Bespoke Brunch Reads: 4/30/17
Welcome to Bespoke Brunch Reads — a linkfest of the favorite things we read over the past week. The links are mostly market related, but there are some other interesting subjects covered as well. We hope you enjoy the food for thought as a supplement to the research we provide you during the week.
Big Shifts
New Yorkers Flock to Booming Sun Belt as Trek South Resumes by Steve Matthews (Bloomberg)
A new demographic analysis of US Census data suggests that the tide of migration out of cold weather areas and into the Southeast and Southwest is accelerating. [Link]
This is the last year a car will be made in Australia by Andrew Barclay (Quartz)
Years ago, the government of Australia decided against continuing support of its auto industry in favor of pursuing comparative advantages in mining and services. The result is a 100% imported auto market but not necessarily much economic angst in a country that hasn’t suffered a recession in a generation. [Link]
NFL Draft
No Team Can Beat the Draft by Neil Pane (538)
NFL players tend to perform about in-line with where they were picked in the draft, creating a neutral expected return on a given draft place. But general managers or teams are unable to perform much better than that draft rank over time. [Link]
Investing
The Dividend Growth Myth by Meb Faber (mebfaber.com)
Succinctly put, dividend growth is not a helpful strategy for beating the market. We’ll leave it to friend-of-the-firm Faber to fill in the details. By the way, if you like Meb’s work, make sure to check out our Bespokecast interview with him here. [Link]
US Economics
CoreLogic Sees Signs of Credit Cracks by Jann Swanson (Mortgage Daily News)
New data notes an uptick in delinquencies for consumer loans, agriculture loans, and business loans despite ongoing mortgage performance improvement. A blip or the end of the current credit cycle? [Link]
Here’s What Wall Street Is Saying About Trump’s Tax Plan by Julie Verhage and Felice Maranz (Bloomberg)
The Administration’s one-pager on what it would like to see from tax reform is creating lots of speculation (about cost, impact on specific taxpayers by income, etc) from Wall Street economists and analysts. This is a good roundup. [Link; auto-playing video]
Dysaster
Fyre Festival, the Coachella for the Super Rich, Ends in Disaster by Polly Mosendz and Kim Bhasin (Bloomberg)
Promo videos featuring supermodels, promises of private island venues, and 4-6 figure ticket prices turned out to be a mirage this week as social media exploded with reports of chaos from the Exumas. A staggering disaster as far as events go. [Link]
I Worked at Fyre Festival. It Was Always Going to Be a Disaster. by Chloe Gordon (NY Mag)
Some more background on Fyre Festival, with hilarious details about management, staff turnover, and outright incompetence in the months ahead of the event. [Link]
Europe
6 takeaways from French election’s first round by Pierre Briançon (Politico)
An excellent and informed analysis of the impact on both the European and specifically French policy and political landscape of a first round that was historic in many ways. [Link]
EU prepares for post-Brexit membership for united Ireland by Alex Barker and Arthur Beesley (FT)
Could the EU lure away Northern Ireland from the UK in a bid to unite the divided island? Emphatically, yes, and they’re laying the ground work to do so. We should note that since this article was published EU27 nations agreed to the inclusion of the provisions discussed. [Link; paywall]
The Man Krugman Called a ‘Sadomonetarist’ Proves He’s Really Not by Love Liman and Johan Carlstrom (Bloomberg)
Some background on Riksbank Governor Stefan Ingves’ overcompensation for the policy mistake of raising rates too quickly after the global financial crisis. [Link]
Softwood Lumber
Why the U.S. and Canada Are Fighting About Lumber: QuickTake Q&A by Jen Skirret (Bloomberg)
Widely criticized as a classically protectionist move by the Trump Administration, the Canadian softwood lumber dispute is actually much more complicated, long-standing, and generally nuanced than that simplistic angle. This is some good background. [Link; auto-playing video]
Impact of the Duty on Canadian Lumber Announced April 25 by Paul Emrath (NAHB Eye On Housing)
The data and analysis in this article should be treated somewhat skeptically given the source, but we think the estimates provide a decent “worst-case” scenario of what the softwood lumber dispute could mean for the US economy. [Link]
Visual Technology
Google’s updated Earth app will destroy your free time by Daniel Howley (Yahoo!)
3D modelling of actual cities, additional layers of information, and a variety of other goodies make exploring the world from your couch easier than ever. Some fun views: Rio De Janeiro (link), Mount Everest (link), the Grand Canyon (link), and Vancouver BC (link). [Link; auto-playing video]
Amazon’s new $200 Echo Look camera will judge your outfits by Natt Garun (The Verge)
A new member of the Amazon Echo device family adds visual algorithms that can help you nail your look, allegedly. [Link]
Bubbles
The Media Bubble Is Worse Than You Think by Jack Shafer and Tucker Doherty (Politico)
New technologies led to the demise of the newspaper industry, which was necessarily local. But the agglomeration of reporters in large urban areas has led to a differential between the day-to-day experience of the people reporting the news and much of the rest of the country. [Link]
Booms
Ancient stone carvings confirm how comet struck Earth in 10,950BC, sparking the rise of civilisations by Sarah Knapton (The Telegraph)
Early human civilization may have been possible thanks to climatic changes that were driven by a large comet impact. [Link]
Railroads of the Raj: Estimating the Impact of Transportation Infrastructure by Dave Donaldson (MIT Department of Economics and NBER)
A week and a half ago Stanford Professor Dave Donaldson received the John Bates Clark Medal from the American Economics Association. This landmark paper alone is ample justification for the award. Using a hard data set from the British Raj in India, it quantifies the benefits of trade and reducing the costs of trade in a remarkable effort. [Link; 51 page PDF]
White Collar Crime
This white-collar crime map will have you clutching your 401ks a little tighter when you see a finance guy on the street (Fast Company)
Simultaneously raising awareness about remarkably toothless prosecution of financial crimes and the disparity between different parts of society when facing the criminal justice system, Syracuse researchers offer a way for you to help figure out if you’re at risk of being a victim. [Link]
Not an inside job: How two analysts became SEC whistleblowers by Sarah N. Lynch (Reuters)
Sharp analysts stand to make a payday off a stock not via short positions but through a whistleblowing award from the SEC which could earn them as much as $2.5 million. [Link]
Have a great Sunday!
