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	<title>the rational post &#187; finance</title>
	<atom:link href="http://www.freedom24.org/rationalpost/tag/finance/feed/" rel="self" type="application/rss+xml" />
	<link>http://www.freedom24.org/rationalpost</link>
	<description>a collection of essays and articles on the science of everyday life</description>
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	<language>en</language>
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		<title>market makers</title>
		<link>http://www.freedom24.org/rationalpost/2010/03/25/market-makers/</link>
		<comments>http://www.freedom24.org/rationalpost/2010/03/25/market-makers/#comments</comments>
		<pubDate>Fri, 26 Mar 2010 00:38:26 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[finance & economics]]></category>
		<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[banking system]]></category>
		<category><![CDATA[capital markets]]></category>
		<category><![CDATA[economics]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[primer]]></category>
		<category><![CDATA[speculation]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=2040</guid>
		<description><![CDATA[As ideological battles are waged over the benefits of free markets, the challenges of financial regulation, the inefficiency of policymaking, and the design of a sustainable path forward, pundits often attack one another without a fundamental understanding of the mechanics of our modern financial system. This primer helps to explain the unique roles that banks and capital markets play in the efficient (and sometimes painfully inefficient) functioning of of modern society. While it won&#8217;t settle any debates, it certainly reminds us how little we may know about the way the economy works&#8230;


Did the Capital Markets Fail Us?
By Karen Johnson &#124; Thursday, March 25, 2010
Amid the debate about excessive bonuses and inadequate risk management, it is useful to ask why the faith ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2010/03/25/market-makers/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>dead parrot of finance</title>
		<link>http://www.freedom24.org/rationalpost/2009/08/09/dead-parrot-finance-efficient-market-hypothesis/</link>
		<comments>http://www.freedom24.org/rationalpost/2009/08/09/dead-parrot-finance-efficient-market-hypothesis/#comments</comments>
		<pubDate>Sun, 09 Aug 2009 16:47:25 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[finance & economics]]></category>
		<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[crisis]]></category>
		<category><![CDATA[efficient markets]]></category>
		<category><![CDATA[failure]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[hypothesis]]></category>
		<category><![CDATA[theory]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=813</guid>
		<description><![CDATA[As capital markets continue to increase in scale and scope, there is a natural tendency to believe that they have also become more accurate at valuation. Scores of &#8220;rational&#8221; investors acting in their own self-interest, based on their own proprietary information along with anything publicly available, make their best guess about the value of a particular security – from a simple common share of IBM to a bet on the amount of rainfall next April. Those who believe the future looks bright will buy, and those who think better days are behind will sell. 
Millions of these independent agents tug back and forth on the price of everything everyday, pledging or withdrawing their capital until a harmonious equilibrium is reached ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2009/08/09/dead-parrot-finance-efficient-market-hypothesis/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>ten market rules to remember</title>
		<link>http://www.freedom24.org/rationalpost/2009/06/13/10-market-rules-to-remember-farrell/</link>
		<comments>http://www.freedom24.org/rationalpost/2009/06/13/10-market-rules-to-remember-farrell/#comments</comments>
		<pubDate>Sat, 13 Jun 2009 20:19:03 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[finance & economics]]></category>
		<category><![CDATA[history & society]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[investment]]></category>
		<category><![CDATA[markets]]></category>
		<category><![CDATA[portfolio]]></category>
		<category><![CDATA[psychology]]></category>
		<category><![CDATA[speculation]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=1714</guid>
		<description><![CDATA[&#8220;Bob Farrell was a legend at Merrill Lynch &#38; Co. for several decades. Farrell had a front-row seat to the go-go markets of the late 1960s, mid-1980s and late 1990s, the brutal bear market of 1973-74, and October 1987&#8242;s crash. He retired as chief stock market analyst at the end of 1992, but continued to occasionally publish. Rumor has it for a humongous donation to Farrell&#8217;s favorite charity, you can get on his very exclusive email list. Marketwatch gathered some of Farrell&#8217;s more famous observations, and republished them as 10 Market Rules to Remember.&#8221; – via The Big Picture

1. Markets tend to return to the mean over time When stocks go too far in one direction, they come back. Euphoria and pessimism ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2009/06/13/10-market-rules-to-remember-farrell/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>politico economicus</title>
		<link>http://www.freedom24.org/rationalpost/2009/03/27/homo-politico-economicus/</link>
		<comments>http://www.freedom24.org/rationalpost/2009/03/27/homo-politico-economicus/#comments</comments>
		<pubDate>Fri, 27 Mar 2009 16:06:40 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[featured]]></category>
