“Program Trading Gone Wild,” the Sequel? What’s behind gyrating stocks the last three weeks or so? (I know, it seems much longer). Here are two theories: One. Age-old human emotion — fickle, fear-and-greed driven human psychology — is the culprit. In particular, less experienced “retail” investors who chased high-flying tech stocks, and are now freaking...Read More
Obama Exits, Stage Right Left As the 2016 stock market rout deepens (the Dow is down over 400 pts. so far this am), shell-shocked investors are all wondering: when will the pain stop? Unfortunately, it’s not clear to me that it will be anytime soon. That’s because markets hate uncertainty, and the biggest uncertainty hovering...Read More
Stock “Comp’s” vs. Housing “Comp’s” If you want to buy 100 shares of Google or Amazon, what are the comp’s? How much the last Buyer paid a fraction of a second ago. After all, stock is fungible: every share (at least common) is the same as every other. Nanoseconds vs. Weeks (Months?) Now, assume you...Read More
Indexing’s Looming “Free Rider” Problem “If you’ve been playing poker for a half-hour, and you don’t know who the patsy at the table is . . . it’s you.” –Warren Buffett “Index funds run by Vanguard see record inflows as savers turn to autopilot.” –“Investors Shun Stock Pickers”; The WSJ (1/5/2015) I’m a long-time fan...Read More
The “Alice in Wonderland” Stock Market; or, Figuring Out What the Fed Will Do “The next level analysis is [determining] whether . . . good news is bad (meaning less accommodation) or good (economic improvement); or conversely, whether bad news is good (meaning more accommodation) or bad (economic deterioration).” –Barry Ritholtz, “Predicting Jobs Data is Hard...Read More
One Step Forward, Two Steps Back? What do the 2010 home buyer tax credits have to do with today’s stock market? After producing a huge spike — actually two, due to the initial credit being extended and expanded — the housing market resumed its swoon. With a vengance: the second half of 2010 and well into...Read More
