Experience Stern | News & Events

Excerpt from CNBC -- "On Tesla itself, I think there's been a lot of good news about the company, but it's still a small company. 1.3 billion in revenues. It's losing money. And even with an optimistic view of the future, if you think of it as an automobile company, I find it difficult to get to the $20 billion that you get as a market cap for the company right now. If you allow the revenues to go from where they are now to Audi levels, $65 billion, and the margins to improve to Porsche level margins, they are among the highest in the auto sector, you still end up with a value of about $8 billion, $9 billion, $10 billion for the company. If you want to stretch to $20 billion, you've got to give me a really good narrative as to what's going to be different about the future for this company."

Excerpt from The Wall Street Journal -- "The European Central Bank will be 'tough' in the upcoming asset quality review and stress tests of the European banking sector, New York University professor Nouriel Roubini said Friday. 'I think they will be tough as they want to build a reputation' ahead of taking over the supervision of larger European banks, Mr. Roubini told reporters at a conference here. He added that he thinks the ECB's reviews will find that several Italian banks are undecapitalized, including some of the largest of the country."

Excerpt from Bloomberg TV -- "There is an economic recovery but in my view it's very fragile. GDP growth in the third quarter might be barely 2%. In the second quarter, excluding inventories, it was less than 2%. There is an improvement in the labor market, but in part it's due to a fall in the labor force participation rate."

Excerpt from the Jamaica Observer -- "Henry is the Dean of New York University's Stern School of Business and also a former Professor of International Economics at Stanford University. He is the author of the thought-provoking book Turn-Around: Third World Lessons for First World Growth, in which he posits that the secret to emerging countries' success is discipline -- sustained commitment to a pragmatic growth strategy. ... At the forum, Henry will share his thoughts on how the policy pendulum now swings toward prudence and self-control in much of the emerging world."

Excerpt from The Wall Street Journal -- "'Many companies are repeating some of the mistakes of the past,' by taking on too much debt, said Edward Altman, a New York University business school professor and the creator of a well-known tool for measuring corporate health, called the Z-score. Mr. Altman said his latest forecast, which measures the probability of corporate defaults, showed overall corporate health was 'no better than it was in 2007 and by some measures worse.' The median scores, which measure corporate financial health by analyzing a combination of liquidity, earnings, solvency and stock market valuations, were 4% lower for companies rated 'junk' in 2012 than in 2007."

Excerpt from The Globe and Mail -- "A study some years ago by David Dunning and Justin Kruger found that most people, regardless of their level of competence with a skill, perceive themselves to be better than average. And it gets worse. This concept doesn’t include those people who boast about their impressive writing skills but are in fact downright terrible writers. These folks may be suffering from 'Dunning-Kruger effect.' The same study found those who are the least skilled tend to rate their abilities higher than others. The worse they were the better they thought they were."

Excerpt from Forbes -- "Evolution is all about competition, and the dramatic effects that competition has on the structure and behavior of organisms over time. But here’s the key idea: competition occurs at multiple levels simultaneously, and the winner at any one level generally succeeds by suppressing destructive forms of competition at the level below."

Excerpt from Marketplace -- "The traditional runway show may not be cost effective for many designers who can’t afford not to turn it into a branding event, according Scott Galloway, a marketing professor at NYU’s Stern School of Business. 'I think brands have realized that and are trying to figure out a way to spread some of that fabulous across their customer base via social media,' Galloway says."

Excerpt from The Wall Street Journal -- “'You can accuse me of being too pessimistic in my assumptions, but the narrative that underlies my valuation is an optimistic one,' Mr. Damodaran said in a blog post summarizing his findings. 'I am assuming that Tesla will grow to be as large as Audi, while delivering operating margins closer to Porsche’s. Even with these assumptions, I cannot see a rationale for buying the company at today’s market price, but that is just my personal judgment.'”

Excerpt from Economic Times -- "Raghuram Rajan is first and foremost a sharp observer of economies. Raghu's interests and understanding of global finance extend beyond his immediate research focus, which is on banking and corporate finance. In particular, Raghu has always been interested in the growth of economies and the institutional and political features governing law and policymaking that lead to or preclude such growth. What is perhaps Raghu's forte is connecting dots in a manner that reflects unusual depth and common sense."

Excerpt from Treasury & Risk -- “'It’s my experience that failure prediction models have done fairly poorly when it comes to financial institutions,' Altman said. 'It always seems that the latest banking crisis is caused by something fairly unique to the current situation and not necessarily correlated with prior bank crises.'”

Excerpt from TheStreet.com -- "'The possibility of truly privatizing them isn't there,' says Lawrence White, professor of economics at NYU's Stern School of Business and author of Guaranteed to Fail: Fannie Mae, Freddie Mac and the Debacle of Mortgage Finance. Fannie and Freddie were once credible institutions with great human capital but all of that has gone now, he says. That ship has sailed. The blow to their reputations has been too great for either [agency] to exist as their former selves."

Excerpt from CNBC -- "...Power Pitch panelist Luke Williams, Executive Director of the Berkley Center for Entrepreneurship and Innovation at NYU Stern Business School, was concerned about the startup's competition. 'I'm not sure if this is an app that other people can easily do...I'm not sure if the system that's behind this is actually making it all work and making it differentiate on the market.'"

