Q&A: Bailout Banks at All Costs?
Some think the exposures associated with credit derivatives are so extreme that the failure of one or two large financial institutions will ruin the nation. Could the useâor abuseâof credit default...
View ArticleQ&A: The First Global Recession?
Some have suggested this downturn is different because it is affecting the entire planet, not just a country or region, so previous downturns don't necessarily compare. Given the state of the world...
View ArticleQ&A: Diversification's Role Today
Is diversification working today, when we need it most? EFF/KRF: When overall market volatility increases, idiosyncratic (security-specific) volatility also tends to increase. For example, market...
View ArticleQ&A: Derivatives in an Efficient Market
What is the role of various derivatives instruments in maintaining an efficient market? EFF: Theoretically, derivatives increase the range of bets people can make, and this should help to wipe out...
View ArticleQ&A: Confidence in the Bell Curve
It would be very enlightening if you would comment on the Nassim Nicholas Taleb ("The Black Swan") attack on the use of Gaussian (normal bell curve) mathematics as the foundation of finance. As you may...
View ArticleQ&A: Thoughts on Mark-to-Market
What do you think of the mark to market issue? EFF: It gives investors a good estimate of what a financial institution is worth. It has more flexibility than commonly realized, especially for illiquid...
View ArticleQ&A: Inverted Yield Curves
I have a client who is convinced that an inverted yield curve is a signal to get out of equities. What are your thoughts on this topic? EFF/KRF: Inverted yield curves are often observed at the front...
View ArticleQ&A: When Market Timers Succeed
Recently, I've heard some say "I got out of the market in May 2008 and I am sure glad I did." Given the obviously positive results of this decision, what is the best argument to convince people that...
View ArticleQ&A: Challenging S&P 500 Earnings
Recently, Professor Jeremy Siegel has challenged the method of calculating earnings for the S&P 500. He believes the calculation should be market weighted, as is the index. Standards and Poor's...
View ArticleQ&A: Foregoing Future Expected Returns?
A recent change to a client's life needs would normally warrant a reduction in portfolio risk. In doing so immediately, he would forego future expected returns that he paid so dearly for in the last...
View ArticleQ&A: An Optimal Allocation?
I represent an endowment of about $30 million. In public equities we have most of our investments in market-wide mutual funds. What mix would you recommend between domestic, international and emerging...
View ArticleQ&A: How True is "Too Big to Fail?"
Is there such a thing as systemic risk in the financial system? Are some of our banking institutions truly "too big to fail?" EFF: The term "systemic risk" is less than 20 years old. It has become a...
View ArticleQ&A: Signs of a Recovery?
I read an article recently profiling five signs that the recession is ending. What signs might you look at to indicate when the recession is ending? EFF/KRF: We are not experts, but know enough about...
View ArticleQ&A: Bias in the EMH?
George Soros claims (in his op-ed in the Wall Street Journal) that the Efficient Market Hypothesis is invalid, because prices in financial markets "always provide a biased view of the future, and that...
View ArticleQ&A: Equity Premium Puzzle
Has the equity premium puzzle gone away? EFF: There never was one. The "puzzle" comes out of a simplified economic model that says the average spread of the equity market return over the t-bill...
View ArticleAs Bitcoin Prices Soar, Forked Rivals Face Different Paths
Bitcoin's stellar rally looks to have boosted its spin-offs bitcoin cash and bitcoin gold. But what lies ahead for the rival cryptocurrencies?
View ArticleXBRL Reporting Standard Co-Founder Joins Blockchain Startup
Blockchain startup Auditchain has added the co-founder of a widely used business reporting standard to its leadership team.
View ArticleNew Alliance Sets Out to Boost Blockchain Interoperability
The companies behind three blockchain platforms have unveiled a new advocacy group focusing on interoperability between disparate networks.
View ArticleJapan's BitFlyer Launches Bitcoin Exchange in US Market
Japanese bitcoin exchange bitFlyer has officially launched in the US.
View ArticleEarly Bitcoin Buyers Talk Bubbles and Origin Stories at Consensus: Invest
Early buyers Glenn Hutchins and Mike Novogratz took the stage at CoinDesk's Consensus: Invest event today.
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