Rabbitisrich
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Posts posted by Rabbitisrich
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Does anyone have the link to the Census figures? I couldn't locate it on the from the "releases" section.
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This is related:
http://www.springerlink.com/content/5b6qld7wqgelj345/
Finally, in Study 3, participants who were told of an alleged ghost in the laboratory were less likely to cheat on a competitive task than those who did not receive this supernatural prime.There was another study where participants who had been directed to think of deceased relatives were less likely cheat. The effect held even for people who expressed disbelief in the afterlife. I'm trying to find the study but am getting a lot of cheating spouses results.
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What about the Holdco debt? It looks like 90%+ of the total debt is in the Holdco. When does this come due? Also, the best stress test for insolvency is to see how much a company's debt is discounted in the market. Is BAC's debt trading below stated value? Is debt that comes due sooner than later trading at a greater discount? If so, how much?
Looking at the debt schedules from the AR and the liquidity at holdco + upstreaming potential (last year $17B, this year $4.5B + statutory net), there is no way that Whalen is talking about debt maturities. He must be referring to a surprise legal development or something similarly abrubt...
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There is plenty of room for upstreaming, if necessary. Last year, the holdco received $17B in cash, and this year it's authorized to receive $4.5B + statutory income. The North American bank sub. has ~$160B in cash + equivalents + fed funds sold and repos. The holdco has $120B+ Tier 1 common equity (Basel I).
BAC handles the holdco problems you mention by focusing on "Global Excess Liquidity Sources", which are largely composed of government guaranteed securities and cash. Even if you impose a duration or stressed liquidity haircut, you still get a reasonable liquidity profile.
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From Monetary Regimes and Inflation, you want to get into gold and fine suits.
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Brett King offers some good comments about the physical branch model on his blog, Bank 2.0:
But who is going to pay for the space?
The big problem with this, of course, is that as customers more commonly neglect the branch in favor of internet, mobile, ATM and the phone (call centre), the economics of the real estate and branch staff is no longer sustainable. So how do you have a space that still ensures the confidence of those customers that require the psychological ‘crutch’ of a space they might need to go to, but who aren’t willing to pay more for the privilege and won’t change their day-to-day banking habits back to the branch because the web and mobile are just so much more convenient?
On interchange fees:
However, the second reaction inevitably will be a realization that the cost base banks carry to support checking accounts via the branch is no longer viable – network is simply a luxury in a world where consumers just aren’t utilizing physical spaces for their relationship. With the best customers only visiting branches occasionally as they become increasingly digitally enabled, the expense of sustaining a network for a core product or relationship which looks more and more like a cost than a profit, becomes rapidly apparent. The UK has had more than a decade to deal with this, which is undoubtedly why the UK has halved the number of retail bank branches since 1990.Note that the author has been crowing about uneconomic bank branches for some time, even as efficiency ratios stayed within a reasonable range for conservative banks. He's still worth reading despite the "if only ___ then I would be right" attitude.
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The trend towards larger companies probably accompanies a trend towards financials and O&G discussion. These are areas where everyone is looking at similar information, but the subjective weightings are so different. Blame "macro-tourism".
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Tariq Ali posted an interview with a bank analyst on his site, Street Capitalist.
Plan Maestro has a lot of strong posts regarding financials on Variant Perceptions.
Junto's post above is great.
Tom Brown's technical posts are also strong.
The long, but thorough, way is to read an AR of a top super regional like USB and focus on their notes, particularly the significant accounting policies. I like USB's AR because it doesn't read like a barrage of semi-useful figures. A careful read-through will inform you about how to think about banking.
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But I have a hard time understanding the competitive advantages these low-investment businesses possess. It's obviously there. They're huge and profitable. I'm curious how you might describe their competitive advantage?
My guess is that NRSRO ratings improve communication. You don't really need a great analyst for that purpose; you just need a widely followed one, regardless of how he/she became widely followed in the first place. It would be difficult for a competitor to enter that status unless Fitch/MCO/S&P hugely screwed up while the competitor massively outperformed. That's a high volatility environment. In a normalized volatility environment, such excellence in rating might hurt more than help given the issuer-selected system. Catch-22 for a new entrant, which is probably why Egan-Jones was so keen to stand out during the wackiest period of 4Q11.
