Morning Reading – Friday, February 18, 2011

FT BeyondBRICs: The end of the EM affair?

According to fund tracker EPFR Global, investors withdrew a net $5.44bn from EM equity funds during the week to Wednesday. Since mid-January, a whopping $18.5bn has flowed from EM funds to DM funds, most of it going to US equities. So is the EM love affair over?

The Big Picture: Did Goldman Sachs Kill AIG ?

First off, let me start out by saying that these are two bad actors; there are no “good guys” here. Second, let me remind the reader that AIG under-wrote $3 trillion worth of derivatives, a massive high-risk exposure — and collected $3 billion (10 bps) in fees on their exposure.

The Big Picture: Other central banks try to fight the Fed

It’s interesting to watch the Fed try to blow up the inflation bubble at the same time other countries around the world are trying to deflate it.

Calculated Risk: The NAR Reponds to Questions of Overstating Sales

The National Association of Realtors (NAR) responded today to recent stories about the NAR overstating sales. This was in response to Calculated Risk posts in January (here, here and here), and to CoreLogic’s release on Tuesday. Barry Ritholtz picked up on the story this morning.

FT Alphaville: The hidden message in Asia’s FDI flows

But the big investment story for Asia, as the note suggests, is about the shift in the balance of FDI flows, and how China’s rising labour costs is prompting foreign companies to relocate or rethink investment plans.

The Reformed Broker: The Number One Rule of Market Punditry

Attention all market commentators and wannabe talking heads…the Number One Rule of Market Punditry…

Crossing Wall Street: “Weird Begets Weird”

David Merkel picks up on my post about the S&P 500 and looks at rallies in relationship to the falls. David says that “weird begets weird.” He finds that bull markets last longer than bear markets, but bear markets are faster than bulls.

The Aleph Blog: Goes Down Double-Speed

Eddy Elfenbein wrote an interesting post on the market doubling from its bottom. But given all of the odd things going on in the markets, and one of my mottoes is “Weird begets weird,” I asked how unusual the fall was before the rise. Over the last 61 years, it is unprecedented.


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