RocketCap » Financial Entertainment

Jim Cramer is Harmless

admin — Tue, 25 Aug 2009 18:27:21 +0000

Paul Bolster and Emery Trahan, professors of finance at Northeastern University, recently rigorously analyzed the investing performance CNBC star Jim Cramer. Cramer is a well known entertainer and market maven who seemingly has a real time database in his head of every traded US stock. He frequently recommends buys and sells for a variety of stocks. He is very rich and famous. But do his recommendations pay off? If you followed him, would you have made money for the risk level of his recommendations?

Here’s the answer, in beautiful brevity:

Professor Bolster stated his overall conclusion: “He has an alpha of 0; he could do worse. He’s harmless.”

This means you would have gained nothing and lost nothing for the risk level of Cramer’s recommendations over the time horizon analyzed (July 2005 to the end of 2007). For details, see the full results described here:

Paul J. Bolster and Emery A. Trahan, “Investing in Mad Money: Price and Style Effects,” Financial Services Review, Vol.18 (2009), pp. 69–86.

You also can read a summary here.

This Just In: How to Use Your ObamaCare Medical Insurance Coverage

admin — Tue, 21 Jul 2009 00:01:04 +0000

This instructional video explains in layman’s terms how to use your ObamaCare plan:

ObamaCare Instructional Video

Taleb Brings His Black Swan to CNBC

admin — Sun, 05 Jul 2009 15:17:25 +0000

Taleb intimidates the reporters on CNBC, who are obviously economically and systemically challenged:

Dr. Black Swan Urges Widespread, Systematic De-Leveraging, World Wide

He says hyperinflation is possible with the current government policies, which policies were unnecessary and driven by political fear.

Nassim Taleb and Ben Bernanke: Covertly Brothers?

admin — Mon, 29 Jun 2009 18:30:39 +0000

We report, you decide!

Taleb is the promoter of the idea that “Black Swans”, or exceptionally rare, impactful and ex-ante unimaginable events must be dealt with in financial markets. Bernanke is chairman of the Federal Reserve Bank.

Taleb (L) and Bernanke (R)

Sixth Biggest Canadian City has Zero Debt. Mayor is Active and 88; 30 Years on Job

admin — Sat, 02 May 2009 17:22:02 +0000

This is an inspirational video if you care about zero debt cities and great health!

#mce_temp_url#

Flush that Policy Idea

admin — Tue, 14 Apr 2009 05:32:45 +0000

It sure sounds like CNBC offered its opinion of Dr. Larry Summers’ policy ideas. Listen for the sound of a toilet flushing in this video!

Dr. Larry Summers’ Ideas Flushed Out?

Financial Entertainment

admin — Tue, 07 Apr 2009 03:37:56 +0000

This post introduces a new feature of this blog: videos about our political economy, investing, business, economics…that may well inflame your emotions. Try this for openers:

First car made in Detroit since the Bailout

SouthPark on Financial Policy-Explains It All

admin — Fri, 27 Mar 2009 18:05:00 +0000

Have fun as you finally understand the financial calamity:

SouthPark on How Treasury Dept. Does Bailouts

Astounding, Articulate Challenge to EU Prime Minister re: Economy

admin — Fri, 27 Mar 2009 01:33:50 +0000

One of the charms of European parliaments is the formal process in which members can directly challenge the leader, without interruption, and at length. (Imagine if American politicians could govern without soundbite thinking and speaking-the mind boggles.) This video shows such a challenge to the EU’s Prime Minister on the subject of the economy.

Note how Daniel Hannan, MEP, is extraordinarily articulate, lightyears beyond any American politician. Even President Obama’s skills are dwarfed by Hannan’s oratorical skills. Hannan, by the way, doesn’t use any notes or teleprompter in this diatribe!

I say this is brilliantly on target. See if you agree.

Daniel Hannan MEP: The devalued Prime Minister of a devalued Government

What? There’s Gambling in this Casino?

admin — Thu, 26 Mar 2009 05:44:27 +0000

Our Congress has spent weeks in a populist frenzy about bonuses paid, with Congress’s own authorization, to certain executives at AIG who were, supposedly, the very same men who destroyed AIG, thereby reqiring subsequent government bailout. How dare they get bonuses for such a monumental failure, said the congress in righteous rage.

It finally was publishjed today that everyone of those system destroyers is long gone from AIG, and the currently targeted bonuses go to true innocents.

As Holman Jenkins writes in the Wall St. Journal, 25 MAR 09:

“There is not a shred of justice in the hysteria that followed. As AIG chief Ed Liddy explained on the Hill last week, the people receiving retention bonuses were not the same people who launched AIG’s unhedged housing bets that brought the company down. Those people were gone. Their pay is already being clawed back.

Those who remained had been asked a year ago to stay and work themselves out of a job. In accepting the terms offered to them, they committed no offense (say, failing to pay taxes). Their only crime was possessing marketable knowledge — all the more marketable because of the opportunity for hedge funds and other counterparties to profit from AIG’s distress. Had the company submitted to Chapter 11 rather than a government takeover, a bankruptcy judge might well have authorized identical incentives to minimize losses and maximize recovery for legitimate stakeholders.”

As Mark Twain reputedly said, “No one is safe when Congress is in session.”