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GFD Blog

Berkshire Before Buffett

Everyone is aware of the incredible returns that Berkshire Hathaway has provided shareholders during the past fifty years that Warren Buffet has run the company. In the late 1960s, when Warren Buffett became CEO of Berkshire Hathaway, shares in the company were trading at under $20. Today, shares trade around $200,000. During the same period of time, the S&P 500 Total Return Index went from around 38 to 3800. While the S&P 500 increased 100-fold, Berkshire Hathaway increased 10,000-fold. That is what I call value added.

But how well did Berkshire Hathaway perform before Warren Buf ...

The Currency Reform that Created Two Germanies

One question I often receive about the data for the Germany is why the German stock and bond indices had a 90% decline in June 1948. At first, people think there is an error in the data, but German shareholders actually did lose 90% of their capital as a result of the Currency Reform of June 20, 1948 when Reichsmark were converted into Deutschemark.

Despite the loss, the reform benefitted shareholders. who were unable to sell their stocks at the fixed prices the Nazis had imposed during the war. Although the Currency Reform imposed an immediate loss on all shareholders and bondholders, ...

Overend, Gurney & Co.: An Inspiration to Karl Marx and Bear Stearns

One of the most dramatic events in the financial history of Victorian England was the collapse of Overend, Gurney and Co. Its failure had a more severe impact on the London financial market than the collapse of Bear Stearns had on U.S. markets over 140 years later. During the financial crisis of 1866, over 200 firms went bankrupt, including a number of banks. The failure of Overend, Gurney and Co. also led to one of the first trials for financial fraud in history when all six directors were brought before the courts of London to answer for their alleged crimes.

Quaker Origins

O ...

The Death of the Zimbabwe Dollar

The government of Zimbabwe announced this week that they were finally demonetizing the Zimbabwe Dollar. Although the United States Dollar replaced the Zimbabwe Dollar in every day transactions back in 2009, banks still carried accounts that were denominated in Zimbabwe Dollars. Beginning on June 15, 2015, for only 35 quadrillion (35,000,000,000,000,000) Zimbabwe Dollars bank customers will receive one free portrait of George Washington. This opportunity expires in September.

Believe it or not, Zimbabwe will not get in the Guinness Book of World Records for the most insane currency co ...

ZZZZ Worst and The Frankenstein of Fraudsters

I have written about numerous scammers who used the stock market to defraud investors of their money, but one of the towering figures of this repulsive group of is Barry Minkow. I refer to him as the Frankenstein of Fraudsters because he is a con man who refuses to die, finding new kinds of fraud when he could no longer pursue his previous criminal activities. If there was a way to cheat people of their money, Barry Minkow found it. Minkow’s frauds cost investors hundreds of millions of dollars. Criminal charges against him include racketeering, securities fraud, embezzlement, money launderin ...

Mickey Mantle Strikes Out, Then Hits a Homer

A previous blog discussed Wilt Chamberlain’s unsuccessful attempt at following up on his successful basketball career with a successful IPO. Wilt Chamberlain wasn’t the only sports star to go into the restaurant business. Few people realize it, but Mickey Mantle set up restaurants twice, once in Texas in the 1950s when he struck out, and a second time in the 1980s in New York City when he hit a home run.

Mickey Mantle played for the New York Yankees between 1951 and 1968 and is one of the few baseball players to hit over 500 home runs during his career, and believe it or not, without ...

Are U.S. and World Unemployment Sending a Signal to the Fed?

The Unemployment Rate in the United States is of primary concern not only because it is an important measure of labor markets, but because it influences the Fed’s decision on whether to raise the Fed Funds Target, which has remained near zero since the beginning of the Great Recession. Although the Fed is hesitant to raise interest rates because of the impact it has on the economy, the graph below shows that 2014 provided a crucial development for the U.S. economy from a technical point of view. Between 2009 and 2013, the United States Unemployment Rate (U-3) was above the average Unemploymen ...

GFD CAPE Ratio Additions

Global Financial Data has added 250 CAPE Ratios to its database. The GFD CAPE Ratios are drawn from over 40 countries and include global indices such as World excluding USA index. The GFD CAPE ratios are updated on a monthly basis.

The CAPE Ratio is the cyclically-adjusted price-to-earnings ratio, also known as the Shiller P/E, which was developed by the Nobel Prize winning economist Robert Shiller. GFD’s CAPE Ratios are a moving average calculated as the inflation-adjusted price of the stock index divided by an average of ten years of inflation-adjusted earnings for the index. Graha ...

Whatever Happened to my AT&T Shares?

One of the great mysteries of life was created when AT&T split up into Ma Bell and the Baby Bells. This created a chain reaction of share distributions, splits, take-overs and acquisitions which has created stress and confusion to anyone selling shares in AT&T purchased before January 1, 1983. At least when Standard Oil broke up into 30 companies back in 1912, they at least had the common sense to do this before the IRS could make life miserable for stockholders.

Luckily, the number of people who owned the original AT&T shares in 1983 and haven’t sold their shares yet, forcing them t ...

3000 New Data Sets Added to the Global Financial Database

GFD has added 3000 new data sets to the GFDatabase which calculate the Annual Percentage Change. These files focus on economic data for which users are more concerned about the rate of change than the actual number, such as the Consumer Price Index and Real GDP.

Although GFD provides the annual percentage change as a choice when downloading the raw data, there are several advantages to providing the annual percentage change as a separate file. First, users can download the rate of change directly. Second, users can use the Annual Percentage Change files in our new platform, Finaeon, ...

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