Finance and Stuff

Thoughts on finance and other stuff by Johan Lindén

Tag: Video

Symmetry in Compensation – Occupy Wall Street

Nassim Talab claims that the reason for the demonstrations on Wall Street is about asymmetry in compensation. Thus to fix this problem we need symmetry in compensation.

Symmetry in compensation basically means that the upside for bankers on Wall Street, the rewards, should equal the risk for losses. What we have seen so far is that bankers have made million dollar bonuses, and they still are, but when screwing up they get bailed out by the tax payers.

Here is the video by, Nassim Taleb, one of the most important persons of the century:

Market Wizards Lecture

Jack Schwager, the author av the trading bible Market Wizards, now has a lecture that can be watched on Youtube or here below.

Since most of his advice is very good, you can really understand that he is a smart man who interviewed and learned from some of the best traders of all times.

The whole lecture is divided in four pieces.

Part 1

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Part 2

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Part 3

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Part 4

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Related Article:
Quotes from Market Wizards

The Truth Behind the Trader on BBC

If you have not seen it yet, see the clip from BBC about the trader who spoke frankly about what he thought about the market. Some of the things he says is:

  • The smart money, do not buy the European rescue plan. The stock market is finished. The Euro is finished.
  • That he and most traders do not care about how the economy goes. He says that he goes to bed every night dreaming of a recession since they equal opportunities.
  • A trader or any person can make money if he is prepared.
  • This economic crises is like a cancer. It will just grow if not taken care of. Get prepared.
  • Governments don’t rule the world, Goldman Sachs does, and Goldman Sachs does not care about the European rescue package.
  • In less than 12 months the savings of million of people will vanish, and that is just the start.

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I mostly agree with him, and think he has some good observations. But there are two main issues here that I want to point out. Firstly, from a contrarian view it is very bullish when mainstream television like BBC air such an ultra negative outlook like this.

Secondly, what is really interesting is that many newspapers today write about this interview. But instead of focusing on what the trader said, they focus on him as a person trying to discredit him. When people trying to hide their heads in the sand by discrediting sources instead of statements, then that should be seen as very negative from a contrarian view.

Market sentiment remains very negative at the moment, making it hard to bet on a downward market (S&P500 1163), more upside risk than downside risk at the moment. However, the long-term outlook is still very bearish as long as most people are denying the risk of a disaster.

Reasons Why The Economy Got Bad

One of the most powerful figures in finance thinks that printing money is a way to save the economy.  

Alan Greenspan, the ex chairman of the US Federal Reserve Bank and one of the most important figures in finance for the last decades, thinks that printing money can save the US economy.

Obviously he must think that the US is the only country printing their money, and that the other parts of the world still use gems and gold to do their business. No wonder we are in a bad shape.

Enjoy the video!

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