Scott Barlow
A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the Web
There are pockets of volatility, but markets remain trendless overall so today's links might be a bit more esoteric than usual.
The Harvard Business Review published a column urging people to stop reading "traits of highly successful people" list. There are a few reasons given, including "research is anecdotal" and "Research doesn't always transfer to different contexts," but the best argument derives from Nassim 'Black Swan' Taleb,
"Nassim Taleb recounts an anecdote Cicero told about the Greek poet Diagoras of Melos. When Diagoras was told that praying saves sailors from drowning, he wondered about those who prayed but drowned anyway. Prayer receives credit for saving sailors because all those who survived prayed. Yet this strategy is utterly useless if those who died also prayed, which is a fair assumption."
Celebrities often advise their fans to "follow your dreams," but there's tens of thousands of people who did so failed – they just don't get interviewed. The same is true of successful people. Others who had the same habits didn't have the same opportunities or skills, or just weren't so lucky.
"Stop Reading Lists of Things Successful People Do" – Harvard Business Review
=====
Domestic markets remain inexplicably linked to the Chinese economy through resource demand and yet the growing financial stresses in the country are rarely discussed. Former UBS economist (and one of my own most trusted sources of analysis on China) George Magnus, wrote about the future directions of the Chinese economy,
"Everyone knows by now that China has a problem with rapid credit creation, misallocation of capital, reliance on credit to drive GDP growth, and the accumulation of bad loans on the books of Chinese banks formally estimated at less than 2 per cent of assets but privately reckoned to be more in the region of 22 per cent."
The entire post is worth reading closely, particularly for any investor with holdings in resource related market sectors.
"China has regained economic stability, but clues are in the weeds of finance" – GeorgeMagnus.com
"Liquidity Issues in China?" – Across the Curve
=====
No topic is more intensely debated in Toronto than the housing market but to avoid the risk of boring the rest of the country, I'll just leave a few links here,
"Ontario wants Ottawa to boost tax on real estate speculators" – CBC
"Banks spot evidence of a housing bubble. What took so long?" – Report on Business
"Speculative activity in Toronto worse than we thought: TD" – BNN (video)
=====
Google executives described their hiring policies and I found the resulting article instructive. There are four basic principles, "Set an uncompromisable high standard,""Find candidates on your own,""Put checks in place to assess candidates objectively," and "Provide candidates with a reason to join."
"Google's 4 rules for hiring the best employees" – World Economic Forum
=====
Tweet of the Day: "@tracyalloway Goldman financial conditions index vs. MSCI EM Index. Or, why U.S. central bank conundrums bode well for emerging market assets: ' – (chart) Twitter
Diversion: "Millennials: How They Consume TV, Ads, and the Perception of Celebrity" – A Journal of Musical Things
Scott Barlow