Blog entries

Reserve Releases Remind Us that Bad Habits Die Hard in Banking Industry

Administrator — Fri, 12 Oct 2012 07:00:00 +0100

It’s earnings season, and this time the focus is on reserve releases at banks. Reserves, as the name implies, are funds set aside to absorb expected losses. Reserve releases occur when banks feel that storm clouds have cleared and that there is no longer a need to maintain such a large buffer of reserves. In “releasing” reserves bank managers are able to redirect freed-up dollars to earnings. According to a Wall Street Journal analysis, “The four biggest U.S. banks have released $18.2 billionRead More...

Unlucky in love? Adopting savvy investors' methods could help

Administrator — Tue, 07 Aug 2012 23:11:07 +0100

Baltimore Sun's Eileen Ambrose features Yuval Bar-Or's new book, Crazy Little Risk Called Love, in her weekly column.

Media Wrongly Suggest Thiel Fellowships Threaten College Education

Administrator — Sat, 14 Jan 2012 22:08:29 +0100

The Thiel Foundation is currently processing hundreds of applications for its second class of Thiel Fellowships. Each of twenty winners will receive a $100,000 grant to pursue an entrepreneurial venture and must in turn agree to skip college for at least two years. Some in the media suggest Peter Thiel is using his Fellowships to brazenly challenge and undermine mainstream college education. But they are wrong.

Mr. Thiel has been widely quoted stating his belief that college education Read More...

For Better Rating Agencies Go Back to Campus

Administrator — Sat, 19 Nov 2011 05:34:05 +0100

"For Better Rating Agencies Go Back To Campus" (November 18, 2011), Forbes, Yuval Bar-Or

Sovereign Credit Ratings: Relics of a Bygone Era

Administrator — Fri, 28 Oct 2011 07:00:00 +0100

"Sovereign Credit Ratings: Relics Of A Bygone Era" (October 28, 2011), Forbes, Yuval Bar-Or

Q&A with KBRA

Administrator — Mon, 17 Oct 2011 07:00:00 +0100

Several months ago I profiled Kroll Bond Rating Agency (KBRA), the new kid on the rating agency block. At the time I concluded that KBRA’s success and its impact on the rating industry remained to be seen and I documented several questions that would likely determine whether KBRA could revolutionize the ratings industry.

Recently, I had an opportunity to pose these questions directly to KBRA’s management: Mr. Jules Kroll, Chairman and CEO, and Mr. James Nadler, PresidRead More...

Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues (Forbes.com)

Administrator — Fri, 10 Jun 2011 07:00:00 +0100

"Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues" by Yuval Bar-Or on Forbes.com

Launch Sequence For Human Genome Stocks (Forbes.com)

Administrator — Wed, 08 Jun 2011 21:28:40 +0100

"Launch Sequence For Human Genome Stocks" by Yuval Bar-Or on Forbes.com.

Gold Doesn't Glitter for Advisors

Administrator — Mon, 06 Jun 2011 00:57:10 +0100

I was recently informed by one of my former students that some advisors don't like to acquire gold for their clients. The stated reason is that they may not be compensated for bullion transactions and are therefore more likely to try to convince clients not to make such purchases. While a decision not to purchase gold for a client may be correct for a variety of reasons (liquidity and diversification come to mind), the decision should not be motivated by the advisor's compensation mechanism. Read More...

LinkedIn’s 1999-Style IPO Rekindles Questions About Leaving Money On The Table (Forbes.com)

Administrator — Sat, 21 May 2011 02:49:59 +0100

"LinkedIn’s 1999-Style IPO Rekindles Questions About Leaving Money On The Table," by Yuval Bar-Or on Forbes.com

The Hidden Costs of Age-Based Funds

Tue, 19 Apr 2011 19:05:55 +0100

The prevailing wisdom is that investors, whose ability and inclination to face risk declines over time, should rebalance their portfolio as they age. More specifically, it is assumed that investors should invest more heavily in stocks when they are young, and then gradually shift from stocks to bonds over time. Near their retirement date, it is accepted that they should be primarily invested in high quality bonds whose volatility is much lower than that of stocks.

The asset managRead More...

