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China – The Mother of All Black Swans

Chinese economy – it has tremendous overcapacity in the commercial and residential real estate and industrial sectors as you see from this presentation: China – The Mother of All Black Swans – By Vitaliy Katsenelson <

Jamie Dimon’s Thoughts on Chinese Banking System

 If I were a prosecutor I’d be thanking Al Gore for inventing the internet and email (I don’t know if Mr. Vice President claimed the email invention, but without the internet there is no email).  Especially email, because now you can amass evidence of wrongdoing in a very searchable and easy-to-use format. has dug […]

Speaking, Travel and See you in Omaha

 I have exciting travels for the next couple of months:   I’ll be giving a talk about Active Value Investing to the Bermuda CFA Society on February 11th.  On the way to Bermuda my wife and I will spend three days (February 7-9th) in NYC.  Then, as a Valentine’s present to each other, we’ll spend four […]

Even Capitalist Pigs Should Love Bank Regulation

 I am a Capitalist Pig, and proud of it, thus you would not expect me to support government interference and more strenuous regulation of financial institutions – after all, capitalism (free markets) and tight regulation don’t mix well.  Well, at the risk of been kicked out of the Capitalistic Pig Party, I am in support […]

Chinese Quest for Shortcut to Greatness

The Chinese economy must be getting out of control, because the Chinese government is doing the unthinkable: It is desperately trying to put the brakes on the economy. When you pump a stimulus package that represents 14% of GDP through a fire hose into an economy, which was already on shaky bubble foundation, in a […]

Welcome to Another Lost Decade

The stock market’s performance over the next decade will be very similar to the one since 2000: the WSJ appropriately named it “the lost decade.”  Stocks will go up and down (setting all-time highs and multiyear lows), stagnate, and trade in a tight range.  At the end of this wild ride, when the excitement subsides […]

Barron’s: Economic Steroids Are Toxic, Too

AS THE NEW YEAR OPENS, THE stock market is behaving as if the past 20 years were about to repeat themselves: Another recession will turn into a robust expansion. Stock prices already are discounting an earnings recovery to something only slightly below the level before the financial crisis. Risk-taking is in vogue again. The global […]

China vs. the World

 This paragraph, taken from a SocGen research report by Dylan Grice (one of the few sell-side folks worth reading, along with Albert Edwards, also at SocGen), sums up the dichotomy between how investors look at China and the rest of the world. Trading on a lowly 0.5x book value, Lloyds (LYG 5.1 ↓2.49%) is clearly […]

Q&A with FT:Investing in Range-Bound Markets

In the bull market that preceded the collapse of Lehman Brothers and the ensuing financial crisis, equity valuations reached some very frothy levels. The correction that followed only lasted until March, since when, the S&P 500 index has risen more than 60 per cent, while the FTSE Eurofirst 300 has gained a similar amount. Vitaliy […]