How About Some Tajikistan Bonds?—-The World’s Largest Sovereign Wealth Fund’s Investment Model Is A Rearview Mirror
…… notable is his take on modern capital allocation and investing by the $14 trillion pool of 401(k)s and IRAs, which he calls “the world’s largest sovereign wealth fund”, and which finds itself forced to invest in such assets as Tajikistan and Iraqi bonds because the traditional framework preached by the MPT is no longer applicable, and as a result “the largest SWF on earth is investing with no valuation model but for the rear-view mirror.”
It’s about the liquidity myth, the story that says the market’s mechanical wheels are well greased. It’s not just a myth… It’s a total lie. Sure, there’s liquidity when markets go up, when it’s not needed. But when things go south – and they will – the myth will be revealed for what it is.
If I am right, his indictment will provoke a five-column headline in The New York Times, Don Lemon will have a multiple orgasm on CNN tonight, and by Halloween the whole Manafort matter will be as forgotten as Hurricane Maria in Puerto Rico and the Las Vegas Country Music Massacre. That’s how we roll in Attention Deficit Nation. I suppose Mueller’s team next will want to charge fired National Security Advisor General Michael Flynn for failing to register as a foreign agent prior to a having conversation with the Russian ambassador — but mightn’t it be a little absurd to outlaw dialogue between incoming White House officials and foreign ambassadors who, after all, are here to have conversations with our people? That’ll be an interesting precedent. Why would other countries even bother to send an ambassador here if that’s our policy?
It’s going to take more than the biggest stock slump in world history to convince analysts that PetroChina Co. has finally hit bottom. Ten years after PetroChina peaked on its first day of trading in Shanghai, the state-owned energy producer has lost about $800 billion of market value — a sum large enough to buy every listed company in Italy, or circle the Earth 31 times with $100 bills.
While the mainstream media was announcing for the past two weeks that President Trump was going to release the CIA’s long-secret records on the JFK assassination, I took a different position. On Monday of this week, I predicted that Trump would make a deal with the CIA that would enable the CIA to continue its cover-up of the JFK assassination……On Thursday, the day of the deadline established by law for releasing the records, Trump granted the CIA’s request for continued secrecy, on grounds of “national security,” more than 50 years after the Kennedy assassination.
This past week in Beijing, China’s 19th Party Congress not only re-appointed Xi as party leader but enshrined him in the Communist pantheon right next to Chairman Mao. In effect, Xi has become China. Paraphrasing France’s Louis XIV, Xi was saying, ‘I am the state.’ Which means that anyone opposing Xi Jinping will become an enemy of China.
Unfortunately, the evidence of the past 16 years clearly indicates that the answer is no. Enough time has now passed since 9/11 to reach two important conclusions. First, the threat posed by Islamist-inspired terrorism does not justify such a mammoth effort. Second, the aggressive military strategy the United States has pursued since 2001 has not only failed to reduce the threat of terrorism; it has likely made things worse.
No matter which party controls the White House or Congress, the War Party runs things. Warmongering neocons in the GOP and warmongering neolibs in the Democrat Party control Washington, D.C. Oh, they might fuss and feud with each other over domestic and social issues (abortion, homosexuality, welfare, immigration, tort reform, etc.), but they are joined at the hip on the one issue that matters most to them: the Warfare State.
But very quietly behind the scenes there’s been an extremely rapid uptick in the US national debt. In the month of October alone, the US national debt has soared by nearly a quarter of a trillion dollars. This is pretty astonishing given that October is supposed to be a ‘good’ month for the US Treasury Department. The tax extension deadline means that October is usually quite strong for federal tax receipts.
The International Monetary Fund has warned that the increasing use of exotic financial products tied to equity volatility by investors such as pension funds is creating unknown risks that could result in a severe shock to financial markets. In an interview with the Financial Times Tobias Adrian, director of the Monetary and Capital Markets Department of the IMF, said an increasing appetite for yield was driving investors to look for ways to boost income through complex instruments. “The combination of low yields and low volatility facilitates the use of leverage by investors to increase returns, and we have seen rapid growth in some types of products that do this,” he said.