Tag Archives: Plain English

Plain English: It’s Not What You Say, It’s What People Hear

This video stands to have an immediate impact on your income if you have anything to do with politics, journalism, public relations, branding, marketing or communications of any kind.

This video stands to have an ancillary impact on your income if you were not included in any of the above professions.

Note that the impact is not zero for anyone.

To wit:

“Any of you in corporate America who use the word, ‘brand’, please stop. Now. And don’t use that word again. Because brand is people like me creating words that have no meaning, trying to sell things that people probably don’t need and trying to explain things that aren’t important. Brand is cheap, brand is fake. Trust is everything, trust is real.”

“The rule of expectations is probably the most important when it comes to business or politics, which is that it is better for people to expect less and get more than it is for them to expect more and get less.”

Those are just two examples of what’s in there.

The speaker is Frank Luntz, an occasional contributor to Fox News. If you have a problem with that data point, consider that his advice and research is applicable across the political divide.

And now I’m gonna drop an even bigger BUT on you: it’s an hour long. Suck it up. Today’s Friday. Consider it an hour you won’t spend watching [insert latest trendy TV hit show here].

Trust me, this’ll have a far bigger impact on your bottom line.

The source link is here.

A May Day Special: Why To Travel When You’re Young

terraqueous-globeI rarely republish in full something from another source, but excerpting this would really not do it justice. Fortunately, Andrew Henderson of Nomad Capitalist has granted us permission to do just that:

Why to travel abroad while you’re young… or not so young

I was talking to about travel with a close friend of mine recently. I was showing him the twenty or so countries I’ll be living in or visiting in the next year or so, and I could tell he was intrigued.

His mind was blown when I said my hotel room in Siem Reap, Cambodia would cost $9 a night. Private room. Private bath. Free wi-fi and breakfast. No forced labor in the afternoons.

Then he went on to tell me how he had all the opportunities to travel when he was younger. He could have taken the summer after high school to backpack through Europe with friends. Then he could have taken a year exploring the world before going back to grad school. Then he could have taken time off from work to go to England with his friends.

But he never did.

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Plain English: China’s Cash Stash

2013.04.11.China FX ReservesThis little quip from the FT about China’s rising FX reserves made me stop in my tracks:

“Reserves jumped $130bn to $3.44tn – roughly equivalent to the size of the German economy…”


Yes. Really. You can look it up here.

This now raises some other basic questions: what else is worth $3.4 trillion? Or: what could China buy with that kind of money? How else can we even conceptualize this number?

In the spirit of my previous conceptualization of Facebook’s $100 billion IPO, here are some other ways to conceptualize $3.4 trillion:

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Plain English: Some Thoughts On Bernanke’s LSE Speech

2013.03.26.Bernanke Plain English-helicopter benBernanke gave a speech at the London School of Economics yesterday which is grabbing a lot of attention. Those who have heard or read some of his other non-Fed public lectures over the past few years will recognize that he spent about half of it reviewing some of his favorite historical lessons, mostly sourced from his pre-Fed academic work. But there were some new statements to add to this mix. My interpretation of some of the key themes:

  • The current financial crisis is in fact a classic panic: a systemwide run of “hot money” away from assets whose values suddenly became uncertain.
  • That said, there were some different bells and whistles this time, notably the introduction of new financial instruments, more varied actors beyond just banks and (in my opinion) most vitally, a scale and complexity altogether new.
  • Currency war, which Bernanke chooses to refer to as, “competitive depreciation of exchange rates”, is similarly not new.
  • The accommodative monetary policies central banks around the world have been implementing (read: zero interest rate policy) to support growth do not constitute competitive devaluations, currency wars or whatever term you prefer. The primary reason for this is that domestic demand counts for a lot more than exchange rate meddling and in any event when competitive economies both devalue their currencies, whatever effects result from these devaluations effectively cancel each other out.

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Basic Strategy For Hyping An Investment Trend

2013.03.11.PlanetHypeI’ve seen this happen so many times, I could teach a class on it:

  1. Take a small data sample of something that confirms the view you’re determined to promote;
  2. Regardless of how rigorous the methodology or how representative the sample size, declare that this is indicative of a broader trend–forest for the trees or some such thing;
  3. Willfully ignore any aspects of this declaration that remotely contradict your view;
  4. Deny/insult/discredit/lash out at anyone who tries to take an even-handed view on it;
  5. Begrudgingly concede that nothing is perfect but that a positive attitude is what counts;
  6. Neglect to make clear the very pertinent fact that you have a vested interest–financially, politically, reputationally–in a positive outcome which therefore inhibits your own objectivity;
  7. If your lawyers insist, loosely outline the caveats to your opinion and bury them somewhere where they are least likely to be noticed (“past performance is not indicative of future results” is the boilerplate here);
  8. Debunk the caveats by paraphrasing points 1 and 2 and emphasize the probability your forecast will prevail;
  9. Lather;
  10. Rinse;
  11. Repeat.

