But here's one from three sources you should be aware of even if they could be reading too much into the June job numbers.
http://blogs.barrons.com/incomeinvesting/2013/07/05/blackrock-jpm-goldman-now-see-fed-taper-starting-in-september/?mod=BOL_hpp_blog_investing#
Saturday, July 6, 2013
Thursday, July 4, 2013
CAIIFORNIA BUSINESSES
While some say the decline in the number of California's businesses isn't clear, those businesses and lots of jobs with them are disappearing. And California is not alone.
That's the bad news. The good news is some states have seen an increase in new businesses.
Could the differences between California and Florida, both whacked hard by the real estate bubble, the former losing firms and the latter growing them, be about the difference in taxes?
That couldn't be part of the answer.
http://www.businessweek.com/articles/2013-07-03/why-are-californias-businesses-disappearing#r=rss
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OPPORTUNITY KNOCKS
We've talked about the chaotic bond market before. Where some smell fear, others smell opportunity. The trick is not to let your opinion pre'vent you from making money.
Thank Bernanke for his flub, intended or otherwise, as some have suggested. If he was just pluming the market, fine. If he just screwed up, fine. He created opportunity.
The only real freedom in this increasing government-controlled world is to have your own stash of screw-you-money. Make the money and be gone.
And yes we've looked at Moises Naim's recent book The End of Power.
http://www.bloomberg.com/news/2013-07-04/fidelity-sees-bargains-as-98-of-asia-bonds-sink-credit-markets.html
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That's the bad news. The good news is some states have seen an increase in new businesses.
Could the differences between California and Florida, both whacked hard by the real estate bubble, the former losing firms and the latter growing them, be about the difference in taxes?
That couldn't be part of the answer.
http://www.businessweek.com/articles/2013-07-03/why-are-californias-businesses-disappearing#r=rss
----------------------------------
OPPORTUNITY KNOCKS
We've talked about the chaotic bond market before. Where some smell fear, others smell opportunity. The trick is not to let your opinion pre'vent you from making money.
Thank Bernanke for his flub, intended or otherwise, as some have suggested. If he was just pluming the market, fine. If he just screwed up, fine. He created opportunity.
The only real freedom in this increasing government-controlled world is to have your own stash of screw-you-money. Make the money and be gone.
And yes we've looked at Moises Naim's recent book The End of Power.
http://www.bloomberg.com/news/2013-07-04/fidelity-sees-bargains-as-98-of-asia-bonds-sink-credit-markets.html
_______________________
Wednesday, July 3, 2013
AUSTERITY FATIGUE
Portuguese stocks and bonds take another dive owing to what some are calling "austerity fatigue."
In 2011 the EU's Big Three--the ECB, the IMF and the European Commission--coughed up $106
billion to help the nation's ailing economy. No small amount for a country with a $215 billion GDP.
Portugal's unemployment hovers near 18% and its GDP has been in a slump since late 2010. The money came with strings in the form of required budget cuts. Those cuts, according to some, are starting to bite. Complicating matters two political figures tendered their resignations in recent days raising questions about government stability.
The stock market is down nearly 18% and yields on 10-year government bonds linger near 8%, up from 5.5% just two months ago. And Portugal is not alone. Greece faces similar problems meeting its demands trying to qualify for more handouts from EU officials.
Austerity fatigue or not, the EU's economic turmoil looks a long way from being resolved.
_____________
In 2011 the EU's Big Three--the ECB, the IMF and the European Commission--coughed up $106
billion to help the nation's ailing economy. No small amount for a country with a $215 billion GDP.
Portugal's unemployment hovers near 18% and its GDP has been in a slump since late 2010. The money came with strings in the form of required budget cuts. Those cuts, according to some, are starting to bite. Complicating matters two political figures tendered their resignations in recent days raising questions about government stability.
The stock market is down nearly 18% and yields on 10-year government bonds linger near 8%, up from 5.5% just two months ago. And Portugal is not alone. Greece faces similar problems meeting its demands trying to qualify for more handouts from EU officials.
Austerity fatigue or not, the EU's economic turmoil looks a long way from being resolved.
_____________
YOU NEED TO
I have a way of starting sentences with "You need to...." as if I am trying to tell the other person what to do when I'm not. It's a bad habit. But we all at times need to do something not because you or I or anyone else says it.
W. B.Yeats, the great Irish poet, warned against "hitching our Pegasus to a plow" trying to "please every knave and dolt."
Pegasus you recall was the winged horse in Greek mythology that could fly. In more modern times he was the image for years for Mobil Oil now known as Exxon Mobil.
Yeats concluded by saying: "I swear before the dawn comes 'round again, I'll find the stable and pull out the bolt." In other words, free up his creative self after years of writing to please others that proved most unsatisfying.