		<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[history & society]]></category>
		<category><![CDATA[banking system]]></category>
		<category><![CDATA[behavioral]]></category>
		<category><![CDATA[capital markets]]></category>
		<category><![CDATA[expectations]]></category>
		<category><![CDATA[failure]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[financial markets]]></category>
		<category><![CDATA[macroeconomics]]></category>
		<category><![CDATA[model]]></category>
		<category><![CDATA[political economy]]></category>
		<category><![CDATA[rational]]></category>
		<category><![CDATA[theory]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=704</guid>
		<description><![CDATA[In the midst of a global financial pandemic, private enterprise finds itself under the public microscope yet again — as it did during the 1930s after a century of unbridled growth and later in the 1970s after decades of stifling regulatory oversight. With this 21st century changing of the guard, the theoretical bases for free market capitalism are now under academic and legislative review. At the heart of the debate is the accuracy of the economic models taught to college students around the planet as though they were immutable physical laws. Having some basis for estimating the future is clearly a useful if not interesting intellectual exercise, but modeling the stability of the entire financial system around half-baked calculus and ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2009/03/27/homo-politico-economicus/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>multiplicity and complexity</title>
		<link>http://www.freedom24.org/rationalpost/2009/03/19/multiplicity-and-complexity/</link>
		<comments>http://www.freedom24.org/rationalpost/2009/03/19/multiplicity-and-complexity/#comments</comments>
		<pubDate>Fri, 20 Mar 2009 02:04:34 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[history & society]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[behavioral]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[history]]></category>
		<category><![CDATA[psychology]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=692</guid>
		<description><![CDATA[&#8220;The human mind cannot grasp the causes of phenomena in the aggregate. But the need to find these causes is inherent in man’s soul. And the human intellect, without investigating the multiplicity and complexity of the conditions of phenomena, any one of which taken separately may seem to be the cause, snatches at the first, the most intelligible approximation to a cause, and says: &#8216;This is the cause!&#8217; &#8221;
— Leo Tolstoy, War and Peace, Book IV, Part 2, Chapter 1, first paragraph
]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2009/03/19/multiplicity-and-complexity/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>next shoe to drop</title>
		<link>http://www.freedom24.org/rationalpost/2008/12/01/next-shoe-to-drop/</link>
		<comments>http://www.freedom24.org/rationalpost/2008/12/01/next-shoe-to-drop/#comments</comments>
		<pubDate>Mon, 01 Dec 2008 17:27:27 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[finance & economics]]></category>
		<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[banking system]]></category>
		<category><![CDATA[contagion]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[mortgages]]></category>
		<category><![CDATA[real estate]]></category>
		<category><![CDATA[stimulus]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=426</guid>
		<description><![CDATA[With all eyes on traditional residential mortgages, analysts are now looking for clues in related asset classes for any signs of recessionary contagion. In his weekly review of the U.S. economy, Nouriel Roubini highlights the vulnerability of commercial mortgage back securities – which typically lag their residential cousins by 2 years – as well as plunging retail sales, a worsening inventory cycle, and the soaring fiscal deficit&#8230;
Focus on the U.S. Economy
RGE Monitor
The current U.S. and global economic conditions, remain at the very least quite challenging.  The good news is that President-elect Barack Obama has unveiled a first rate economic team to drive the economy towards the recovery.  Larry Summers, Tim Geithner and Christina Romer are certainly top rated experts and ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2008/12/01/next-shoe-to-drop/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>a great depression</title>
		<link>http://www.freedom24.org/rationalpost/2008/11/16/a-great-depression/</link>
		<comments>http://www.freedom24.org/rationalpost/2008/11/16/a-great-depression/#comments</comments>
		<pubDate>Sun, 16 Nov 2008 16:49:39 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[history & society]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[crisis]]></category>
		<category><![CDATA[depression]]></category>
		<category><![CDATA[economics]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[history]]></category>
		<category><![CDATA[society]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=393</guid>
		<description><![CDATA[&#8220;Despite its severity, we believe that the slump in stock prices will prove an intermediate movement and not the precursor of a business depression&#8230;&#8221; This advice from the Harvard Economic Society on November 2, 1929 illustrates that unbridled optimism in the capital markets was just as dangerous 80 years ago as it is today. Modern financial crises aren&#8217;t simply failures of regulatory oversight or inherent structural weakness. They&#8217;re a combination of the cyclicality of human behavior, the dangers of unbridled leverage, increased speculation by unsophisticated investors, and our complete lack of financial memory beyond 20 or 30 years.

