Remember when we were assured that HRC was not a target of interest to the Russians and therefore we could be confident that they never even attempted to hack her server, which was conveniently still in it’s woefully under-protected state while this spy ring was targeting her specifically? The people who told us not to worry our pretty little heads are the same ones who knew all about this spy ring.
In today's low interest rate environment, equity is being retired by many companies through stock buybacks. Many mergers are still being done with debt...since it is less expensive than issuing stock. Also, I would argue that the value of a well run company with good finances and a rising dividend stream is far greater, per se, than it has been historically.
The financials were helping to lead the decline. Again we have Morgan Stanley at a new 52-week low, down 3.3%. Goldman Sachs down 3.6%, a new 52-week low. But really, the biggest losers on the day were the tech stocks. These have been the stand-outs. This is what has been holding up the market - the FAANG stocks, all of these technology infotech stocks - and a lot of people were actually describing them irrationally as a "safe havens". I couldn't believe it when people were saying that tech stocks were the new "safe havens". When you hear stuff like that, you know you're close to the end.
Confidence and complacency are more acute now than any time I’ve seen before. All expressions of overvaluation are at historical extremes. Despite this, most money managers remain in the market. The thesis is “if it’s going up, regardless of anything else, I want to be in it.” Perhaps the best indicator of complacency is the VIX which at its current level of 13 tells us that investors see no reason to protect their positions. Every minor decline is seen as a buying opportunity. The rationale is that the Fed would not allow anything worse than a 10% decline. If the stock market starts sinking between now and October 1st, I will be most interested to see if the Fed eliminates QE.
The truth is California has been living off phony home equity gains for 40 years. Nothing was ever produced to create this money, Nothing. But, they all spent this counterfit cash into the economy like it was real. California has flourished under this scheme of ever increasing Real Estate prices, but the free ride is over. Now they’ll have to learn how to actually produce something to have prosperity.
Second, Faber says "The market isn't healthy" because only a small number of stocks are driving the major indexes upward, per Money. "We have a bubble in everything," he told CNBC. However, in an earlier CNBC segment, Faber was castigated by another guest for consistently forecasting a market crash since 2012. (For more, see also: Why the S&P 500 Is Healthier Than It Looks.)
The question often arises in liberty movement circles as to how we get to the point of full blown tyranny within a society. There are numerous factors that determine this outcome, but through all the various totalitarian systems in history there are common denominators – elements that must be there for tyrants to prevail. When we can identify these common elements in an objective manner, we make it far more difficult for despotic structures to stand.
During the first three quarters of 2016 we were open to the possibility that a new cyclical gold bull market got underway in December of 2015, but over the past 18 months we have been consistent in our opinion that the December-2015 upward reversal in the US$ gold price did NOT mark the start of a bull market. Since late-2016 there have been some interesting rallies in the gold price, but at no time has there been a good reason to believe that we were dealing with a bull market. That’s still the case. The question is: what will it take to set a new cyclical gold bull market in motion? Read More
Early in 2018, we detailed Bridgewater's massive short bet against Europe, peaking at a record total short against the EU's biggest companies of around $22 billion. At the time we noted that, since Bridgewater is not known for picking individual stocks, the manager’s position was the result of a view on the wider economy according to James Helliwell, chief investment strategist of the Lex van Dam Trading Academy.
Now think about it. The best borrowers are the ones who are solvent and haven’t defaulted regardless of their submergence and can’t get a short sale approved because they are financially solvent – they were just unfortunate enough to get caught up in the false market created by the banksters. They are the victims of a false market contrived by the banksters by mislabeling sub-junk loans as AAA and sticking them in low risk investment funds around the world. Why would you want to reward them for their fraud by being their slave?
You’ll keep wasting money on expired put options (like spending insurance premiums), and it will drag down your returns during bull markets. Then during a bear market, you might get a nice payout when one of your recent round of put options finally becomes valuable, but it might not make up for all the expired put options you already paid for, depending on how long you’ve been doing it.
DHB has done several an article on Culver City and the surrounding areas. Don’t doubt that the RE spring summer season will want the affluent-esque Culver RE participant to push this area up during this time. If you can wait, do so. Don’t get mixed up in with the buying season this year. I would think we’ll see some interesting price drops in the still bubble areas this fall/winter. Of course I’m a guy stashing away money in a rent free place just watching, reading, learning and waiting.
