Category: finance

Last Post on Facebook (I Promise)

(Written for a local newspaper op-ed, but rejected) More than seven thousand IPOs in the last thirty years have returned, on average, just under 18% on the first day itself. In the case of Facebook, this return was less than…

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Interviewed by ABC on Facebook IPO

I was interviewed this morning by ABC on the Facebook IPO (I come in at around 4:50 or so). The reporter, Katie Marzullo, was great. In the limited time that I had though, I don’t know if I got my…

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Credit Default Mop-Up (Updated Twice)

The latest on the JPMC debacle is that Ina Drew, Chief Investment Officer there is all set to resign: Executives said that within the last several months, Ms. Drew told traders at the bank’s chief investment office to execute trades…

No Shallow End

A fair amount of entities and people are flailing about trying to keep afloat in current financial markets. One response is to trade in the  growing number of dark pools. These are, essentially, private networks of traders who wish to trade without…

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Expensive and Disturbing

A Goldman Sachs trader who, when leaving the company, uploaded a copy of Goldman’s high frequency trading (HFT) software to a server, after which he then downloaded it to his home computer. He was leaving to join a startup that…

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Smoking These Bonds is Injurious to One’s Health

Some  years back, I blogged about the bond bubble leading to even churches issuing bonds. Now bonds are being issued that depend on manufacturers of the devil’s weed (I’m referring to tobacco. I know it’s an antiquated reference, but work with me…

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Myths about Derivatives

Although my students already know that some of these are myths, it does not hurt to be reminded of them every once in a while. Here is a sampling of the first myth, that includes the story of Thales, one…

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From Steve Randy Waldmann at interfluidity:

I no longer trust my own government to be the provider of a civilized society. No government is perfect or without corruptions. But in 2007, I thought I lived in a remarkably well-governed nation that had gone off-kilter under a small and mean administration. In 2011, I view my government as the sharp edge of an entrenched kleptocracy, engaged in ever more expansive schemes of surveillance and arrogating powers of ever less restrained brutality. At a visceral level, I dislike President Obama more than I have disliked any politician in my lifetime, not because he is objectively worse than most of the others — he is not — but because he disproved my hypothesis that we are a country with basically good institutions brought low by poor quality leadership. Whenever I hear the President speak and am impressed by the quality of his intellect, by his instinct towards diplomacy and finding common ground and rising above petty struggles, I despair more deeply. Not just because a leader of high quality failed to restore passably clean and beneficient government. It is worse than that. The kleptocracy has harnassed this man’s most admirable qualities and made them a powerful weapon for its own ends. He has rebranded as “moderate”, “adult”, “reasonable”, practices such as unaccountable assassination lists and Orwellian nonhostilities. He has demostrated that the way grown-ups get things done in Washington is by continually paying off thieves in suits. Perhaps it is unfair to blame Barack Obama for all this. Maybe he has done the very best a person could do under our present institutions. But then it is not unfair to detest the institutions, to wish to see them clipped, contained, or starved. [link]

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