Am I the only one who thinks Roubini may have peaked out?
(portfolio.com) It’s Saturday night. A stream of young fashionistas and other assorted Manhattan scenesters pours into a fashionable Tribeca building. They’re all headed for the loft of a middle-aged economist—a man whose name would hardly have registered with anyone but the most obsessive CNBC watcher a few years ago. A doorman on duty surveys the scene and rolls his eyes. “Another Roubini party,” he mutters.
Nouriel Roubini's thoughts about the economy in October 2008.The host of the hour, Nouriel Roubini—the New York University professor credited with calling the current economic collapse and a ubiquitous presence on financial-news shows who continues to forecast gloom and doom—is looking positively upbeat this evening. He greets guest after guest with a kiss on both cheeks as music thumps at a volume loud enough to irritate the neighbors. Suspended from the ceiling, above the throngs of minglers, are dozens of small glass globes, resembling nothing so much as bubbles.
Read the entire article here
Thursday, March 26, 2009
Wednesday, March 25, 2009
‘Bull Market’ Has Begun, Templeton’s Mark Mobius Says
(Bloomberg.com) The next “bull-market” rally has begun and there are bargains in every emerging market following a record slump in stocks, Templeton Asset Management Ltd.’s Mark Mobius said.
The MSCI Emerging Markets Index has jumped 26 percent since reaching a four-year low on Oct. 27, outperforming the 4.2 percent drop in the MSCI World Index and 9.5 percent decline in the Standard & Poor’s 500 Index. Emerging markets made up the 10 best-performing benchmark gauges this year, led by the 28 percent gain for China’s Shanghai Composite Index.
“You have to be careful not to miss the opportunity,” said Mobius, who helps oversee about $20 billion of emerging- market assets as executive chairman at San Mateo, California- based Templeton. “With all the negative news, there is a tendency to hold back.”
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The MSCI Emerging Markets Index has jumped 26 percent since reaching a four-year low on Oct. 27, outperforming the 4.2 percent drop in the MSCI World Index and 9.5 percent decline in the Standard & Poor’s 500 Index. Emerging markets made up the 10 best-performing benchmark gauges this year, led by the 28 percent gain for China’s Shanghai Composite Index.
“You have to be careful not to miss the opportunity,” said Mobius, who helps oversee about $20 billion of emerging- market assets as executive chairman at San Mateo, California- based Templeton. “With all the negative news, there is a tendency to hold back.”
Read the entire article
Sunday, March 22, 2009
No Safety in Numbers
(NYTimes.com) Is there such a thing left as a safe investment? Stocks have been massacred, real estate all but wiped out. Each was promoted in its day — as was gold — as safe and secure, appropriate for widows and orphans.
If there is a truly last bastion of safety, it would be, of course, the U.S. Treasury bond, that venerable instrument with the full faith and credit of the United States behind it. Perhaps it is esteemed so highly because we think of it not as an “investment” per se but as an article of faith in Washington and, by extension, the entire country. It is our tax dollars, after all, that stand behind it — the accumulated output of our citizens. And ever since the Wall Street meltdown, as investors have fled from any security carrying a whiff of danger, Treasuries have been in hot demand.
Read the entire article
If there is a truly last bastion of safety, it would be, of course, the U.S. Treasury bond, that venerable instrument with the full faith and credit of the United States behind it. Perhaps it is esteemed so highly because we think of it not as an “investment” per se but as an article of faith in Washington and, by extension, the entire country. It is our tax dollars, after all, that stand behind it — the accumulated output of our citizens. And ever since the Wall Street meltdown, as investors have fled from any security carrying a whiff of danger, Treasuries have been in hot demand.
Read the entire article
Thursday, March 19, 2009
Enjoy The Sucker's Rally, Says Merrill's Rosenberg
(Clusterstock.com) David Rosenberg:
[The Fed's purchase of $300 billion of Treasuries] is equivalent to nearly 20% of this year’s bond borrowing requirement. As a stand-alone event we think this is worth 75-100 basis points of interest rate reduction (so today’s post-meeting 50bp rally takes us between one-quarter and half-way there). We also believe that the risk to this program size is clearly to the upside...
