Video documentary: “25 million pounds” | Adam Curtis
The story of Barings Bank’s 1995 collapse at the hands of Nick Leeson, a rogue futures trader who lost £827mm and bankrupted the company after he hid years’ worth of accumulated, speculative, proprietary positions as client flow trades.
Rail traffic weekly: Slipping lower again | Association of American Railroads (AAR)
Weekly traffic -4.3% y/y; growth cascades into contraction -0.9pp @ -0.4% ytd.
2 of 10 carload groups posted gains: petroleum +7.9%, grain +2.5; minerals -10.6.
[Previously: “Still noise; the signal will have to come in March, when pent-up demand will have to displace these effects from winter storms.”]
#Brown noise $XLE $USO $UNG $DBA $XME
Investor sentiment survey: Exuberance moderated to normalized levels (February 12, 2014) | American Association of Individual Investors (AAII)
Surveys sentiment for equity performance over next 6 months (through 8/2014):
– Bulls +12.3pp @ 40.1% vs 39.0 historical avg & 60.6 high in January (45% considered extremely high)
– Bears -9.1pp @ 27.3 vs 30.5 historical avg & 18.5 postcrisis low in January (25% extremely low)
– Bull/Bear ratio @ 2.2x vs 4x alltime record in January
[Retail investors are so fickle; how quickly their excesses come & go!]
#Bullish #Mean reversion
US household debt & credit report (4q13): Releveraging | Federal Reserve Bank of New York (NY Fed)
Second straight quarterly increase in balances suggests private sector deleveraging is reversing:
– Total consumer indebtedness +2.1% q/q @ $11.52T (+$241B in the biggest increase since 3q07) vs $12.68T record in 3q08
– Mortgages +1.9% @ $8.05T (+$152B)
– Delinquencies have returned to pre-crisis norms, with the exception of elevated student loan impairments, which themselves receded in Q4
[Household sector did a good job of weathering Q4’s rising rates.]
Reinventing education: The school that will get you a job | TIME
New Chicago charter high school, Sarah E. Goode “STEM” School (Science/Technology/Engineering/Math), is a 6-year program that takes 2 extra years for student to obtain an associate’s degree with their diploma.
In addition, a partnership with $IBM guarantees graduates employment in a $40k+ position.
#Jobs guarantee #Vocational
The American Recovery & Reinvestment Act of 2009, 5 years later | Lance Roberts (Street Talk Live)
Updates the progress of Obama’s $830B ARRA fiscal stimulus, part of $31T in total government bailouts from the crisis:
ARRA has not increased real fixed investment (-$53.5B since 1/2009) in “shovel ready infrastructure projects” as intended.
[See also: Moral hazard & the opportunity cost of doing nothing]
Short story: “Thicker than water: A Nantucket family’s trial at sea” | The New Yorker
Amazing account of the capsized Mleczko charter fishing boat off the coast of Nantucket.
[A scaled-down version of The Perfect Storm]