Monday links: naive extrapolation

• abnormalreturns
• May 11th, 2009

On the dubious value of “naively extrapolating historical patterns and applying them to our current situation.”  (1-2 Knockout)

It shouldn’t really matter to traders whether this is a bull market or bear market rally.  (MarketSci Blog)

Risky bets have paid off year-to-date, much to the chagrin of some quant funds.  (WSJ.com, ibid)

Stocks are approaching fair value once again.  (WSJ.com, Clusterstock)

Hedge funds are cutting their fees.  (FT.com, naked capitalism)

Four overlooked qualities of successful traders.  (TraderFeed)

“Swensen’s position is that those who wish to invest in active vehicles should not hire agents to do so on their behalf, but rather must devote the time, energy and resources to do it themselves.  Be a principal, not an agent.”  (Manual of Ideas)

The “sell in May” phenomenon is too inconsistent to take seriously.  (CXO Advisory Group)

How the breadth of media coverage affects the cross-section of stock returns.  (Journal of Finance)

What are some commodity sub-sectors doing of late?  (VIX and More)

Traders have discovered the US Natural Gas Fund (UNG).  (FT Alphaville)

“Caffeine addicts face higher prices for their daily fix as the wholesale cost of both coffee and sugar rise sharply because of poor crops and robust demand.”  (FT.com also greenfaucet.com)

Banks are trying to get out from under the TARP as soon as possible.  (DealBook)

The downside of giving a dying firm, AIG, an open checkbook.  (Clusterstock)

“In short, these bailouts are emphatically not neutral to society as a whole, because they damage incentives and divert productive resources into hands that have proven themselves to be reckless and incapable.”  (Hussman Funds)

“There are much better uses for federal money than handing capital gains to debtholders.”  (Financial Crisis and Recession via EconLog)

Talk of a ‘V’ economic recovery heats up.  (FT Alphaville)

Is a quick economic rebound going to lead to sweeping our problems under the rug?  (Curious Capitalist)

“The reason the government can borrow money so cheaply right now is that no one wants to lend to anyone else–too risky.”  (Atlantic Business)

Large numbers, like the budget deficit, defy our ability to grasp them. (Felix Salmon)

“WolframAlpha is different. For starters, it does not gather data from the Web. Instead, its “knowledge base” is made up of reams and reams of data…”  (NYTimes.com)

Micropayments coming to the WSJ.com.  (FT.com, Silicon Alley Insider)

The iPhone will not kill the wireless carriers.  (GigaOM)

What self-control tells us about a whole range of personality factors.  (NewYorker.com)

Tim Geithner returns to SNL to discuss the bank stress tests.  (Hulu.com)

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