Will Relatively Low Inflation Expectations Persist In 2013?

The new abnormal is still with us in the new year, but will 2013 break this strange relationship? I’m referring to the unusually close positive connection between the stock market and the implied inflation forecast via the yield spread between the 10-year Treasury Note and its inflation-indexed counterpart. Historically speaking, expectations of higher inflation haven’t […]

The Effects of Golden Parachutes

The indefatigable Lucian Bebchuk has written another empirical paper (Dealbook summary), this time with Alma Cohen and Charles Wang, on the impact of golden parachutes (agreements that pay off CEOs generously in case of acquisition by another company) on shareholder value. Looking just at the question of whether a company is acquired and for how much, they […]

Running Out the Clock on 2012 Stocks

click for updated futures   Sometimes in a close football game, when the team with the ball has a small lead, and with only a few minutes left, they will run out the clock. They can use the maximum amount of time before, during and after each play, to burn off as many minutes and […]

Drawing the Wrong Inferences From Economic Data

Most individual investors have missed the stock market rally — so far.  Many hedgies are also lagging and finding excuses.  The stories about the “headwinds” date back to Dow 10K, when the question was whether we would go to 5000 or Dow 20K.  (I wrote two years ago, with a big skeptical reaction). Why is it […]

Revisiting Stocks For The Long Run

For the last few years we have been poking fun (hopefully in a good-natured way) at the book Stocks for the Long Run. About halfway through this historic equity bull market, in 1994 to be exact, Dr. Jeremy Siegel first published Stocks for the Long Run.  The Washington Post called it “one of the ten best investment books of […]