ACTIONABLE ADVICE FOR FINANCIAL ADVISORS: Newsletters and Commentaries Focused on Investment Strategy

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2015-10-05 00:00:00 US Equity and Economic Review For Sep. 28-Oct 2; The Bull Needs Stronger Earnings, Edition by Hale Stewart of Hale Stewart

This week’s economic news was mostly positive. Manufacturing is still expanding and consumers are still spending, especially on durable goods. But the stronger dollar and weaker international environment are clearly taking their toll, as the ISM is just barely in expansionary territory. The markets are in somewhat precarious shape as we enter earnings season; they remain expensive and therefore need to see topline revenue growth. Unfortunately, that doesn’t appear to be coming.

2015-10-05 00:00:00 The Looming Risk in the Bond Market by Robert Huebscher (Article)

Lack of bond-market liquidity has been the focus of recent reporting in the financial media. But one of the first to warn about that danger was Michael Aronstein, who said last week that the risks are clearer than ever. Mutual fund investors face the greatest peril.

2015-10-05 00:00:00 The Labor Market Conditions Index for September: At the Flatline by Doug Short (Article)

The Labor Market Conditions Index (LMCI) is a relatively recent indicator developed by Federal Reserve economists to assess changes in the labor market conditions. It is a dynamic factor model of labor market indicators, essentially a diffusion index subject to extensive revisions based on nineteen underlying indicators in nine broad categories (see the table at the bottom for details). Today's release of the September data came in at 0, down from 1.2 in August. Negative revisions were made to the previous three months: -0.1 in July to 0.7 in June, -0.7 in July and -0.9 in August.

2015-10-03 00:00:00 SALE CHEAT POINT BLANK & LOST SAGA ALL OF COUNTRY by Sahrial Ardiansyah (Article)


2015-10-03 00:00:00 Better Times are Ahead by Byron Wien of Blackstone

The best recent period for investing in equities may have been 1982–1999, but I still think reasonable risk-adjusted returns for equities are likely in the years ahead, and that Treasurys and high-quality corporate bonds are less attractive.

2015-10-02 00:00:00 S&P 500 Snapshot: A Rally on the Disappointing Jobs Report by Doug Short (Article)

Of all the economic indicators, the monthly employment report probably has the biggest impact investor sentiment. But in recent years that impact has been complicated by monetary policy, and "the bad economic news is good market news" syndrome. Such appears to have been the case today. The S&P 500 initially tanked on the disappointing jobs report, plunging to its -1.57% in the opening minutes. It then reversed directions and rallied to close at its impressive 1.43% intraday high.

2015-10-01 00:00:00 A Fragile Transition Supported by (Further) Policy Accommodation by Adam Bowe, Isaac Meng, Tadashi Kakuchi of PIMCO

n the following interview, Portfolio Managers Adam Bowe, Isaac Meng and Tadashi Kakuchi discuss conclusions from PIMCO’s quarterly Cyclical Forum, in which the company’s investment professionals debated the outlook for global economies and markets. They share our views on economies and investment implications across the Asia-Pacific region over the next 12 months.

2015-10-01 00:00:00 It Ain't Over 'Til It's Over by Burt White of LPL Financial

Yogi Berra passed away last week at the age of 90. One of the greatest baseball players of all time, Berra was probably known more for his funny sayings (so-called “Yogi-isms”) than he was for his impressive career as a New York Yankee that lasted from 1946 until 1963 and included 3 MVP awards and 10 World Series championships. Some of these Yogi-isms are relevant for investors, including: 1) it ain’t over ‘til it’s over, 2) déjà vu all over again, and 3) the future ain’t what it used to be. Berra also famously once said, “Make a game plan you can stick to…unless it’s not w

2015-10-01 00:00:00 Recent Volatility Signals a Market in Transition by Chuck Royce, Francis Gannon of The Royce Funds

CEO Chuck Royce and Co-CIO Francis Gannon talk about why they believe the decline for equities in 3Q15 is part of the market transitioning back to more historically typical performance patterns, why a rate hike could be positive for small-caps and stocks as a whole, how history reveals the importance of discipline, the necessity of diversification within the small-cap asset class, and more.

2015-10-01 00:00:00 ISM Manufacturing Index: Lowest Reading Since May 2013 by Jill Mislinski (Article)

Today the Institute for Supply Management published its monthly Manufacturing Report for September. The latest headline PMI was 50.2 percent, a decrease of 0.9% from the previous month and below the forecast of 50.6. This was the 33rd consecutive month of expansion.

2015-09-29 00:00:00 Annual Outlook by Mary Ellen Stanek of Robert W. Baird & Co.

In an environment of low rates and heightened uncertainty, the U.S. has experienced sub-par growth during this economic cycle relative to past expansions. But compared to the rest of the world, the U.S. has been a strong performer. And even with only moderate growth, the U.S. economy has experienced healthy job creation – 11 million jobs since the bottom of the recession, 3 million created last year, the highest since 1999, and 2.5 million this year.

2015-09-29 00:00:00 On My Radar: It’s Déjà vu All Over Again by Steve Blumenthal of CMG Capital Management Group

What scares me, or what worries me, is what the next downturn in the economy looks like, with asset prices where they are and a lesser ability of central banks to ease monetary policy.” – Ray Dalio with Bloomberg’s Tom Keene

2015-09-28 00:00:00 The ABCs of Impact Investing by John Appleby (Article)

Impact investing is a small but growing segment of the financial landscape. It is coming to the fore as individual investors seek to “do good while doing good.” Groups from wealthy entrepreneurs to the G8, the UN and the Pope are talking about the subject. Here’s what advisors need to know if they want to serve clients who strive for “impact” with their investing.

2015-09-28 00:00:00 The Hidden Cost of Zero Interest Rate Policies by Laurence B. Siegel and Thomas S. Coleman (Article)

Zero interest rates are a massive transfer of wealth from investors and savers to governments and other borrowers around the world. We’ll show how big the scale of the transfer is.

2015-09-28 00:00:00 Regional Fed Manufacturing Overview: September by Jill Mislinski (Article)

The Federal Reserve System consists of twelve Federal Reserve Banks, twenty five branches, and the Board of Governors in Washington, D.C. Each bank serves a larger regional district. Five out of the twelve Federal Reserve Regional Districts currently publish monthly data on regional manufacturing: Dallas, Kansas City, New York, Richmond, and Philadelphia. Here is an overview of all five with an overlay and average of historical data.

2015-09-28 00:00:00 Dallas Fed Manufacturing Outlook Remains Weak by Jill Mislinski (Article)

This morning we got the most recent Dallas Fed Manufacturing Outlook. The latest index came in at -9.5, a 6 point increase from last month's -15.8. The forecast was for a reading of -9.5.

2015-09-25 00:00:00 Developed Europe: Economy Trends Update July 2015 by Team of Thomas White International

Euro-zone Sustains Recovery on the Back of Robust Growth in Italy, Export Surge in Germany

2015-09-25 00:00:00 In Search of the Phillips Curve by Carl Tannenbaum of Northern Trust

Macroeconomics students spend a good bit of class time learning about the Phillips curve, and it is probably etched permanently in their minds. The Phillips curve suggests that there is an inverse relationship between inflation and unemployment in the short run.

