Author Archives: Felix

Hedge Fund Datapoint of the Day

Posted on August 6, 2008 by Felix

Evan Newmark: Citigroup estimates that in the past 18 months Fortress has lost an astonishing 85%, or $6 billion to $7 billion, in the value of publicly-traded companies in which it holds large positions. It takes an extra-special level of … Continue reading →

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Should You Tap Your Heloc Before it’s Frozen?

Posted on August 6, 2008 by Felix

The home equity line of credit, or Heloc, is a wonderful thing: the best way of having liquid funds available in case of emergency you could possibly imagine. Your net worth might be tied up in your house, but that … Continue reading →

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Retirement: Not as Important as a Dishwasher

Posted on August 6, 2008 by Felix

Heather Havrilesky has an important piece in Salon about online retirement calculators, and she ultimately ends up in exactly the right place, albeit with a very low level of confidence. The right place, in case you hadn’t worked it out … Continue reading →

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Why Big Mortgage Losses are Here to Stay

Posted on August 6, 2008 by Felix

John Hempton is doing an admirable job teasing out the dynamics of the US mortgage market, and asking whether the losses we’re currently seeing are due to fraud or to broader economic stress. If it’s mainly fraud, he says, that … Continue reading →

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The WSJ’s Broken Subscriptions System

Posted on August 6, 2008 by Felix

Rupert Murdoch’s News Corp today announced a 57% rise in annual profits, to $5.38 billion. Please, Mr Murdoch, spend a tiny, tiny amount of that money on fixing the Wall Street Journal’s horrendously broken subscriptions system. I’m spending the summer … Continue reading →

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No Changes to Libor

Posted on August 6, 2008 by Felix

Remember the big Libor makeover, prompted by fears that Libor was increasingly fictional? Well, now that we’ve all pretty much forgotten what the fuss was all about, the BBA has come out and decided to do nothing. In a 14-page … Continue reading →

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Blogonomics: Daily Candy Sold for $125 Million

Posted on August 6, 2008 by Felix

I’ll get this out of the way immediately: Daily Candy isn’t really a blog, it’s more of an email newsletter. But still, this is impressive: after buying the company in 2003 for what seemed at the time to be the … Continue reading →

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Extra Credit, Tuesday Edition

Posted on August 5, 2008 by Felix

FOMC Statement: No change, as expected. Hovering Above Poverty, Grasping for Middle Class: "The vast majority of those polled said religion or their faith in God plays an important role in helping them through financial straits." Argh. It hurts: "I, … Continue reading →

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Meredith Whitney and the Hierarchy of Payments

Posted on August 5, 2008 by Felix

It used to be that if you were having difficulty making your mortgage payment, you’d end up, one way or another, putting it on your credit card — if only by being unable to pay off much of your credit … Continue reading →

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Legalese Datapoint of the Day

Posted on August 5, 2008 by Felix

The word count for Marc Lefar’s new employment agreement with Vonage? 18,418. The document does say that Lefar will receive up to $50,000 in reimbursement for "reasonable counsel fees incurred in connection with the negotiation and documentation of this Agreement". … Continue reading →

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The Economics of Discounting

Posted on August 5, 2008 by Felix

"Discounting smacks of desperation," says Liz Gunnison. "That’s why brands like Louis Vuitton and Apple don’t do it." Is this a common strategy, or is it a very tough one? All department stores have sales, no matter how high-end they … Continue reading →

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Record Label Valuation Datapoint of the Day

Posted on August 5, 2008 by Felix

May 2007: Terra Firma buys EMI at a valuation of $6.3 billion. August 2008: Sony buys out Bertelsmann, its partner in the Sony BMG joint venture, at a post-deal valuation of $1.8 billion.