Presidential Tweets Express Anger at the FedThe catalyst today was more tweets from President Trump where he is expressing anger, not only at the Federal Reserve, and at the ECB and at the Bank of China, because he is accusing both Europe and China of being currency manipulators; taking advantage of us by weakening their currencies. He's saying ...…
The methods and procedures by which municipal debt is issued are governed by an extensive system of laws and regulations, which vary by state. Most bonds bear interest at either a fixed or variable rate of interest, which can be subject to a cap known as the maximum legal limit; some bonds may be issued solely at an original issue discount, or 0% coupon. If a bond measure is proposed in a local election, a Tax Rate Statement may be provided to voters, detailing best estimates of the tax rate required to levy and fund the bond. In cases where no election is held, depending on applicable local law, voters may be entitled to petition the approval to referendum (i.e., a public vote) within a specified period of time; bonds are typically not issued prior to the expiration of any such referendum period.
Research from Carmen Reinhart and Kenneth Rogoff shows that when a country’s government debt-to-GDP ratio stays over 90% for more than five years, its economy loses around one-third of its growth rate. Lacy also points out that “the longer the debt overhang persists, the relationship between economic growth and debt becomes nonlinear.” This is happening to the US today with the economy growing at only half its long-term growth rate.
“If you pay peanuts, you get monkeys” is the perfect way to describe the current market. Investors are all playing the same game and reinforcing the passive investing trend by constantly plowing more money into passively managed funds. The management fee of the iShares Core S&P 500 ETF (NYSE: IVV) is just 0.04% which is extremely low and positive for investors. However the low fees, mindless investment strategies, and extremely high valuations will lead to a catastrophe when the same mindless buying reverts to panicked, mindless selling.
However, other indicators suggest an intermediate-term bottom is in place. Bullish sentiment among ordinary investors is even lower than that seen at the 2009 market lows, while Merrill Lynch’s latest monthly fund manager survey shows institutional investors are holding more cash than at any time since 2001 – an “unambiguous buy” signal, says Merrill. Allocations to equities have plunged to levels unseen since the market bottoms of mid-2011 and mid-2012. All this indicates last week’s rally may have legs. However, a multi-week or even a multi-month rally would not mean the danger has passed. Fat Pitch blogger Urban Carmel last week noted there were seven bear market rallies in 2008-09, with three lasting six to eight weeks. Stocks always gained a minimum of 7-8 per cent, twice bouncing by at least 20 per cent.
Peoples’ enthusiasm is understandable: From 1965 to 2017, Buffett’s Berkshire share achieved an annual average return of 20.9 percent (after tax), while the S&P 500 returned only 9.9 percent (before taxes). Had you invested in Berkshire in 1965, today you would be pleased to see a total return of 2,404,784 percent: an investment of USD 1,000 turned into more than USD 24 million (USD 24,048,480, to be exact). Read More
Although Jeffrey manages one of the world’s largest bond funds, he is an independent thinker who has courage and conviction in his beliefs—maybe because he comes out of left field. Jeffrey holds degrees in mathematics and philosophy from Dartmouth College and was once the lead for a new-wave rock band, back when Paul Volcker had me paying 18% interest on that loan.
Swiss-born Marc Faber, now a resident in Thailand, holds a PhD in economics and is an investment advisor and fund manager through his firm, Marc Faber Ltd. He also writes a monthly investment newsletter, "The Gloom, Boom and Doom Report." As Money notes, Faber is consistently bearish, and frequently is called "Dr. Doom." He sees two big red flags right now.
The average pension fund assumes it can achieve a 7.6% rate of return on its assets in the future. As noted in Monday’s Wall Street Journal, the majority of these assets are invested in the stock market. The rest are invested in bonds, real estate and alternatives. An aggregate bond index fund yields 2.5% today. Real estate investment trusts, as a group, yield nearly 4%. Read More
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, municipal advisors gained an increasingly important role in overseeing financial and legal circumstances surrounding the issuance of bonds. The municipal advisor serves as a fiduciary for the municipal issue, taking care of all of the assets and finances involved in the issuance process. Legally, the advisor is obligated to represent the interests of the issuer and serve as a source of financial advice. This entails offering advice on structuring, selling, and promoting bonds, as well as serving as the central liaison between other members of the financial team, especially the underwriters and credit rating agency. Although municipal financial advisory services have existed for many years, municipal advisors have played a key role in the bond issuance process since the Securities and Exchange Commission enacted the Municipal Advisor rule in 2014, which prohibits certain communications between issuers and broker-dealers unless one of four exceptions is met, one being that the issuer has retained an Independent Registered Municipal Advisor ("IRMA").
