Monday, November 25, 2013
Some reading and stuff.
BI - Citi's supposed stock market euphoria indicator. Citi's "proprietary panic/euphoria indicator" supposedly is worth something because it "relies heavily on market based measures that are believed to reflect market sentiment. Components of the model include NYSE short interest ratio, margin debt, retail money funds, the put/call ratio, gasoline prices and the ratio of price premiums in puts versus calls". Gasoline prices? Are you shitting me? If you haven't looked under the hood to see exactly how this model is constructed, and don't know exactly why the underlying components (especially the options market) are doing what they've been doing these past few years, then I suspect the best thing to do is ignore it; otherwise you're not even sure that the chart is charting the same thing over time.
Calculated Risk - housing starts and permits. Take a look at this chart:
Does that look like euphoria to you? If the market is supposed to turn down from here, then that suggests either a fundamentally-unjustified panic sell that reverses itself a la 1987, or it suggests the US economy is about to collapse. But collapsing from this point in the housing cycle could only mean a Mad Max dystopian future of piles of human skulls. Frankly, if you believe that, then you'd better fucking well explain the mechanism of disaster and not just hide behind an infantile proprietary indicator.
Bloomberg - China developers fall after property tax report. China has to start taxing real estate so that they can bail out local governments, who really have no way of earning revenue other than the obviously unsustainable selling of land. So I'm not too worried.
FT Alphaville - information asymmetry in the era of bitcoin. Interesting read on how silly the process of actually using bitcoins is.
Junior Gold Miner Seeker - Franco Nevada's asset handbook. Always a riveting read.
Economic Geologist - the scoping phase in the feasibility process. This guy is way educational!