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How Auctions Drive the Art Market

Posted on August 5, 2008 by Felix

The first chapter of Sarah Thornton’s Seven Days in the Art World is on auctions, and it’s a corker. Thornton not only has sharp insights, she also expresses them beautifully: The hammer punctuates and passes judgment. It acts as a … Continue reading →

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Timing the Recession

Posted on August 5, 2008 by Felix

Don Fishback and Barry Ritholtz are shocked — shocked! — that the InTrade recession contract is based on hard GDP numbers rather than, um, something else, maybe an NBER pronouncement the timing of which is entirely unknown. The fact is … Continue reading →

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Merrill: Losing the Expectations Game

Posted on August 5, 2008 by Felix

Dennis Berman looks today at Merrill Lynch’s earnings per share. With earnings down and the number of shares up, he concludes, reasonably enough, that, in the words of Sanford Bernstein’s Brad Hintz, "it’s extremely difficult to get to the earnings-per-share … Continue reading →

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Mobile Banking for the Poor

Posted on August 5, 2008 by Felix

At a press conference this morning in Mumbai, mobile-banking company Obopay announced an alliance with Grameen Solutions — an alliance with an extraordinarily ambitious goal. In ten years’ time, the companies said, they would like to see 1 billion of … Continue reading →

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Why the Energy Crisis Won’t Solve Itself

Posted on August 5, 2008 by Felix

Will Wilkinson is optimistic about energy. Don’t worry about peak oil, he says: as oil prices rise, alternative energy sources will become more attractive, and eventually innovation and competition in the alternative-energy space will drive alternative-energy prices down below the … Continue reading →

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Extra Credit, Monday Edition

Posted on August 4, 2008 by Felix

Economist Rankings: On the Wu-index, Andrei Shleifer is clearly Top Dog, with 14 papers having at least 140 citations. Lucas, Barrow, and Bernanke are in joint second place, each with 12 papers having at least 120 citations. A Comparison of … Continue reading →

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Where’s Calomiris’s Paper?

Posted on August 4, 2008 by Felix

Charlie Calomiris and two co-authors have a piece in today’s Washington Post making an improbable case: Most Americans have not experienced any significant decline in the value of their homes — nor are they likely to. "In our research," they … Continue reading →

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Jimmy Cayne’s Latest Own-Goal

Posted on August 4, 2008 by Felix

Jimmy Cayne has been speaking at length with Fortune’s William Cohan, and has now managed to tell his side of the story. No wonder people don’t like him much: he comes across really badly even here. After reading the piece, … Continue reading →

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How Risky is Venezuela’s Bank Nationalization?

Posted on August 4, 2008 by Felix

Hugo Chávez has done a lot of things to endanger the Venezuelan economy. But to read John Lyons in the WSJ today, one of the worst and riskiest is his decision to nationalize Banco de Venezuela, which the then-government sold … Continue reading →

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Gasoline Datapoint of the Day

Posted on August 4, 2008 by Felix

Comes from Edmunds.com: The median household is spending 11.5% of its income on gasoline, up from 4.6% of its income five years ago. It’s a pretty basic calculation, which assumes that both miles driven per year and fuel economy have … Continue reading →

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Art in Textbooks

Posted on August 4, 2008 by Felix

David Galenson has a list of the greatest works of art of the 20th Century. The Demoiselles are in top place, which is reasonable enough. But the list gets rather screwy after that: Tatlin’s model of his unbuilt Monument to … Continue reading →

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Productivity: Looking Good

Posted on August 4, 2008 by Felix

One of the bright spots in the recent GDP reports has been the productivity figures. Whenever GDP continues to grow even as employment is falling, productivity — which is the growth in GDP per worker — will look particularly strong. … Continue reading →

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Extra Credit, Sunday Bonus Edition

Posted on August 3, 2008 by Felix

A Response to the Gates Foundation Memo: Stephen Landsburg lays into the "creative capitalists". I Heart Adam Smith: He groks all the contradictions in the nexus between wealth and happiness. Riches to Rags: "Phillips believes the agony of the American … Continue reading →

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