Author Archives: Felix

World Bank Biofuels Report Finally Released

Posted on July 30, 2008 by Felix

Three weeks ago, the Guardian’s Aditya Chakrabortty published "the biofuels report they didn’t want you to read": the research paper from the World Bank’s Don Mitchell saying that 75% of the rise in global food prices could be attributed to … Continue reading →

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The Mystery of Merrill’s Asset Reduction

Posted on July 30, 2008 by Felix

Alea is as eagle-eyed as ever: The most important and most ignored sentence in Merrill’s press release: The sale will reduce Merrill Lynch’s risk-weighted assets by approximately $29 billion. How is this possible? After all, last month the CDOs being … Continue reading →

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The Economics of Checked Baggage

Posted on July 30, 2008 by Felix

What to make of Delta’s new sliding scale for checking bags? On domestic flights, the first bag is free, the second is $50, and the third is $125. This kind of thing is the exact opposite of most retail economics, … Continue reading →

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Computers in the Oval Office

Posted on July 30, 2008 by Felix

In England, they call it "silly season": the slow-news days of the summer where newspapers find themselves forced to run faux-provocative opinion pieces, just because there’s nothing else to fill the newshole. It was surely only a matter of time … Continue reading →

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Bandwidth Datapoint of the Day

Posted on July 30, 2008 by Felix

Tim Wu: Americans today spend almost as much on bandwidth — the capacity to move information — as we do on energy. A family of four likely spends several hundred dollars a month on cellphones, cable television and Internet connections, … Continue reading →

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Extra Credit, Tuesday Edition

Posted on July 29, 2008 by Felix

Wine connoisseurs – I call them cons: The real lesson of the Judgment of Paris isn’t that California wines were better than French wines. It’s that wine tasters, when they’re really tasting blind, are clueless. How Good Is The Mainstream … Continue reading →

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The Curious Case of Hernan Arbizu, Part 4

Posted on July 29, 2008 by Felix

Hernan Arbizu (see entries passim, parts 1, 2, 3) has been arrested in Argentina! He’s charged with embezzling about $5.4 million from bank clients. Martha Graybow reports: He was arrested on Monday in Buenos Aires and is being held by … Continue reading →

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When Banks Hide Fees in FX Rates

Posted on July 29, 2008 by Felix

I just transferred some money from my US bank account to a vendor in the UK. Citibank’s wire-transfer fee was a modest flat rate of $20 — or so I thought until I looked at the exchange rate, which was … Continue reading →

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John Hempton, Financial Blogger Extraordinaire

Posted on July 29, 2008 by Felix

In mid-May, Australian fund manager John Hempton started a blog which is already one of the best in the world for serious analysis of finance investment ideas on both the long and the short side. Coming back from holiday today … Continue reading →

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Hirst at Sotheby’s

Posted on July 29, 2008 by Felix

A pair of unembeddable YouTube videos appeared quietly last Friday, and have made not much of a splash: Damien Hirst Beautiful Inside My Head Forever 1 and Damien Hirst Beautiful Inside My Head Forever 2 have been viewed less than … Continue reading →

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Do Covered Bonds Have a Government Guarantee?

Posted on July 29, 2008 by Felix

Steve Waldman reckons he’s worked out what the problem is with covered bonds: A covered bond offered by Citi or Bank of America would only default if a titan collapsed. Investors might reasonably believe that would not be permitted to … Continue reading →

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House Prices: Bad, but Abating

Posted on July 29, 2008 by Felix

Wow, those house prices are looking dreadful, aren’t they. Check out the headline on the front page of nytimes.com: "Home Price Index Down 15.8% in May" is the story. And the official press release from Case-Shiller is also very alarming: … Continue reading →

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Chart of the Day: Merrill’s Write-Downs

Posted on July 29, 2008 by Felix

A picture tells a thousand words: Remember this. Just because a write-down is large, doesn’t mean it’s final. (HT: Ritholtz)

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Adventures in Technical Analysis, McClellan Oscillator Edition