2015-09-25 00:00:00 Michigan Consumer Sentiment: Up Slightly from Preliminary Reading by Jill Mislinski (Article)

The University of Michigan Final Consumer Sentiment for September came in at 87.2, an increase from the 85.7 Preliminary reading. had forecast 86.7 for the September Final.

2015-09-25 00:00:00 Are the Bulls Regaining Their Footing? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Uncertainty surrounding the Federal Reserve continues after its punt of rate hikes at its most recent meeting. But as the market gets more clarity on monetary policy and given a still-growing US economy, the bull market should slowly reestablish itself, albeit with bouts of volatility. Further support should come from global growth in areas that are net beneficiaries of the plunge in commodity prices.

2015-09-25 00:00:00 How Will These Leaders of 4 Billion People Change the World? by Frank Holmes of U.S. Global Investors

This week the U.S. played host to three prominent and illustrious leaders to billions of people: Chinese President Xi Jinping, Indian Prime Minister Narendra Modi and Pope Francis. Among them, they lead—either politically or spiritually—nearly 4 billion people worldwide, more than half of everyone living on the planet right now.

2015-09-25 00:00:00 Vehicle Miles Traveled: A New Look at Our Evolving Behavior by Doug Short (Article)

The Department of Transportation's Federal Highway Commission has released the latest report on Traffic Volume Trends, data through July.

"Travel on all roads and streets changed by 4.2% (11.4 billion vehicle miles) for July 2015 as compared with July 2014." The less volatile 12-month moving average is up 0.37% month-over-month and 3.16% year-over-year. If we factor in population growth, the 12-month MA of the civilian population-adjusted data (age 16-and-over) is a smaller change, up 0.28% month-over-month and up only 1.98% year-over-year.

2015-09-25 00:00:00 The Case for Credit by Mark Kiesel of PIMCO

Three reasons why the outlook for developed credit markets remains constructive.

2015-09-24 00:00:00 Chicago Fed: Economic Growth Slowed in August by Jill Mislinski (Article)

"Index shows economic growth slowed in August": This is the headline for today's release of the Chicago Fed's National Activity Index.

2015-09-24 00:00:00 Kansas City Fed Survey: Manufacturing Declined Moderately in September by Jill Mislinski (Article)

The Kansas City Fed Manufacturing Survey business conditions indicator measures activity in the following states: Colorado, Kansas, Nebraska, Oklahoma, Wyoming, western Missouri, and northern New Mexico. The latest index came in at -8, which indicates slowing activity. Here is a snapshot of the complete Kansas City Fed Manufacturing Survey. The three-month moving average, which helps us visualize trends, is at its lowest level since mid-2009.

2015-09-24 00:00:00 Fed Implications by Burt White of LPL Financial

The Federal Reserve’s (Fed) decision not to raise interest rates at its September 17 policy meeting was undoubtedly the biggest event of last week. Although not a big surprise, besides Donald Trump (and perhaps China), the Fed is all that anyone is talking about these days. This week we share some of our perspective on what the Fed’s decision may mean for the stock market and offer some investment ideas.

2015-09-23 00:00:00 Logical Song: What to Make of Record Buybacks by Liz Ann Sonders of Charles Schwab

A common question I’ve been getting at client events lately is about stock buybacks and the effect they’re having on earnings-per-share (EPS); as well as what they say about the economy overall and investor/business psychology.

2015-09-22 00:00:00 Richmond Fed: Manufacturing Slowed in September by Jill Mislinski (Article)

Today the Richmond Fed Manufacturing Composite Index dropped 5 points -5 from last month's 0. had forecast an increase to 4. Because of the highly volatile nature of this index, we include a 3-month moving average to facilitate the identification of trends, now at 2.5, still indicating expansion.

2015-09-22 00:00:00 On My Radar: “Dammit Janet” by Steve Blumenthal of CMG Capital Management Group

Whatever you can do, or dream you can… begin it; boldness has genius, power and magic in it.” – Johann Wolfgang von Goethe

2015-09-22 00:00:00 Meet Jeremy Corbyn by Bill O’Grady of Confluence Investment Management

On September 12, Jeremy Corbyn, a longtime Member of Parliament, was elected as the new leader of the UK’s Labour Party. In this report, we begin with a short biography of Corbyn followed by a description of how he won his party’s leadership role. With this background, we explore Corbyn’s long held policy positions and their potential impact on UK policy. We offer our reflections on Corbyn’s win, including an examination within the context of other political developments in the West. As always, we conclude with potential market ramifications.

2015-09-21 00:00:00 US Equity and Economic Review For Sept. 14-18; Weak 3Q Numbers On the Horizon, Edition by Hale Stewart of Hale Stewart

The U.S.’ immunity to international economic weakness continues. In their latest policy statement, the Fed once again described U.S. growth as “moderate.” With the exception of industrial production, this week’s economic releases confirm that assessment.

2015-09-21 00:00:00 Equities Fall After the Fed Fails to Raise Rates by Robert Doll of Nuveen Asset Management

U.S. equities were little changed last week, with the S&P 500 declining 0.1%. Stocks posted gains early in the week before falling on Thursday and Friday after the Federal Reserve announced it would hold rates steady. For the week, utilities, consumer staples and health care outperformed, while materials, telecommunications and financials came under pressure.

2015-09-19 00:00:00 Here Are Two Ways Investors Can Take Advantage of the Fed's Uncertainty by Frank Holmes of U.S. Global Investors

Although interest rates could still be hiked in one of the two remaining times the Federal Open Market Committee (FOMC) meets this year, I’m inclined to think they’ll stay near zero until at least 2016. The decision is a welcome one for both gold demand and new home purchases. When rates rise, gold becomes less attractive for some investors, who are encouraged to exchange their no-yielding gold for income-producing assets.

2015-09-19 00:00:00 Upon Further Review: More Reflections on the Fed by Carl Tannenbaum of Northern Trust

The Federal Reserve has typically downplayed market expectations of inflation. These indicators emerge from trading in Treasury Inflation-Protected Securities (TIPS), which can be influenced by many things.

2015-09-19 00:00:00 Annual Outlook Address by Mary Ellen Stanek of Baird Investment Management

The uncertainty caused by speculating on when the Fed will raise rates is almost worse that the move itself. We think the Fed needs to forecast where the U.S. economy will be in terms of full employment and inflation a year or two down the road given the long and variable lags of the impact of their policy changes. We think they have been too optimistic in terms of the expected growth of the economy.

2015-09-19 00:00:00 Merkel Opens the Gates by John Mauldin of Mauldin Economics

This is all well and good for nations like Germany that need immigrants, but much of Europe is really not in need of new workers, given their present severe unemployment problems. Not to mention that in those countries budgets are already strained and taking on the task of housing tens of thousands of immigrants and refugees is not cheap.

