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Fund-level borrowing takes off
Bloomberg reporting on the greater use by private equity of lines of credit at the fund level, to improve returns…
Retailers on secular downslope
Interview with hedge fund manager Jason Mudrick… He is shorting retailers and says the Amazon effect is a “paradigm shift” and a “forever trend”…
What myths can teach us about investing
Excellent interview by Barry Ritholtz of historian Yuval Noah Harari on human cooperation based on myths…Relevant to behavioral finance as well as politics…
ALM hit Blackstone fund
Bloomberg account from earlier this year on Blackstone closing GSO Special Situations Fund…An acknowledgement by one of the largest credit funds that asset and liability matching is critical for distressed debt investing…
How too much liquidity is distorting oil prices
The U.S. E&P business is in a classic vicious cycle… Too much capital markets liquidity allows E&P companies to continue drilling… Which in turn keeps a lid of prices… Some companies are losing money on every barrel, and trying to make it up on volume… Bradley Olson of the Wall Street Journal has the story: […]
‘Reverse reasoning’ can cloud our judgement
Excellent essay by Jeffrey Kluger at Time Magazine on Reverse Reasoning… One event following another does not mean causation… Relevant to both investing and politics…
Taper takes aim at MBS
With a fall Fed taper looking likely, worth revisiting this Bloomberg piece on the MBS Whale: The coming unwind of the Fed $1.75 trillion MBS portfolio… Time to watch MBS spread contraction reverse… The effect will not be linear…
Posted in Financial News, Uncategorized
Reinsurance deal still looks sweet for Buffett
With AIG ponying up it’s $10 billion sweetener last week, it’s worth looking back at the original terms of the its reinsurance deal with Berkshire Hathaway … The liabilities took like a $34 billion vertical slice of AIG’s P&C risk… BH gets $10 billion to invest… AIG pays the first $25 billion of claims… BH […]
Landline co. struggles
It’s very tough to manage a declining business… Frontier is experiencing this, having consolidated much of the landline telephone world using leverage… Drew FitzGerald of the Wall Street Journal has the story: This Telecom Bet Big on Landlines…And Lost
When I was added to the ‘world’s largest Rolodex’