November 2008 through January 2009 was a rough period. The markets were in chaos. My best posts I will categorize for your benefit:
Criticism of Government and Central Bank Policy
- The Humility of Realism
- The Humility of Realism, Redux
- Bailouts Must Be Odious
- Failure to Admit Failure
- Issuing Debt for as Long as Our Republic Will Last
- The More Things Change, The More They Remain The Same
- The Progress of Debt
- A New Goal For TARP Money: Create Mutual Banks
- The Humility of Realism — II
- Ten Takeaways from the Greenspan Years
- Against Bank Nationalization
As the crisis hit, the government was not willing to reconcile bad debts, but insisted on on putting off pain. Though Depression was staved off, it came with a price, which includes a future depression.
- What is a Depression?
- “There doesn’t seem to be a fundamental reason why.”
- Start a Rating Agency, Why Don’t You?
- Financial History is Valuable
- Spot the Three Currency Regimes
As many grasped at straws, the crisis was best understood as too much debt, and because that was not a part of the neoclassical economists’ playbook, they floundered, having no idea of why the crisis was occurring.
- Sell Stocks, Buy Corporate Bonds
- The Occasional Seemingly Free Lunch
- GE Does Not Bring Good Things For Your Life
- What To Do?
- Momentum in the S&P 500
- Hidden Credit Risk in Currency Funds
- A Different Look at Industry Momentum
- A Different Look at Industry Momentum — II
Many good ideas for how to play the market in a depressed state. The call to buy junk bonds was a very good call.
Why entitlements are the weak link in the US economy.
Why fair value accounting if properly done, is the best method for accounting.
Public pension plans had a naive faith in the power of equities.
Most economists don’t have their heads screwed on straight. It is only a matter of time before the view of economists change to more of an Austrian or Minsky perspective. Oh yeah, and the Santa Fe Institute…
Past economic relationships disappoint.
Very basic stuff, because cash flow is the life of a business.
Real stability means that you don’t have to take any action in order to preserve value.
Got a lot of flak from this piece, but I still stand behind it. Black swans are created by those that think a financial trend can continue indefinitely.