The Big Picture

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• #AskJPM . . . Hilarity Ensues
• 10 Thursday PM Reads
• Consumer Psychology & eCommerce
• Not Quite Bubblicious Yet
• QE & Ultra-low Interest Rates: Distributional Effects + Risks
• Guest Hosting Bloomberg Radio 10am-2pm
• 10 Thursday AM Reads
• European Slowdown
• Change Blindness

#AskJPM . . . Hilarity Ensues Posted: 14 Nov 2013 04:30 PM PST I was on the road yesterday when this erupted, but its too good not to post:     Other media coverage: Buzzfeed Reuters NYTimes   Stacy Keach Reads the best of #AskJPM

10 Thursday PM Reads Posted: 14 Nov 2013 01:30 PM PST My afternoon “Whats-all-the-Yellin’-about“  train reading: • Four Key Points From Yellen on Tapering (WSJ) see also Yellen on Stocks: This Isn't a Bubble (WSJ) • The ‘Easiest’ Year of This Bull Market Is Ending  (Yahoo Finance) • Looking For Love On The Bloomberg Terminal (Buzzfeed) • Financial Advisers: How to Counsel Clients in a Hot IPO Market (CFA Institute) • Bid Wars Wane in U.S. Housing Markets on Supply Rise (Bloomberg) • Occupy Wall Street activists buy $15m of Americans’ personal debt (Guardian) see also Occupy’s Plan To Cancel Consumer Debt Has Been A Big Success So Far (Business Insider) • Elizabeth Warren to Regulators, Congress: End 'Too Big to Fail' (Nation) • Will Google Docs kill off Microsoft Office? (CNN) • Aspiring Lego designers are called to Denmark to build Lego sets under pressure (WSJ) • Lou Reed's New York Was Hell or Heaven (NY Times) What are you reading?   IPO Market Shows Signs Of Cooling Down Source: WSJ

Consumer Psychology & eCommerce Posted: 14 Nov 2013 11:30 AM PST click for complete graphic     click for ginormous graphic

Not Quite Bubblicious Yet Posted: 14 Nov 2013 10:00 AM PST Source: BlackRock   It seems that everywhere I go over the past few weeks, I bump into some form of bubble chatter. Mom and pop are returning to equities means it's a bubble, all the new stock and bond issuance is a bubble and, of course, the Twitter initial public offering indicates we are deeply in bubble territory. Russ Koesterich of Blackrock, however, points out that the usual indicia of bubbles are nowhere to be found. He points out stock valuations are "no longer cheap, but they are still a long way from the peaks seen in previous cycles." Equities trade for 2.5x book value and for 16.5x trailing earnings — far below the heady highs of prior bubbles. He notes the 1987, 2000 and 2007 peaks saw price-to-earnings ratios at 23, 30 and 17.5. The price-to-book ratio, meanwhile, peaked at close to 5 in 2000 and 3 in 2007.   Continued here

QE & Ultra-low Interest Rates: Distributional Effects + Risks Posted: 14 Nov 2013 07:30 AM PST Source: McKinsey & Company     McKinsey has a new study out on the impacts of QE. I have yet to read the full report (or summary) but the graphic above and excerpt below give you some flavor: The impact that ultra-low interest rates have had on banks has been mixed. They have eroded the profitability of eurozone banks, resulting in a cumulative loss of net interest income of $230 billion between 2007 and 2012. But banks in the United States experienced an increase in effective net interest margins and a cumulative increase in net interest income of $150 billion. The experience of UK banks falls between these two extremes.

Guest Hosting Bloomberg Radio 10am-2pm Posted: 14 Nov 2013 06:45 AM PST   Barry Ritholz, chairman and chief investment officer at Ritholtz Wealth Management, discusses Fed Policy, Europe, and other fascinating topics with with Bloomberg’s Kathleen Hays on Bloomberg Radio’s “The Hays Advantage.” l’ll post the audio as soon as its available. Stream it live here

10 Thursday AM Reads Posted: 14 Nov 2013 06:15 AM PST Good morning, some fascinating reads to put your brains in gear: • 10 reasons to be a bull in 2014, a bear by 2017 (MarketWatch) • What Is the Value of Stolen Art? (NY Times) see also Nazi Loot Heirs Look To Reclusive Hoarder to Recover Art (Bloomberg) • Fracking Boom Gives Banks Mortgage Headaches (American Banker)     Continued here

European Slowdown Posted: 14 Nov 2013 05:00 AM PST The headline's this morning are all agog about Europe. "ECB’s Praet: All Options on Table;" Central Bank Could Adopt Negative Deposit Rate, Asset Purchases If Needed said the WSJ. "Europe Recovery Wanes as Germany Slows, France Contracts" was the Bloomberg hed.  The FT's Martin Wolf wrote Why Draghi was right to cut rate." And the big one, "Euro-Zone Recovery Falters." Please calm down about Europe.   Continued here

Change Blindness Posted: 14 Nov 2013 03:00 AM PST Psychologists who study the fascinating phenomenon of change blindness know that merely looking at something is not the same as actively paying attention to it. As the demonstration in this video shows, people can be blind to significant changes in a visual scene that are obvious to someone who expects that these changes are going to happen Originally posted at NOVA

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