Book: Endgame: The End of the Debt SuperCycle Authors: John Maudlin and Jon Tepper The title of the book is self-explanatory. The authors say that we are at the end of the debt super cycle and then talk about ways of unwinding the global credit binge. They also look at the possible paths that different countries may … Continue reading
Book: Reminiscences of a Stock Operator Author: Edwin Lefevre This is a book about exploits of Jesse Livermore, and is written by Edwin as if it were Livermore’s autobiography. Jesse Livermore was a trader in late 19th and early 20th century–he traded by watching the tape. One can be snooty about whether he was an … Continue reading
Book: Risk Author: John Adams “Prudence is a rich, ugly old maid courted by incapacity.” – William Blake Our culture pulls no punches when talking about people who avoid risk. Risk-takers are adorned with adjectives such as swash-buckling and fearless, while those who seek to avoid risk are described in a tone that William Blake … Continue reading
Look at how drastically 2Y, 10Y and 30Y yields have dropped in a week. This is stunning. The 2mo yield became negative. This is so unreal that BoNY Mellon has started charging fees for keeping investors’ money if they deposit >$50m, reversing everything you have come to expect from a bank deposit. You’re now … Continue reading
Book: Fool’s Gold Author: Gillian Tett One of the key financial inventions of the past two decades has been credit derivatives. Some of these, namely CDOs got extremely popular in financial press in the aftermath of financial crisis. This book traces the root of creation of these derivatives and their route to popularity. It is … Continue reading
Book: The Most Important Thing Author: Howard Marks This past Thursday, I, and 25 or so other summer interns at UBS, had the fortune to meet Howard Marks. I read his book in preparation for this meeting. This post is a summary of that meeting and my takeaway of the book. First, an introduction to … Continue reading
First of all, this post is simply another (simplified, I hope) version of http://www.zerohedge.com/article/forget-vix-skew-tells-true-story-about-market-risk. I claim no credit for any original thought in this post. This is still fairly wonkish, and you would need a understanding of options to understand this post (and/or call me out on a mistake). Second, CSFB here doesn’t stand for … Continue reading
I believe that the S&P 500 is overpriced and due for at least 8-10% correction in the coming 9 months. I would take advantage of this mispricing using a long put option on S&P 500 Mini options (XSP). Very simply put, the S&P will rise if the component firms’ sales increase, margins improve, or if … Continue reading
I have previously argued that Spain is the game-changer for Eurozone debt crisis. If Spain fails, it will be the Lehman of debt crises, because rules of engagement will be unknown, and panic will spread across the globe riding on a giant uno-correlation machine. This is why EU, ECB, and likley G-20 will do all … Continue reading
It’s here; a new era has begun. Wisconsin public-sector workers have lost their collective bargaining rights. The narrative of how unions are hollowing out America’s fiscal stability has won. Except, that the new era, if it lasts for long, is an unfortunate one. First, this is not a negotiation; the Wisconsin public-sector employees have simply … Continue reading
