The greatest force for socialism is...

financial markets. :-) Or so I would lead you to believe. I blogged previously about listening to the Financial Markets course from Yale University on Academic Earth. This has got to be one of the coolest websites ever. I just wish they would expand their offerings. I know a lot of other universities have these online courses as well which are free to the public. I would like more variety.

I have to say after finishing the course I feel like watching courses is a suboptimal way to learn a subject. Which raises serious questions in my mind about the ability of learning from online courses. Though if I had the book with me and was reading it while watching the courses online, maybe I would feel differently.

The course is by Robert Shiller who is famous for, among other things, the Case-Shiller housing index. Also I learned in the course that he was trying to setup a futures market for housing prices which is very interesting. Apparently the Chicago Board of Exchange was listing it for a time about a year ago but I can no longer find it on their website. There were a bunch of interesting guest lecturers. One particularly interesting one was Carl Icahn who is the stockholder accountability guy. Also there was an interesting one by Stephen Schwarzman who is a big bonds investor. It was interesting to hear him talk about why he only invests in bonds. Mostly because (until recently thank you very much Obama) the bondholders were the first in line in bankruptcy and the company is required to return the money to the investors. This is in opposition to the stocks which are not required to pay a dividend. Essentially the stock is buying the present value of future earnings and if the stock will never pay a dividend then its value should be zero. (Makes sense to me.)

One thing that really came out of this course for me is that the markets are way more complicated than I would have originally thought they were. It was nice to have an overview of the markets and all aspects of them even if the depth was shallow. One thing I did appreciate more than I previously did was the utility of financial markets. Markets are just a way to spread risk. The discussion on life insurance was interesting and the struggle the companies had to sell life insurance for so long.

The course is about 30 hours of content and so I don't suggest you start it unless you want to finish it. It is actually a nice thing to listen to while you cook or something kinda like music but with a point. However if your time is more limited I suggest you at least listen to the guest lecturers. There is a lot of nuggets of investor wisdom that are just too interesting to pass up.