a year-end summary. Here’s the first batch, encompassing the categories Education, Management/Leadership/Business, and Markets/International Trade.
Markets and Trading
Investing Here and Abroad
Recently I was reviewing the performance of the (small) trusts that I manage for my nieces and nephews. The site www.trustfundsforkids.com contains the performance and stock selections for each of the three portfolios if you are interested (not plugging it for cash… no advertisements there).
A friend of mine said that I had beaten the relative benchmarks in my fund performance and I was feeling pretty good about myself. However, I realized that the benchmarks that we are commonly using, the NASDAQ and NYSE, didn’t really apply because so many of the stocks that I selected were foreign companies – thus the relative benchmarks would be the high-flying international indexes where my performance would be comparatively… retarded, to use a politically-incorrect term.
Muni Bonds and Garbled Journalism
One of the best financial periodicals available is the Wall Street Journal and I read it daily. I find their standards, overall, to be quite high. Occasionally, however, they write a garbled piece which brings me back to my opinion that “generalist” journalists should go the way of the Dodo. The article in question is titled “Exodus from Muni Bonds Could Yield Opportunities” from Saturday, August 25th.
This Time It’s Not Different
From MarketWatch:
SAN FRANCISCO (MarketWatch) — The liquidation of a big hedge fund or investment-bank trading portfolio is wreaking havoc in some parts of the hedge-fund business, according to managers and investors.
Black Mesa Capital, a hedge-fund firm that uses computer models to track down investment ideas, said that at least one large hedge fund or investment bank is liquidating “massive” trading portfolios, according to a letter the Santa Fe, N.M.-based firm sent to investors Wednesday.
The warning is causing disruptions and triggering big losses among other so-called market-neutral hedge funds, Black Mesa said in its letter, a copy of which was obtained Thursday by MarketWatch.
“Clearly, something is amiss in the markets that few in our strategy, if anyone, have experienced before,” Black Mesa’s managers, Dave DeMers and Jonathan Spring, wrote. DeMers declined to comment Thursday.
The firm’s hedge fund, which has about $1.9 billion in long positions and $1.9 billion in short positions, was down roughly 7.5% this month through Aug. 7. Those losses could grow to as much as 10% for August so far, Black Mesa noted.
I love this quote: ‘Clearly, something is amiss in the markets that few in our strategy, if anyone, have experienced before.’
Something unanticipated is always amiss in the markets in these situations. That’s how these situations happen.
Excellent Blogging on Power, Infrastructure and Financial Issues
I highly recommend Carl from Chicago’s posts on these issues at the Life in the Great Midwest blog. Carl’s posts are easily accessible via the category list on his blog’s left sidebar (click on Economics, Electricity, Social Security or Taxes to start).
Carl’s latest post, on the economics and politics of electric-power infrastructure in Illinois, is here.