Linkfest: Has the US economy turned a corner? Active v. passive indexing; Argentina may take US to world tribunal

Categories: Linkfest

The daily Linkfest is moving!

As part of the evolution of CFA institute blogs, after 400-odd posts, this will be the last daily linkfest published on Inside Investing.

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When inspiration strikes, I hope to continue to blog occasionally in these pages. Hope to keep seeing you here and over at streeteye.com!

– Druce Vertes, CFA

Today’s most shared:

  • FRED charts, jobs and employment. Plosser sees an economy that has turned the corner, and Fed guidance that is no longer appropriate.
  • Buffett is winning his bet on S&P vs. hedge funds. Hedge funds underperform, active mangers are overpaid, but the deeper question is how to capture a diversified set of risk premia in an efficient manner. There has never been a better time to be an individual investor, in terms of tools available, if not valuations.
  • Argentina threatens to take US to The Hague over judicial meddling in debt restructuring; Top economists call on Congress to act to mitigate fallout from judge’s ruling.
  • Despite all the ‘disruption’ afoot, in large swaths of US economy it’s harder and harder for new firms to compete with dominant incumbents.
  • BlackRock and Fidelity seen averting too-big-to-fail oversight; GAO finds TBTF funding effects diminished since crisis.

For Jobs, 2014 Has Been the Best Year of the Recovery—By Far
The Atlantic
Here’s a graph to make you feel better about the direction of the economy
shared by @JustinWolfers, @TMFHousel
 
An Unemployment Line, From Coast to Coast
New York Times
Despite the improvements in the economy, far too many people remain out of work.
shared by @ModeledBehavior, @JustinWolfers, @moorehn
 
President Plosser Comments on FOMC Dissent (August 1, 2014)
philadelphiafed.org
President Plosser: Recovery is ahead of schedule laid out in previous guidance, forward guidance language no longer appropriate or warranted.
shared by @BCAppelbaum, Business Insider, @Noahpinion
 
The hare gets rich while you don’t. Back the passive tortoise
Financial Times
Nomura, as part of an excellent report looking at various aspects of active versus passive investment management, have considered Warren Buffett’s famous bet that an index fund will beat a fund of hedge funds over ten years. Buffett is winning, and the bank’s conclusion is that this is very far from a fluke.
shared by @abnormalreturns, Abnormal Returns, @M_C_Klein
 
Confessions of an Index Investor
rickferri.com
Confessions of an Index Investor: I don’t consider following an index as being paramount in portfolio management as long as you’re capturing the risk premiums you’re seeking in a low-cost and efficient manner.
shared by @abnormalreturns, @ReformedBroker, @StockTwits, Abnormal Returns
 
Tadas Viskanta: There really never has been a better time to be an individual investor
The Big Picture
There has never been a time when the individual investors has had such a powerful array of tools available at such a low cost. For those willing to farm out their portfolios things have never been simpler or in the words of Jonathan Clements “kinder.” The raw materials to build a reasonable portfolio are all out there for the taking. It is up to the investor to put together a plan to pull them together so they can service your ultimate goals, whatever they may be.
shared by @EddyElfenbein, Abnormal Returns, @MichaelKitces, @RPSeawright, @howardlindzon
 
Bearish investors who won big during the crisis are growling again, in unison
Wall Street Journal
Many of the Wall Street money managers who made billions by anticipating the U.S. housing bubble see more trouble on the horizon.
shared by @carney, @ReformedBroker, @ErikSchatzker, @JacobWolinsky
 
Economists Call on Congress to Mitigate Fallout from Ruling on Argentine Debt
cepr.net
Over 100 economists, including Nobel laureate Robert Solow, Branko Milanovic and Dani Rodrik called on Congress today to take action to mitigate the harmful fallout from the recent ruling by Judge Griesa of the U.S. District Court for the Southern District of New York that requires Argentina to pay holdout creditors at the same time as the majority of creditors.
shared by @SonyKapoor, @CardiffGarcia, Marginal Revolution, @M_C_Klein
 
Argentina accuses US of judicial malpractice for triggering needless default
The Telegraph
Country threatens to take US to The Hague after defaulting on its debts for the second time in 12 years.
shared by @RoubiniGlobal, @Nouriel, @edwardnh, @SconsetCapital
 
The Other Aging of America: The Increasing Dominance of Older Firms
brookings.edu
Incumbent, entrenched firms in all sectors of the economy and throughout all areas of the United States represent a larger share of all firms than at any time in the past two decades.
shared by @MarkThoma, reddit/Economics, @newsycombinator, Marginal Revolution
 
Asset managers may avoid Fed oversight
Wall Street Journal
After months of lobbying, large asset managers such as BlackRock Inc. and Fidelity Investments won a battle in their fight against tighter regulation Thursday.
shared by @AmyResnick, @MattGoldstein26, @munilass, @Kelly_Evans
 
Land for gas: secret German deal could end Ukraine crisis
The Independent
Germany and Russia have been working on a secret plan to broker a peaceful solution to end international tensions over the Ukraine.
shared by @AmyResnick, @YanniKouts, @LorcanRK
 
Coke Confronts Its Big Fat Problem
Bloomberg Businessweek
Coca-Cola’s North America president, Sandy Douglas, oversees a relaunch of America’s No. 1 soft drink.
shared by @mccarthyryanj, @BarbarianCap, @tomkeene, @ryanchittum
 

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