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Deliberate inflation & devaluation to drive tourism/exports, & put the country back to work.
You have to think this is repeatable in Spain & Portugal, the lands of 50%+ youth unemployment. It also has to be looking attractive to southern Italy (Palermo) with 85%+ youth unemployment. The obvious solution is a new Plaza Accord, & two euro’s within Euroland. A hard currency (Germany, France, Switzerland, etc), a soft currency (PIIGS), a fixed hard/soft euro exchange rate, & all existing trade agreements remaining as is. At best, a minimum 3-5 years to implement.
How likely is it that Germany would institute a hard currency regime given the current account rebalancing that would occur in a two euro scenario?
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Looks like an interesting presentation, Parsad. Are you going to make the full set available?
The problem with trying to read the minds of the EZ leaders is that there is no way in hell any of these bureaucrats are going to throw themselves on a sword and promote monetary expansion without reaching consensus on consolidated fiscal expansion as well. If it "works", then your political enemies say that you unnecessarily put your country at hyperinflation risk. A political animal will wait until its constituents express desperation. If the German elite, for example, secretly supported the logic of Keynesian policies, then they would probably look very similar to austerians until the last minute.
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I would jump into the high return on tangible asset businesses like the ratings agencies, Verisk, Fiserv, etc... Anything with big profits and a fat goodwill entry that grows at a slower rate than earnings. Financial tools and products will be relevant so long as the world economies grow.
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Whoa, this VAR comment is pretty interesting. I'm surprised Dimon didn't get pressed more on the issue. Investors need to know whether new VAR model was a simple mistake in construction, or whether perverse incentives interfered with its selection.
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Just listened to the call.
From what I understand the synthetic credit position started out as a way to hedge the tail risk of the credit environment getting really bad, then over time they began to undo the hedge with a different strategy and that's where things went bad.
It's also funny that at one point someone ask Jamie Dimon if there were signs that he should have been following in Q1 when problems started to show up. He mentioned he should have paid more attention to trading losses and read the newspaper. I'm just guessing he's referring to all the commotion with the "London Whale".
Interesting times.
I haven't heard the call but a Felix Salmon post referred to a trade on CDS spreads adjusting towards the spreads of the underlying issues. So they go long the bonds by shorting the CDS, but the change in CDS spreads outpaced the bonds'. So if I read Salmon correctly, and he interpreted Dimon rightly, then the hedge was meant to protect JPM from the risk of some credit environment improving.
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There have been older threads that included criticisms of Chou's holdings. Hester's post--"the great Francis Chou"--may have seemed like an attack on Chou personally. However, I interpreted it as a comment on (perceived) excessive adoration by board members.
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Things I admire about religious people (really religious - not Newt Gringich religious), at least from my limited experience, they seem to be happier and stay married longer. The nonreligious people seemed to get divorced more often and, by and large, are less happy. Although, superficially they do seem happy. Again, this is based on a very small sample size.
The problem isn't just a small sample size, but also a comparison of "really" religious people to the non-religious. So many ways to skew your impression, from survivorship to poor specification.
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Speaking of, Chan Lee, from Petra Capital Management presented four ideas at the most recent Value Investors Congress: http://www.marketfolly.com/2012/05/chan-lee-on-korea-as-goldmine-of-ideas.html
The Samsung Climate Control and Pangrim investor relations pages are entirely in korean.
The Petra Capital newsroom contains more than one article with a skeptical view towards chinese fixed capital spend ("China's Investment Boom" from 11/2009): http://www.petracm.com/abo_9
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Is there a morningstar/valueline type service for Kospi financials?
Regarding China, Michael Pettis has been offering cautionaries since at least the beginning of the 00s: http://www.mpettis.com/2012/04/09/the-ways-china-can-rebalance/
To try to work out what these options might be I will begin with two key assumptions. The first is that the fundamental imbalance in China is the very low GDP share of consumption. This low GDP share of consumption, I have always argued, reflects a growth model that systematically forces up the savings rate largely by repressing consumption, which it does by effectively transferring wealth from the household sector (in the form, among others, of very low interest rates, an undervalued currency, and relatively slow wage growth) in order to subsidize and generate rapid GDP growth.[/size]As a consequence of this consumption-repressing growth model, Chinese growth is driven largely by the need to keep investment levels extraordinarily high.
