President Trump is on searching for the next Federal Reserve chairman to take over when Janet Yellen's term expires in February. It has long been rumored that former Goldman Ssachs COO and current economic advisor to the president, Gary Cohn was at the top of Trump's short list. Now it seems that Cohn's star is fading. After Cohn criticized the president's response to the recent violence in Charlottesville, it appears Trump has begun looking elsewhere. The Wall Street Journal reports that after the criticism Trump doesn't even like to hear Cohn's name. The former investment banker had told … [Read more...]
Archives for September 2017
Is Your Portfolio Prepared for a Black Swan Event?
Worrying about a Black Swan event can do serious damage to a portfolio. Jon Sindreu and Laurence Fletcher write at The Wall Street Journal: In the wake of the global financial crisis, fear of such “black-swan” events drove some investors into hedge funds that offered protection should markets plunge. But the swans have yet to return, and such strategies have fallen out of favor. The patience of many investors has run out after losing money during the intervening years of mainly benign market conditions. According to data by CBOE Eurekahedge, those who invested in these tail-risk … [Read more...]
Can Trucking Companies Fend Off a Holiday Armageddon?
The last few years have been hard on transportation companies. As e-commerce sales have soared, trucking and package delivery businesses have had trouble estimating the amount of extra help and equipment they would need for holiday deliveries. Now the transporters are trying to get ahead of the curve by staffing up early to prepare for the deluge in business. Jennifer Smith reports at the Wall Street Journal: Package-delivery firms are shoring up their staffing in big numbers as they prepare for a holiday season likely to see another surge in online sales. Courier and messenger companies … [Read more...]
Are Investors Too Bullish?
As a group, the retail investing public tends to arrive to the party late and stays too long. This chart comes courtesy of the WSJ Daily Shot and TD Ameritrade. According to TD Ameritrade, retail investors are more bullish than they have been in years. Elevated levels of investor sentiment tend to be most useful as a contrary indicator. The higher investor sentiment, the lower you should set your return expectations and the more you should demand those returns in the form of dividend payments. Share prices tend to fluctuate wildly as sentiment shifts, dividend payments do not. … [Read more...]
Car and Driver: When Will You be Able to Buy an Autonomous Car?
I thought this was interesting from the September issue of Car and Driver "Upfront" section: Automakers define “autonomy” according to a scale established by SAE International (formerly the Society of Automotive Engineers). The scale tops out with control-free pods at Level 5, but even adaptive cruise control counts as Level 1. What most people think of as full autonomy begins with Level 4, in which a car can handle the complete driving task without needing to defer to a human driver—in certain cases. Think of a car that can drive on the highway but may need a human to take over at the … [Read more...]
What’s Next for Commodities? Ask D.C. and Beijing
Since early 2016, commodities prices have been making up some of their massive post-2011 losses (see chart below). Some of the increase in commodity prices is thanks to strong demand. More of the increase relies on dollar weakness and Chinese stimulus plans. At the FT, John Authers explains the current bullishness in commodities. The US stock market has outstripped the rest of the planet ever since the financial crisis. But rising raw materials prices historically help the rest of the world outperform the US. That did not happen when metals prices rallied in the wake of the crisis — but … [Read more...]
What Happens When Your Self-Driving Car Gets Hacked?
It's terrifying to find out that your personal computer has been compromised by a hacker. You instantly begin a damage assessment. What personal information is contained in the compromised machine? How long have you been monitored by spyware? These questions race through your mind. But what happens when the computer being compromised is your car? There are surely security measures built in to every autonomous vehicle, but the vulnerability that may be hardest to control is one hackers can exploit without even knowing your car exists. Because autonomous vehicles operate in response to inputs … [Read more...]
Class Warfare is Holding America Back
As the Senate and Congress ready themselves for a debate over tax reform, Dan Mitchell, a senior fellow at the Cato Institute, writes that the policymakers should ignore the shouting of class warriors and, like Reagan, focus on the entire economy. Faster economic growth is the best solution to the problems of everyone in the economy. Mitchell writes: Reagan’s tax policy (especially the Economic Recovery Tax Act of 1981) was good because the President and his team ignored the class-warfare crowd. They didn’t care whether all income groups got the same degree of tax relief. They didn’t care … [Read more...]
Is the Amazon Story Wildly Inflated?
Amazon's effect on retail is an amazing story, but despite its disruptive nature, the company hasn't been generating profits or managing risk nearly as well as its retail competitors. Now Charlie O'Shea, an analyst from Moody's is attempting to deflate the Amazon bubble by poking holes in the myths surrounding the company's performance. MarketWatch reports that O'Shea believes Amazon's stock performance potential is overshadowing the on the ground operating performance advantages of its competitors. Amazon’s stock AMZN, +0.29% has outperformed rivals, but it’s mostly based on the company’s … [Read more...]
MIT Teaches Robots to Live Among Humans
Perhaps the biggest challenge in robotics is the unpredictability of humanity. With an ever changing world, robot interactions cannot be preplanned if they are ever going to fit seamlessly into daily life. MIT is teaching robots to react to their environments, and to those humans around them, in ways that will work best in changing circumstances. Helen Clark reports: The MIT team attempted to teach its robotic buddy to navigate crowds using a technique called reinforced learning. On a basic level, the method involves putting a robot through a series of computer simulation training scenarios … [Read more...]
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