The following compilation from The Atlantic&#8216;s impressive archives serves as a painful reminder that, much like the &#8220;Great War&#8221; that preceded it, The Great ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2008/11/16/a-great-depression/feed/</wfw:commentRss>
		<slash:comments>3</slash:comments>
		</item>
		<item>
		<title>oh canada</title>
		<link>http://www.freedom24.org/rationalpost/2008/11/13/oh-canada/</link>
		<comments>http://www.freedom24.org/rationalpost/2008/11/13/oh-canada/#comments</comments>
		<pubDate>Fri, 14 Nov 2008 00:36:38 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[in other words]]></category>
		<category><![CDATA[banking system]]></category>
		<category><![CDATA[canada]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[leverage]]></category>
		<category><![CDATA[regulation]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=396</guid>
		<description><![CDATA[Currently the envy of Hank Paulson and virtually every Finance Minister around the globe, Jim Flaherty describes how the world&#8217;s leading middle-power managed to side-step most of the financial devastation that&#8217;s haunting global financial markets, and what the world can learn from its sure-footed path&#8230;

&#8220;Boring&#8221; Canada&#8217;s Financial Tips for the World
The following guest column by the Honourable Jim Flaherty, Minister of Finance, appeared in today’s Financial Times. In it, Minister Flaherty outlines Canada’s five-point plan to restore stability to the international financial system.
&#8220;The financial crisis that began 14 months ago in the US has intensified and spread around the world, threatening to roll back economic progress that has been made over the past two decades. Governments have been responding in ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2008/11/13/oh-canada/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>four one nine</title>
		<link>http://www.freedom24.org/rationalpost/2008/07/05/nigerian-419-scheme/</link>
		<comments>http://www.freedom24.org/rationalpost/2008/07/05/nigerian-419-scheme/#comments</comments>
		<pubDate>Sat, 05 Jul 2008 14:29:48 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[history & society]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[africa]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[investments]]></category>
		<category><![CDATA[marketing]]></category>
		<category><![CDATA[regulation]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=247</guid>
		<description><![CDATA[See below for yet another in a series of elaborate digital frauds. Somewhat surprising is the considerable improvement in grammar and argument – it may even have been written by a native English speaker. Not surprising is the use of a decade old framework – the Nigerian 419 scheme – to lure unsuspecting Westerners into providing key banking information in exchange for a share in a large and unattributed overseas estate. The &#8220;four one nine&#8221; comes from the section in the Nigerian penal code which deals with such frauds. To hear Der Spiegel tell it: &#8220;A 419 is a mass crime, a money generator, and could aptly be described as the use of globalized methods as revenge by the losers ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2008/07/05/nigerian-419-scheme/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
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		<item>
		<title>command and control</title>
		<link>http://www.freedom24.org/rationalpost/2008/05/11/command-and-control/</link>
		<comments>http://www.freedom24.org/rationalpost/2008/05/11/command-and-control/#comments</comments>
		<pubDate>Mon, 12 May 2008 00:33:44 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[finance & economics]]></category>
		<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[bailout]]></category>
		<category><![CDATA[Bear Stearns]]></category>
		<category><![CDATA[credit cycle]]></category>
		<category><![CDATA[economics]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[financial markets]]></category>
		<category><![CDATA[inflation]]></category>
		<category><![CDATA[Paulson]]></category>
		<category><![CDATA[policy]]></category>
		<category><![CDATA[sovereign wealth]]></category>
		<category><![CDATA[treasury]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/?p=242</guid>