2015-09-18 00:00:00 Conference Board Leading Economic Index Sees Fractional Increase in August by Doug Short (Article)

The Latest Conference Board Leading Economic Index (LEI) for August is now available. The index increased 0.1 percent from a revised 123.6 to today's 123.7. The latest indicator value came in below the 0.2 percent forecast by

2015-09-18 00:00:00 Japan Then and Now by Kenichi Amaki of Matthews Asia

Late in 2006, Matthews Asia was wrapping up a special report titled “Japan Reawakens.” The timing of that AsiaNow publication, just ahead of the Global Financial Crisis, was unfortunate to say the least. With the ensuing economic turmoil, Japan fell asleep again, sliding off the radar screens of many investors. But as interest in Japan has more recently re-emerged, I thought it would be important for us to take a look back and consider what we previously published. Has Japan evolved the way we had envisioned? What’s changed and what hasn’t?

2015-09-17 00:00:00 More Volatility on U.S. Horizon Has Sights Turning to Asia by Russ Koesterich of BlackRock

After weeks of struggling, global equities stabilized last week. In the U.S., the S&P 500 Index rose 2.08% to 1,961, the Dow Jones Industrial Average climbed 2.05% to 16,433, and the tech-heavy Nasdaq Composite Index advanced an even stronger 2.97% to end the week at 4,822. Meanwhile, the yield on the 10-year Treasury rose from 2.13% to 2.19%, as its price correspondingly fell.

2015-09-17 00:00:00 Does a Higher Retirement Bogey Call for a Different Club? by Jeff Middleswart of Ranger International

Recent research suggests the rule of thumb 4% distribution rate is far too high. If true, savers may want to consider adding dividend paying stocks to their portfolios.

2015-09-17 00:00:00 Philly Fed Business Outlook: General Activity Index Goes Negative by Jill Mislinski (Article)

The latest gauge of General Activity came in at -6.0, down significantly from last month's 8.3. The 3-month moving average came in at 2.7, down from 9.7 last month. Since this is a diffusion index, negative readings indicate contraction, positive ones indicate expansion. The Six-Month Outlook was up at 44, versus the previous month's 43.1.

2015-09-16 00:00:00 The Fed's Dilemma by Scott Minerd of Guggenheim Partners

The U.S. Federal Reserve’s rate rise history reveals a familiar dilemma—previous delays led to inflated asset prices and recessions.

2015-09-15 00:00:00 On My Radar: Valuations, Forward Returns and Recession by Steve Blumenthal of CMG Capital Management Group

Of the nine market declines associated with recessions that started with valuations above the mean, the average decline was -42.8%. Of the four declines that began with valuations below the mean, the average was -19.9%”– Doug Short

2015-09-15 00:00:00 Weighing the Week Ahead: To Hike, or not to Hike? by Jeff Miller of NewArc Investments, Inc.

After many years of standing pat on interest rates, there is finally a genuine chance of a shift in Fed policy. The punditry will be asking: To hike, or not to hike?

2015-09-15 00:00:00 We Aren't Getting by with a Little Help from the Fed by David Robertson of Arete Asset Management

Long term investors would do well to avoid getting caught up in the guessing game of when the Fed will raise interest rates. Economic theory and empirical evidence both point to the reality that there is precious little the Fed can do sustainably improve economic outcomes. Instead, it is far better to keep an eye on income and investment.

2015-09-15 00:00:00 Market Unease May Continue for Some Time by Robert Doll of Nuveen Asset Management

Markets calmed last week relative to recent turmoil, but investor sentiment remains fragile. The focus on Federal Reserve policy, weakness in China and concerns about economic growth continued to drive sentiment. The S&P 500 Index gained 2.1%, commodities were flat and bond yields rose. Technology and health care posted the best results, while energy lagged.

2015-09-15 00:00:00 Empire State Manufacturing Remains at Lowest Levels by Jill Mislinski (Article)

This morning we got the latest Empire State Manufacturing Survey. The diffusion index for General Business Conditions at -14.7 (-14.67 to two decimals) shows a slight edge up from last month's -14.9, which signals a decline in activity.This is the lowest level since 2009. The forecast was for a reading of -0.75.

2015-09-14 00:00:00 The Beauty of Truth and the Beast of Dogma by John Hussman of Hussman Funds

When you examine historical data and estimate actual correlations and effect sizes, the dogmatic belief that the Fed can “fine tune” anything in the economy is utter hogwash. Truth, on the other hand, is beautiful. Economic relationships that are supported in real-world data are a sight to behold.

2015-09-14 00:00:00 Schwab Market Perspective: Now What? by Liz Ann Sonders, Brad Sorensen, Jeffrey Kleintop of Charles Schwab

“Everyone has a plan until they get punched in the mouth.”—Mike Tyson. We don’t often quote Mike Tyson, but his words resonate lately. Investors are wondering what to do—buy the dips, sell the rallies, or sit tight? First, investment decisions should never be made on emotion, which tends to dominate at times like this. It can be difficult to stomach moves such as we’ve seen recently. But investors who have an investing plan in place should indeed just sit there, let things calm down, and continue with the plan already put in place.

2015-09-12 00:00:00 Life Is Uncertain and So Are Interest Rates by Frank Holmes of U.S. Global Investors

Right now, a lot of investors are wondering about the uncertainty of rising interest rates—the causes, effects and possible ramifications. Many people have been saying for weeks and months now that a rate hike is imminent and that September is the anticipated takeoff. I’ve been skeptical of this, and now a chart from highly-respected market analyst Jeff deGraaf confirms my skepticism.

2015-09-11 00:00:00 Housing: A Secular Opportunity? by Adam Peck of Heartland Advisors

Low interest rates, demographics, and a solid economy should provide staying power to a resurgent housing market. We are finding opportunities to capitalize on growth in the area while diversifying idiosyncratic risks in our portfolios.

2015-09-11 00:00:00 Global Economic Perspective: September by Franklin Templeton Fixed Income Group of Franklin Templeton Investments

While the [US] Fed is facing an extremely delicate task ... it is still our belief that the US economy remains sufficiently strong to be able to bear a gradual increase in short-term rates in the coming months.

2015-09-11 00:00:00 Protecting Against Inflation In a Deflationary World by Steven Malin Ph.D. of Allianz Global Investors

Powerful global deflationary forces will continue to put downward pressure on the prices of inputs and outputs for months, if not years, to come. Even if the US Federal Reserve and the Bank of England raise policy interest rates over the months ahead, inflation risk premiums built into market interest rates will remain small. In the absence of strong wage increases, unprecedented global growth in the supply of resources and outputs relative to demand will linger—and inflation will remain constrained.

2015-09-10 00:00:00 The U.S. Economy Is Not Holding Back the Fed by Carl Tannenbaum, Asha Bangalore of Northern Trust

The Federal Reserve’s rate-setting committee meets next week, and there is more uneasiness than usual surrounding the event. Much has changed in the past few weeks, and the Fed’s likely course of action is being examined from a multitude of angles.

2015-09-10 00:00:00 Why All the Hoopla over 25 Basis Points? by Dr. Brian Jacobsen of Wells Fargo Asset Management

Should the Federal Reserve hike rates at their next meeting? Take a look at the case for and against, with Dr. Brian Jacobsen, CFA, CFP®, of Wells Fargo Asset Management.

2015-09-10 00:00:00 Equity Valuations, Recessions and Stock Market Declines by Doug Short (Article)

Note from Doug: In response to a request, I've updated the data in this article through the August month-end numbers.