Fed’s announcement less bullish for equities, in our view.
But the equity market, which had already been enjoying a classic short-covering rally accentuated by quarter-end pressures, also reacted very positively to the Fed’s announcement today and at one point the S&P 500 looked set to break above the 800 threshold for the first time since mid-February. We are of the view that what occurred this afternoon was less bullish for the equity market than meets the eye. Here’s why:
Read the entire article
[The Fed's purchase of $300 billion of Treasuries] is equivalent to nearly 20% of this year’s bond borrowing requirement. As a stand-alone event we think this is worth 75-100 basis points of interest rate reduction (so today’s post-meeting 50bp rally takes us between one-quarter and half-way there). We also believe that the risk to this program size is clearly to the upside...
Fed’s announcement less bullish for equities, in our view.
But the equity market, which had already been enjoying a classic short-covering rally accentuated by quarter-end pressures, also reacted very positively to the Fed’s announcement today and at one point the S&P 500 looked set to break above the 800 threshold for the first time since mid-February. We are of the view that what occurred this afternoon was less bullish for the equity market than meets the eye. Here’s why:
Read the entire article
Treasurys Rally on Fed's Long-Term Purchase Plan
(CNBC.com) Treasury debt prices soared Wednesday, prompting the biggest one-day drop in benchmark yields since 1987, after the Federal Reserve made a surprise announcement that it would buy long-term Treasuries.
In a statement released at the end of its two-day policy meeting, the Fed said it would buy up to $300 billion worth of longer-term U.S. government debt over the next six months and expand purchases of mortgage-related debt to help ease credit market conditions.
Bond prices soared on the news. Benchmark 10-year note prices rose four full points while their yields, which move inversely, had the biggest one-day drop since October 20, 1987, the day after the 1987 stock market crash.
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In a statement released at the end of its two-day policy meeting, the Fed said it would buy up to $300 billion worth of longer-term U.S. government debt over the next six months and expand purchases of mortgage-related debt to help ease credit market conditions.
Bond prices soared on the news. Benchmark 10-year note prices rose four full points while their yields, which move inversely, had the biggest one-day drop since October 20, 1987, the day after the 1987 stock market crash.
Read the entire article
Friday, March 13, 2009
Rep. Maxine Waters Held Stock In Tiny Bank She Boosted
(WSJ.com) When Rep. Barney Frank was looking to aid a Boston-based lender last fall, the Massachusetts Democrat urged Maxine Waters, a colleague on the House Financial Services Committee, to "stay out of it," he says.
The reason: Ms. Waters, a longtime congresswoman from California, had close ties to the minority-owned institution, OneUnited Bank.
Ms. Waters and her husband have both held financial stakes in the bank. Until recently, her husband was a director. At the same time, Ms. Waters has publicly boosted OneUnited's executives and criticized its government regulators during congressional hearings. Last fall, she helped secure the bank a meeting with Treasury officials.
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The reason: Ms. Waters, a longtime congresswoman from California, had close ties to the minority-owned institution, OneUnited Bank.
Ms. Waters and her husband have both held financial stakes in the bank. Until recently, her husband was a director. At the same time, Ms. Waters has publicly boosted OneUnited's executives and criticized its government regulators during congressional hearings. Last fall, she helped secure the bank a meeting with Treasury officials.
Read the entire article
China’s Premier Wen ‘Worried’ on Safety of Treasuries
(Bloomberg.com) China, the U.S. government’s largest creditor, is “worried” about its holdings of Treasuries and wants assurances that the investment is safe, Premier Wen Jiabao said.
“We have lent a huge amount of money to the United States,” Wen said at a press briefing in Beijing today after the annual meeting of the legislature. “I request the U.S. to maintain its good credit, to honor its promises and to guarantee the safety of China’s assets.”
Read the entire story
“We have lent a huge amount of money to the United States,” Wen said at a press briefing in Beijing today after the annual meeting of the legislature. “I request the U.S. to maintain its good credit, to honor its promises and to guarantee the safety of China’s assets.”
