Bull markets are born in pessimism, grow in skepticism, mature in optimism, and die in euphoria
The Bubble is in Cash, Not Stocks…or better the only bubble is people’s uncertainty of the future and their desire to hold large sums of cash. These high cash levels equate to a huge pool of marginal buyers, rather than sellers, for stocks and other “real” assets.
Contrary to popular belief the common trait of previous market tops, wasn’t that they were expensive, rather it was that too many people owned stocks.
Consumers (who are ultimately the buyers of stocks) have the highest cash levels in a generation, combined with the liquidity of stocks that is probably the lowest in a generation and you have the recipe for the best is yet to come in the stock market. Yes, the rally in stocks is likely to continue for many months and the performance may well rival what we have seen over the last 5 years!
FINANCE in a NEW Way… A World Without Fractional Reserve Banks And Central Planning. Is it our desidered world?
Today’s commercial banks would split into two types.
“Banks of commerce” would take deposits and keep them safe for a fee, like the goldsmiths of old.
“Banks of credit” would pay interest on deposits and lend out depositor money, but would have to match the duration of deposits with the duration of loans. Deposits that can be withdrawn anytime (a checking account for instance) could only be used to fund a loan which the bank can “call” on demand, while longer-term deposits (say a 5-year CD) would be matched to longer-term loans like a business term loan or 5-year mortgage. Really long-term loans like 30-year mortgages would be funded with deposits for which the bank would have to pay up in order to convince a depositor to part with his or her money for such a long time.
The resulting mortgage would carry a high enough rate to provide the bank with a small profit, which would make 30-year mortgages both expensive and hard to get. But the case can be made that they should be hard to get. Buying a house – or anything else that requires capital for extremely long periods – should require a hefty down payment, other liquid assets as collateral and a solid income stream. This coverage would give the bank the ability to foreclose and realize more than the value of the loan, which would protect its ability to repay its depositors, thus making depositors more willing to tie up their money for long periods.
Buffett is saying two things.
First, the market will weather crises no matter how bad they are.
Second, a good business offering attractive longterm returns is always worth investing in.
Are stocks about to crash? Maybe. Maybe they’ll keep rising.
But whatever the path, prices will most likely be higher for patient investors.
Goldman Sachs, we estimate that the fair value for EUR/$ is around 1.19,
not because foreign portfolio flows into the Euro area have abated, but because domestics are increasingly sending portfolio flows out of the Euro area, as ongoing ECB easing encourages a hunt for yield elsewhere. Our view is that these portfolio outflows have much greater potential to grow than foreign flows into the Euro area, given that periphery risk premia are already so compressed
As far as ECB policy goes, we think there is – counter to market consensus – plenty of room for President Draghi to ‘talk’ the currency lower, which he notably started to do in the August press conference when he said that “fundamentals for a weaker exchange rate are today much better than they were two or three months ago”. Reinforcing his comment, we estimate that the fair value for EUR/$ is around 1.19
Don’t hire people for what they know. Instead, ask if they can learn to do the job
Somebody who is constantly improving is a requirement
Look for somebody to work with
The most common way I see startups get the “do I want to work with them?” question is by confusing that question with “do I want to be friends with this person?”
‘Contactless Cards,’ Like London’s Transit Card, Will Fuel Mobile Payments Adoption Globally
Though consumers have concerns about the security of mobile payments, these can be alleviated with education. NFC-based mobile wallets already have a host of security features that make them as secure, or more secure, than credit and debit cards.
NFC, a technology already used in apps like Google Wallet, allows people to pay with their phones by tapping a payment register at a store