Now, let’s consider a brief list of where we’ve seen this template applied in the recent past:

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Plain English: How to read a yield curve

These fine young gentlemen seem perfectly qualified to run the European Central Bank don’t they?

Fun & Finance Segunda Temporada Capítulo 4: Como leer la Yield Curve (w/subs) from Estudio de TV Diario del Viajero on Vimeo.

Plain English: Quantitative Easing Explained

Kudos to Ed Dolan for putting together this highly readable and stripped down tutorial on quantitative easing:

See more from Ed Dolan’s blog here.

Plain English: The future of economics, according to the chosen ones

I’ve read the entirety of The Big Think’s “Empirics and Psychology: Eight of the World’s Top Young Economists Discuss Where Their Field Is Going” plus comments, and while there’s a lot about it that I find problematic, I think I’d rather focus on the few items I’m most in agreement with and that I find most relevant to the world as I see it:

Gauti Eggertsson, NY Fed, 37:

“My guess is that if one looks back 20 years from now, one will notice that a shift occurred towards studying the basic, big-picture, policy-relevant questions of macroeconomics—e.g., optimal currency areas, bank runs, fads and herding in financial markets, and automatic stabilizers—that have the power to change the course of history. I think there have been two comparable events that shaped the field in this way. As a discipline, macroeconomics was born in response to the Great Depression, giving rise to Keynesianism; the rational-expectations revolution in macroeconomics was born in response to the great inflation on the 1970s.”
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George Soros in Plain English: Eurozone crisis goes back to the future

I finally had time to read the George Soros speech in Italy a few weeks ago that put everyone into a frenzy for about 24 hours until they all got distracted by the next big thing. At the same time, a colleague emailed me the following graph, which I have not yet been able to independently verify, but if this is true, WOW:

Once I got over the initial shock of looking at this chart, I thought it interesting to note that Continue reading

PIMCO in Plain English: Fed, ECB LTRO and Emerging Markets Risk Management

The latest PIMCO newsletter spends some time discussing Emerging Markets tail risk from ECB and Fed actions, but glosses over the very real prospects of capital flight from developing countries. As European banks are further pressured to shore up capital, to the extent they’ll do so by selling EM assets, any emerging economy without a suitably deep local market to pick up the slack—which is going to be most of them—stands a quite real risk of experiencing, among other things, downside risk to local currency values.

I don’t have references immediately on hand, but I’ve seen a few estimates of the global value of this potential sell-off to be well into the trillions of dollars. Anyone with country-specific concerns would be well-advised to assess the level of European investment in all domestic assets, regardless of currency denomination.

Here’s the passage in question from PIMCO global central bank focus, released late last week: Continue reading

PIMCO in Plain English: Mohamed El-Erian looks to the future and sees…

Double, double toil and trouble
Fire burn, and cauldron bubble.
— Macbeth Act IV, Scene I

Mohamed El-Erian recently deconstructed central bank activism to an audience of…central bankers, at the St. Louis Fed. Really, the core fight here is about how much of a visible and active hand central banks should have in overseeing a country’s economy. And this crossroads is exactly where civilized conversation, particularly in the U.S. context, particularly in an election year, comes to die. So let’s put aside our politics for a moment and look at this as aseptically as we can.
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Ray Dalio in Plain English: How the Economy Works

Cardiothoracic surgeons | Source: WikipediaBridgewater Associates’ Ray Dalio has recently updated a white paper outlining the basic template of developed markets. Since my concern is emerging and frontier markets, I’m going to take his arguments at face value as they apply to the U.S. and extract what is  relevant in assessing economies where information is not always so forthcoming.

And for those who don’t know who Ray Dalio is, he founded the largest hedge fund in the world, Bridgewater Associates, which manages  well more than US$100 billion (see Contrarian Investor yesterday for a very informative guide to visualizing this number).
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Bernanke in Plain English: The Gold Standard

Ben Bernanke’s lecture  at George Washington University last month on the Gold Standard method of fixing currency values continues whipping people into frenzied rants. Not one for frenzied rants, I thought I’d try to make sense of all this, so following are Dr. Ben’s essential arguments, the few remotely coherent reactions I managed to find to this event and then some of my own observations. The video of the March 20 lecture is available here and a full transcript is here. The exact points at which he discusses gold are between minutes 28 and 40 in the video and pages 13-17 in the transcript, followed by a student question at page 26.
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