Posted on July 29, 2008 by Felix

When I dumped on technical analysis last month, one of the more unexpected results was a long email thread with a chap called Jeff Drake, on the subject of something called the McClellan Oscillator. He’s a big fan, while I … Continue reading →

Posted in charts, investing, stocks | 1 Comment

The Failure of John Thain

Posted on July 29, 2008 by Felix

Want proof that CEOs are overpaid? Just look at the mind-bogglingly awful Merrill Lynch announcement yesterday. It’s hard to know where to start: maybe the fact that Merrill is selling off $30.6 billion of CDOs to Lone Star for just … Continue reading →

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The Economic Paradoxes of Contemporary Art

Posted on July 28, 2008 by Felix

Don Thompson has written, by far, the best book on the economics of the contemporary art market yet written. It might seem like a narrow area, not enough to get a book out of – yet after wolfing down these … Continue reading →

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Ben Stein Watch: July 27, 2008

Posted on July 27, 2008 by Felix

Ben Stein has some news for you, this week. "The economy isn’t at its best," he concedes. "But over all, it’s not all that bad." Yes, little Benjy Sunshine is back, and he’s up to the same old tricks, especially … Continue reading →

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Lush Life

Posted on July 18, 2008 by Felix

Matty’s cell rang. “Excuse me,” half turning away. “Got a pen?” It was his ex. “Yup.” Making no move to find one. “Adirondack Trailways 4432, arriving Port Authority, four-fifteen tomorrow.” “A.m. or p.m.?” “Guess.” “All right, whatever,” glancing at Billy. … Continue reading →

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Signing Off

Posted on July 17, 2008 by Felix

Just in time to avoid the aftermath of the dreadful Merrill results, I’m off on holiday. (Although it’s worth noting that the shares "sinking" 9% in after-hours trade only brings them back to where they closed yesterday.) There won’t be … Continue reading →

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Extra Credit, Thursday Edition

Posted on July 17, 2008 by Felix

Clinton Foundation Sets Up Malaria-Drug Price Plan Ashmore Group Surges After Assets Under Management Increase: To $37.5 billion. Called to account: The profitability of UK checking accounts. Appointments With Red Ink: Citi execs criticize Pandit’s "dull platitudes". Color me unsurprised. … Continue reading →

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One Hand, One Million Dollars, No Falsifiability

Posted on July 17, 2008 by Felix

Joe Nocera has a provocative parenthetical in his list of the best business non-fiction books: “Liar’s Poker”, by Michael Lewis (even though I’ve since become convinced that the anecdote that gives the book its title never happened). The title, and … Continue reading →

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The Busch and the Marlin

Posted on July 17, 2008 by Felix

David Kesmodel has the wonderful story of what happened when Anheuser-Busch’s then-CEO, August Busch III, went on an ill-fated marlin fishing trip with a group of Modelo executives in the early 1990s. Go read the whole thing, it’s great. But … Continue reading →

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The Unconvincing Rally in Financials

Posted on July 17, 2008 by Felix

Financials are on a roll right now: the XLF index fund, which tracks the S&P financials index, traded as high as $20.89 this morning, exactly $4 or 23.6% higher than where it traded at the same time Tuesday morning. That … Continue reading →

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The Competitive Advantage of Stock Exchanges Without Parking Lots

Posted on July 17, 2008 by Felix

The headline of the day, without a doubt, is at Bloomberg News: Pakistani Investors Stone Karachi Exchange as Stocks Plunge Yes, they really started throwing stones at the physical stock exchange. In Karachi investors today broke windows, threw plant holders … Continue reading →

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Bloomberg Datapoint of the Day

Posted on July 17, 2008 by Felix

Back in 1985, investment-banking powerhouse Merrill Lynch bought a 30% stake in Bloomberg LP for $30 million. A few years later, Bloomberg bought back a 10% stake for $200 million, leaving Merrill with 20% — which it’s now selling, again … Continue reading →

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