Europe is Closed. Everyone Out of the Pool

Ah, this explains much about European markets.

20111019-090641.jpg

America is Under-populated: Fix It

Provocative case for America being under-populated country. I have colleagues who argue same thing, and I’m torn. I get the argument, and there is much to be said for, in practical terms, importing the developing world into this one while the U.S. still can, but … there are many persuasive arguments against it as well.

But not a single Republican candidate has spoken up for the idea that America is an under-populated country. In terms of population density, it is, at 83 persons a square mile, an impoverished country, barely a quarter of the rich density of China, which is running way behind India. America just has enormous room for population growth.

via A GOP Default – October 18, 2011 – The New York Sun.

Knowing What You Owe: The Case of Credit Cards

New FRB NY report compares borrower and lender reports of consumer debt. It finds that we mostly know what we owe, with the exception of credit cards, where consumers report owing half as much as they do.

Do We Know What We Owe? A Comparison of Borrower- and Lender-Reported Consumer Debt

Household surveys are the source of some of the most widely studied data on consumer balance sheets, with the Survey of Consumer Finances (SCF) generally cited as the leading source of wealth data for the United States. At the same time, recent research questions survey respondents’ propensity and ability to report debt characteristics accurately. We compare household debt as reported by borrowers to the SCF with household debt as reported by lenders to Equifax using the new FRBNY Consumer Credit Panel (CCP). Moments of the borrower and lender debt distributions are compared by year, age of household head, household size, and region of the country, in total and across five standard debt categories. The debt reports are strikingly similar, with one noteworthy exception: the aggregate credit card debt implied by SCF borrowers’ reports is less than 50 percent of the aggregate credit card debt implied by CCP lenders’ reports. Adjustments for sample representativeness and for small business and convenience uses of credit cards raise SCF credit card debt to somewhere between 52 and 66 percent of the CCP figure. Despite the credit card debt mismatch, bankruptcy history is reported comparably in the borrower and lender sources, indicating that not all stigmatized consumer behaviors are underreported.

via Do We Know What We Owe? A Comparison of Borrower- and Lender-Reported Consumer Debt.

Credit debt

The Rich Invest in ‘Catastrophe Portfolios’

From a WSJ article today on catastrophe portfolios among the rich, the thing that caught my eye is the one-third (!) in gold. Assuming that’s the case, these portfolios are already having their catastrophe, what with gold being off 12% from its early September peak. Very zen to bring the catastrophe inside one’s portfolio.

According to an article in Reuters, some of the most fearful rich are creating “catastrophe portfolios.”  Ivan Adamovich of the Swiss bank Wegelin said that the catastrophe portfolio is one-third gold, one-third blue chips and one-third debt in safe, developed countries  (whatever those are).

via The Rich Invest in ‘Catastrophe Portfolios’ – The Wealth Report – WSJ.

Senate ETF Hearing Underway

As of 6:30am pst 10/19/1987, the Senate hearing on ETFs is underway here. Some information and presentations are at this location as well.

Twitter Digest: 2011-10-19

Not In Love

For reasons too unusual to explain, this came up in a conversation tonight here in Las Vegas. And, most importantly, my ability to convincingly create a Canadian hair band lineage from Rush, to Platinum Blonde won me a complex bet.

Mary Meeker’s Latest Interwebile Slidefest-o-Rama

It’s October, so it’s the time Mary Meeker goes mad with the PowerPoint thing and puts more slides in a single deck than should be legal. Always worth asking oneself, of course, that if Mary’s slides are so great how come her stock picks didn’t do better, but that’s just being mean. Right?

KPCB Internet Trends (2011)

Twitter Digest: 2011-10-18

  • "Internet Killed The Radio Store" – Mall Vacancies Hit All Time Record – http://t.co/qPpmuME7 #
  • Excellent interview with Bill Clinton in Weekend FT. This link should transit the paywall. http://t.co/dUhqJILI #
  • The doing and undoings of film critic Pauline Kael – http://t.co/A1fN4WO1 /via @wrongologist #
  • On Brownian motion in a coffee cup, or the pointlessness of daily stock market reporting – http://t.co/2Yfoll33 #
  • Senate hearing on ETFs scheduled for Wed. http://t.co/RVMjYNJX #
  • Remarkable: 100-year-old marathoner sets world record by completing Toronto race http://t.co/ljjZCXT0 #
  • VC firms hiring HR people as partners. Didn't we do that at the peak of the last bubble? http://t.co/H3vVKSuJ #
  • Just finished it, & it's geekishly great: Mosquito Empires: Ecology and War in the Greater Caribbean, 1620-1914 http://t.co/wVyJX9iR #
  • "[The] whole damn war business is about nine hundred and ninety-nine parts diarrhea to one part glory." – Walt Whitman #
  • Briefly flipped on CNBC this morning and realized that @herbgreenberg is increasingly looking like Louis Rukeyser's younger brother. #
  • Anyone out there dropped Dropbox in favor of iCloud? I just can't get there. #
  • So, a bunch of quick responses (thanks!) on dropping Dropbox for iCloud, and it's unanimous: iCloud isn't there yet. #
  • iOS vs. Microsoft: Comparing the bottom lines http://t.co/GIQCtOHW #
  • Progressivity, tax rates, and Warren Buffett (via JP Morgan) – http://t.co/qAtTc6Ua #
  • Visualizing life expectancy changes http://t.co/SX9iSGqg #
  • Why people think they sweat more when they stop running. I have explained this so many times. http://t.co/4qxLSK2h #
  • RT @nytimesbusiness: IBM Earnings Meet Expectations http://t.co/W4syvi6C #
  • Have Web 2.0 Summit live video stream on in background. Going to see how long I last until exasperated. #
  • There are few public speaker cliches that say "I'm an idiot!" clear than bellowing "Good morning!" until your audience does same. #
  • .@BradCasemore I missed that. It took until this Intel guy. So … I'm out. #
  • Learned of Kristen Schaal on latest @Radiolab's episode. Apparently once went for 20 minutes. Love it. http://t.co/qRAicWFQ #
  • Canadian real estate bubble expands, with Toronto real estate price gains now touching Vancouver levels – http://t.co/7l4fKcDR #
  • The most remarkable figure if you want to compare Canada & U.S. real estate prices. http://t.co/FDutxq3D #
  • Two things on that real estate chart: 1) Vancouver skews market by 10-15%; & 2) CDN $ conversion makes gap wider. Gap still exists tho. #
  • Improvement in US mortgage delinquencies ends, as prime becomes new subprime – http://t.co/6bvfYic8 #
  • That real estate chart compares "median" U.S. prices to "average" Canadian prices. Bizarre and likely indefensible choice by BMO/G&M. #
  • The NYT is finally writing what I and others have only been saying about Groupon for … months – http://t.co/htdsBAoY #

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S&P 500 vs TED Spread

From Bloomberg tonight, the S&P 500 vs the TED spread over the last few years. When the two diverge it isn’t usually for long, and they recently diverged. If the past holds, the path forward is lower in the S&P. Or lower in the TED Spread. Either one, really.

Ted spread