Tuesday, December 25, 2007

Christmas Readings Across the Blogosphere



* Interest Rates and Stocks - As the charts above indicate, interest rates on the 10-year Treasuries and stock prices in the S&P 500 futures have moved pretty well in lockstep since October. This suggests that, so far, stocks have been responding more to themes of economic strength/weakness than to inflation themes.

* Online Trading Journal - This strikes me as far more effective than a static paper journal. The StockTickr service enables traders to categorize their trades and see what's working and what's not. See also their blog, including interviews with traders and trading coaches.

* Insider's Look at the Mortgage Crisis - I've been using the Twitter app to link readings that highlight market themes and influences; this article on the dimensions of the mortgage problem was one of the posts I think is especially worth highlighting. The latest five Twitter "tweets" appear on the TraderFeed blog page under "Twitter Trader". You can also subscribe to the Twitter page via RSS if you'd like the updates to come directly to your feed reader.

* Mixed Economic Signals - The Calculated Risk site does a great job of tracking credit markets and economic themes. It appears we're seeing increasing consumer credit card problems even as economic data for the fourth quarter looks strong. Mish sees the credit card data as part of a larger, deflationary picture.

* Yield Spreads, Odds of Recession, and a Possible Shakeout Among ETFs - Lots of good topics covered in the recent links posted by Abnormal Returns.

* Buying Beaten Down Issues - StockPickr tracks some recent selections from Bill Miller, including homebuilders and financial stocks. Here's an insightful post from Accrued Interest on the dangers of buying value when the good stocks are being punished with the bad.

* Holiday Sales - Barry Ritholtz finds the holiday sales picture to be mixed at best. See also his skeptical take on the recent consumer spending data.

* Chances of Recession - This one also from Calculated Risk, with a link to an informative analysis by Paul Kasriel.

* Sign of Desperation? - Bespoke Investment Group on the terms of the Merrill Lynch cash infusion.

* The Limits of Statistics - A fine overview of the Nassim Taleb text, The Black Swan, from the CXO Advisory Blog. It illustrates how conventional statistical analyses can mislead investors.

4 comments:

Jeff Pietsch CFA, Esq said...

Merry Christmas and happy holidays to all. Checking in BRIEFLY, I'd hope you would elaborate on the fist paragraph here -- Thanks!

Brett Steenbarger, Ph.D. said...

Hi Jeff,

Stocks and interest rates have been linked by risk-seeking vs risk-averse sentiment: the same dynamic recently linking stock strength to weak Yen.

Brett

Paolo Pezzutti said...

thank you for your great work this year on your blog.

The mortgage crisis is still impacting markets. we have to expect more to come in the next months, but the flexibility and adaptability of the US economy will help manage the situation and recover.
I am looking into investment opportunities in the financial sector; I think that emotions drive prices to the downside excessively. There is value in the sector and it is only a matter of timing.

Brett Steenbarger, Ph.D. said...

Hi Paolo,

Thanks for your note and for your support. I agree that bargains will be out there in some of these beaten down sectors; as with techs a few years back, however, we may see the downside as overdone as the upside.

Brett