Japanese asset price bubble 1991 Lasting approximately twenty years, through at least the end of 2011, share and property price bubble bursts and turns into a long deflationary recession. Some of the key economic events during the collapse of the Japanese asset price bubble include the 1997 Asian financial crisis and the Dot-com bubble. In addition, more recent economic events, such as the late-2000s financial crisis and August 2011 stock markets fall have prolonged this period.
There is definitely an argument to be made for having a slight overweight to cash when you start to feel wary on both sides of market, viewing both equities and bonds from a peak down. Nine to 12 months of cash reserve, rather than just six months, is the new norm for greater security, and to take some risk off the table and wait for a better opportunity to reinvest, he said.
Dow Ending a Down Week on a Positive NoteThe Dow managed to finish a down week on a positive note; the Dow Jones was up about 55 points - 24,270-ish is where we closed. Although intra-day, we were up better than 250 points, so most fo the losses came toward the end of the day, as the Dow was not able to hold on to all those gains. It held on to ...…
In the months ahead, knowing that you can depend on us to guide you through Market turbulence will be most reassuring. In this market, Buy & Hold can only lead to financial ruin. When stressed, we humans tend to fall back on strategies that worked in the past, despite a vastly differing market environment than any time since 1929. With Exceptional Bear, you choose which asset-class ETFs to employ, and which to exclude.
Because of the special status of most municipal bonds granted under Section 103 of the Internal Revenue Code, which provides that the interest on such bonds is exempt from gross income, investors usually accept lower interest payments than on other types of borrowing (assuming comparable risk). This makes the issuance of bonds an attractive source of financing to many municipal entities, as the borrowing rate available to them in the municipal, or public finance, market is frequently lower than what is available through other borrowing channels.
His place was taken by Daniel Drew, also known as the “Great Bear”, “Ursa Major”, and the “Sphinx of Wall Street”. Drew was described by a contemporary as “shrewd, unscrupulous, and very illiterate – a strange combination of superstition and faithlessness, of daring and timidity – often good-natured and sometimes generous.” He was the great rival of Cornelius Vanderbilt and a sometime partner of Jay Gould.
Some may argue that a healthy labor market in the past couple of years in contrast to the dark days of the Great Recession will certainly help the broader market gain traction. After all, the unemployment rate remains below the 4% mark for the past several months, weekly jobless claims touch a 49-year low and wage growth hits the fastest pace since 2009.
In addition, during World War II, the Empire of Japan considered wildfires as a possible weapon. During the spring of 1942, Japanese submarines surfaced near the coast of Santa Barbara, California, and fired shells that exploded on an oil field, very close to the Los Padres National Forest. U.S. planners hoped that if Americans knew how wildfires would harm the war effort, they would work with the Forest Service to eliminate the threat. The Japanese military renewed their wildfire strategy late in the war: from November 1944 to April 1945, launching some 9,000 fire balloons into the jet stream, with an estimated 11% reaching the U.S. In the end the balloon bombs caused a total of six fatalities: five school children and their teacher, Elsie Mitchell, who were killed by one of the bombs near Bly, Oregon, on May 5, 1945. A memorial was erected at what today is called the Mitchell Recreation Area.
But Credit Suisse says that after a 32-year bull market in bonds, the recent fall in bond prices is likely to prove to be more than a mere correction. And that's at least partly because inflation might really, truly, be back. Inflation expectations have risen 35 basis points in the U.S. and 50 basis points in Europe since the beginning of the year. Oil prices have risen back up above $60 a barrel after declining to a low of $48.55 in January. Credit Suisse analysts think the increase in inflation expectations indicates that investors believe healthier demand is driving the oil price rally, which would in turn portend stronger global growth.