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About This Blog
- Sivaram Velauthapillai
Given the drastic changes in bond yields of late, I thought I would update the charts I produced a few years ago showing bond yields during three major deflationary busts. It's almost as if we had gone full-circle over the last two years. The present yield (as of end of August, 2011) on the 10 year US Treasury is lower than what it was back in 2008!
You may want to read the original post I wrote to get more details about the following charts and the source of the data (the original post also has a few more charts I didn't update).
American Bond Yields in the 2000's
The following chart shows the bond yield of the 10 year US Treasury, up to the end of August of 2011.
Tags: bonds and credit instruments, deflation
Inflicted with a painful wisdom tooth problem... hopefully your life is feeling better... Here are some articles I found interesting. Hope you find them worth checking out. As usual, some articles may be old so aware of that.
- Wireless payments via smartphones (Bloomberg Businessweek): One of the reasons the mobile phone industry is attractive—one key reason I'm still closely following companies like Nokia—is because it has potential to revolutionize society beyond communications. This article presents the scenario of carrying out payments through NFC (Near-Field Communications) embedded in smartphones. Futuristic, out-of-reach, concepts like 'virtual wallets' are so close to reality. Not sure who profits from all this though.
- (Recommended) Understanding overall market P/E ratios - Part 1 - Part 2 (Ed Easterling for Advisor Perspectives): Very good explanation of P/E ratios. Anyone interested in evaluating overall market valuation based on P/E ratios should check out the two articles.
- Primer on craft brewers (Bill Smith for GuruFocus): The beer industry in the developed world is stagnating but how about the craft beer industry? I don't know much about it and am not sold on it yet but for anyone interested in the industry, check out this overview of the craft brewer industry in the US.
- Goldman Sachs' enters a distressing period (Bloomberg): Goldman Sachs is facing some problems these days and this article sort of recaps its evolution under the Blankfein era.
- Is Gary Cohn set to replace Blankfein at Goldman Sachs? (Bloomberg): Given all these leaks and personal profiles hitting the mainstream media all of a sudden, I have a feeling that Goldman Sachs is orchestrating a transition. Remains to be seen if management change makes any difference at the venerable "investment bank" (if I'm not mistaken, it's a bank holding company now).
- Shell corporations in the US Midwest (Reuters; h/t Greg Speicher): Investigative article examining the use of shell corporations incorporated in the Midwest. Interesting...
- (Recommended) What's your investing edge? (Greg Speicher): The author suggests that one needs to know what their edge is when it comes to investing, and to write it down. Nice idea that I'm thinking of following through on. I have commented in the past that one should think about and maybe write down what their circle of competence is; or, conversely, I prefer to know what is not in my circle of competence. Similarly, it may be time to think about what's investment approach and competitive advantage may be.
- Should directors be kicked out if they don't garner 50% of the votes? (Bloomberg Businessweek): Apparently, since 2008, more than 200 corporate directors received less than 50% of the shareholder votes yet continued to serve. Should these people be kicked off the boards or not? There are advantages and disadvantages: if you force people off then corporate boards may end up short-term-oriented, like politics, with people coming and going based on voting mood of shareholders; on the other hand, if you keep boards static, they may be less innovative and rubber-stamp everything management pursues.
- "Can Chinese companies live up to investor expectations?" (McKinsey Quarterly; requires free registration): Many emerging markets, including China, trade at premiums to developed markets. Can Chinese stocks meet investor projections?
- Potentially changing Internet business models (strategy+business): Will there be new winners in the Internet business space? Are the models changing (from large scalability to niche focus)?
- How can Twitter earn revenue? (Fortune): A lot of skeptics, including me, have wondered how Twitter will ever make any money to justify its valuation. In this short article, Twitter CEO talks about how he expects to earn revenue.
- How solid is Groupon? (gigaom for Bloomberg Businessweek): Not sure if I linked to this article before but here are some skeptics questioning the viability of Groupon. The problem with making a bearish call is that these are new industries and it's difficult to say how the business model will evolve. As the article points out, many were skeptical of Facebook, Amazon, and Google at one point as well.
- "Chinese Protest $5B Losses Tied to Reverse Mergers" (Bloomberg): American and Canadian investors, amongst others, have been hit hard by the RTO scams and this story covers the Chinese investors who lost money.
- (Recommended) Book excerpt - Odyssey: Pepsi to Apple... a Journey of Adventure, Ideas and the Future by John Sculley and John A. Byrne (Fortune): Book excerpt from an old book from 1987, written by the CEO of Apple at that time, talking about how Steve Jobs was thrown overboard, and how his team rescued Apple. In hindsight, now that we know the history of how things unfolded, it almost seems like a work with 100% irony written all over it.
- Does advertising work? (The Atlantic): The article doesn't really say much but it does have video clips of some of the best commercials seen on American television.
- (non-investing) "What makes us happy?" (The Atlantic): Very interesting article from 2009 from The Atlantic: "Is there a formula—some mix of love, work, and psychological adaptation—for a good life? For 72 years, researchers at Harvard have been examining this question, following 268 men who entered college in the late 1930s through war, career, marriage and divorce, parenthood and grandparenthood, and old age. Here, for the first time, a journalist gains access to the archive of one of the most comprehensive longitudinal studies in history. Its contents, as much literature as science, offer profound insight into the human condition—and into the brilliant, complex mind of the study’s longtime director, George Vaillant."
- (non-investing) Five books on space exploration (The Browser): Now that NASA is decomissioning the Space Shuttle, space exploration is going to enter a new era. Government budget cuts may also hamper NASA, as well as other space agencies throughout the world. This interview covers the future of space and five important books on space exploration.