Despite all the media coverage, glitz and glam of hedge funds, they have not done well for their investors. They have high — some say excessively high — fees; their short- and long-term performance has been poor.
Czech railway operator Ropid is considering introducing subway carriages for single people to get together in Prague. Ropid spokesperson Filip Drapal hopes the lure of finding love will get people out of their cars and onto Prague’s public transport system. “We want to emphasize that public transport is not only a means of travel but that you can do things there that you cannot do in your car,” he tells Reuters.
The challenge is that Baby Boomers who have seen the entire financial landscape change before their eyes are now reaching retirement age seemingly unprepared for it. While many in this demographic will suffer the consequences, it is also society at-large that will also have to come to terms with these self-induced problems. It would be naive to think that the financial service industry or its overseers in Washington will willingly push for much in the way of constructive change. In the end it may be the case that our financial goals are simply too ambitious and that we need to lower our sights. What is clear is that we as a society have failed and are continuing to fail the average saver.
You’d think a guy like President Obama would prefer a world in which revelations of that sort — the sort that formed the basis for his critique of his predecessor and made his very presidency possible — were filtered through the New York Times rather than anonymous Web denizens of unknown values. By targeting journalists like James Rosen and media organizations like the Associated Press, Team Obama makes it more likely that future leaks will be filtered through people who aren’t moved by government appeals, the judgment of professional peers, public opinion or U.S. ethical norms.
Regardless of where you stand on union issues, this is a situation where the public-sector unions themselves need to know what kinds of activities their money-managers are involved with. These workers possess an enormous about of political power via their retirement plans, which lumped together with the plans of their co-workers often represent the largest institutional investors in the country.
In short, amateurs may be able to beat the investment professionals, but most do far worse. This keeps professional investors in business (and that keeps people like me employed, which is nice). But it means that returns to investors typically lag benchmark returns by a long margin. The outlook, in my view, is for low returns ahead, as measured by common benchmarks. If investors continue to receive materially worse returns than those benchmarks, effective returns are likely to be derisory.
SUPPOSE that an investor you admire and trust comes to you with an investment idea. “This is a good one,” he says enthusiastically. “I’m in it, and I think you should be, too.” Would your reply possibly be this? “Well, it all depends on what my tax rate will be on the gain you’re saying we’re going to make. If the taxes are too high, I would rather leave the money in my savings account, earning a quarter of 1 percent.” Only in Grover Norquist’s imagination does such a response exist.” Source: New York Times
I believe the analogy between national finances and insolvency is damaging. If politicians and policy makers believe their country is, literally, insolvent, then they behave differently towards their creditors. For politicians of debtor states, suddenly vast privatizations make sense, because of course you’re selling some of your remaining assets. Suddenly the will of the people of the debtor nation becomes secondary to the will of the nation’s creditors. Suddenly democracy is an expensive irrelevance in the face of an overwhelming technocratic desire for a speedy, and market-friendly, solution.
April 16 is the 50th anniversary of the publication of a little book that is loved and admired throughout American academe. Celebrations, readings, and toasts are being held, and a commemorative edition has been released. I won’t be celebrating. The Elements of Style does not deserve the enormous esteem in which it is held by American college graduates. Its advice ranges from limp platitudes to inconsistent nonsense. Its enormous influence has not improved American students’ grasp of English grammar; it has significantly degraded it.
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