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<title>Minyanville - Mark Dow RSS</title>
<description>
The Trusted Choice for the Wall Street Voice
</description>
<link>
		http://www.minyanville.com</link>
<copyright>
		2013Minyanville Publishing and Multimedia, LLC. All Rights Reserved
</copyright>
		<item>
<title><![CDATA[The Case Against Commodities and Emerging Markets]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/commodities/articles/The-Case-Against-Commodities-and-Emerging/2/27/2013/id/48426</link>
<pubDate>
			Wed, 27 Feb 2013 16:52:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/commodities/articles/The-Case-Against-Commodities-and-Emerging/2/27/2013/id/48426</guid>
<description>
<![CDATA[Commodities as a group have been underperforming equities for about six months now. The correlation between the two groups has been grinding lower. Even more important, I think the underperformance of commodities-and by extension emerging markets-will persist for some time.
	
	Hang on. If the backdrop is improving growth expectations and continued, if not increased, global central bank base money expansion, why have they underperformed and why should it continue? Here's my answer.
	
	Misunderstanding Monetary Policy
	
	This is going to sound bad so I'm just going to say it: Most investors and commentators have a deeply flawed understanding of monetary policy. ]]>
</description>
<content:encoded>
	<![CDATA[Commodities as a group have been underperforming equities for about six months now. The correlation between the two groups has been grinding lower. Even more important, I think the underperformance of commodities-and by extension emerging markets-will persist for some time.
	
	Hang on. If the backdrop is improving growth expectations and continued, if not increased, global central bank base money expansion, why have they underperformed and why should it continue? Here's my answer.
	
	Misunderstanding Monetary Policy
	
	This is going to sound bad so I'm just going to say it: Most investors and commentators have a deeply flawed understanding of monetary policy. ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[The Effects of QE on Treasury Yields -- Now the Answers Start to Matter]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/the-effects-of-qe-on-ust/1/7/2013/id/47202</link>
<pubDate>
			Mon, 7 Jan 2013 17:03:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/fixed-income/articles/the-effects-of-qe-on-ust/1/7/2013/id/47202</guid>
<description>
<![CDATA[The debate about the impact on US treasury yields from the Federal Reserve's LSAP programs - often referred to as quantitative easing  -is raging into its fourth year. In fact, now that the time series are getting long enough for more robust number crunching, I suspect academics are going to really start diving in and begin the writing of history.
	
	Practitioners, however - both policy makers and those of us who have money on the line - don't have the luxury of time. We are entering a critical phase right now. Why? Household leverage has been the prime impediment to ]]>
</description>
<content:encoded>
	<![CDATA[The debate about the impact on US treasury yields from the Federal Reserve's LSAP programs - often referred to as quantitative easing  -is raging into its fourth year. In fact, now that the time series are getting long enough for more robust number crunching, I suspect academics are going to really start diving in and begin the writing of history.
	
	Practitioners, however - both policy makers and those of us who have money on the line - don't have the luxury of time. We are entering a critical phase right now. Why? Household leverage has been the prime impediment to ]]>
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			</item>
			<item>
<title><![CDATA[Berlusconi: Why He's No Donald Trump]]></title>
<link>
			http://www.minyanville.com/sectors/global-markets/articles/Berlusconi253A-Why-He2527s-no-Donald-Trump/12/11/2012/id/46572</link>
<pubDate>
			Tue, 11 Dec 2012 10:35:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/sectors/global-markets/articles/Berlusconi253A-Why-He2527s-no-Donald-Trump/12/11/2012/id/46572</guid>
<description>
<![CDATA[It is easy to see Silvio Berlusconi as an egocentric and aging clown figure desperate to stay relevant---especially when looking at it from outside Italy. But this would be a mistake. He is no Donald Trump. His message is real and should be heeded, both in Rome and Berlin, even if his odds of winning are nil.

Let me be clear: It would be a disaster if Berlusconi were to return to power. Even if you support that part of Italy's political spectrum, you should recognize that Berlusconi is too polarizing a figure inside of Italy, and too compromised a ]]>
</description>
<content:encoded>
	<![CDATA[It is easy to see Silvio Berlusconi as an egocentric and aging clown figure desperate to stay relevant---especially when looking at it from outside Italy. But this would be a mistake. He is no Donald Trump. His message is real and should be heeded, both in Rome and Berlin, even if his odds of winning are nil.

Let me be clear: It would be a disaster if Berlusconi were to return to power. Even if you support that part of Italy's political spectrum, you should recognize that Berlusconi is too polarizing a figure inside of Italy, and too compromised a ]]>
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<title><![CDATA[Our Next Treasury Secretary]]></title>
<link>
			http://www.minyanville.com/business-news/politics-and-regulation/articles/treasury-secretary-government-capital-hill-hillary/11/16/2012/id/45920</link>
<pubDate>
			Fri, 16 Nov 2012 12:09:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/politics-and-regulation/articles/treasury-secretary-government-capital-hill-hillary/11/16/2012/id/45920</guid>
<description>
<![CDATA[The chatter over who will the next Treasury Secretary has heated up now that the election is behind us. Given that the position will likely be-as things stand right now-central to the nation's next four years, the attention is understandable and warranted.
		
