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Archive for the Investment Mathematics Category

The Last Bubble Standing – Amazon’s Same Day Trip Through The Casino – David Stockman’s Contra Corner 07-27-15

David Stockman writes: Amazon’s valuation, its one day gain and last week’s Google gain are reminiscent of the days before the tech wreck 15 years ago. The 12 Big Cap Techs of 2000 saw their peak combined valuation of $3.8 trillion plunge to $875 billion a decade later, even as their sales

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Take Cover – Wall Street Is Breaking Out The Bubblies – David Stockman’s Contra Corner 07-20-15

Salient to Investors: David Stockman writes: Google’s unwarranted market cap gain last Friday – 75% of the 9.6% gain in net income from the prior quarter was due to a lower tax rate and a cutback of ballooning G&A expenses – easily passed in one day the entire $50 billion market cap of Caterpillar, though only

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Nassim Taleb: World is NOT more peaceful – Yahoo Finance 05-19-15

Salient to Investors: Nassim Taleb said: Over the last 2000 years, there is no no statistical evidence that violence has dropped, or that the frequency or magnitude of wars is declining. People are lulled into a false sense of security because of the nature of fat tail events, which can

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Barclays Says Stock Bulls Confuse Correlation With Cause – Bloomberg 10-28-14

Salient to Investors: Jonathan Glionna at Barclays said: There is insufficient data not enough data – only 21 observations in the last 86 years – to expect a repeat of stocks’ habit of rallying after midterm elections – a median 7% in the 90 days following, with a range of

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Morgan Says Buy Russia Stocks Seven Weeks After Sell Call – Bloomberg 10-20-14

Salient to Investors: Ronan Carr at Morgan Stanley said they are tactically overweight Russian stocks – upped to Buy from Sell – and that the situation is not deteriorating and that worst case outcomes, like additional sanctions, now appear less likely.  JPMorgan Chase said Russian stocks are likely to extend

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BlackRock Sales in October Rally Signal Its Limits – Bloomberg 10-20-14

Salient to Investors: Peter Hayes at Blackrock said nobody really expects rates to rally significantly from here and everybody is waiting for a pullback. Hayes said the muni market is overpriced and said sell into strength and wait for better opportunities. Munis have rallied in each of the first 9 months

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Fidelity’s Rossi Buying Stocks as Hedge Funds Get Caught – Bloomberg 10-16-14

Salient to Investors: Dominic Rossi at Fidelity Worldwide Investment said: He is looking to buy markets at these levels, particularly US stocks, amid a sell-off exaggerated and exacerbated by poor positioning from hedge funds. Long-only investors had largely maintained their asset allocations, but there has been a massive contraction of

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European Stocks Tumble to One-Year Low on Crisis Concern – Bloomberg 10-16-14

Salient to Investors: Steen Jakobsen at Saxo Bank said we have reached the part of the cycle where bad news is bad news – for years we have been trading on monetary policy and now we have to deal with real economic problems. James Bullard at FRB St. Louis said the Fed

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U.S. Stocks Tumble as Russell 2000 Enters Correction – Bloomberg 10-01-14

Salient to Investors: Randy Bateman at Huntington Asset Advisors said investors have always relied on the Fed priming the pump, which ends this month so investors are moving focus to the many geopolitical situations and economic concerns. Economists forecast growth from Japan to China will slow every year through 2016. Tim Courtney at Exencial Wealth

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Tepper Sees Junk Debt at Fair Value, Equity Prices Not High – Bloomberg 10-01-14

Salient to Investors: David Tepper at Appaloosa Management said: P/E ratios for US stocks are not high and junk bonds are at the mid-point of fair value. The US economy is good. The end of the bond market rally started last month when the ECB unexpectedly cut interest rates and

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