Archive - May 2011 - Blog entry

While globalization has generated immense wealth over the last 30 years, it has accrued only to those who were in position to take advantage of it. Those would be multinationals, technology firms, and emerging nations. If you are not one of those, or a shareholder in them, then you have been basically screwed by globalization. Champaign with former Secretary of Labor, Robert Reich.

Canadian private equity is booming, helped in large part by large Canadian public pension funds, and increasingly attracting global tech leaders. Is this the beginning of a renaissance period for Canada's PE market, or a sign that an overheated and over-leveraged economy is peaking?

Hiroko Tabuchi is a NY Times Reporter who received this letter from a mother in Fukushima on a recent trip. She promised to translate it and share it. It just popped up on Twitter and after reading it I feel compelled to repost it here as well. It is heart breaking and the plea by those suffering fellow citizens of our planet deserves to be heard and acted upon by all of us.

Shill will be shills and Eric ("Inaction Jackson") Holder will be Shinola.

It is simply not physically possible for 400M, or even 40M barrels of oil to actually be delivered to Cushing, I can tell you FOR A FACT that over 90% of those contracts will not only be cancelled before the expiration date, but that they will then be rolled over to August.

Are they pulling a Columbo?

The pullback in commodities has been EVEN BETTER for other lesser known inflation hedges. Indeed, individual players were absolutely decimated, bringing them to valuations we haven’t seen since 2008.
Consider that during 2008, Gold traded around $900 per ounce. Today it’s at $1,500. And yet, based on reserves and underlying assets, many inflation hedges today are trading at valuations equal to when Gold was only at $900 per ounce.

It's amazing what one can discern from a leisurely walk through the local big box electronics retailer. I reiterate - the wholesale assumption that Apple can defy the basic rules of business, economics 101 (supply and demand) and common sense, combined with a near-nonsensical lovefest for this admittedly very impressive and innovative company will result in some very bad days for the NASDAQ (wherein Apple is one of the, if not the, heaviest weighting) in the future.

59 percent of all Americans now receive money from the federal government in one form or another... is there any hope?

Engage in “constructive paranoia” and structure your portfolio to take advantage of the changes sweeping through the economy, rather than fall victim to them. A bumpy journey to a “new normal”. Developed countries will see sluggish economic growth, high structural unemployment, increased regulation, and constant pressure for private sector deleveraging.

A rehash of an old story. Answer this question and you seal the fate of the Fed.

This is not entirely surprising given that governments have been covering up nuclear meltdowns for fifty years to protect the nuclear industry

Jim Chanos is short China and solars. I say it's time to short Chanos...

Secondary bond selling continues, but seems as much about rotation into new issues as derisking for now. Equity outperformed credit on the day but we wonder whether the self-fulfilling liquidity support in corporate bond land is starting to ebb as concessions and basis contract and curves reach extreme steeps.

Fight Club is about personal growth and community, of discovering what we are all made of, of seeking the inner steel and honing it to perfection, then using our newly strengthened muscles to build a tighter more functional community. Fight Club is about creation, not random destruction.