Most of us are taught not to be selfish, not to pound our own drums or sing our own praises. Don't know if that's Christian-Judea or what. I do know, as Yeats was pointing out, it's a recipe at best for mediocrity if not worse.
So here's the point. Never be afraid of finding that stable and dislodging that bolt.
And the same holds true for investing. Sometimes following the herd works as in the trend is your friend or, as the late Marty Zweig use to say, not fighting the tape.
The tape today seems to be Federal Reserve controlled, at least for the nonce. Some, however, believe a structural shift is afoot based on better fundamentals caused by all the easy money these past few years. These people cite an improved housing market, the so-called lack of inflation, a moot point if ever there was one, and improved consumer confidence.
The SM is supposed to be a leading not a lagging indicator of what's ahead. It could just be if these folks are correct that when these positives become accepted fact, the market might just head south again, anticipating the next economic down turn.
Forget death and taxes. With the politicians and bureaucrats running this charade, there will most certainly be another one playing at a venue near you in the not too distant future.
______________________________
W. B.Yeats, the great Irish poet, warned against "hitching our Pegasus to a plow" trying to "please every knave and dolt."
Pegasus you recall was the winged horse in Greek mythology that could fly. In more modern times he was the image for years for Mobil Oil now known as Exxon Mobil.
Yeats concluded by saying: "I swear before the dawn comes 'round again, I'll find the stable and pull out the bolt." In other words, free up his creative self after years of writing to please others that proved most unsatisfying.
Most of us are taught not to be selfish, not to pound our own drums or sing our own praises. Don't know if that's Christian-Judea or what. I do know, as Yeats was pointing out, it's a recipe at best for mediocrity if not worse.
So here's the point. Never be afraid of finding that stable and dislodging that bolt.
And the same holds true for investing. Sometimes following the herd works as in the trend is your friend or, as the late Marty Zweig use to say, not fighting the tape.
The tape today seems to be Federal Reserve controlled, at least for the nonce. Some, however, believe a structural shift is afoot based on better fundamentals caused by all the easy money these past few years. These people cite an improved housing market, the so-called lack of inflation, a moot point if ever there was one, and improved consumer confidence.
The SM is supposed to be a leading not a lagging indicator of what's ahead. It could just be if these folks are correct that when these positives become accepted fact, the market might just head south again, anticipating the next economic down turn.
Forget death and taxes. With the politicians and bureaucrats running this charade, there will most certainly be another one playing at a venue near you in the not too distant future.
______________________________
Tuesday, July 2, 2013
KNOW YOUR EXITS
We recently wrote a brief--Have An Escape Route--about following the news but make sure you know where the exits are.
Following the news is akin to following the money and until recently, for nearly the last four years, that money was flowing into emerging markets. According to a piece in today's WSJ between 2009 and 2012 private money flowing into emerging markets totaled $4.2 trillion, "more than all the money invested in the Tokyo Stock Exchange."
A nice piece of change anyway one chooses to count it. Troubles in Emerging Market Land seem to be spreading. From Brazil to China to India and Turkey it appears that the prospects of slower growth and rising interest rates are taking their toll.
End result: investors are fleeing as they yank their capital from bond and equity funds. Like rigor mortis, reality has a way of setting in. Toss in political unrest and the slowing of the global locomotive most know as China and it looks more and more like another round of investor hand-wringing time.
A quick scan of some currencies tells much of the tale. Brazil's real is down more than 20% this year. The South African rand has lost a similar amount against the US dollar as gold prices tanked and to the north the Canadian loonie is, well, looking a bit loonie owing to a high level of household debt, a looming real estate bubble and weak energy prices.
Recall back in 2009 when the EU turmoil erupted many investing soothsayers like Bill Gross and others touted EMs, especially their debt instruments. Have they called you recently and warned you where the exits were located?
Much of this could be summarized by one word--growth. Investors flock to it. But they get their hats over non-growth. How much non-growth? Probably a lot more than MSM is predicting.
____________________________
Following the news is akin to following the money and until recently, for nearly the last four years, that money was flowing into emerging markets. According to a piece in today's WSJ between 2009 and 2012 private money flowing into emerging markets totaled $4.2 trillion, "more than all the money invested in the Tokyo Stock Exchange."
A nice piece of change anyway one chooses to count it. Troubles in Emerging Market Land seem to be spreading. From Brazil to China to India and Turkey it appears that the prospects of slower growth and rising interest rates are taking their toll.
End result: investors are fleeing as they yank their capital from bond and equity funds. Like rigor mortis, reality has a way of setting in. Toss in political unrest and the slowing of the global locomotive most know as China and it looks more and more like another round of investor hand-wringing time.
A quick scan of some currencies tells much of the tale. Brazil's real is down more than 20% this year. The South African rand has lost a similar amount against the US dollar as gold prices tanked and to the north the Canadian loonie is, well, looking a bit loonie owing to a high level of household debt, a looming real estate bubble and weak energy prices.