		Much of the talk seems to focus on the traditional discussion about the attributes a Treasury Secretary should typically have. Wall Street or Main Street? Public sector background or private sector background? I think this approach leans us in the wrong direction. Instead, we should focus on what we need now. And today's context is fiscal and political, ]]>
</description>
<content:encoded>
	<![CDATA[The chatter over who will the next Treasury Secretary has heated up now that the election is behind us. Given that the position will likely be-as things stand right now-central to the nation's next four years, the attention is understandable and warranted.
		
		Much of the talk seems to focus on the traditional discussion about the attributes a Treasury Secretary should typically have. Wall Street or Main Street? Public sector background or private sector background? I think this approach leans us in the wrong direction. Instead, we should focus on what we need now. And today's context is fiscal and political, ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Note to a Friend on the Market]]></title>
<link>
			http://www.minyanville.com/trading-and-investing/commodities-and-options/articles/investing-equity-usdmxn-dollar-eur/9/10/2012/id/43850</link>
<pubDate>
			Mon, 10 Sep 2012 10:05:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/trading-and-investing/commodities-and-options/articles/investing-equity-usdmxn-dollar-eur/9/10/2012/id/43850</guid>
<description>
<![CDATA[I just wrote this note to a friend of mine on where I stand. I don't talk that much about my trading, and I tend to post a lot less when I am in California (opportunity cost is very high here), but I thought the note below might be a useful follow-up to the Toxic Migration case I made a few weeks ago.
	 

	Dear X,
	
	I am riding the equity calls I bought a week or two back, and actually added to them late last week. I closed out my USDMXN (USDMXN=X)  short yesterday. And I got scared out of ]]>
</description>
<content:encoded>
	<![CDATA[I just wrote this note to a friend of mine on where I stand. I don't talk that much about my trading, and I tend to post a lot less when I am in California (opportunity cost is very high here), but I thought the note below might be a useful follow-up to the Toxic Migration case I made a few weeks ago.
	 

	Dear X,
	
	I am riding the equity calls I bought a week or two back, and actually added to them late last week. I closed out my USDMXN (USDMXN=X)  short yesterday. And I got scared out of ]]>
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			</item>
			<item>
<title><![CDATA[Toxic Migration and the Bull Case]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/s2526p-bullish-case-world-economic-growth/8/15/2012/id/43236</link>
<pubDate>
			Wed, 15 Aug 2012 12:30:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/s2526p-bullish-case-world-economic-growth/8/15/2012/id/43236</guid>
<description>
<![CDATA[It's not as fun to be bullish. Bears are smart. Bulls are wide-eyed optimists. Bears have data. Bulls tell stories. Bears make money when everyone else is in pain. Bulls make money when everyone else already claims to be a genius. In short, many of us get more satisfaction being bearish because the psychic payoff is greater: We calibrate our own self-esteem not by our victories in absolute terms, but in our victories relative to others.

So, with personal biases disclosed, let me lay out the bullish case. I don't want to get carried away. For one, I know that ]]>
</description>
<content:encoded>
	<![CDATA[It's not as fun to be bullish. Bears are smart. Bulls are wide-eyed optimists. Bears have data. Bulls tell stories. Bears make money when everyone else is in pain. Bulls make money when everyone else already claims to be a genius. In short, many of us get more satisfaction being bearish because the psychic payoff is greater: We calibrate our own self-esteem not by our victories in absolute terms, but in our victories relative to others.

So, with personal biases disclosed, let me lay out the bullish case. I don't want to get carried away. For one, I know that ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[A Quick Lesson on Base Money and Money Supply]]></title>
<link>
			http://www.minyanville.com/business-news/politics-and-regulation/articles/base-money-money-supply-base-money/6/25/2012/id/41968</link>
<pubDate>
			Mon, 25 Jun 2012 14:00:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/politics-and-regulation/articles/base-money-money-supply-base-money/6/25/2012/id/41968</guid>
<description>
<![CDATA[A lot of people have a hard time understanding why base money growth (i.e., Fed printing) doesn't necessarily lead to money supply growth. I've been beating this drum for a few years now, and I get the question a lot. So here's a quick, non-technical answer:

