Prieur’s readings (December 18, 2009)
This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy.
• Jonathan Ford (Prospect): Public intellectuals and the financial crisis, December 16, 2009.
Who has contributed best to the “public conversation” during these turbulent times? Prospect names the top 25 brains of the financial crisis.
• Jeffrey Nichols (Mineweb): Four pillars of gold price strength remain intact, December 14, 2009.
Notwithstanding the recent correction – and the possibility that gold may yet fall further before bargain hunters and other buyers (including central banks) reappear – the four pillars of gold-price strength remain intact. These are: (1) Inflation-fueling US monetary and fiscal policies; (2) Central bank reserve diversification with the official sector being a taker rather than a supplier of gold in 2009 and the next few years; (3) Expanding retail and institutional investor participation in the United States, China, and around the world; and (4) Declining world gold-mine production.
• Claudia Carpenter and Pham-Duy Nguyen (Bloomberg): Gold buying by central banks may send signal to sell, December 16, 2009.
Some of the biggest buyers of gold may be sending the strongest signal to sell it, if past performance is indicative of future results. Central banks, holding about 18 percent of all gold ever mined, are expanding their reserves for the first time in a generation as a nine-year bull market drives prices to a record.
• Rod Smyth, Bill Ryder and Ken Liu (RiverFront Investment Group via Fullermoney): Risk may not be where you think it is … bonds more vulnerable than stocks, December 14, 2009.
Considering the short-term technical picture of the US dollar, Adam Hewison (INO.com) provides valuable insight with a short analysis. Click here to access the presentation.
• Daniel Gross (Newsweek): The myth of the “typical” investor, December 16, 2009.
Yes, retail investors matter. And the willingness of individuals to spend can affect the fundamentals of the consumer-oriented companies that populate stock indices. But the experience of the last several years, and the debacles that have sapped confidence from Wall Street to Dubai, suggest that they are along for the ride, not driving the train.
• Jonathan Davis (Financial Times): Be aware of over-reaction to gloom, December 13, 2009.
Given a choice between betting that analysts’ forecasts are precisely right or that investor psychology is roughly wrong, the smart money rarely errs by choosing the latter.
• Gerald O’Driscoll (The Wall Street Journal): Obama vs the banks, December 16, 2009.
Wall Street fat cats are always a convenient political target, but bankers are responding to the incentives generated by the economic policies of the Treasury and the Federal Reserve. First and foremost is the Fed’s policy of near-zero interest rates.
• Edmund Conway (Telegraph): There’s only one escape from our debt trap, December 17, 2009.
The solution to today’s fiscal crisis is the same as it has always been: to cut spending, reduce the deficit and learn to live within our means.
• Michael Kanellos(Seeking Alpha): Top 10 emerging green trends of 2009, December 9, 2009.
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