The Big Picture

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• Here’s The Thing: Joseph Stiglitz
• Can You Use the Dow as an Election Indicator?
• Morgan Housel’s 9 Financial Rules
• McLaren MP4-12C Spider
• Climate of Doubt
• 10 Weekend Reads
• Macroeconomic Effects

Here’s The Thing: Joseph Stiglitz Posted: 27 Oct 2012 01:00 PM PDT This week on Here's the Thing, Alec talks about the financial crisis with Joseph Stiglitz, a Nobel Prize-winning economist. Stiglitz shows no restraint when unleashing criticism of presidential policies — on both sides. Of President Barack Obama's financial-industry rescue plan, Stiglitz said that whomever designed it was “either in the pocket of the banks or … incompetent.” Stiglitz talks to Alec about growing up in Gary, Indiana and how that impacted his decision to become an economist. Joseph Stiglitz Monday, May 07, 2012

Can You Use the Dow as an Election Indicator? Posted: 27 Oct 2012 12:00 PM PDT Dow Jones Industrial Average performance for 28 Presidential Terms since 1900  click for ginormous graphic Source: NYT   Floyd Norris shows this very cool graphic of market performance under various presidents. The caveat, of course, is that the President does not drive market prices (though their policies can affect markets to0 a greater or lesser degree). I have stated (repeatedly) that the underlying factors that help an incumbent also tend to drive markets higher. Gains in jobs and income, increases in corporate revenue and profits, improvements in living standards, improvements in investor sentiment and consumer confidence are the sorts of factors that tend to benefit both incumbents and equities. Its not the market that determines the outcomes of elections, but rather, the same set of forces act upon both politics and equities.     Source: The Dow as an Election Indicator FLOYD NORRIS NYT, October 26, 2012 http://www.nytimes.com/2012/10/27/business/the-dow-as-election-indicator.html

Morgan Housel’s 9 Financial Rules Posted: 27 Oct 2012 09:00 AM PDT Another set of instructive rules for investors, this one from Morgan Housel: 1. Nine out of 10 people in finance don’t have your best interest at heart. 2. Don’t try to predict the future. 3. Saving can be more important than investing. 4. Tune out the majority of news. 5. Emotional intelligence is more important than classroom intelligence. 6. Talk about your money. 7. Most financial problems are caused by debt. 8. Forget about past performance. 9. The perfect investment doesn’t exist.     Source: 9 Financial Rules You Should Never Forget Morgan Housel October 14, 2012 http://www.fool.com/investing/general/2012/10/14/9-financial-rules-you-should-never-forget.aspx

McLaren MP4-12C Spider Posted: 27 Oct 2012 05:00 AM PDT   Can break the 200mph barrier, Reaches 62mph in 3.3 second, More than 3000rpm, 3.8-litre, flat-crank V8, 625bhp, Opening or closing the roof takes 17 seconds, and can be done while driving at up to 19mph, The coupé costs £176,000, the Spider £195,000. Source: Classic Driver

Climate of Doubt Posted: 27 Oct 2012 04:30 AM PDT Watch Climate of Doubt on PBS. See more from FRONTLINE.

10 Weekend Reads Posted: 27 Oct 2012 04:00 AM PDT Some longer form readings to start your weekend: • The Bloomberg Way (The Atlantic) • After the Boom in Natural Gas (NYT) • Which Fortune 500 Companies Are Sheltering Income in Overseas Tax Havens? (Citizens for Tax Justice) • Thomas Edison's Quixotic Plan for a New Monetary Policy (Bloomberg) • Billions in Hidden Riches for Family of Chinese Leader (NYT) see also Dirty money cost China $3.8 trillion 2000-2011: report (Reuters) • The Story of Grand Central Station and the Taming of the Crowd (Scientific American) • The Theory Generation (N+1) • George Lucas’s Force (The Chronicle) • Feet of clay, heart of iron: Horseshoe champion Brian Simmons might be the toughest athlete in the world (SB Nation) • How Barack Obama Vindicated ‘The Cult of the Presidency’ (The Atlantic) What are you reading?   Price to Earnings Ratio (PE ratio), 1900 to present Source: Chart of the Day

Macroeconomic Effects Posted: 27 Oct 2012 03:00 AM PDT

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