Salient to Investors: John Paulson said the euro would fall apart and bet against the region’s debt. Morgan Stanley predicted the S&P 500 would lose 7 percent and Credit Suisse predicted wider swings in equity prices. Warren Buffett called bonds dangerous. The largest banks and most-successful investors failed to anticipate how government actions would influence
READ MORE... →Salient to Investors: The number of people sued by the SEC or charged with insider trading by the Justice Department has more than doubled since 2008 – 22 percent involving health-care stocks. Bankers, lawyers, accountants, doctors, traders, analysts, hedge-fund managers, company chiefs, pharmaceutical executives and movie producers, lovers, neighbors, classmates
READ MORE... →Salient to Investors: The SEC is increasing its focus on insider trading by overseas buyers of US-traded securities. Overseas trading probes present significant obstacles to criminal charges. Foreign insider traders, while at some risk of losing their money, face very little chance of going to prison. The significant number of cross-border transactions
READ MORE... →Salient to Investors: Trading in US equity markets is spread across 13 stock exchanges and 50 dark pools. A third of US volume occurs away from exchanges. Justin Schack at Rosenblatt Securities said that from 2008 through 2010, big banks expanded their dark pools by using them as the first destination to
READ MORE... →Salient to Investors: We know we carry too much credit card debt, own too little retirement savings. Our confidence in our abilities to live on our meager nest eggs is far too high, and our emergency reserves too low. Schools don’t teach money management skills, despite their importance. Parents don’t hand down any money managing skills.
READ MORE... →Salient to Investors: Nassim Nicholas Taleb says: Black Swan effects are necessarily increasing as a result of complexity, interdependence between parts, globalization, and the efficiency that makes people sail too close to the wind. We must make our public and private lives less vulnerable to randomness and chaos, but also “antifragile” — positioned to
READ MORE... →Salient to Investors: Jack Bogle at Vanguard recommends these investing books: The Intelligent Investor by Benjamin Graham, A Random Walk Down Wall Street by Burton G. Malkiel Unconventional Success by David F. Swensen The Four Pillars of Investing by William J. Bernstein Extraordinary Popular Delusions and the Madness of Crowds by Charles
READ MORE... →Salient to Investors: Robert Auerbach at University of Texas writes: Warren Buffett disagrees with the importance of taxes and for some investors he is surely correct. Millions of people, including perceptive investors, are currently putting their money in accounts that pay around “a quarter of 1 percent” because the expected
READ MORE... →Salient to Investors: Bloomberg data show that in 2011, the Teacher Retirement System of Texas’ chief investment officer made the most of any public pension employee in the 12 most populous U.S. states. The fund paid $9.7 million in bonuses, the most in those states, and is the 7th largest in the US. The
READ MORE... →Salient to Investors: Carson Block at Muddy Waters said he stopped betting against Chinese companies this year after government agents hindered his analysts and harassed workers at his storage company in Shanghai. Block says China is protecting frauds by making it difficult to research short sale candidates, and has used intelligence and police agencies to deter
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