Excerpt from The Wall Street Journal -- "Yakov Amihud, a finance professor at New York University’s Stern School of Business, says, 'When market liquidity is expected to be lower than normal, expected return should be higher than normal. This may apply for Rosh Hashana.'”

Exerpt from LiveMint -- "At the V-Lab in New York University’s Stern Business School, we estimate the capital needs of banks in future stress. We use market data to assess the downside risk of banks and assess their gearing in a stress scenario by comparing their book liabilities to market value of equity after taking account of the downside risk. Our estimates suggest that in the event of a minus 40% correction to the global market over a six-month period, as seen in the Great Depression and the Great Recession, publicly traded Indian banks and financial firms will require over $80 billion of equity capital to maintain a market equity ratio of 8% relative to their assets."

Excerpt from Bloomberg TV -- "The thing I’m watching for, or I think the most interesting event is Apple’s launch of a discount phone – the 5C. They’ve effectively been relegated to the high-end market. Apple became the largest market cap company on the backs of one unbelievable phenomena. They became the low-cost producer at the premium price; the biggest market share, lowest price. That would be like if Ferrari had the market share of Toyota – that’s a very powerful cocktail…"

Excerpt from Bloomberg TV -- "They registered pretty substantial market share gains, Microsoft Windows phones this quarter. That's the good news. The bad news is the number 4. That's their market share. So it's 80 - 14 - 4. Android, iOS and then Microsoft Windows-powered phones. But they do have a foothold in the market now."

Excerpt from The Huffington Post -- "In a paper to be published in Psychological Science, we propose that another way to influence people's behavior towards protecting the environment is to emphasize the long life expectancy of a nation, rather than its imminent downfall. ... If people perceive their country or planet's remaining time to be very short, then they rationally shouldn't place too much importance on making these present-day sacrifices. But if a long future is seen, sacrifices today for a brighter tomorrow for ourselves and our offspring make more sense."

Excerpt from the LA Times -- "'This is the first stage of something more profound, which is the ability of people to structure their lives around doing multiple sharing-economy activities as a choice in lieu of a 9-to-5, five-day-a-week job,' said Arun Sundararajan, a professor at New York University. 'This is technology-driven progress,' he said. 'This is what it's all about.'"

Excerpt from Livemint -- "What should perhaps come as a surprise is that until recently, the investor view and pricing of India’s currency and markets hardly seemed to reflect the ground reality. The expansion of monetary base due to unconventional central bank policies in the Western economies, especially in the US, found its way readily into the Indian debt and equity markets. These flows, however, abruptly reversed themselves since the announcement in May of the potential tapering of the US Federal Reserve’s expansionary policies. The sentiment on India has since turned bearish, its asset and currency markets have suffered quick and massive depreciations, and its structural weaknesses for generating future growth have all of a sudden come to the fore."

Excerpt from Details -- "'If you're a Brazilian billionaire, moving money offshore into a Manhattan apartment is a good idea,' says Stijn Van Nieuwerburgh, the director of the Center for Real Estate Finance Research at NYU Stern School of Business. 'The market hasn't peaked yet. It's a stable currency. And these foreign investors aren't looking for a 5-to-7-percent return on their investment. It's a trophy asset, a luxury good.'"

Excerpt from Advertising Week -- "Pick a company and a business superstar that resonate with you. It's like becoming a loyal fan of a rock star. Create a virtual shadow of these entities and learn everything you can so you will be ready when it's time to be introduced."

Excerpt from Project Syndicate -- "In the United States, three sources of policy uncertainty will come to a head this autumn. For starters, it remains unclear whether the Federal Reserve will begin to “taper” its open-ended quantitative easing (QE) in September or later, how fast it will reduce its purchases of long-term assets, and when and how fast it will start to raise interest rates from their current zero level. There is also the question of who will succeed Ben Bernanke as Fed Chairman. Finally, yet another partisan struggle over America’s debt ceiling could increase the risk of a government shutdown if the Republican-controlled House of Representatives and President Barack Obama and his Democratic allies cannot agree on a budget."

Excerpt from The Washington Post -- "William Baumol, who is, amazingly, still an active economist at age 90 and just released a book on these very issues, realized in a series of papers in the 1960s (many coauthored with future Princeton President William Bowen) that industries that didn’t see productivity increases might still see costly wage increases. 'The insight that Baumol and Bowen had was that there are some industries where productivity growth is very likely and some where it’s not,' Robert Archibald, an economist at the College of William & Mary, explains."

Excerpt from The New York Times -- "Ms. Quinn was standing beside a woman who had faced much more harrowing situations – Lindsey Melki, an Army veteran who flew a Black Hawk helicopter in Iraq in 2007 and 2008 – to announce what she would do as mayor in her first 100 days in office to help veterans. 'We have not done enough — the Bloomberg administration has not done enough," Ms. Quinn, a Democrat, said. Among her proposals was creating a 'welcome home' center in Times Square that would offer counseling, medical, job and housing services for veterans, as well as satellite support centers in each borough. Ms. Melki praised the idea of having a 'one-stop shop' to help veterans navigate the services available to them."