Edward J. Strafaci ~ Academic Blog

A review of Warren Buffet's Annual Letter...NY Times Berkshire Hathaway’s bottom line for 2017 got a big lift from the new tax law. In an annual letter to Berkshire’s shareholders on Saturday, the company’s chief executive, Warren Buffett, said the conglomerate recorded a more than $29 billion gain related to the tax overhaul that became law in December. He also said that a “purchasing frenzy” had raised deal prices to a level that the company could not stomach. That was why, he said, that Berkshire had largely avoided big acquisitions last year. Here’s a look at some of the highlights from the letter: Taxes Berkshire recorded a hefty windfall from the tax bill that Congress passed at the end of last year. The annual report said the tax overhaul produced a $29.6 billion gain that was offset slightly by $1.4 billion of tax payments on repatriated foreign earnings. The tax gain contributed nearly two-thirds of Berkshire’s $44.9 billion in net earnings for 2017. Each year, Mr. Buffet...

It Was Not Effective, But We'll Do It Again by Mike Mish Shedlock 11 hrs Boston Fed President Eric Rosengren has some interesting comments about QE today. The Bond Buyer reports  Rosengren Expects Fed to Again Resort to Asset Purchases . Although large scale asset purchase programs may not be as effective as previously believed, Federal Reserve Bank of Boston President Eric Rosengren said Friday, “it is quite likely” that the programs will be needed in the future. Advertisement Crisis-Era Failures The Wall Street Journal reports  Fed’s Crisis-Era, Bond-Buying Plan Was Largely Ineffective, Economists Say . The Federal Reserve’s signature bond buying stimulus program undertaken during and in the wake of the financial crisis was largely a dud for the economy, argues a new paper authored by a group of prominent economists. The paper, which was to be presented Friday at a conference held in New York by the University of Chicago Booth School of Business, takes aim ...

The Economy Is Getting Hotter. Is a Productivity Boom Next? By  Neil Irwin Feb. 21, 2018 Image Self-serve kiosks are already a familiar sight at the supermarket or in airports. But more settings, like restaurants or casinos, might start to find them cost-effective as workers grow harder to find, and this infusion of technology might in turn increase productivity. Credit Nicole Bengiveno/The New York Times Two of the most important facts about the global economy over the last decade are these: A giant financial crisis led to mass unemployment in many countries and years of disappointing growth. And despite a seeming barrage of technological innovation, productivity growth has been the weakest in decades. Maybe it’s not a coincidence. That is the provocative conclusion of  new research  from the McKinsey Global Institute, the in-house think tank of the consulting giant, that suggests we should change how we think about the advancements that make ...

Opinion   Market Volatility The corporate debt problem refuses to recede Non-financial leverage is higher today than it was before the crisis London Financial Times Retreived from: https://www.ft.com/content/ceb8d8ee-0b57-11e8-8eb7-42f857ea9f09 As stock markets gyrated wildly earlier this week, the Reddit social media platform delivered a scream of pain from somebody called “Lilkanna”, who claimed to be a small-time investor holding exchange-traded notes that bet on low US equity volatility. “I started with 50k [dollars] and traded all the way to 4 mill over 2.5 years . . . using more and more margin [ie debt],” this declared. “But now I have lost $4m, three years of work, and other peoples’ money.  I feel like such a fool.” Quite so. For months, commentators have warned that a correction in the US stock market was overdue. Financial insiders have also warned that volatility was bound to explode after last year’s supernatural calm, spelling disaster for anybo...

Previous Close 1,350.50 Open 1,373.49 Bid 0.00 x 0 Ask 0.00 x 0 Day's Range 0.00 - 0.00 52 Week Range Volume 14,141,524 Avg. Volume 4,560,477 Market Cap 648.51B Beta 1.76 PE Ratio (TTM) 217.82 EPS (TTM) 6.15 Earnings Date Apr 25, 2018  -  Apr 30, 2018 Forward Dividend & Yield N/A (N/A) Ex-Dividend Date N/A 1y Target Est 1,631