Kint

Dollar Cost Averaging: The Myth That Will Never Die

How would an average investor know when to invest? If they invested a lump sum at the wrong time, they would be screwed. Also, the quote you gave doesn't show DCA doesn't work - it shows that when people don't follow it, it doesn't work. DCA doesn't produce the highest returns, but for the average person, it's the best way to go. If you use "momentum investing," one wrong move and all your gains are wiped out, and then some.

Two Takes on the Financial Crisis: 'Too Big to Fail' by Andrew Ross Sorkin and 'How Markets Fail' by John Cassidy

Having read neither books, I may be missing something, but I disagree with the title "Too Big to Fail," which maybe be a catchy phrase, doesn't accurately capture what the problem was. The issue really is Too Interconnected to Fail - companies can't be allowed to buy unregulated products like CDSes, and with cross-ownership and over-leveraging, it's a system of mutually assured destruction. The subprime crisis is not the issue. Lehman going under is acceptable, and even AIG going under in and of itself is acceptable - but an AIG going down that was going to bring down a host of other financial firms because of the CDSes is not acceptable.

Dollar Forced to Abdicate Its Throne

When the Chinese yuan is weak, everyone complains. When the US dollar is weak, everyone complains. Which is it that you want?? Just let the markets play out - it's not the end of the world.

Employment: Neither Quality Nor Quantity

You raise good points, Whitslack.. and there is actually an example of an economy that's mostly healthcare and finance - Hong Kong. Of course, it's only a city, but if you specialize in something that you do better than other people, you don't necessarily have to produce "things" to lead a high standard of living.

Why Krugman's Analysis of Economists Is Wrong

I'm not sure you understand Krugman's argument - what Krugman is arguing is, monetarists economists are the ones who live in a bubble. Their theory is based on numbers and math, and that capitalism is a perfect system. Krugman says monetarists argue that stock prices reflect all available information - the system balances itself, so very little regulation is required. The non-Keynesian view was there couldn't be a housing bubble, because markets are perfectly efficient - and only behaviorists and Keynesians saw the crisis coming. As we've seen in the CDS market, the one system with no regulation is the one that brought down the whole system. If you accept Krugman's premise, then his argument is perfectly valid.

When to Be a Contrarian

Good post..it takes a strong stomach to do what you say, but it pays off.

Four Reasons We're Headed Even Higher

Good article.. also, good job on your stock picks.

Japan's Past = Our Future?

Agree with Andrew.. we have different social contracts.. actually, what Japan is experiencing now is what we experienced in the late 60s.

Coming Soon: Banking Crisis of Historic Proportions

This article is wrong.. where was this biting analysis *before* it happened? Your error is that you're plotting the future based on past trajectory, which is what people did before the subprime meltdown (home prices will never go down!).. you're making the error on the other side now.

Europe Is Recovering More Quickly than U.S. - Why?

Chap08 got it right.. also, b/c of the social contract the Europeans have, they almost have a built-in recession, so it wasn't much of a shock to their economies b/c it wasn't high to begin with. Unemployment rates in France and post-unification Germany have generally been around 8-9%.. so what we call high unemployment, they call "unemployment."

Economists' Views on Trade Deficit Increase

Wait - you mean free markets actually work? Who would've thunk it..

Case-Shiller Home Prices Rise in May, But Don't Read Too Much into This

That chart is hard to read.. the only easy city to see is New York. How about a chart where if you mouse over the city, the line comes to the forefront?

A Reality Check on U.S. 'Economic Recovery'

On Jul 30 03:07 PM thiazole wrote:
> If you believe that, then how do you know that it wasn't lies and
> fabrications that sank the market in the first place? If I were
> ever to subscribe to a conspiracy theory (which I won't), it would

Agreed - and also, how do you know that the market doesn't know about those bank properties being kept off the market, and as the old cliche goes, the information has already been built-in to the prices?

Bad Unemployment News for the Unskilled

Makes sense.. we need more college graduates anyway, if we're to compete with the likes of China, Japan, Germany, etc..

The Government's Role in the Housing Bubble

When a bubble situation starts, it becomes a self-feeding cycle.. I'm not sure if I buy the low interest argument, but when people start seeing home prices rise and the bubble mentality takes hold, all rational thought goes out the window.