The Stingy News Weekly (07/19/2015)
High conviction buybacks
"the high conviction companies have gone on to ourperform the average large stock by about 3.3% in the subsequent year, while the low conviction firms haven't really delivered much excess return at all (just 0.5%, on average)." [Value Investing]
Burger benchmark finds greenback too dear
"Exchange rates are currently being buffeted by the euro crisis, the growing likelihood of a rise in interest rates in America, China's slowing economy and the sharp drop in the oil price, one of the drivers of the rouble's slump. By showing how much these forces have driven different currencies off course, the Big Mac gives a flavour of what may be to come." [World]
Could China be the next Japan?
"China today is very similar to Japan in 1990, and the world's No. 2 economy should be wary of repeating the policy mistakes of Japan" [World]
China crash bigger than subprime
"Hedge fund manager Paul Singer said that China's debt-fueled stock market crash may have larger implications than the U.S. subprime mortgage crisis, echoing warnings from fellow billionaire money managers Bill Ackman and Jeffrey Gundlach." [World]
"Post-1990 Canada certainly looks like a country with successfully managed fiscal and monetary policy. The federal government brought fiscal policy under control and reduced the burden of government debt, and the central bank adhered to its announced inflation target. How did they do it? In the 1995 federal budget, some well-liked social programs, including government health care, remained more or less intact, and cuts were made in a politically palatable way." [World]
Self-driving cars and insurance
"Self-driving cars have a near perfect driving record. So far, when self-driving cars do get into accidents, it's because humans were responsible. Since Google began to release details about self-driving car accidents, reports from the Wall Street Journal, the RAND Corporation, and KPMG have all predicted a dramatic shrinking in the auto insurance industry." [Tech]
Why robo-advisers are here to stay
"Much has been written about newer investment advisory firms that dispense advice through user-friendly websites, called Robo-Advisors. This new breed of advisory firms offers many potential benefits but also faces many headwinds." [Hallett]
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