Finance

Michael P. Regan is a Bloomberg Gadfly columnist covering equities and financial services. He has covered stocks for Bloomberg News as a columnist and editor since 2007. He previously worked for the Associated Press.

From where I'm sitting, the scariest news story of the week was the one about a blogger in China who was deported from the blogosphere after publishing a post that mocked former President Jiang Zemin's hairstyle.

Why is this so scary? Well, much of the current blog economy -- blogconomy if you will -- is heavily dependent on mocking and investigating the hairstyles of political leaders in the U.S., the U.K. and beyond.  Should a certain U.S. presidential candidate find out that China (China!) is beating America when it comes to crushing the growth industry of critical political hairstyle commentary, well God help us all. 

I was tempted to pick up the torch for "Shameless China" blogger Laura Lian and make some jokes about Jiang's hairstyle myself. However, truth be told, I find the "slick-backed coiffure" of Jiang to be a perfectly reasonable hairstyle for the leader of a major nation. Indeed, I did not find much at all to mock in the hairstyles of the world's political strongmen, at least those who are powerful and petty enough to have a cyberattack launched against a hair critic. Certainly not the jaunty, Pauly D-esque updo of Kim Jong Un, which is a perfect hybrid of Michael Corleone on top and "Full Metal Jacket" on the sides. And how could one have anything but praise for the proletarian efficiency of Vladimir Putin's wisps, which get the job done without any ostentatious displays, like a Russian minimalist painter. 

Anyway, as I said, the hair-blogging story was perhaps only the scariest piece of news for someone like me, whose job it is to ponder such important matters. For many of my readers, I believe the scariest article of the week may be Oshrat Carmiel's piece with the headline "Hamptons Mansion Buyers Have More Choices With Sales Sliding." This, to be sure, is a more optimistic take than "Hamptons Mansion Sellers Are Out of Luck With Sales Sliding." 

Real Estate Rager
How long can Hamptons home prices stay aloft amid rough times for hedge funds and Wall Street banks?
Source: Zillow.com

The Hamptons, for those who are unfamiliar, are famous for being the Jersey Shore of Long Island. Fine, maybe a little more upscale than that. But they don't even have a boardwalk! And let's be honest with ourselves here folks: This "new normal" economy is way more Seaside Heights than Southampton. The time for a convergence arbitrage pair trade involving the two is long overdue. 

So the Trade of the Week is to short the Hamptons and go long on the grittier corners of the good ol' Jersey Shore. All the corroborating evidence is right there in plain sight, if you've been paying attention to the news. The coolest people in the Hamptons these days are all hermits. Your neighbors very well might be in such dire straits that they have to rent the place out to some bro who will host a party that looks like something Stifler from "American Pie" would throw if he grew up to be a hedge fund manager. You can't even get away with that in Wildwood! Even Tiger Management founder Julian Robertson is reportedly renting -- not buying -- in Southampton. Boy, oh boy, wait'll all the Tiger cubs find out about that.

Besides, who has time for a $50 million beach house anyway, as hedge fund outflows and the "hunt for yield" once again make the news this week, causing the financial elite to scramble off to the four corners of the world like a bunch of hill toppers chasing a fox.   

Where, oh where will that yield hunt take the hot money next? We got some indications this week. How about the dollar bonds of Outer Mongolia, El Salvador or Zambia? Could we interest you in some South African trade-financing loans?

While the buy side is off on safari hunting the big game of positive yields, don't count on the sell side to come to the rescue of your inflated Hamptons home prices. (Besides, the sell side has always been sort of what's known as "shoobies" on the Jersey Shore anyway, right?)  Anyway, don't even waste your realtor's time by having him call. Goldman Sachs, JPMorgan Chase and Morgan Stanley have slashed first-half compensation pools by the most in four years, as Laura J. Keller reported.

If I learned one thing from the financial news this week, it's that it's clearly time to cancel that fancy Hamptons bottle service and head on down the Jersey Shore for some funnel cake and Coors Lite. And who knows, maybe a little gym, tan and laundry.

Besides, Jersey is the place to go to find the one natural resource that our modern blog-economy relies on most: an abundance of mockable hair

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story:
Michael P. Regan in New York at mregan12@bloomberg.net

To contact the editor responsible for this story:
Daniel Niemi at dniemi1@bloomberg.net