Another textbook I picked up from the University Library trash table is Bodie, Kane & Marcus's "Investment". It is a good textbook, uses relevant examples and explains clearly how synthetic stocks are built, how to build hedges and arbitrages, what is active portfolio management and so on. The book is very heavy in statistics and equations, which I like, but they misapply them wholesale.For example, Chapter 27.6 explains how calculate to the second decimal point the forecasting accuracy of analists, their coefficient of bias and its variance, and how to discount each analyst's forecast. Unfortunately, accuracy yesterday does not predict accuracy tomorrow and the day after tomorrow. I am also skeptical in general about the relevance of past events to the future in investments (I must be wrong on this point, but let me be). Also portfolio manager's alpha seldom continues for more than one cycle.
The book asks the student to provide retirement advise. For example, a 50 y.o. engineer with one adult daughter and with 900,000$ savings. The student must explore the investment objectives of the engineer: Do you plan to retire at age 55 or 60? Ha! Here I am an Israeli Water Engineer at the age of Mathuselah and the idea of retirement looks so remote like Alpha Centaurii (pic). Hm!
11 comments:
Benmosche would be proud of you, J.
I am proud of him too.
"...the 68-year-old AIG chief told the company’s shareholders אhat he planned to stay on longer than he originally anticipated."
"Though Benmosche’s comments were directed at Europe, American workers may also be working well into their golden years. Already one quarter of middle-class Americans expect to retire when they’re 80, not 65, according to a Wells Fargo survey from November.
In addition, the average retirement age of American workers hit 67, according to a Gallup poll from last month. That’s up from 63 ten years ago and 60 in the mid-1990s."
Textbooks are always one generation late. The golden age of retirement at 50 is no more. Today we die "con las botas puestas", with the boots on, in Spanish.
Mohammed Morsi is Egypt's new ruler.
There are two good Russian bloggers: Tolstoy and Anatol Karlin.
Australia, Russia, America, and Egypt are the future of intellectual progress!
http://akarlin.com/
Karlin is at least partly of Russian-Jewish origin.
May be, probably, but he is not a Karlin Hassid.
Israel is not a White country, and cetainly not a Western country. We did bring here the Falasha (it was a mistake, I say). So we have about 100,000 Ethiopians sweeping the streets. They are Africans 100% and have no blood relation with the Jewish people.
And sorry to say that African "refugees" are still with us and not being expelled in any numbers. We are offering 10,000 dollar to each volunteer to leave.
It is a pity that some have opinions on Israel racial composition without taking the trouble of taking a walk on the streets of Tel Aviv or Jerusalem.
Karlin, you are invited.
"Chapter 27.6 explains how calculate to the second decimal point the forecasting accuracy of analists, their coefficient of bias and its variance, and how to discount each analyst's forecast"
This is religion.
The main idea being to legitimize the system which financed this kind of useless rubbish.The mind boggling planetary level of capital malinvestment of the last decades suggests either a conspiracy to destroy our economy and society - I don't believe it at all - or something so very very strange almost inconceivable.
Those guys are really so very completely dumb. Retarded. Like strange austistic kids writing and drawing things they have no idea about on pieces of paper.
The lack of any result I think settles the matter for idiocy.
( I believe you can as an elite to steal but not collapse the system.)
The advice is hard to give to this " The book asks the student to provide retirement advise. For example, a 50 y.o. engineer with one adult daughter and with 900,000$ savings. The student must explore the investment objectives of the engineer: Do you plan to retire at age 55 or 60?"
It works like this - one of the funds who financed this kind of idiotic analysis will take the engineer's money. They will either lose or appropriate the money for themselves.
And in medium term the engineer will get nothing , except a " go to work ya' lazy bum'.
:)))):)))))
It is no supposition, they already started to talk about this and saying it.
Russia is not Western.
The "retirement" prospects for most people in the West are now pretty bleak, in real terms, because it is simply impossible to store real wealth and run the modern welfare/warfare states while pandering to selfish, non-child-bearing careerist women.
The average man can potentially sock away a million dollars after forty years at the coalface, but you can't get a real 5% on top of inflation.
You can't even get 3%.
Anon.
"The "retirement" prospects for most people in the West are now pretty bleak, in real terms, because it is simply impossible to store real wealth and run the modern welfare/warfare states while pandering to selfish, non-child-bearing careerist women."
Yeap. Exactly.
Of course the brilliant american economic thinkers found a sort of solution.
Give da' money to the investment structures which feed us nicely for nothing. Of course there were no possibilities to invest into real value creation, but instead of all those money going to waste better to go to the management class of the financial world. A lot of brilliant thinkers were also enormously rewarded from that pile of money to show that hmmmm those geniuses who took untold numbers of billions for personal use from society to build palaces,yachts, private planes, to hire armies of nice girls and build sky scrappers to house them at work etc were up to something.
Of course they were not up to anything useful except fraude.
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