Earlier this year I had a fascinating conversation with Neile Wolfe, of Wells Fargo Advisors, LLC. Based on the underlying data in the adjacent chart, Neile made some cogent observations about the historical relationships between equity valuations, recessions and market prices:

2015-09-09 00:00:00 Competing with the Alpha and the Omega by Cole Smead, CFA of Smead Capital Management

In the Bible, Jesus said, “I am the Alpha and the Omega, the first and the last, the beginning and the end.” While Jesus infers that he is at both the beginning and the end of time, we as investors can only operate in the present with a knowledge of what has come before. To better understand today's commodity market circumstances, we believe investors should examine the herd mentality and the psychological backing that may lead to contrarian investment opportunities.

2015-09-09 00:00:00 Weighing the Week Ahead: Time to Revise Year-End Market Estimates? by Jeff Miller of NewArc Investments, Inc.

Sometimes the calendar dictates the agenda. The Labor Day weekend marks the official end of a summer that was eventful for markets. The punditry will be asking: What is your (revised) EOY target for stocks?

2015-09-09 00:00:00 Everything's Not Bad by Brian Wesbury, Robert Stein of First Trust Advisors

Have you noticed? Everything’s bad these days. On February 25, 2015, the Washington Post wonkblog posted a piece titled “Why rising wages might be bad news.” Last week, on September 1st, after another strong month of car and truck sales, the Wall Street Journal published a story “The Bad News in Strong Car Sales.”

2015-09-09 00:00:00 On The Economy, Inflation, China & Odds For Fed Liftoff by Gary Halbert of Halbert Wealth Management

The investment markets remain fixated on whether the Fed will hike interest rates for the first time in almost a decade on September 17. Stock market volatility spiked in late August and so far this month, with most global equity markets in “correction” territory. It remains to be seen if the latest stock market chaos will cause the Fed to delay lift-off until December or later.

2015-09-08 00:00:00 Making Sense of Market Volatility by Sponsored Content from Invesco (Article)

• On Aug. 21, the Dow Jones Industrial Average entered a correction and reminded investors what volatility looks like. • Several Invesco senior investment leaders discuss their views of market volatility. • They share how it affects, or doesn’t affect, the opportunities they see.

2015-09-08 00:00:00 Betting on Japan, Inc.’s Recovery by Vadim Zlotnikov of AllianceBernstein

Japanese stocks have outperformed the past few years, and we don’t think their run is over. Policies to improve profitability, capital use and productivity should provide a stronger foundation for further gains.

2015-09-06 00:00:00 Muddling Through Shanghai by John Mauldin of Mauldin Economics

China is in transition, a transition that was clearly telegraphed if you have been paying attention. Our recent book on China (A Great Leap Forward?) clearly laid out this new path. Today we are going to talk about this precarious, difficult transition, which may impose profound impacts on much of the rest of the world. This transition is going to change the way global trade has worked in the past. There will be winners and losers.

2015-09-04 00:00:00 Here’s Your Guide to What the Influencers Are Saying about Commodities by Frank Holmes of U.S. Global Investors

A few legendary influencers in investing are making huge bets right now on commodities, an area that’s faced—and continues to face—some pretty strong headwinds. What are we to make of this?

2015-09-04 00:00:00 Unfazed by the Turmoil by Byron Wien of Blackstone

Overall, my sense of this year’s lunches is that the participants were still basically optimistic, as they generally are. I wonder if there were something big and negative brewing out there, whether the group would be able to anticipate it.

2015-09-04 00:00:00 International Economic Week in Review For Aug. 31-Sept. 4 by Hale Stewart of Hale Stewart

The potential negative impact of China’s slowdown is sinking into policy maker’s decision making process and trader’s analysis. Money is flowing from emerging to developed economies; emerging markets and currencies are underperformers relative to developed markets. The potential for China to export deflation is being discussed. And central bankers are acknowledging the slowdown by lowering growth forecasts and opening speculating about additional monetary stimulus. As we leave the summer doldrums and enter the last four months of trading, the environment has clearly changed.

2015-09-03 00:00:00 12 Questions for a 12% Correction by Burt White of LPL Financial

The recent market downdraft and related uncertainty in China have led to many investor questions. The strong 6.5% rebound in the S&P 500 over the last three trading sessions (August 26, 27, 28, 2015) has cut the S&P 500’s losses from the 2015 peak (2130 on May 21, 2015) to 6.7%. In response to the S&P 500’s recent 12% correction?—?the first decline of more than 10% since 2011?—?we answer 12 investor questions. Bottom line, we do not expect the latest correction and China uncertainty to lead to the end of the U.S. economic expansion or the end of the six-and-a-half-year old bull

2015-09-03 00:00:00 Weight of the Evidence Argues for Caution by William Delwiche of Robert W. Baird & Co.

At this point, cycle lows for the popular averages may well be in place. This is not yet supported by the weight of the evidence, however. Simply put, risks remain elevated and it is too early to sound an all clear.

2015-09-03 00:00:00 Remember This Isn’t 2008 by Russ Koesterich of BlackRock

After a seesaw week for stocks, Russ Koesterich explains why it's important to maintain perspective.

2015-09-02 00:00:00 Keeping Firm Perspective as Markets Gyrate by Russ Koesterich of BlackRock

BlackRock Global Chief Investment Strategist Russ Koesterich discusses why it is important to maintain perspective amidst the recent volatility, and how the selloff has created some areas of value.

2015-09-02 00:00:00 Equities Endure Intense Volatility, but the Bull Market Survives by Robert Doll of Nuveen Asset Management

U.S. equities experienced extreme volatility last week. Prices plummeted on Monday morning due to concerns over slowing growth in China as well as uncertainty surrounding Federal Reserve policy. The sell-off was likely exacerbated by trading halts, liquidity pressures and systematic investing programs. Markets recovered later in the week as investors viewed conditions as oversold, and as oil and other commodity prices stabilized and advanced. For the week, the S&P 500 Index gained 1.0%. The energy, technology and consumer discretionary sectors led the way while utilities sold off sharply.

2015-09-02 00:00:00 Market Reset, Not Recession by John Calamos of Calamos Investments

In our view: Neither the U.S. or global economy is headed for recession; instead, we are seeing a market reset that is not entirely unexpected. Markets are likely to be extremely choppy over these next months, and we may see additional corrections. Over the near term, energy and commodity prices will remain volatile, with global interest rates and currency turmoil adding to the headwinds. Market dislocations are providing us with select opportunities to establish and build positions in fundamentally strong companies, worldwide—including in emerging markets.

2015-09-01 00:00:00 Near-Term Headwinds Offer Attractive Buying Opportunities by (Article)

With many companies in more economically sensitive sectors of the small-cap market poised for incremental margin expansion and accelerated earnings growth as the U.S. economy continues down the path of normalization, Portfolio Managers Steven McBoyle and Lauren Romeo are trying to take advantage of current headwinds that should ultimately reverse with more robust economic growth.