Say base money is 10% of the money supply (close enough for illustrative purposes). Then, if the 90% portion is contracting because banks aren't lending and consumers are deleveraging, it doesn't take much contraction for this to more than offset almost any increase in the 10% (base money) portion. This is the basic concept. ]]>
</description>
<content:encoded>
	<![CDATA[A lot of people have a hard time understanding why base money growth (i.e., Fed printing) doesn't necessarily lead to money supply growth. I've been beating this drum for a few years now, and I get the question a lot. So here's a quick, non-technical answer:

Say base money is 10% of the money supply (close enough for illustrative purposes). Then, if the 90% portion is contracting because banks aren't lending and consumers are deleveraging, it doesn't take much contraction for this to more than offset almost any increase in the 10% (base money) portion. This is the basic concept. ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[A Framework for Thinking About Gold and Silver]]></title>
<link>
			http://www.minyanville.com/sectors/precious-metals/articles/precious-metals-gold-silver-precious-metals/6/25/2012/id/41967</link>
<pubDate>
			Mon, 25 Jun 2012 12:25:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/sectors/precious-metals/articles/precious-metals-gold-silver-precious-metals/6/25/2012/id/41967</guid>
<description>
<![CDATA[Gold and silver have become very popular investments in recent years. I'm sure you've all seen the ads pitching them. The reaction to this last Fed policy meeting and press conference makes it a good time to go over the main reasons people have had for owning gold and silver, and how those factors have been evolving.

Low real rates. Commodities in general tend to do well in environments of low real interest rate, and none more so than precious metals. The two reasons are (1) the opportunity cost of holding precious metals is low, and (2) periods of low ]]>
</description>
<content:encoded>
	<![CDATA[Gold and silver have become very popular investments in recent years. I'm sure you've all seen the ads pitching them. The reaction to this last Fed policy meeting and press conference makes it a good time to go over the main reasons people have had for owning gold and silver, and how those factors have been evolving.

Low real rates. Commodities in general tend to do well in environments of low real interest rate, and none more so than precious metals. The two reasons are (1) the opportunity cost of holding precious metals is low, and (2) periods of low ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[In Poker Terms, Germany Is Pot Committed, and the Other Players Are Not About to Fold]]></title>
<link>
			http://www.minyanville.com/business-news/editors-pick/articles/Spanish-bank-german-economy-euro-crisis/6/12/2012/id/41681</link>
<pubDate>
			Tue, 12 Jun 2012 11:55:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/editors-pick/articles/Spanish-bank-german-economy-euro-crisis/6/12/2012/id/41681</guid>
<description>
<![CDATA[The short-term market reaction to the Spanish bank deal should not blind us to the important longer-term implications: Germany is now pot committed.

Pot committed is a poker term describing when you have bet such a large percentage of your chips that you cannot fold your hand. You are not all-in yet, but you eventually will be unless the others fold. ("Crossing the Rubicon" has roughly the same meaning, but seemed a little too evocative in the present context).

The Spailout, as it is being called, is the biggest one-shot resource commitment the eurozone has made in this crisis. In ]]>
</description>
<content:encoded>
	<![CDATA[The short-term market reaction to the Spanish bank deal should not blind us to the important longer-term implications: Germany is now pot committed.

Pot committed is a poker term describing when you have bet such a large percentage of your chips that you cannot fold your hand. You are not all-in yet, but you eventually will be unless the others fold. ("Crossing the Rubicon" has roughly the same meaning, but seemed a little too evocative in the present context).

The Spailout, as it is being called, is the biggest one-shot resource commitment the eurozone has made in this crisis. In ]]>
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			<item>
<title><![CDATA[This Is the Dirtiest Secret Amongst Professional Money Managers]]></title>
<link>
			http://www.minyanville.com/business-news/markets/articles/money-management-trading-tips-investor-advice/6/7/2012/id/41574</link>
<pubDate>
			Thu, 7 Jun 2012 11:30:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/markets/articles/money-management-trading-tips-investor-advice/6/7/2012/id/41574</guid>
<description>
<![CDATA[How many times have we all heard the line, "You can't go broke taking a profit"? TV talking heads say  all the time. It is dead wrong.

Perhaps the dirtiest of secrets amongst professional money managers is that ideas - the primary basis on which they sell themselves to clients - come in third behind risk management and portfolio construction in generating replicable returns.

It doesn't matter how much you explain to clients the centrality of risk management; they obligingly nod, wait for their turn to speak, and say, "Oh, that's great, Mark. Very nice. You were great on TV ]]>
</description>
<content:encoded>
	<![CDATA[How many times have we all heard the line, "You can't go broke taking a profit"? TV talking heads say  all the time. It is dead wrong.

Perhaps the dirtiest of secrets amongst professional money managers is that ideas - the primary basis on which they sell themselves to clients - come in third behind risk management and portfolio construction in generating replicable returns.

