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Archives for September 2016

How to Turn $67 Million into a Cool $3.3 Billion

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You’ll like this story about Yeti Coolers—a small company founded by two brothers with a great idea. A small private-equity firm is about to get a big payoff from a bet on $400 coolers. If all goes as hoped, Cortec Group, with just 20 employees in Midtown Manhattan, could make a profit on paper of about $3.3 billion in the coming initial public offering of Yeti Holdings Inc., according to people familiar with the matter. The company is seeking a valuation of $5 billion in its IPO, which could come as soon as October, the people said. Cortec bought a roughly two-thirds stake in 2012 for … [Read more...]

Is one of the World’s Largest Banks in a Death Spiral?

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Deutsche Bank is one of the world's largest and most important banks and its shares are cratering. The stock is down over 50% YTD and it is taking a beating again this morning. Over the weekend, it was reported that German Chancellor, Angela Merkel ruled out giving the bank state-aid. That may have been a mistake as investors now smell blood. If Deutsche Bank's counter-parties start backing away from doing business with the bank and the German government doesn't come to its rescue, there may be no way for the bank to recover. … [Read more...]

Millennials: Home is Where the Heart Is

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I've often encouraged Millennials to be entrepreneurial and to take chances in order to build successful lives for themselves (see here, and here). But the Great Recession, and other factors like extended lifespans, are changing how young people, and society, think about living with parents in adulthood. In America, 32% of 18-34 year olds live with a parent. In the EU it's 48.1%! Gone are the days when age 18 struck and you expected to move out of the house. You may think it isn't the best way for young adults to live, but the WSJ writes that it's not only the desire to mooch from Mom and Dad … [Read more...]

Worthy Reads: Can Math Crack Cancer’s Code?

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Kingdom Comedown: Falling Oil Prices Jolt Average Saudis (WSJ) Can Math Crack Cancer’s Code? (WSJ) Elon Musk Is About to Reveal His Plan for Living on Mars (Bloomberg) Fed proposes to restrict bank involvement with physical commodities (MarketWatch) Struggling coffee growers threaten future supplies (FT) … [Read more...]

How to Secure your Financial Accounts from Cyber Criminals

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Hacking and cybercrime have been on the rise. I’m sure I’m not telling you something you don’t already know, but what you might not know, is that a growing trend among cyber criminals is specific targeting of high-net-worth individuals. In these attacks, hackers will identify a target and develop a victim profile based on public and private information with the goal of stealing assets from financial accounts. How do you secure your financial accounts from cyber criminals? While there is no silver bullet solution to prevent every type of cyber-attack, there are many steps that can be taken … [Read more...]

Detroit—Five Straight Years of Job Growth

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Jonathan Coppage, writing at The American Conservative, unfolds the near miraculous story of powerful job growth in previously forlorn Detroit and Wayne County, Michigan. Here’s how it happened. In the 1950s, on a per capita basis, Detroit was the richest city in America. The Broadway-Capitol Theatre offered showings of Casablanca in palatial Renaissance décor. The Detroit Institute of Arts Museum boasted one of the world’s greatest collections, including works by Picasso, van Gogh, and Matisse. The city’s vibrant downtown was populated by soaring Art Deco skyscrapers, burnished with sculpted … [Read more...]

Vanguard’s Investment Advice in a Low Yield World

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Vanguard 's head of investment strategy and global chief economist Joseph Davis gives some advice to investors in a low yield world, don't be a hero. Bloomberg writes: “The next five years are going to be more challenging than the previous five years in investing,” said Joseph Davis, head of investment strategy and global chief economist at Malvern, Pennsylvania-based Vanguard, which oversees $3.8 trillion. “Be cautious of trying to be heroic in this environment.” Vanguard's global head of fixed income, Gregory Davis, echoes his colleague's sentiments. Given the uncertainty still facing the … [Read more...]

What Janet Yellen Should have said during her Q&A

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If you have been a long-time reader of this site you know what the Fed did at its policy meeting yesterday even before you read it here. They did what they always do. They delayed a hike yet again and for the umpteenth time during this recovery they moved the goal posts on when the next hike would come. For the financial economists who follow these things closely, the Bernanke/Yellen Fed has become a joke. So rather than offering any serious commentary on the Fed’s decision, let’s have some fun. Below are some of the questions Yellen was asked yesterday and how I imagine a more candid … [Read more...]