2015-08-31 00:00:00 Making Sense of Market Volatility by Karen Dunn Kelley of Invesco Blog

On Aug. 21, the Dow Jones Industrial Average entered a correction, falling 10% from its most recent peak, and reminded investors what volatility looks like after almost four correction-free years. While volatility exposes weaknesses in the market, in my opinion it also reveals the strength of high conviction managers who are skillfully navigating the market. Active management and smart beta strategies seek to surpass the “market averages” offered by traditional benchmarks, providing the potential not only for higher returns, but also for a smoother ride.

2015-08-31 00:00:00 Dog Days Are Over: What a Week! by Liz Ann Sonders of Charles Schwab

Volatility … and the volatility of volatility … hit record levels last week. We believe this is just a correction; not the beginning of a new bear market. Weeks like last week provide valuable lessons for investors about crowd psychology and the benefits of diversification and rebalancing.

2015-08-30 00:00:00 Weekly Market Summary by Urban Carmel of The Fat Pitch

Waterfall events like the current one tend to most often reverberate into the weeks ahead. Indices will often jump 10% or more higher and also attempt to retest the lows. Volatility will likely remain elevated for several months. But the fall in equity prices, which has knocked investor sentiment to its knees, opens up an attractive risk/reward opportunity for investors. Further weakness, which is quite possible, is an opportunity to accumulate with an eye toward year-end. However, a quick, uncorrected rally in the next week or two would likely fail.

2015-08-30 00:00:00 US Equity and Economic Review For August 24-28 by Hale Stewart of Hale Stewart

The strongest news of the week was the upward revision of 2Q GDP from 2.3% to 3.7% (Q/Q). All sectors contributed. Personal consumption expenditures increased 3.1% with contributions from durable goods purchases (+8.2%) and non-durable goods (+4.1%). Residential construction increased 7.8% while non-residential was up 3.1%. Equipment was down .4%, but this can be attributed to oil sector’s weakness. Finally, exports increased 5.2%. Overall, this report was very encouraging, especially considering 1Q weakness.

2015-08-30 00:00:00 US Equity and Economic Review For August 24-28 by Hale Stewart of Hale Stewart

The fundamentals overall are slightly positive because they give companies an environment where they can grow top line revenue. The problem is most companies are just barely doing so. Even excluding the energy sector, top line revenue was only up 1.1% last quarter. Yes, it’s positive, which is obviously better than the alternative. But with market is already pricey; a 1.1% revenue increase doesn’t add a lot of upside room.

2015-08-28 00:00:00 Why This Time Could Be Different by Lance Roberts of Streettalk Live

In yesterday's post, I discussed the current correction within the context of previous "bull market" corrections. Specifically, the corrections in 1987, 1998, 2010 and 2011. However, today, I want to look at the current correction in the context of previous starts to "bear markets" and subsequent recessions.

2015-08-28 00:00:00 What’s Holding Back the U.S. Consumer by Russ Koesterich of BlackRock

Since the recession ended, U.S. real household consumption has remained well below the historical average. Russ Koesterich explains why it’s likely to remain that way.

2015-08-27 00:00:00 Superpower by Bill O’Grady of Confluence Investment Management

Our subject is a new book titled Superpower: Three Choices for America’s Role in the World, by Ian Bremmer, a political scientist who writes often on geopolitical issues. At some point, the US will need to select a workable foreign policy for the post-Cold War era and determine how to handle the superpower role. In this report, we review Bremmer’s book, starting with his premise that no president since the fall of the Berlin Wall has developed a coherent foreign policy.

2015-08-26 00:00:00 China Commentary by John Calamos: Market Reset, Not Recession by John Calamos Sr. of Calamos Investments

The global market selloff of these past days has tested the mettle of many investors—particularly as the turmoil has followed an unusual period earlier this year, where equities delivered healthy advances with very little volatility. While we’ve gone on record saying that we expected volatility to persist (including in our most recent Outlook), we have been surprised by how severe the downturn has been. However, experience teaches that there can be many opportunities in volatile markets.

2015-08-26 00:00:00 A Painful but Healthy Adjustment for Risk Assets by Scott Minerd of Guggenheim Partners

The source of the current market correction is the massive misalignment of exchange rates, which finds its roots in quantitative easing.

2015-08-25 00:00:00 Finding Value in the Selloff Rubble by Russ Koesterich of BlackRock

BlackRock Chief Investment Strategist Russ Koesterich discusses the catalysts for the brutal equity selloff and its key takeaway for long-term investors.

2015-08-21 00:00:00 Developed Asia Pacific: Economy Trends Update July 2015 by Team of Thomas White International

After a slump in consumer spending had raised concerns of an economic slowdown in Japan recently, there was a welcome uptick in indicators such as manufacturing activity and exports. However, slowing growth in China, a major trading partner, is widely expected to have a bearing on the economy in the near future. Meanwhile, the Reserve Bank of Australia left interest rates unchanged in its recent review as expected, thanks to subdued inflation, a stabilizing job market, and early signs of a pick-up in business investment.

2015-08-21 00:00:00 Is a Stronger U.S. Dollar Really Bad News? Three Myths about Emerging Markets by Michele Mazzoleni of Research Affiliates

A strengthening U.S. dollar threatens emerging market economies—owes its plausibility to three myths. Let’s examine them.

2015-08-20 00:00:00 Population Growth & Productivity Headed in Wrong Direction by Gary Halbert of Halbert Wealth Management

Today we’ll focus on some longer-term economic data which shows, unfortunately, that the US economy is in a multi-decade slide that will be very difficult to reverse. Population growth and worker productivity – the keys to sustained economic growth – are both in decline, trends that are not likely to change anytime soon.

2015-08-20 00:00:00 Summer Quartet by Anthony Valeri of LPL Financial

Music from four players continues to influence events in the bond market this summer: the Federal Reserve (Fed), China, oil prices, and the U.S. dollar. The music from these four players has led to a mixed response in the bond market: disturbing for short-term securities, melodic for long-term bonds.

2015-08-20 00:00:00 Global Energy: Adapting to New Realities by Suken Patel of Diamond Hill Capital Management, Inc.

The recent slide in oil prices is symptomatic of large fundamental shifts taking place across the energy sector. The current volatility is nothing new to oil markets as their self-correcting nature has frequently resulted in a sequence of deep boom and bust cycles. While we can anticipate and prepare for these cycles, much like with earthquakes, the timing and consequences can still be surprising. In times like these, maintaining a long-term perspective is essential to place current events in the proper context.

2015-08-19 00:00:00 Global Economic Perspective: August by Franklin Templeton Fixed Income Group of Franklin Templeton Investments

We believe sound headline job creation figures point to rate increases by a [US] Fed that would like to begin to ‘normalize’ monetary policy when possible. The US economy is no longer in the emergency room, as it was in December 2008.

2015-08-19 00:00:00 The One Percent by Jeffrey Saut of Raymond James

I don’t need to defend Mr. Landry. Mr. Landry does just fine on his own. But coming from me – someone who is my own biggest critic as well as a critic of Wall Street – you best realize that Mr. Landry is in the top 1% of people on Wall Street. He is clear, he is concise, and he is right more than he is wrong. AND more importantly, when he is wrong he doesn’t just sit there and fight the tape. He adjusts unlike [many] of the bonehead strategists on Wall Street; stop reading and listening to him at your own risk.