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Is Hempton's description of the sales team (commissioned, older, conversational) a valid depiction? GNW pushes long-term care insurance through the AARP network. Can you launch an affinity sales strategy to 40+ MM people?
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Enoch1, if you are starting an inference by assigning some high probability to the virgin birth story (
), then your statement is correct. But the whole trick is that initial assignment of probability!probably at least one party who would have some pretty damn good rational substance for believing what they believeOf course, looking back at one specific instance of a birth, there are various possibilities. It could have been a spontaneous virgin birth, or an alien impregnation, or an affair through wedlock (for the sake of this argument, no offense intended). How do you decide between the possibilities? The scientific method doesn't lead you directly to the anwer. It only provides relative frequencies. You would look for an explanation that requires the least conjectured inputs to result in that birth.
It can be frustrating because we are used to looking for answers that improve explanatory power, but that is the nature of seeking an explanation for a given event. Did your parents leave gifts for you on Christmas? Or did Santa Claus embed directions into their minds while existing in a state that is invisible to detection? Both are possible, but one explanation is much simpler.
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I'm not religious in the least. Having said that I do find that people who are deeply religious are often those I would depend on the most, that I trust the most, because they have acted in a virtuous manner in the past.
I recently got in a little bit of a spat with my roommate, who is very liberal, about Mitt Romney. He laughed at the thought of Romney as an attractive candidate because of how 'stupid' mormonism was. Although I haven't ever found a religion I believed in, I found it attractive that at least he was raised to have a sense of right or wrong.
I'm not offended or trying to jump on you, but this sentiment flies in the face of massive evidence to the contrary (although evidence isn't religion's strongsuit)
Predominantly atheist countries have lowest crime rates:
http://www.nairaland.com/121066/predominantly-atheist-countries-lowest-crime
Despite being roughly 5-8% of the population, atheists make up only aboout .2% of prisoners
http://www.holysmoke.org/icr-pri.htm
It's interesting that if you look at non-theistic movements that have resulted in atrocities (cultural revolution, Stalinist purges, North Korea, arguably Nazis) you see the "worship" of some idealized superior. The people are unified through rituals, shared symbolisms, and the fear of a great enemy. Some popular atheists like Dawkins and Hitchens promote the idea of non-theism as a solution to the man's ills but call me skeptical.
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Yeah, I didn't mean to offend anyone either. My point is that you can draw misleading conclusions about a factor (religion) by looking at an associated attribute ("virtue"). For one thing, this method doesn't tell you anything about the frequency of "virtue" relative to other associated attributes. It also falsely passes the morality of an ostensible result to the cause without checking if a cause has other, less desirable effects. It's just not a powerful way of explaining things, in my opinion.
If you sponsor a young black athlete because you are sure that black people are great at sports, then you might have greatly improved the lives of that athlete and everyone he meets. You may also be one bad experience away from purchasing a white hood and a flammable cross.
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I agree about marriage but not about religion. We really do not derive our morals from religious dogma - no one does - , but mens' actions are certainly more restrained and less aggressive (more 'moral' in the utilitarian sense) as a result of marriage and children. Tying down fathers, especially young ones, to their children is a good thing for society as a whole and no matter what we may feel towards marriage as an institution and concept it accomplishes just this.
Is there any evidence for this in a modern context? It would be difficult to have a natural experiment because the type of factors that change marital relations probably touch on a range of cultural issues.
Wouldn't we expect to see something like an increase in violent crime by males increase among age groups given lower marriage rates?
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What's interesting about religion is that it can take any form from the genocide and mass rapes of Midianites to the search for eggs on Easter. The virtue of the religion isn't related to the forthcoming virtuousness of the society.
By the way, when we say virtue, we are all talking about the same thing, right?
Half of U.S. Household on the Dole
in General Discussion
Posted
So the article is the author's presentation of Census data, and not a transcription of a Census report? Social security and medicare shouldn't be included in the trend analysis without some discussion of demographic shift.