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Christopher Pavese, CFA
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Mr. Pavese holds several positions within the Broyhill family offices, serving as Chief Investment Officer of Broyhill Asset Management and BMC Fund, Inc., an SEC registered investment company. His primary responsibilities include macroeconomic research, strategic asset allocation, portfolio... More
My company:
Broyhill Asset Management, LLC
My blog:
The View From the Blue Ridge
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  • Something's Gotta Give

    As we expected, last Friday, The United States International Trade Commission (USITC) determined that there is a reasonable indication that U.S. industry is materially injured by reason of imports of Multilayered Wood Flooring (MLWF) from China that are allegedly subsidized and sold in the United States at less than fair value.

    And yet “the street” has not put two and two together, as a simple news search on various financial websites makes no mention of this decision as it relates to Lumber Liquidators (NYSE:LL).  We continue to believe that this represents a material risk to shareholders, as we discussed in our initial post on the company and recommend ignoring any commentary suggesting otherwise, especially coming from a small, wooden boy as he is likely to be constructed from MLWF.

    Disclosure: At the time of publication, the author was short Lumber Liquidators  (LL), although positions may change at any time.

    Disclosure: I am Short LL.
    Tags: LL
    Dec 07 7:55 AM | Link | Comment!
  • Back to Basics

    Gold prices are looking frothy and various measures of consensus sentiment are back at extremes in the short term.  We are looking for a correction before increasing our exposure to precious metals as our long-term bullish case for Gold as a store of value has not changed.  It is interesting to note that a few leaders in the mainstream community are coming around to this view as well – note the recent comments from World Bank President Robert Zoellick, and this weekend’s NYT Op Ed by James Grant, editor of Grant’s Interest Rate Observer, and one of our favorite long-term thinkers in the business.

    And on a completely unrelated note, we found this illustration between the correlation of sovereign debt risk and men living with their parents, entertaining if nothing else.  As a man named Homer once advised, “It’s funny ‘cause it’s true.”


    Disclosure: At the time of publication, the author was long Gold and Silver, although positions may change at any time.

    Disclosure: Long Gold and Silver
    Nov 17 4:41 PM | Link | Comment!
  • Open Letter to Ben Bernanke

    The following is the text of an open letter to Federal Reserve Chairman Ben Bernanke signed by several economists, along with investors and political strategists, compliments of the WSJ:

    We believe the Federal Reserve’s large-scale asset purchase plan (so-called “quantitative easing”) should be reconsidered and discontinued.  We do not believe such a plan is necessary or advisable under current circumstances.  The planned asset purchases risk currency debasement and inflation, and we do not think they will achieve the Fed’s objective of promoting employment.

    We subscribe to your statement in the Washington Post on November 4 that “the Federal Reserve cannot solve all the economy’s problems on its own.”  In this case, we think improvements in tax, spending and regulatory policies must take precedence in a national growth program, not further monetary stimulus.

    We disagree with the view that inflation needs to be pushed higher, and worry that another round of asset purchases, with interest rates still near zero over a year into the recovery, will distort financial markets and greatly complicate future Fed efforts to normalize monetary policy.

    The Fed’s purchase program has also met broad opposition from other central banks and we share their concerns that quantitative easing by the Fed is neither warranted nor helpful in addressing either U.S. or global economic problems.

    Cliff Asness
    AQR Capital

    Michael J. Boskin
    Stanford University
    Former Chairman, President’s Council of Economic Advisors (George H.W. Bush Administration)

    Richard X. Bove
    Rochdale Securities

    Charles W. Calomiris
    Columbia University Graduate School of Business

    Jim Chanos
    Kynikos Associates

    John F. Cogan
    Stanford University
    Former Associate Director, U.S. Office of Management and Budget (Reagan Administration)

    Niall Ferguson
    Harvard University
    Author, The Ascent of Money: A Financial History of the World

    Nicole Gelinas
    Manhattan Institute & e21
    Author, After the Fall: Saving Capitalism from Wall Street—and Washington

    James Grant
    Grant’s Interest Rate Observer

    Kevin A. Hassett
    American Enterprise Institute
    Former Senior Economist, Board of Governors of the Federal Reserve

    Roger Hertog
    The Hertog Foundation

    Gregory Hess
    Claremont McKenna College

    Douglas Holtz-Eakin
    Former Director, Congressional Budget Office

    Seth Klarman
    Baupost Group

    William Kristol
    Editor, The Weekly Standard

    David Malpass
    Former Deputy Assistant Treasury Secretary (Reagan Administration)

    Ronald I. McKinnon
    Stanford University

    Dan Senor
    Council on Foreign Relations
    Co-Author, Start-Up Nation: The Story of Israel’s Economic Miracle

    Amity Shlaes
    Council on Foreign Relations
    Author, The Forgotten Man: A New History of the Great Depression

    Paul E. Singer
    Elliott Associates

    John B. Taylor
    Stanford University
    Former Undersecretary of Treasury for International Affairs (George W. Bush Administration)

    Peter J. Wallison
    American Enterprise Institute
    Former Treasury and White House Counsel (Reagan Administration)

    Geoffrey Wood
    Cass Business School at City University London

    Disclosure: no positions mentioned
    Tags: Policy
    Nov 16 11:31 AM | Link | Comment!
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