2015-08-19 00:00:00 Global Economic Overview: July 2015 by Team of Thomas White International

While some of the emerging economies continue to face slow growth from lower commodity exports, the outlook for most developed economies has brightened in recent months. The U.S. slowdown during the first half of this year was not as bad as thought earlier, while economic trends from the Eurozone remain stable. Helped by sustained labor market gains, U.S. consumer sentiment is picking up again and should help aggregate growth during the second half of the year.

2015-08-19 00:00:00 One man’s weed... by Jerry Wagner of Flexible Plan Investments

I spent time at the Woodward Dream Cruise this week in my brother Charlie’s 1985 Ford Mustang convertible (his first new car which he bought and has maintained since that year). I think the Cruise is the largest annual assemblage of classic cars on the planet. What a great time for anyone who enjoys historical vehicles and the memories they bring back, especially here in the Motor City.

2015-08-18 00:00:00 International Economic Week in Review For Aug. 10-14 by Hale Stewart of Hale Stewart

This weekend was my summer vacation, when I (try) to completely unplug from news, internet and other variety of my daily routine. I was pretty successful at the task, although I did keep up with general events thanks to CNN. With the exception of China’s devaluation, there was little meaningful economic news, making my catch-up column a bit easier. But perhaps more importantly, when I returned I was struck just how little things had really changed in a 7 day period.

2015-08-14 00:00:00 China Not Immune to Contagious Quantitative Easing and Massive Printing of Cheap Money by Frank Holmes of U.S. Global Investors

First it was the U.S. Federal Reserve. Then, in 2013, Japan launched what became known as Abenomics. The European Central Bank (ECB) followed suit in 2014. And now the People’s Bank of China has joined the parade. All of them in some way stimulated economic growth by initiating monetary quantitative easing (QE) programs.

2015-08-14 00:00:00 Three Steps to "Good Enough" - In Praise of Simplicity, Common Sense, and Stubbornness by Francois Sicart of Tocqueville Asset Management

The plain truth is that in the practice of investment, “good enough,” combined with a solid dose of common sense, usually beats precision and faith in mathematical models. So, if a careful analysis has given us a “good enough” idea of a company’s worth, we can assume that its market-traded shares will fluctuate – sometimes wildly – around that fundamental value. And that may be the value investor’s salvation.

2015-08-14 00:00:00 The Tortoise Wins Again? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The narrow trading range for US stocks continues, but there are some concerning signs such as seasonality and technical issues that make us a bit more cautious in the near term. We don’t think the bull market is in danger of ending, but there could certainly be a pullback and we don’t believe investors need to be in a great hurry to put money to work. In the immediate aftermath, China’s move on its currency rattled markets, but we don’t think it’s the start of a currency war, and hope that this is part of a herky-jerky path to freer markets.

2015-08-13 00:00:00 Exit from Wonderland: Change Is Now on the Horizon by Ed Easterling of Crestmont Research

Many investors and advisors are unsure about the current financial market environment. They have been wrestling with how to weight equities and whether to include alternative investments. Although equities have performed well in recent years, many alternatives have lagged expectations. This should not be surprising: the financial world is operating just as the Fed has intended.

2015-08-13 00:00:00 Americas: Economy Trends Update -- July 2015 by Team of Thomas White International

Even as the U.S. is recovering from stagnant growth during the initial months of the year, most other economies in the Americas region are struggling with slow growth. Prices of oil and other commodities have dipped again after a short recovery, restricting the ability of governments to increase spending. Many countries in the region depend on revenues from exports of energy and other commodities for financing a substantial part of their budgets.

2015-08-13 00:00:00 What We Can Learn by Going Back to School by Burt White of LPL Financial

The summer has flown by and some children are already going back to school this week. The back to school shopping session is considered the second most important selling season for retailers (after the Christmas/winter holidays), which we think is a good reason to check in on the health of the U.S. consumer and provide our latest thoughts on the consumer discretionary sector. Expectations for this season are low, but several consumer spending tailwinds suggest the sector may be poised to outperform over the rest of the 2015.

2015-08-13 00:00:00 No Solace in Small Caps by Russ Koesterich of BlackRock

In an effort to mitigate the impact of a stronger dollar, many investors have been favoring small-cap stocks. However, this strategy hasn’t provided much benefit year-to-date. Russ explains why.

2015-08-12 00:00:00 Walls are Not Perfect by Jerry Wagner of Flexible Plan Investments

I spent part of this summer on a family vacation in four of the six nations that were once republics of the socialist state of Yugoslavia. Many have asked me “Why,” and I simply replied that I had heard it was beautiful and had always wanted to go there. It didn’t hurt that my barber of 40 years and my employer during law school, Marv Esch, a congressman from Ann Arbor, MI, were both of Yugoslavian heritage.

2015-08-12 00:00:00 10 Dividend Growth Stocks for Your Retirement Portfolios Aggregate Yield 4.3%: Part 2 by Chuck Carnevale of F.A.S.T. Graphs

After an exhaustive search of the dividend growth stock universe I identified 20 dividend growth stocks that I felt were currently worthy of consideration for retirement portfolios based on valuation. In part 1 of this 2-part series found here I discussed the current level of the S&P 500, and offered some important principles about valuation. Additionally, I offered the first group of 10 of what I consider the highest quality members of the 20 screened research candidates I uncovered.

2015-08-11 00:00:00 The Curious Case of Dollar Strength by Russ Koesterich of BlackRock

U.S. equities finished in the red last week. The Dow Jones Industrial Average fell 1.79% to 17,373, the S&P 500 Index slipped 1.28% to 2,077 and the tech-heavy Nasdaq Composite Index dropped 1.66% to close the week at 5,043. Meanwhile, the yield on the 10-year Treasury fell from 2.20% to 2.17%, as its price correspondingly rose.

2015-08-07 00:00:00 Closing the Sausage Factory by John Mauldin of Mauldin Economics

Anything you do attracts bureaucratic oversight now. We may laugh at “helicopter parents” hovering over their children at school, but we all have a helicopter government looking over our shoulders at work.

2015-08-07 00:00:00 Gold Holds Its Own Against These Media Darlings by Frank Holmes of U.S. Global Investors

A recent Bloomberg article points out that the gold rout has cost China and Russia $5.4 billion, an amount that would sound colossal were it not for the fact that U.S. media companies such as Disney and Viacom collectively lost over $60 billion for shareholders in as little as two days this week. Below are the weekly losses for just a handful of those companies. Compared to many other asset classes, gold has held up well, even after factoring in its price decline.

2015-08-07 00:00:00 US Equity and Economic Review For August 3-7 by Hale Stewart of Hale Stewart

The ISM’s US manufacturing number decreased from 53.5 to 52.7, but remained above the key 50 level. New orders and production continued their lengthy periods of expansion. 11 of 18 industries grew. The anecdotal comments are interesting:

2015-08-07 00:00:00 Keep Your Powder Dry by Scott Minerd of Guggenheim Partners

Reports of ongoing global market volatility are taking a toll on consumer confidence. However, compelling opportunities await patient investors.

