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Corporate profits bottomed in the first quarter, gross domestic product recorded its first positive quarter in the third quarter, and employment appears on track to expand in the first quarter of 2010…While it has been obvious for some time that a negative spiral has been broken by policy responses, there is now growing evidence that the seeds of a virtuous cycle are being sown.
—Aneta Markowska, SocGen
These days, as in the aftermath of every recession, you are again hearing a version of those early 1980s worries: this time, things are different. Consumers are tapped out. Business executives are skittish. Banks remain reluctant to lend.
And maybe things really are different this time. Given the many problems weighing on the economy, a mediocre recovery does indeed seem more likely than a strong one, as I’ve written before. But history certainly offers pessimists and semi-pessimists some cause for humility.
—David Leonhardt, noting one of the many phrases that has come to characterize our present circumstances: this time, things are different.
Google co-founder Sergey Brin told you that “people don’t buy books anymore” and that you should put your new book online for free. Your response?
Auletta: When Brin told me this I asked him a series of questions. Who, I asked him, would pay me a salary to work on the book? Who would pay for my 13 trips to Google, including airfare, hotel and car? Who would edit the book? Who would do the book tour and marketing? Who would prepare the index? Who would do the legal vetting?
By the end of my questions, Brin wanted to change the subject. The reason, I think, is that he has an innocent faith in the Internet and inadequate knowledge about how books are published.
The world began without the human race and will certainly end without it. What else has man done except blithely break down billions of structures and reduce them to a state in which they are no longer capable of integration?
—Claude Levi-Strauss, writing in 1955 in Tristes Tropiques. He died this week at age 100, just short of his 101st birthday.
I therefore claim to show, not how men think in myths, but how myths operate in men’s minds without their being aware of the fact.
…
Such is how I view myself: a traveler, an archeologist of space, trying in vain to restore the exotic with the use of particles and fragments
Western civilization now feels threatened in its turn. It has, in the past, destroyed innumerable cultures in whose diversity lay the wealth of humankind. Guardian of its own fraction of this collective wealth, weakened by dangers from without and within, it is allowing itself to forget of destroy its own heritage, which —as much as any other— deserves to be cherished and respected.
—Levi-Strauss in the NYRB
We always talk about homeownership as being the American dream, but during the last decade people forgot it’s shelter and started thinking of it as a fast way to make or lose money. The quicker we move back to seeing real estate as a place to live, a place to put down roots, the quicker the housing recovery will strengthen.
—Nicolas Retsinas, director of the Harvard University Joint Center for Housing Studies
It will be a long time before people think of owning a home as a good investment again. A lot of what drives housing is psychological, and right now there’s a distinct lack of confidence in real estate.
—John Vogel, Tuck School of Business at Dartmouth College
If you buy a home in Beverly Hills or an apartment on Manhattan’s Upper East Side, over the next five and even 10 years you are going to do very well. The greatest threat to price growth in the New York area would be the diminution of Manhattan as a trading capital, and I don’t see that happening. It’s not just a question of sales and inventory — price growth also is based on population patterns, income growth and employment.
—Steve Blitz, president of Pangea Market Advisory
After every major bust there is a rethinking of that asset class. I think people will change their views about real estate and begin to look at it as a long-term investment that provides shelter, rather than a way to make a quick buck.
—Joe Carson, head of global economic research at AllianceBernstein
The nightmare scenario for the Fed would be to see them try to sell their mortgage portfolio, and Congress steps in and tries to stop it on the grounds that the housing market hasn’t fully recovered. The attempts to influence the Fed in the exit strategy will be pretty strong.
—Ethan Harris, head of North American Economics at Bank of America-Merrill Lynch
There is a question whether the housing market can survive when the fiscal props are pulled out.
—Brian Bethune, chief financial economist at IHS Global Insight
When the Federal Reserve stops buying mortgages, is there private capital to substitute? At the moment, it is not certain.
—Laurence Fink, BlackRock, in an interview with the Financial Times’ Martin Wolf broadcast on Bloomberg Television Oct. 28
Stimulus spending probably doesn’t pay for itself, but its true cost, even in a narrow fiscal sense, is only a fraction of the headline number.
To appreciate the impact Demand is poised to have on the Web, imagine a classroom where one kid raises his hand after every question and screams out the answer. He may not be smart or even right, but he makes it difficult to hear anybody else.
The hypothesis does not claim that the market price is always right. On the contrary, it implies that the prices in the market are mostly wrong, but at any given moment it is not at all easy to say whether they are too high or too low. The fact that the best and brightest on Wall Street made so many mistakes shows how hard it is to beat the market.
—Jeremy Siegel on the Efficient Market Hypothesis
There are always a large number of skeptics saying it’s going to be different this time, that future growth is not going to be as strong, that earnings aren’t going to be as strong. This is a very typical reaction, and it’s what prolongs a market rally coming out of recession.
—Timothy Ghriskey, CIO, Solaris Asset Management
The market’s going to be wary of paying too high a multiple for earnings growth. The market’s in a show-me mode.
—Leo Grohowski, CIO at BNY Mellon Wealth Management, $151 billion AUM
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