		<description><![CDATA[As markets continue to reel from the too-little-too-late conservative ethos that is snaking its way through the world&#8217;s major financial institutions, the wisdom of blind faith in some &#8220;invisible hand&#8221; is finally being put to the test. At stake are trillions of dollars of borrowed money floating anonymously within complex and unregulated markets, coupled with with an imploding US dollar, soaring energy demand in high-growth emerging economies, troublesome &#8220;business as usual&#8221; predictions for worldwide carbon emissions, and gross negligence in coordinating the world&#8217;s basic agricultural equilibrium. If free markets and &#8220;the wisdom of crowds&#8221; are truly the answer to the complex challenges of global resource coordination, recent evidence isn&#8217;t the least bit convincing&#8230;

Why We Must Fix It
By Michael Lewitt
&#8220;Society is ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2008/05/11/command-and-control/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>the price of liberty</title>
		<link>http://www.freedom24.org/rationalpost/2007/06/04/the-price-of-liberty/</link>
		<comments>http://www.freedom24.org/rationalpost/2007/06/04/the-price-of-liberty/#comments</comments>
		<pubDate>Mon, 04 Jun 2007 15:03:07 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[in other words]]></category>
		<category><![CDATA[world affairs]]></category>
		<category><![CDATA[balance of payments]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[fiscal]]></category>
		<category><![CDATA[flow of funds]]></category>
		<category><![CDATA[leverage]]></category>
		<category><![CDATA[stimulus]]></category>
		<category><![CDATA[taxation]]></category>
		<category><![CDATA[trade]]></category>
		<category><![CDATA[war]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/2007/06/04/the-price-of-liberty/</guid>
		<description><![CDATA[Spending taxpayers money on a massive military offensive has its own unique economic consequences, but borrowing money from abroad to finance sustained hostilities half-way around the world places the American executive in a vulnerable position vis-a-vis the international community. This moderated conversation, featuring Robert Hormats &#8212; currently Vice Chairman at Goldman Sachs International and a former Assistant Secretary of State, member of the National Security Council, and US Trade Ambassador &#8212; touches on the myriad economic and political challenges that emerge when war is funded by outsiders while policy projects from within&#8230;
The Price of Liberty:  Paying For America&#8217;s Wars
Council on Foreign Relations, Washington, DC
May 16, 2007
KORB:  Let me talk about this important book.  Now, when I read ...]]></description>
		<wfw:commentRss>http://www.freedom24.org/rationalpost/2007/06/04/the-price-of-liberty/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
		</item>
		<item>
		<title>in income we trust</title>
		<link>http://www.freedom24.org/rationalpost/2007/02/15/income-trust/</link>
		<comments>http://www.freedom24.org/rationalpost/2007/02/15/income-trust/#comments</comments>
		<pubDate>Thu, 15 Feb 2007 19:54:28 +0000</pubDate>
		<dc:creator>The Editor</dc:creator>
				<category><![CDATA[finance & economics]]></category>
		<category><![CDATA[world affairs]]></category>
		<category><![CDATA[canada]]></category>
		<category><![CDATA[capital markets]]></category>
		<category><![CDATA[economics]]></category>
		<category><![CDATA[finance]]></category>
		<category><![CDATA[investments]]></category>
		<category><![CDATA[policy]]></category>
		<category><![CDATA[strategy]]></category>
		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://www.freedom24.org/rationalpost/2007/02/03/income-trust/</guid>
		<description><![CDATA[Since their earliest days a rogue asset class &#8212; a breakaway tax haven from the archaic world of REITs &#8212; income trusts have drawn the ire of free-market economists and the capital of free-wheeling investors alike. The former see the structure as an anti-competitive perversion of natural capital flows, while the latter flock to invest in a sea of premium yields. Traditionally, policy makers have been hamstrung by this natural dichotomy, but with their latest Halloween trick, Flaherty and the Tories have taken a bold step toward a fair and open capital market. Baby boomers may cry foul over their lost pot of gold, and socialists may applaud their conservatives counterparts for a rare shot across the bow of a ...]]></description>
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