2015-08-07 00:00:00 What Kind of "Improvement" Does the Fed Want? by Peter Schiff of Euro Pacific Capital

If GDP growth only averages 2.0% in the Second Half (which I think is likely), then 2015 growth will only be about 1.7% annually. Given that the Fed didn't raise rates in 2012, 2013, and 2014, when growth was well north of 2%, why would they do so now? Yet Wall Street and the media stubbornly cling to the notion that 3% growth and rate hikes are just around the corner. Old notions die hard, and this one has taken on a life of its own.

2015-08-06 00:00:00 The Three Gluts by Joachim Fels of PIMCO

While the global savings glut is likely the main secular force behind the global environment of low growth, lowflation and low interest rates, both the oil glut and the money glut should help lift demand growth, inflation and thus interest rates from their current depressed levels over the cyclical horizon.

2015-08-06 00:00:00 The Euro Isn't Dead by Peter Schiff of Euro Pacific Capital

While the world can count dozens of important currencies, when it comes to top line financial and investment discussions, the currency marketplace really comes down to a one-on-one cage match between the two top contenders: the U.S. Dollar and the Euro.

2015-08-06 00:00:00 Productivity Puzzle by John Canally of LPL Financial

All eyes are on jobs this week. The U.S. Department of Labor’s July Employment Situation report (due August 7, 2015) will likely show that the U.S. economy created 225,000 jobs in July 2015, close to the average job creation over the past 12 months (245,000) according to the consensus of economists polled by Bloomberg News.

2015-08-04 00:00:00 Concerned About Interest Rates Rising? Consider Convertibles by Sponsored Content from Invesco (Article)

  • Convertible securities uniquely combine equity and bond features.
  • In my view, convertibles are attractive today due to their historical performance during rising interest rate periods.
  • I examine asset class performance during each of the last 10 periods of US rising interest rates.

2015-08-04 00:00:00 Reasons to Stay with an Equity-Focused Investment Stance by Robert Doll of Nuveen Asset Management

A number of issues garnered attention last week, including falling oil prices, a sell-off in Chinese equities, ongoing corporate deal activity and mixed economic and earnings data.

2015-08-04 00:00:00 Even Garth Can't Argue About Liftoff by Brian Wesbury, Robert Stein of First Trust Advisors

Plow On, Garth! Time for Liftoff, Wayne! The first report on Q2 real GDP showed Plow Horse annualized growth of 2.3%, exactly the same as the average growth rate in the past year. Now that’s the definition of a Plow Horse report.

2015-08-03 00:00:00 US Equity and Economic Review: Weaker Breadth Indicators, Edition by Hale Stewart of Hale Stewart

The Fed’s policy statement was the main economic event this week; its opening paragraph began, “Growth in household spending has been moderate and the housing sector has shown additional improvement; however, business fixed investment and net exports stayed soft.”

2015-08-03 00:00:00 Bridging the Gap in Global Infrastructure Funding, Part 1 by Darin Turner of Invesco Blog

Infrastructure is the backbone of every economy, providing essential public services such as water supply, energy and mobility. And for investors, infrastructure also has the potential to provide unique benefits.

2015-08-02 00:00:00 International Economic Week in Review: Emerging Market Exodus, Edition by Hale Stewart of Hale Stewart

One of the biggest stories to emerge has been the decline in Emerging Market Currencies. The IMF noted this in their latest World Economic Outlook.

2015-08-02 00:00:00 Fear of the Fed Is Rising by Carl Tannenbaum, Asha Bangalore, Ben Trinder of Northern Trust

My youngest daughter has an acute case of arachnophobia; even the tiniest spider sets her off. When a daddy longlegs appeared in the bathroom of a vacation home we were renting, she covered herself in the shower curtain and ran straight out the front door. It’s gotten so bad that the mere mention of a spider upsets her; the fear is almost worse than the reality

2015-08-02 00:00:00 When China Stopped Acting Chinese by John Mauldin of Mauldin Economics

Much of the world is focused on what is happening in Greece and Europe. A lot of people are paying attention to the Middle East and geopolitics. These are significant concerns, for sure; but what has been happening in China the past few months has more far-reaching global investment implications than Europe or the Middle East do. Most people are aware of the amazing run-up in the Shanghai stock index and the recent “crash.” The government intervened and for a time has halted the rapid drop in the markets.

2015-08-01 00:00:00 Gold on Sale, Says the Rational Investor by Frank Holmes of U.S. Global Investors

The leveraged gold futures derivatives market is knocking down the precious metal, yet in massive contrast, this drop has ignited a shopping frenzy according to gold coin dealers. I spoke with several friends and industry experts this week who confirmed the record sales numbers for the month. In fact, American Gold Eagle sales reached 161,500 ounces in July, the highest monthly figure since April 2013. What gives?

2015-07-29 00:00:00 Equities, Dividends & Rising Interest Rates by Guinness Atkinson Investment Team of Guinness Atkinson Asset Management

With interest rates at generational lows and what is likely an improving US economy, it is natural to contemplate or even worry about the possibil- ity of rising interest rates. Common perception is that rising interest rate environments are generally not favorable to equities and income oriented in- vestments. This is certainly true for bonds1 whose prices move directly and inversely with changes in interest rates. But is it true for equities in general and for dividend paying stocks in particular?

2015-07-29 00:00:00 Ten Quick Topics to Ruin Your Summer by Jeremy Grantham of GMO

Chief investment strategist Jeremy Grantham reviews "10 topics that really matter, at least in my opinion. They can all be viewed as problems: potential threats to our well-being"

2015-07-29 00:00:00 Laudato Sí by Bill O’Grady of Confluence Investment Management

Last week, the Vatican held a meeting of the mayors of some of the world’s largest cities to discuss climate change. This meeting was part of Pope Francis’s efforts to add to the discussion of climate change, which was the subject of a recent encyclical, Laudato Sí. In this report, we will begin with our position on climate change, discuss the encyclical and try to measure its potential impact on the direction of climate change policy. As always, we will conclude with market ramifications.

2015-07-27 00:00:00 The Nuclear Deal is Mostly about Oil by John Browne of Euro Pacific Capital

The recent nuclear non-proliferation agreement between Iran and the U.S. has created a firestorm debate in the Middle East and both sides of the Atlantic. While the deal is supposedly all about nuclear power and nuclear bombs, its practical implications are all about oil. But the conclusions we should make about its impact on the energy sector are far from clear. A ratification of the deal would allow Iran to make lucrative long term production and distribution contracts with foreign energy firms.

2015-07-26 00:00:00 US Equity and Economic Review: Transports Still Concerning, Edition by Hale Stewart of Hale Stewart

The Conference Board released the leading and coincident indicators, both of which provide an excellent summation of current and future activity.

2015-07-26 00:00:00 European Drama Hasn’t Derailed US Growth by Ed Perks of Franklin Templeton Investments

We believe headwinds to growth have been easing and what the current leg of the US expansion has perhaps lacked in intensity may very well be made up for by a transition to a more durable or lengthy expansion.

2015-07-25 00:00:00 3 Reasons Why Gold Isn’t Behaving Like Gold Right Now by Frank Holmes of U.S. Global Investors

The last time the metal descended this quickly was 18 months ago, on January 6, 2014, when someone brought a massive gold sell order on the market before retracting it in a high-frequency trading tactic called “quote stuffing.”

