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MiB: Gretchen Morgenson on Private Equity

The Big Picture

A former stockbroker and alumna of the New York Times and Wall Street Journal, she won the Pulitzer Prize in 2002 for her “trenchant and incisive” reporting on finance. They also wrote the 2011 bestseller “ Reckless Endangerment: How Outsized Ambition, Greed and Corruption Led to Economic Armageddon ,” about the mortgage crisis.

Taxes 324
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10 Monday AM Reads

The Big Picture

It’s hard to completely dismiss this as a leading indicator and I’m not here to do that, but while most drawdowns of this magnitude have led to economic contractions, they haven’t always. At its low, the S&P 500 was 25% below its high. Irrelevant Investor ). Cumulative vs. Cyclical Knowledge : Knowledge in some fields is cumulative.

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Observations to Start 2023

The Big Picture

What does this rock traversing through the vast emptiness of space have to do with economic expansion, corporate revenues & profits, inflation, or interest rates? It takes the Earth 365 days, 6 hours, 9 minutes, and 9.76 seconds to complete one orbit – to return to its exact same place in space relative to our star, the sun.

Economy 326
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What’s Wrong With Macroeconomic Uncertainty Indexes

The Big Picture

It is a “monthly measure of how unpredictable overall economic conditions are 1 month, 3 months, and 1 year ahead.” But “uncertainty” as that word is commonly used on Wall Street 1 seems to be correlated with concerns about faltering economic conditions and/or rising market volatility. And I am okay with that.

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Was the Crypto Bubble the Worst of Its Kind?

Mish Talk

The Fed failed to do that in 2002 and 2008 and before that in the Long Term Capital Management bailout. When you continually bail out financial institutions and set interest rates too low, you foster if not outright encourage speculative manias. What about the knowledge gained?

Banking 223
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Leading Index for Commercial Real Estate Increased 8% in July

Calculated Risk

This graph shows the Dodge Momentum Index since 2002. Commercial construction is typically a lagging economic indicator. The index was at 198.6 in June, up from 1179.9 the previous month. According to Dodge, this index leads "construction spending for nonresidential buildings by a full year".

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Leading Index for Commercial Real Estate Increases in November

Calculated Risk

The Momentum Index continued to rise in November, conveying hopefulness from owners and developers that the construction sector will endure the possible economic slowdown next year,” said Sarah Martin, senior economist for Dodge Construction Network. This graph shows the Dodge Momentum Index since 2002. The index was at 207.2