Monday, January 26, 2015

"Recent Evidence on the Interest Rate Sensitivity of REITs," UCLA Economic Letter, January 2015

The link below is to my article demonstrating that the 10 year U.S. Treasury yields accounted for 79% of REIT  relative performance compared to the S&P 500 between January 2, 2013 - November 7, 2014.

In a Wall Street Journal Blog on REITs and Interest Rates

I was quoted this morning in a Wall Street Journal Blog on REITs and interest rates citing a forthcoming article for the Ziman Center for Real Estate at UCLA. The URL to the article is at:

I will post the full article later today.

Saturday, January 24, 2015

My Amazon Review of "Stalin: Volume I: Paradoxes of Power, 1878 -1928"

The Rise of Joseph Stalin

Princeton professor Stephen Kotkin sure knows how to tell a story. In his nearly 1000 page (in the print edition) biography, and remember this is just Volume 1, describes and analyzes the rise to power of Joseph Stalin from his humble beginnings in the Georgian backwater town of Gori in 1878 to his full assumption of power over the Soviet Union in 1928 on the eve of the collectivization of Russian agriculture.  As any good Marxist would do he analyzes Stalin’s rise in the context of the broad historical forces shaping Europe and Asia in the late 19th and early 20th centuries. However, this is a story where the force of will of two individuals, namely Lenin and Stalin, alter the arc of history. Simply put, without them, no Soviet Union.

Because much of the story is known and is present in other reviews on Amazon, I will highlight what I found special in Kotkin’s biography. First and foremost the autodidact Stalin, who was far from the intellectual lightweight portrayed by his critics, was from the beginning a hard leftist. Nevertheless he learned from Lenin the importance of tactical flexibility. This enabled him to turn right to defeat Trotsky and then turn left to defeat, first Zinoviev and Kamenev, and then Bukharin. If anything Kotkin teaches us the Stalin was the true successor to Lenin.

He further highlights how Stalin built a dictatorship within the dictatorship. By that he means that Stalin seized control of the Communist Party which dictated over all of Russia. Through his role as general secretary Stalin seized control of the party, which was internally democratic, and bent it to his will. Thus he created a dictatorship within a dictatorship.

Here are a few interesting factoids that I learned from the book:

   *Lenin’s Testament was probably not written by Lenin. It was written by, most likely, his wife.

   *With respect to his wife, unlike other leading Bolsheviks Stalin was a sexist in the sense he did not want her to work outside the home.  For a while she was a secretary to Lenin.

   *Finance Commissar Grigory Sokolnikov broke the Russian inflation with a very orthodox monetary policy putting the country on a modified gold standard. He minted gold coins with an engraving of the deposed Czar Nicholas II on it. This was done with the backing of Stalin. Sokolnikov is later a victim of the terror.

   *Vladimir Putin’s grandfather worked as cook for Lenin.

Stalin was a true party boss. Harry Truman described him “as near like Tom Pendergast (Kansas city Democratic Party boss) as any man I know.” The difference, of course, is that Pendergast did not control the entire security apparatus of the state. This control will be wreaked with a vengeance in Kotkin’s next volume. I can’t wait for it to come out.

The full Amazon URL is: 

Wednesday, January 21, 2015

The State of the Union (Democratic Party)

Last night's State of the Union address was a reprise of President Obama's inaugural address of two years ago where he outlined his broad social democratic vision for America. His speech would have been more appropriate for a Democratic national convention rather than before a largely Republican Congress. His Santa's bag was filled with such goodies as free community college tuition, higher childcare credits, higher minimum wage and paid family leave; all to be paid for by taxes on business and the very rich. Yes. it is easy to play Santa Claus with other people's money.

With respect to foreign policy, in the words of the words of the administration's house organ, MSNBC, the president was "delusional". On what planet is he living? ISIL remains on the march in the middle east, Yemen is falling apart, a weakened Russia is advancing in the Ukraine and across much of the world, terrorist alerts have been upgraded.

To be sure President Obama held out hope for potential deals on corporate taxes and trade, but most of speech was outright hostile to the GOP majority by offering veto threats on Keystone and amendments to financial reform.

Finally he returned to his theme of 2004 calling to unite red and blue America and he called for the removal of "dark money" from political campaigns.  This was perhaps the most cynical portion of the speech. Of course the Republican leadership has played a leading role in dividing the country, but make no mistake, President Obama has been hardly willing to compromise as well. Moreover over all of President Obama's election cycles he has been "the fundraiser in chief." It was he who chose not to take public funds in 2008 and 2012.

Thursday, January 8, 2015

Ottawa, Sidney and Paris: Connect the Dots

As if we did not already know it, you don't have to be Inspector Clouseau to deduce that there is something very wrong with a strain of Islam that is out to destroy Western values. Within the past three months we witnessed terrorist attacks on the Canadian War Memorial, the heart of Sidney and yesterday's horrific slaughter at the offices of the satiric French magazine, Charlie Hebdo.

It is time to heed the words of Egyptian President al-Sisi to purge Islam from those who kill in the name of the religion and those who give aid and support to the killers. Further it is time for the western multi-culturalists to stop making excuses for very bad behaviors. It is also time to realize that the NSA surveillance state has more than a few positive attributes going for it.

I do recognize that this is a problem primarily within Islam where more than words from moderate clerics and secular leaders are needed. Nevertheless we can't just sit around and watch magazine editors being gunned down with assault rifles without acting.

Je Suis Charlie