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.

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Introducing The Reformed Broker All Access by Josh Brown (The Reformed Broker)

Ritholtz Wealth Management CEO and noted market commentator Josh Brown announces his plans for @AllAccessTRB, part of Premo Social, a new social media service from Bespoke. [Link]


Brokers’ Call on Wall Street: Bye by Michael Wursthorn (WSJ)

A review of the move from wirehouse offices where brokers charge commissions for trades to the independent registered investment advisor model. [Link; paywall]

Wall Street Profits by Putting Investors in the Slow Lane by Jonathan Macey and David Swensen (NYT)

Fractions of a cent per trade incentivized by rebates to brokers can add up to billions in costs at scale. More importantly, the practice isn’t transparent, limiting the steps customers can take to prevent or avoid it. [Link; soft paywall]

Goldman Partners Mark End of Era as Stock Holding Drops Below 5% by Dakin Cambell (Bloomberg)

When Goldman IPO’d in May of 1999, more than 60% of the firm’s value was held by partners. As of the third of July, that number is down to less than 5%, its lowest ever. [Link; auto-playing video]

Business Models

The Business of Artificial Intelligence by Erik Brynjolfsson and Andrew McAfee (HBR)

A fantastic and comprehensive overview of the current AI space and what the outlook looks like, struck in easy to understand and realistic terms. [Link]

The Crazy Math Behind Drug Prices by Paul Barrett and Robert Langreth (Bloomberg)

In the complex US healthcare system, pharmacy benefit managers stand between drug companies and the entities that pay for drugs, like insurance companies, are the subject of new lawsuits alleging harm to consumers by uncompetitive behavior. [Link]

International Affairs

EU threatens to escalate Article 7 action against Poland by Arthur Beesley (FT)

With Poland’s Law & Justice Party attacking the independence of the country’s supreme court, the EU is considering steps to limit the attack on an independent judiciary. [Link; paywall]

An Early Sign India’s Huge Tax Revamp Is Working: Happy Truck Drivers by Corinne Abrams, Debiprasad Nayak, and Anant Vijay Kala (WSJ)

Reform to India’s tax system has removed regional taxes and replaced it with a national GDP, improving efficiency of movement for goods around the massive country. [Link; paywall]

Can the Fed and ECB Work Together To Reduce Imbalances? by Brad W. Setser (Council on Foreign Relations)

An argument that the ECB should focus on raising interest rates rather than reducing its balance sheet, having an optimal impact on the country’s currency and the imbalances in global current accounts. [Link]

Economic Dynamism

Older and Slower: The Startup Deficit’s Lasting Effects on Aggregate Productivity Growth by Titan Alon, David Berger, and Robert Dent (NBER Working Papers)

A unique paper design that shows productivity declines are likely driven in large part by falling turnover of US firms, also called the “startup deficit”. [Link; 37 page PDF]

Low-Income Earners See Weekly Pay Gain Faster Than Other Groups by Eric Morath (WSJ)

Wages for the lowest paid workers (those in the bottom decile of usual weekly earnings) are growing at the fastest pace in almost a decade, and faster than both median and top decile workers. [Link; paywall]

Crime and Punishment

Forget Silk Road, Cops Just Scored Their Biggest Victory Against The Dark Web Drug Trade by Thomas Fox-Brewster (Forbes)

This week the DoJ announced cooperative actions with international law enforcement agencies which shut down two major clearinghouses for both cryptocurrency and illicit drugs. [Link]


Why Banco Popular’s credit default swaps are getting messy by Robert Smith (FT)

The ECB put a Spanish bank into liquidation last month, but CDS linked to junior debt are now facing uncertain payouts because junior bondholders may have legal claims related to the liquidation. [Link; paywall]

Real Estate

2017 Profile of International Activity in US Residential Real Estate (National Association of REALTORS)

An excellent, chart-heavy review of purchases made by international buyers in the US market. Total dollar volume reached $153.0 billion in the twelve months ended March 2017, close to evenly split between residents and non-residents. [Link; 48 page PDF]


Former $2 billion private equity fund now nearly worthless: WSJ by Dion Rabouin (Reuters)

An oil producer-focused private equity fund raised at the peak of the shale boom has collapsed, with investor holdings now worth nothing. [Link]

Long Reads

A Piece of the Action: Recent Books on the Digital Economy by Ron Hogan (LA Review of Books)

Long, winding words on the imagination of the digital economy that ends with a brilliant metaphor for network effect products using an episode of Start Trek. [Link]

Screaming About Stocks Into A Well: A Text Adventure by Noon Six Capital (Medium)

A play on a recent McSweeney’s piece, Noon Six playfully expresses what so many investors are thinking: futility and frustration in a world that we just don’t always understand. [Link]

On The Lighter Side

Supreme Court’s Junior Justice Has to Run the Cafeteria. Don’t Eat There by Jess Bravin (WSJ)

An endearing review of the cafeteria which serves the Supreme Court and the hazing new members of the court undergo by operating it. [Link; paywall]

The 100 Greatest Props In Movie History, And The Stories Behind Them (Thrillist)

An exhaustive list of the physical tapestry of movies, complete with discussions from members of the production team and stories about how they came into being. [Link]

Have a great Sunday!

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