It doesn't matter how much you explain to clients the centrality of risk management; they obligingly nod, wait for their turn to speak, and say, "Oh, that's great, Mark. Very nice. You were great on TV ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[The Enlightened Trader: An Essential Reading List]]></title>
<link>
			http://www.minyanville.com/business-news/editors-pick/articles/behavioral-economics-books-behavioral-economics-finance/6/1/2012/id/41419</link>
<pubDate>
			Fri, 1 Jun 2012 13:20:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/editors-pick/articles/behavioral-economics-books-behavioral-economics-finance/6/1/2012/id/41419</guid>
<description>
<![CDATA[I've been getting a lot of requests for a book list on behavioral economics, finance, etc. Here are what I find to be some of the best books on these subjects. I picked books that are aimed at the intelligent reader who does not necessarily have specialized training in economics, sociology, or evolutionary psychology.

	 
	But I would also suggest you start with the 30-minute video of Daniel Kahneman's Nobel Prize lecture. Videos are always easier than books, and it'll open your eyes to our cognitive limitations as a species. Yes, that means you, too. Especially you.

	
		James Montier, The Little ]]>
</description>
<content:encoded>
	<![CDATA[I've been getting a lot of requests for a book list on behavioral economics, finance, etc. Here are what I find to be some of the best books on these subjects. I picked books that are aimed at the intelligent reader who does not necessarily have specialized training in economics, sociology, or evolutionary psychology.

	 
	But I would also suggest you start with the 30-minute video of Daniel Kahneman's Nobel Prize lecture. Videos are always easier than books, and it'll open your eyes to our cognitive limitations as a species. Yes, that means you, too. Especially you.

	
		James Montier, The Little ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[More Greek Cognitive Illusion: What They Really Think About Germany]]></title>
<link>
			http://www.minyanville.com/business-news/the-economy/articles/euro-eurozone-greece-greece-crisis-greek/5/31/2012/id/41388</link>
<pubDate>
			Thu, 31 May 2012 16:00:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/the-economy/articles/euro-eurozone-greece-greece-crisis-greek/5/31/2012/id/41388</guid>
<description>
<![CDATA[Editor&#39;s note: To read Part One of Mark Dow&#39;s musings on Greece, see: Big, Fat Cognitive Illusion (And All of Us Are More Greek Than We Think).

	 
A quick update on my post about Greece and cognitive illusion when under stress. I mentioned one of the most powerful attributes of human nature is our insidious, and often subconscious, ability to shift blame to others when things aren't going well. Another thing we do is take shots at others' success.

For example, here's a slide from the results of a recent Greek survey of "Greek Public Opinion about Germany and its ]]>
</description>
<content:encoded>
	<![CDATA[Editor&#39;s note: To read Part One of Mark Dow&#39;s musings on Greece, see: Big, Fat Cognitive Illusion (And All of Us Are More Greek Than We Think).

	 
A quick update on my post about Greece and cognitive illusion when under stress. I mentioned one of the most powerful attributes of human nature is our insidious, and often subconscious, ability to shift blame to others when things aren't going well. Another thing we do is take shots at others' success.

For example, here's a slide from the results of a recent Greek survey of "Greek Public Opinion about Germany and its ]]>
</content:encoded>
			</item>
			<item>
<title><![CDATA[Big, Fat Cognitive Illusion (And All of Us Are More Greek Than We Think)]]></title>
<link>
			http://www.minyanville.com/business-news/editors-pick/articles/eurozone-greece-greeks-greek-economy-greece/5/31/2012/id/41390</link>
<pubDate>
			Thu, 31 May 2012 13:20:00EST
</pubDate>
<guid isPermaLink="true">
			http://www.minyanville.com/business-news/editors-pick/articles/eurozone-greece-greeks-greek-economy-greece/5/31/2012/id/41390</guid>
<description>
<![CDATA[Editor&#39;s note: To read an update to this article, see: More Greek Cognitive Illusion: What They Really Think About Germany.

	 
Joe Weisenthal at Business Insider put out a quick post the morning of May 29 on the Pew Research Center study, "European Unity on the Rocks." It is an eye opening read.

To start with, it strongly supports the working hypothesis of many that the political forces now unleashed in Europe are centrifugal, not centripetal. This reality makes betting on solving the crisis through a deepening of the EU a long shot that&#39;s odds are getting longer by the day. ]]>
</description>
<content:encoded>
	<![CDATA[Editor&#39;s note: To read an update to this article, see: More Greek Cognitive Illusion: What They Really Think About Germany.

	 
Joe Weisenthal at Business Insider put out a quick post the morning of May 29 on the Pew Research Center study, "European Unity on the Rocks." It is an eye opening read.

To start with, it strongly supports the working hypothesis of many that the political forces now unleashed in Europe are centrifugal, not centripetal. This reality makes betting on solving the crisis through a deepening of the EU a long shot that&#39;s odds are getting longer by the day. ]]>
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