Tuesday, May 25, 2004

Big Picture - Economics

I recently happened upon a blog devoted to macroeconomics. Macroeconomics is one of those topics where people feel free to form strong opinions without a sufficient basis of information or theory. Boneheads like me will argue with absolute certainty what the impact of deficits or minimum wage hikes will be. Some will even switch sides depending on the times - witness the support Bush enjoys within the Republican party for his binge spending.

The Big Picture
is the work of Barry Ritholtz, the Chief Market Strategist for Maxim Group, a money management firm. He certainly seems to know what he's talking about, and does not appear to be partisan. I look forward to using his site to increase my knowledge.

For an introduction to his work, I'll recommend What is Wealth?, in which he critiques a fellow economist for faulty reasoning.


Blogger Barry Ritholtz said...

Partisanship costs money! I'm obligated to offer "informed opinion" to our clients.

A post like this one generated a lot of feedback:

The Incumbent is Vulnerable: The Iraq situation is a vulnerability for President Bush. Barron's big money poll revealed the vast majority of fund managers - nearly 80% - want to see the incumbent re-elected. The history of presidential elections shows that the markets have a distinct preference for incumbents over challengers, especially in the period leading up to elections.

If you are partisan, you miss things like this -- our clients (and BigPicture readers) saw this long before it became a widely accepted meme.

The same issue was raised after the Tax cut 13 months ago -- whether you liked it or not. While I thought they were badly flawed (http://bigpicture.typepad.com/comments/2003/09/stock_market_vs.html) I also thought they would be very stimulative to the stock market (Here: http://bigpicture.typepad.com/comments/2003/05/bah_humbug_tax_.html)

Such is life . . .

5/25/2004 1:10 PM  

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