We thought we had it all figured out before this week started.
We were wrong.
The top minds in the investment business offered some novel analysis, broke conventional wisdom, and even opened our eyes to some misperceptions.
What follows are excerpts from 11 of the best stories this week. All of the important stuff you might have missed this week, right here.
REVEALED: The Truth About Ronald Reagan's Economic Growth Miracle
"Wait, what's that: Japan has grown the most since 1960. Okay, part of that is due to the uber-strong yen and the translation back into dollars. But then, next is... France. And then Germany! Okay, but what if we set them all equal to each other right at 1980, when the Reagan revolution began. It turns out that Great Britain, Japan, and Australia have all grown faster than the US on a per capita basis. And Germany is very close. Bottom line: Anyway you slice it doesn't it look like anything special happened starting in 1980."
Goldman Has A Fascinating Theory For Why Government Gridlock Has Been A Drag On Growth
"Now the first thing to note is that contrary to some popular delusions, which posit that the government is only pumping more and more into the economy, in the last quarter, government spending was a net drag on growth, as stimulus fades, and austerity starts to kick in.
But the spending cut was more than expected, and Phillips posits that it's the result of gridlock in DC. More specifically, he argues that it's the ongoing result of funding mechanisms called "continuing resolutions" which are the temporary stopgap measures that Congress uses to keep the government operating in the absence of a full-year budget deal."
Here's How Religion Is Tied To Stock Price Crash Risk
"This study examines whether religiosity at the county level is associated with future stock price crash risk. We find robust evidence that firms headquartered in counties with higher levels of religiosity exhibit lower levels of future stock price crash risk. This finding is consistent with the view that religion, as a set of social norms, helps to curb bad news hoarding activities by managers."
See the rest of the story at Business Insider
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See Also:
- 16 Fresh Insights That Challenged What We Thought We Knew About Investing
- 16 Expert Observations That Will Have You Rethinking Your Investment Strategy
- 18 Unique Insights That Challenged Conventional Wisdom On The Markets And The Economy