Just passing along a good letter here from the CFA Institute and John Bogle. This message should be burned into the brain of everyone who participates in the market:
When the Foundation of Modern Econ Begins to Crumble….
“Modern (“neoclassical”) economic theory has been pretty successful at describing people’s decision-making patterns in static settings, but not so good at describing how people make decisions in dynamic settings.”
Today’s 4-1-1
Today’s summary of random financial news, punditry and data.
Margin Debt Soared in December Along with Bullish Sentiment
NYSE margin debt hit a new high of $444MM in December as sentiment over equities remained euphoric. Equally interesting, margin debt as a percentage of GDP hit a new high of 2.48% during this bull market. That’s still just shy of the previous highs, but getting very near all-time highs nonetheless.
HSBC China Manufacturing PMI Weaker Than Expected
China’s economy might be weaker than many presume. This evening the HSBC China Manufacturing PMI missed at 49.5 after the flash PMI of 49.6 and Credit Suisse sees 2014 GDP falling to 7.3% from their prior estimate of 7.7%.
Today’s 4-1-1
Pretty much the only thing you need to read about the financial markets today.
Turkey is a Distraction Amid Much Bigger Potential Problems
I made some comments on Twitter yesterday regarding Turkey and the interest rate hike that the CBRT implemented to try to stave off crisis. The comments didn’t include much detail (the whole 140 character thing is limiting) and I don’t think my point came across very well. So I wanted to elaborate a bit….
The Myth of the “Self Made Man”
I was intrigued by some comments Perkins made in the Bloomberg TV interview. At one point, he discussed how he came from the 99% and declared: “i am your classical self-made man, if you will.”
Today’s 4-1-1
After you read this you can probably avoid every other financial website for the rest of the day.