What we’re reading (1/5)
“Interest-Rate Worries Batter Stock Market” (Wall Street Journal). “Major U.S. stock indexes fell Wednesday as investors worried that the Federal Reserve might respond more aggressively to rising inflation than previously anticipated…The minutes of the Federal Reserve’s December policy meeting, released Wednesday afternoon, indicated that officials might lift short-term interest rates as soon as March. U.S. equities fell broadly after the minutes were released. Bond yields rose to their highest levels since early April.”
“Hedge Funds Struggle To Lure New Money As Performance Lags” (Financial Times). “Hedge funds gained 8.7 per cent on average from January to November 2021, according to data provider HFR…[h]edge fund managers argue their portfolios are not designed to match an index but rather to do well in all market conditions, but the size of the underperformance last year has nevertheless raised some concerns. Goldman Sachs analysts noted that while hedge funds did not necessarily aim to beat the S&P 500, last year’s returns were also ‘weak on an absolute basis’.”
“Oh, No: Adam Neumann Wants To Be A Landlord Again” (Curbed). “It seems safe to say that when Neumann himself eventually comes out of quasi seclusion to speak about his new venture, there will be lots of self-regarding over-the-top rhetoric (WeGrow once vowed to revolutionize elementary school via ‘elevating the collective consciousness of the world by expanding happiness and unleashing every human’s superpowers’).”
“The NFT Craze Has Stopped Being Funny” (The Week). “As an NFT skeptic, some guy getting scammed out of his collection of objectively hideous procedurally-generated ape cartoons was amusing. But it's all getting steadily less funny. Real non-rich people are putting a lot of money into these things, and there are good reasons to think sooner or later most of them are going to lose their shirts.”
“The Price Of Nails since 1695: A Window Into Economic Change” (Daniel Sichel, NBER). “First, from the late 1700s to the mid 20th century real nail prices fell by a factor of about 10 relative to overall consumer prices. These declines had important effects on downstream industries, most notably construction. Second, while declining materials prices contribute to reductions in nail prices, the largest proximate source of the decline during this period was multifactor productivity growth in nail manufacturing, highlighting the role of the specialization of labor and re-organization of production processes. Third, the share of nails in GDP dropped back from 0.4 percent of GDP in 1810—comparable to today’s share of household purchases of personal computers—to a de minimis share more recently; accordingly, nails played a bigger role in American life in that earlier period. Finally, real nail prices have increased since the mid 20th century, reflecting in part an upturn in materials prices and a shift toward specialty nails in the wake of import competition, though the introduction of nail guns partly offset these increases for the price of installed nails.”
