This Week in Review, Independence Day Edition

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Historically, the 4th of July has been one of my favorite holidays. When I was young, so much younger than today, the men in my family used to take a float trip down various rivers around the state. It was a great time, mostly because it was our thing. Those were some good trips. It feels like we did it forever, but I guess we only really did it for about five years. Then, when I was in high school and early college, I used to play with my friends in the 4th of July mud volleyball tournament in our hometown. All the teams were full of people from the town, who knew each other. Both of those things contributed to making the 4th one of my favorite holidays. Plus, it’s in the middle of the summer and is all about being proud of the home team. People have different political views, we disagree on everything under the sun, but I think most people have a healthy amount of pride about the country they come from.

I started a new job this week, so I didn’t read as many articles as I sometimes do. Thanks to twitter, though, I think I caught some of them on the way by.

Protect Your Identity @ Suburban Dollar – The internet has changed security and the way we look at it forever. It’s not enough anymore to make sure your money is locked away in a vault or a safe – now people can steal it with a computer more easily than a cutting torch.

Making home affordable expanded again @ Wisebread – I honestly feel bad for anyone that’s inside out on their home. I feel bad, but I also think that the government should just let the market work. I would allow lenders the flexibility of deciding which situations they should lend in. Then again, I wouldn’t have thrown money at the automakers, either.

Is the Economic Downturn Over @ The Digerati Life – I don’t know if it is or not, but I have noticed that things seem to be looking up. I don’t know many people that are unemployed, the job market seems to be picking up a little bit, and advertisers have been contacting me lately. I can’t predict financial markets or the future, but things seem to be turning. If I had to guess, though, I’d say that the worst is over but that overall recovery will happen slowly.

Is Wealth Creation a Myth @ Lazy Man and Money – I don’t think wealth creation is a zero sum game, as is stated here. Using a pie analogy, in a zero sum game there are only so many pieces of pie. In economics, you can make the pie bigger – with technology. With fertilizer, all the sudden we have been able to produce higher quantities of food, so fewer people have to devote their lives to simply feeding themselves. To me, this is an example of wealth creation through technology.

Warren Buffett’s Record is Not Evidence EMH is Wrong @ Amateur Asset Allocator – I agree with the initial premise of this post…that markets are mostly efficient most of the time. I disagree with both the form and substance of the rest of the post. AAA states that his record is “not evidence,” but then proceeds to offer no data or evidence to back up any of his claims. I’ve heard the Buffett as a brilliant manager theory many times – this is simply not the case. He votes his shares in favor of giving himself a seat on the board for one reason – to watch over his investment. He’s said many times that he doesn’t run the companies, and wouldn’t know the first thing about running Coca Cola. In his one run at being a CEO (of Salomon Brothers) was mostly a failure. I always hear this one from EMH people. Buffett’s heard it, too. He thinks it’s ridiculous. As for the opportunities Buffett has available to him that we don’t…yes – NOW he has opportunities that we don’t. He didn’t have those while he was building his original partnerships or when he first took over Berkshire. As for the “it’s just luck” argument, the author wrongly seems to believe that he’s proved that Buffett has done this by chance. He does this by offering an analogy and a logical fallacy, neither of which prove anything. No data is offered to show why it’s a statistical probability that someone like Buffett should exist. Give the man some credit.

I hope everyone has an incredible holiday (or weekend, if you’re outside the US)! Thanks for reading.