30 June 2017: The end of the financial crisis

America’s 34 biggest banks have passed the Federal Reserve’s stress test. These results give them the green light to pay out dividends and buy back stock. It means that regulators have finally closed the book on the 2008 financial crisis.
Is that a good thing? The answer depends on your viewpoint: banks themselves will welcome the results. It will give them the freedom to behave – finally – as a normal company. And it is exactly that fact that should scare society at large. Because the memory of people is short and bankers do not form an exception to this wisdom. It will not take long before the irresponsible behavior that led to the 2008 financial crisis returns. The first signs of that can be observed if we take a closer look at car and personal loans. Hopefully, regulators are not under the impression that they can start resting on their laurels. Their job has only just begun.

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Stock markets had a wild ride yesterday. The NASDAQ closed below its 50-day moving average for the first time in almost three months. Volatility shot up like a rocket: the VIX gained more than 50% intraday, before falling back and closing ‘only’ 14% higher. The NASDAQ lost 1.44%, the S&P 500 closed 0.86% lower and the Dow retreated 0.78%. Naturally, UVXY ETFs profited: +10.60%. XIV ETNs suffered a loss of almost 5%.
Danny Daredevil was a happy person: his RSS shot up and closed at 362%. Adventurous Anny was holding cash yesterday and her RSS remained at 40%. Solid Suzy and Lazy Larry saw their RSS drop back to 23%.

Model Holds Start date

RSS

YTD

QTD

AAR

Danny Daredevil XIV 1 January 2016

361.92%

14.59%

-1.46%

178%

Adventurous Anny XIV 6 March 2017

40.21%

40.21%

15.13%

190%

Solid Suzy XIV 6 March 2017

23.23%

23.23%

12.52%

93%

Lazy Larry
XIV 6 March 2017

23.23%

23.23%

12.52%

93%

RSS = Return Since Start | YTD = Year-To-Date | QTD = Quarter-To-Date | AAR = Average Annual Return

 

Two of our models gave a trading signal at the end of yesterday’s session: Danny Daredevil and Adventurous Anny. Danny switched from UVXY ETFs to XIV ETNs and Anny traded her cash for XIV ETNs at the opening of today’s session.

 

 

RS_v05-smallRené’s Reflections @ Friday: Preserving memories

In our times of digital photography it is easy to forget the era that preceded it: that of analog (film) photography, a period of almost two hundred years. Up until 15 or 20 years ago, every photo we took cost us money. Before we could take a picture, we had to load our camera with a film roll. Each film roll was typically only good for 36 shots (or 24, or 12, depending on the film). Not only did we have to buy the film, we also had to pay for developing and printing it after the roll was finished, so we could add the best photos to our family albums. ‘Sharing pictures’ in those days meant that you had to physically sit down with your family or friends with the photo album in your lap. The cost of taking pictures made you think twice before pressing the shutter button. Today, we can shoot like crazy if we feel like it, keeping only the images we like while deleting the rest. But back in the old analog days, only the professional photographers and the wealthy amateurs could afford to take pictures with the present-day intensity. For the rest of us, pictures were only taken during holidays, anniversary parties, and other special events. Other than that, the camera literally didn’t see the light of day.
In 2000, at the height of film photography, Kodak reported that amateur photographers had taken 80 billion photos that year, setting a new all-time record. Fifteen years later, with the digital revolution in full swing, InfoTrends estimated that over one trillion photos were captured worldwide in 2015. That shows a staggering exponential growth in the popularity and increasingly widespread use of photography. The number of (analog) photos made before 2000 in relation to the total number of photos ever made, is falling sharply every year. It will not take long before analog photos become a rarity.
With that in mind, I decided to spend some time to start cataloging the more than 4,000 analog pictures (both slides and negatives) I took from 1975 to 2000, and take the necessary measures in order to preserve them for the future. So it happened that last Wednesday night, I set up my slide projector, loaded it with a tray of slides from the mid-1970s to the early 1980s, and watched the first slides I ever took. It was like a journey back in time. Each slide brought back vivid memories of long-gone places, pleasures, and, alas, people. One can just wonder what an incredible source of collective memory the vast amount of today’s digital pictures will be for those who see them decades, or even centuries, from now. That is, if we manage to find ways to keep them safe from threats like data decay, media obsolescence, or ransomware.

From top to bottom and from left to right: 1. A horse in Mastbosch Breda (1975) – my first slide, 2. Picknick near Chaam (1980), 3. Egg (1981), 4. Alicante airport (1977), 5. Driving around  & sightseeing near Montbron France (1981), 6. Secundary school building (1981), 7. My friend Hans driving my Citroën DS (1983), 8. Sailing at Veerse Meer (1982)