Find it here. Highly recommended.

Here comes the first installment of the Barron’s Roundtable. This is always one of my favorite things in the yearly investment publication calendar. It’s because the participants have often very controversial hypotheses and are strongly at odds with each other about the outlook. At the roundtable you find such controversial figures like former Goldman investment head Abby Joseph Cohen and Dr. Doom Marc Faber. So, enjoy the games…

As more and more traditional fund firms are entering the ETF market and issuing new products, the market is driving down prices. Vanguard has fueled a price war in the United States by issuing 20 new ETFs undercutting Black Rock and others, Bloomberg reports today:

“Vanguard’s U.S. ETFs pulled in a net $25.6 billion this year through Sept. 30, 26 percent more than BlackRock and State Street combined, according to Chicago-based Morningstar Inc. Vanguard last month offered 20 new ETFs, taking on the bigger companies for the first time with funds that track Standard & Poor’s and Russell indexes, including the S&P 500 Index.(…) Fees charged by BlackRock and Boston-based State Street, which oversees $216 billion in ETFs, are on average about double those of Vanguard and Schwab of San Francisco.”

But competition drives also innovation. The latest thing being bullet bond ETFs, as read in today’s Wall Street Journal:

“One of the exchange-traded-fund industry’s latest innovations aims to answer a longstanding criticism of bond mutual funds: that these investments never mature and so investors can’t lock in attractive yields as they can with individual bonds. Two ETF providers, BlackRock Inc.’s iShares unit and Guggenheim Partners LLC, have begun offering “end-date” or “bullet” bond ETFs in the past year. The new funds hold a portfolio of bonds all maturing in the same year.”

This seems to me among the more sensible innovations in the ETF market. It’s reassuring to see that in some areas of the financial services world market forces actually do work.

The Wallstreet Journal dispenses some advice which we like a lot:

“Investing is complex rocket science that requires professional help-at least that’s what the professionals usually say. But a strong case can be made for investors following a design principle known as KISS, which in this case stands for: Keep it simple, saver…”

Highly recommended reading - especially for the investor who is seeking peace of mind…

I just finished the bestseller “Too big too fail”, delivering a behind-the scenes and moment-by-moment account of the months between the fire sale of Bear Sterns in spring 2008 and the announcement of the biggest bailout in history in October 2008. Drawing on hundreds of hours of interviews with the key players the Author Andrew Sorkin of the New York Times was able to write a kind of real-life thriller on the struggle of overpaid bankers and overwhelmed politicans to save the financial systems, there companies, jobs and even more so their egos. A gripping book one reads with disbelief on the lack of self-awareness and competence of main players, but also a lot of amusements on how the “big” world of finance and business comes down to surreal realities in the face of disaster.

One of these hard to belive events is a check over USD 9 billion! that literally saved Morgan Stanley and the jobs of its 45.000 employees in the very last minute. Hand delivered by a Japanese delegation and picked up by a banker wearing flip-flops….

Great post on the value of short-selling in the WSJ Deal Journal

Innovating to zero: Bill Gates unveils his vision for the world’s energy future

Why “nuanced voices” are not welcome on financial TV

Just in case you want to spend some time during your holidays pouring over good & bad investment advice, thinking about financial Armageddon or heavenly bull markets, the (limited) wisdom of market pundits, or even read about bankers on the run, well, then have a look at the following links:

Institutional Investor is gloomy about stocks - sounds for my taste just a little bit like these “STOCKS ARE DEAD” predictions in the late 1970s….

Doug Kass’s 20 surprises for 2010 - fun to read and Doug in many cases was spot on end of 2008 with his predictions for 2009

Obituary - Legendary Value investor Chris Browne dies

Surprise - Best performing fund of the decade is from…SWEDEN

LA Times - shares with us the top-5 investing lessons of 2009, very rational

“Banker On The Run” - Why the new bonus tax makes British bankers leave London in droves.  An example how punishing taxes can backfire? (from the German paper Sueddeutsche)

For the weekend I have collected a few interesting links for you who make a strong bearish case looking ahead to 2010: The Edwards strike back, The next economic bubble?, Dr. Doom vs. The Investment Biker (quite a funny piece).

In short, the story goes like this: The recession will come back vigorously next year, the market will go to new lows, US Dollar will reverse again and appreciate, carry trades playing on low and cheap Dollar will unravel. Big bloodbath all over. 1929 or 1934 redux. DEPRESSION!

But read for yourself….Next week we will present the BULL case. Yet it is up to you to draw the right conclusions, dear reader.

There has been loads of speculation why Warren Buffett has acquired the rail operator Burlington Northern (including to make a play on coal or to make it easier for his successor to run Berkshire Hathaway).

Yet in my opinion, the best analysis is that Burlington Northern is just undervalued - and at the end of the day will be worth a lot more than its stock market price reflects. Just like the old saying goes: Price is what you pay, value is what you get.

Today this interesting news release from BCG (the Boston Consulting Group, a leading strategy consulting firm) came across my desk: BCG  has just released a brand new study on Global Wealth 2009.

The most interesting point is that Europe has now overtaken the US as a wealth managment centre. Measured by Assets under Management (AuM) Europe is leading with USD 32.7 trillion whereas the US has only USD 29.3 in AuM.

Another interesting finding of the study is that pressure is mounting on offshore assets. A finding that mirrors the forecasts of MyPrivateBanking research. Switzerland is still the leading offshore centre with USD 1.8 trillion in AuM (28% market share).

The BCG study is another call to arms for the wealth management industry (particularly wealth managers in offshore jurisdictions) to transform its business model in order to meet the requirements of a rapidly changing business and regulatory environment.