Recall back in 2009 when the EU turmoil erupted many investing soothsayers like Bill Gross and others touted EMs, especially their debt instruments. Have they called you recently and warned you where the exits were located?
Much of this could be summarized by one word--growth. Investors flock to it. But they get their hats over non-growth. How much non-growth? Probably a lot more than MSM is predicting.
____________________________
Monday, July 1, 2013
JUST OUR OPINION
There's an old saw about the more attractive the reward, the more reluctant people are to go after it.
The rule certainly applies to beautiful women. Most guys are too shy or intimidated to approach them. But the same rule applies to investing.
Following a big sell-off like the one that happen recently when Bernanke spooked the markets, many equities and bonds suddenly became more attractive while gobs of investors instead of buying headed for the nearest exit.
To be sure, there's some risk here, just as there can be in approaching a beautiful lady. So it raises the age-old, classic question: does the reward outweigh the risk? The answer is really quite simple. You have to learn to decide.
If you're afraid to approach beautiful ladies, spare yourself the angst of going around claiming you really want one because under those conditions your chances are at best remote. And the same pretty much holds true for making serious money in the market.
Some time soon we'll talk about another old saw: never let an opinion get in the way of making money.
The rule certainly applies to beautiful women. Most guys are too shy or intimidated to approach them. But the same rule applies to investing.
Following a big sell-off like the one that happen recently when Bernanke spooked the markets, many equities and bonds suddenly became more attractive while gobs of investors instead of buying headed for the nearest exit.
To be sure, there's some risk here, just as there can be in approaching a beautiful lady. So it raises the age-old, classic question: does the reward outweigh the risk? The answer is really quite simple. You have to learn to decide.
If you're afraid to approach beautiful ladies, spare yourself the angst of going around claiming you really want one because under those conditions your chances are at best remote. And the same pretty much holds true for making serious money in the market.
Some time soon we'll talk about another old saw: never let an opinion get in the way of making money.
IRS OCTOPUS
It's
tentacles ever grow. The Washington spy agency benignly known as the
IRS was birthed in 1913, the same year another octopus was born, the
Federal Reserve Bank. The two have probably done more to crimp the
freedom of American ingenuity than all the mindless politicos together.
http://www.bloomberg.com/news/2013-07-01/simons-strategy-to-shield-profit-from-taxes-draws-irs-ire.html
____________________
http://www.bloomberg.com/news/2013-07-01/simons-strategy-to-shield-profit-from-taxes-draws-irs-ire.html
____________________
GOLD MAKES TRIPLE BOTTOM
Few items have had more ink spilled over them the past several months than gold.
People seem to love or hate it, deride or praise it, buy or short it. We won't get into the particulars other than to say we don't trust bureaucrats, central bankers and politicos any farther than we can toss them.
And these are the people with their foot to the pedal over most of the globe. Frightening, we know.
In the eyes of some that will most likely makes us quality material for some epithet category, take your pick: fear-mongering, conspiracy freak or whatever. We say thank you very much and we accept the challenge.
In the meantime here is a read you might find of interest.
http://www.resourceinvestor.com/2013/07/01/roger-wiegand-predicts-a-brand-new-world-for-gold?t=mining-investments&page=2
__________________
People seem to love or hate it, deride or praise it, buy or short it. We won't get into the particulars other than to say we don't trust bureaucrats, central bankers and politicos any farther than we can toss them.
And these are the people with their foot to the pedal over most of the globe. Frightening, we know.
In the eyes of some that will most likely makes us quality material for some epithet category, take your pick: fear-mongering, conspiracy freak or whatever. We say thank you very much and we accept the challenge.
In the meantime here is a read you might find of interest.
http://www.resourceinvestor.com/2013/07/01/roger-wiegand-predicts-a-brand-new-world-for-gold?t=mining-investments&page=2
__________________
POSITIVE SPIN
Federal Reserve Governor Jerome Powell in a speech last week oiled up the old spin machine.
Here's an example from today's WSJ.
Fed Governor Jerome Powell said in a speech Thursday that, though growth has been middling so far this year, he has been surprised at how well the economy has performed in the face of tighter fiscal policy.
Here's an example from today's WSJ.
Fed Governor Jerome Powell said in a speech Thursday that, though growth has been middling so far this year, he has been surprised at how well the economy has performed in the face of tighter fiscal policy.
What tighter fiscal policy? They didn't cut anything, just didn't add any new spending. If they made any real cuts, most likely the market reaction would've been even better, as hard as that is to imagine.
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I
I
THE SECOND HALF
If you think the Fed's talk about taking the punch bowl away from the QE party is real--meaning the economy is ready to stand on its own in the near future--then look at cyclicals.
Energy, materials and what has been a lagging technology sector might deserve some of your investment capital.
________________
Energy, materials and what has been a lagging technology sector might deserve some of your investment capital.
________________
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