Read the entire story
Wednesday, March 11, 2009
Rebalancing the Books-unpleasant but not unbearable
(Jeremy Grantham--FT.com) The proximate cause of our problems today is the breaking of the US housing bubble, and the ultimate cause is the remarkably widespread belief in rational expectations: that economic man behaves like a logical machine that in turn causes markets to tend to efficiency and equilibrium. In such a world the tech bubble was rationalised by Alan Greenspan as an internet-driven productivity burst, and the housing bubble (in reality a 100-year event) was so preposterous an idea that Ben Bernanke could not see it, such was his faith in efficiency.
In an efficient world all asset price changes merely reflect fundamental change and thousands of well-informed investors are bound to be right. There is never anything to fear and we can all keep dancing for ever.
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In an efficient world all asset price changes merely reflect fundamental change and thousands of well-informed investors are bound to be right. There is never anything to fear and we can all keep dancing for ever.
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Pimco Predicts Inflation, Joining Buffett, Marc Faber
(Bloomberg.com) Pacific Investment Management Co. which runs the world’s biggest bond fund, joined investors Warren Buffett and Marc Faber in saying inflation will quicken, sounding a warning for Treasury investors.
U.S. government and Federal Reserve efforts to snap the recession will increase costs for goods and services as soon as 2010, Pimco said in a report today on its Web site by Chris Caltagirone and Bob Greer. Commodity producers are also delaying projects, which may limit supply and lead to higher prices when global growth resumes, according to Pimco.
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U.S. government and Federal Reserve efforts to snap the recession will increase costs for goods and services as soon as 2010, Pimco said in a report today on its Web site by Chris Caltagirone and Bob Greer. Commodity producers are also delaying projects, which may limit supply and lead to higher prices when global growth resumes, according to Pimco.
Read the entire article
Monday, March 9, 2009
Jon Stewart Exposes CNBC's Worthlessness
(jasonkelly.com) In the clip below, Jon Stewart does his usual masterful job, this time on CNBC's worthlessness. Here's an index of key moments:
Cramer's "Bear Stearns is fine" call. (3:03)
"Lehman Brothers is no Bear Stearns. . . . Lehman Management is incredibly engaged and responsive." (3:15)
Merrill won't need to raise additional capital. (3:30)
Read the article and see the video here
Cramer's "Bear Stearns is fine" call. (3:03)
"Lehman Brothers is no Bear Stearns. . . . Lehman Management is incredibly engaged and responsive." (3:15)
Merrill won't need to raise additional capital. (3:30)
Read the article and see the video here
Sunday, March 8, 2009
Half Of Stocks Are Less Than $5
(Clusterstock.com) ....Nearly half of all stocks in the index are now trading at less than $5, and 37% are under $3....
Read the entire article
Read the entire article
The Latest Craze: Blue Chip Penny Stocks
(Ritholtz.com) Here’s a short list of only the highest quality, bluest of blue chip, penny stocks:
AIG (39 cents)
Citigroup (98 cents)
E*Trade (66 cents)
Fannie Mae (39 cents)
Freddie (39 cents)
Unisys (37 cents)
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AIG (39 cents)
Citigroup (98 cents)
E*Trade (66 cents)
Fannie Mae (39 cents)
Freddie (39 cents)
Unisys (37 cents)
Read the entire article
How to Deal With a 3 A.M. Fear
(NYTimes.com/Ben Stein) CAN it be that only a couple of years ago, Stephen A. Schwarzman of the Blackstone Group, wildly successful in private equity, treated hundreds of guests at his lavish birthday celebration to performances by Rod Stewart and Patti LaBelle?
Can it be that as recently as 2006, financial firms accounted for almost one-third of all the corporate profits in the United States? Or that money was so free-flowing that a single bat mitzvah party could be estimated to cost $10 million?
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Can it be that as recently as 2006, financial firms accounted for almost one-third of all the corporate profits in the United States? Or that money was so free-flowing that a single bat mitzvah party could be estimated to cost $10 million?
Read the entire article
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