Financial Advisors Not Charging Enough?

admin — Sun, 03 Apr 2011 20:31:47 +0100

On March 29, 2011 an article appeared on InvestmentNews.com under the title “Advisers not charging enough: Study”.

The article goes on to highlight results of a study by PriceMetrix Inc., a Toronto, Canada based firm that “helps retail wealth management firms and their advisors optimize selling efforts, manage clients, identify growth opportunities, and enhance practice management” (from pricemetrix.com).

A main message in the study is that &ldquoRead More...

Is a Financial Plan the Key to Investing Success?

Administrator — Sat, 19 Mar 2011 18:11:33 +0100

Crafting a carefully considered investing plan is an important step in the financial planning process. Doing so with the assistance of a properly qualified financial planner is advisable.

Having the plan does not, however, guarantee success. This is because many of the errors investors make are not in the creation of the plan but in the execution of the plan. More precisely, as markets gyrate, investors tend to become swayed by emotional considerations. These feelings convince inveRead More...

Better Decisions are often Made from a Distance

Administrator — Fri, 18 Feb 2011 20:43:47 +0100

Working with a client I was recently reminded of an important principle for decision makers. When we enter our workplace we tend to put on a metaphorical suit of armor. The armor is designed to protect us from difficult clients, inept colleagues, nagging bosses, and other threats or distractions – real or imagined.

Because our armor is so much a part of us, we don’t realize it’s there, but we do experience the tension and anxiety from carrying its weight, ofRead More...

America’s energy challenge reflected in Egyptian unrest

Administrator — Sat, 29 Jan 2011 01:02:57 +0100

The recent anti-government protests in Egypt (and earlier in Tunisia) are likely precursors of many more similar events globally in coming years. Frustrated by many decades of autocratic rule, Egypt’s people are in the streets demanding change, including greater democracy. The nation’s security forces have been mobilized and video footage shows violence is escalating as thousands ignore a curfew.

America has long relied on Egyptian President Hosni Mubarak’s iron grip to maintain stabiRead More...

Fiduciary Standard for Brokers Within Reach

Sun, 23 Jan 2011 04:00:19 +0100

The SEC’s much anticipated recommendation is out: Brokers should be held to the fiduciary standard.

To date, unlike registered investment advisors who are fiduciaries, brokers have only been required to meet a suitability standard, which is a less rigorous legal requirement. Under a fiduciary standard, brokers will be required to provide their clients with advice that is in the clients’ best interest.

One of the reasons for the SEC’s recommendation is that Read More...

January 2011's Book of the Month is Tom Friedman's "Hot, Flat and Crowded"

Administrator — Mon, 10 Jan 2011 20:55:58 +0100

Thomas L. Friedman’s Hot, Flat and Crowded 2.0 is not a fun read. It’s an important read.

Friedman covers a lot of ground, explaining the significant climate change and dirty energy challenges we face. The discussion also makes it clear that climate change deniers are not doing anyone any favors. Instead, our failure to make tough but necessary decisions now only serves to damage the planet more, erode America’s moral and economic standing, and enrich petro-dictators&Read More...

Long-Term Trading Simulations for High School Students

Administrator — Tue, 05 Oct 2010 06:28:37 +0100

The recent financial market decline devastated investors and provided a harsh reminder of the importance of basic investing literacy.

In recent years there has been a flurry of activity, with many States and counties adding financial literacy to school curriculums. A variety of providers, many of them non-profits, have begun or boosted their financial literacy education offerings. One learning tool in particular has gained in popularity: the stock trading simulation.

These simulRead More...

September 2010's Book of the Month is Jeffrey Wasserstrom's "China in the 21st Century"

Administrator — Thu, 30 Sep 2010 20:10:33 +0100

Jeffrey Wasserstrom's book "China in the 21st Century: What Everyone Needs to Know" is an easy and important read.

Why is it important?

Because China already is, and will increasingly become more, influential in global economics.

Because we must understand the Chinese mindset about politics, economics, law, human rights, etc.

Because we have deep misconceptions about China which hamper our ability to understand and interact with a nation of 1.3 billion people.

Forbes: Rating Agencies Should Get A Death Sentence

Yuval Bar-Or — Fri, 24 Sep 2010 07:00:00 +0100

"Rating Agencies Should Get A Death Sentence" (September 24, 2010) Forbes, Yuval Bar-Or