2015-07-24 00:00:00 The Rise of the Renminbi: Will China’s Yuan Become a Global Reserve Currency? by Mark Mobius of Franklin Templeton Investments

Reserve currency status and RMB internationalization could confer a number of significant benefits on China, including potentially lowering borrowing costs and facilitating overseas expansion by Chinese companies.

2015-07-24 00:00:00 Sector Insights-Financial Services by Mark Dawson of Rainier Investment Management

The financial services sector is unique. Unlike other sectors, it is essentially the lifeblood of the economy. When it’s healthy, it provides businesses and consumers with access to the credit, capital and investments that are vital to a healthy and growing U.S. economy. But when it’s sick, as we saw during the financial crisis in 2008, it can weaken the whole system. Severely damaged in 2008, the U.S. financial system - in particular banks - have been healing. Now is a good time to seek out investment opportunities in financial stocks.

2015-07-23 00:00:00 Are MLPs Waiting for Godot? by David Chiaro of Eagle Global Advisors

Like the absurdist play where two characters Vladimir and Estragon wait for a mysterious Godot who never shows up, investors in MLPs continue to wait for definitive answers to the "big questions" facing MLPs: when will interest rates rise and what will happen with future oil production and prices?

2015-07-23 00:00:00 Mid-Year Market Outlook - July 2015 by Team of Thomas White International

At the end of 2014, “why international?” was the prevailing investor sentiment. After all, foreign stocks had lagged U.S. equities yet again, underperforming four out of the five years between 2010 and 2014. The consensus outlook was that U.S. markets would outperform their foreign peers in any case, and so, would it really serve any purpose to hold international equities in a portfolio? Many investors followed the crowd.

2015-07-23 00:00:00 Mid-Year Outlook: Global Economy Likely to Withstand China, Greece by John Calamos, Sr. of Calamos Investments

The global markets and economy should be able to move higher for the remainder of the year, with accommodative monetary policy and well-contained inflation providing tailwinds. The U.S. looks set to extend its not-too-hot, not-too-cold recovery, while Japan is benefiting from stimulus and pro-market reforms. Although economic conditions in Europe remain fragile and uneven, growth looks to be accelerating overall, and we believe the European Union has the tools to prevent a broader Europe contagion should the Greek bailout resolution fall apart.

2015-07-22 00:00:00 Global Economic Outlook by Carl Tannenbaum of Northern Trust

Economists and the financial markets have been almost exclusively focused on events in Greece and China over the past several months. These situations merited attention but pushed more-positive economic developments into the background.

2015-07-22 00:00:00 The Upside to Low Liquidity Bond Markets by Multisector Full Discretion Team of Loomis Sayles

As structural and cyclical factors reduce bond market liquidity, the Multisector Full Discretion team explains how they are positioning portfolios.

2015-07-20 00:00:00 US Equity and Economic Review For the Week of July 13-17; Earnings Season Begins, Edition by Hale Stewart of Hale Stewart

The Federal Reserve issued two important documents last week: the Beige Book and Chairperson Yellen’s latest Congressional testimony. The Beige Book was largely positive. Non-financial service growth is moderate. Real estate is growing and the employment picture was generally positive. Strong demand for autos sales helped increase consumer spending. The only negative was manufacturing which was uneven due to the strong dollar and weak energy sector.

2015-07-20 00:00:00 Shopping for Bargains in Russian Retailers by Henry D'Auria, Justin Moreau of AllianceBernstein

Russian equities are among the cheapest in the world amid political and economic controversy. Yet investors might be surprised to discover that the rapidly developing retail industry offers undervalued opportunities with attractive return potential.

2015-07-20 00:00:00 Tax Cuts on the Horizon by Brian Wesbury, Bob Stein of First Trust Advisors

The one key reason for being bullish on equities the past several years has been valuation. Stocks are cheap based on profits and interest rates.

2015-07-19 00:00:00 Imperial Germany by Bill O’Grady of Confluence Investment Management

Last week, we analyzed the Greek/Eurozone negotiations using game theory as an explanatory tool. In this report, we will review the basic geopolitics of Europe, the political response and the evolution of the Eurozone. Using this background, we will examine Germany’s actions in the most recent Greek crisis. As always, we will conclude with market ramifications.

2015-07-17 00:00:00 Schwab Market Perspective: Slow Summer?! by Liz Ann Sonders, Brad Sorensen, Jeffrey Kleintop of Charles Schwab

Summer is supposed to be a time of slow trading, light news, and an opportunity for vacations. But the past several weeks have been anything but slow. Greece—a country representing 0.38% of the world economy based on gross domestic product (GDP), has dominated attention; China’s recent stock market plunge also dented sentiment among US investors. It’s meant the “running to stand still” characteristic of this year’s first half is persistent. In fact, the first half of the year saw the S&P 500 trade in its narrowest range in history.

2015-07-17 00:00:00 Crude Oil Is the Best-Performing Commodity of 2015 So Far by Frank Holmes of U.S. Global Investors

The widest expansion this year was made by none other than crude oil, the worst-performing commodity of 2014. As of June 30, oil posted gains of over 11 percent, rising to $59.47 per barrel. After falling more than 50 percent since last summer, though, it had little else to go but up. That oil claimed the top spot just highlights the reality that commodities are in a depressed state right now.

2015-07-17 00:00:00 Productivity and Modern-Day Horse Manure by John Mauldin of Mauldin Economics

What exactly do we mean by this “productivity” word? I’ve given this a good deal of thought lately, and I plan to explore it in my newsletters over the next few months. As you will see, productivity growth has both a positive side and a very negative side.

2015-07-15 00:00:00 The National Debt Is Over $18 Trillion, Not $13 Trillion by Gary Halbert of Halbert Wealth Management

In June, the non-partisan Congressional Budget Office (CBO) released its annual “Long-Term Budget Outlook” which concluded yet again that the trajectory of US federal debt is “unsustainable” and will lead to an unprecedented debt crisis in the years ahead.

2015-07-14 00:00:00 Weighing the Week Ahead: Will Falling Earnings Sink the Stock Market? by Jeffrey Miller of NewArc Investments, Inc.

There is special interest in 2nd quarter earnings both as a read on the economy and trends in costs and margins. Ordinarily the focus would be Fed Chair Yellen’s House testimony on Wednesday and the reprise on Thursday. She has stated her viewpoint so frequently – rate hike possible, data dependent, expecting better growth – that a surprise is unlikely.

2015-07-11 00:00:00 Global Investors: You Should Be Paying Attention to this Economic Indicator by Frank Holmes of U.S. Global Investors

In addition to our own macro models, BCA Research , a highly respected independent research company, pointed out that PMIs in developing economies have plunged to new lows. The International Monetary Fund also revised downward its global growth forecast for 2015. On this account, bad news is good news, as central bankers are scrambling to stimulate economic growth.

2015-07-11 00:00:00 Signs the U.S. Recovery is Solid by Rick Rieder of BlackRock Investment Management

Rick Rieder dispels pessimistic evaluations of the U.S. economy, explaining why the U.S. recovery is actually stronger than headline data would have you believe.

2015-07-09 00:00:00 Greece Playbook by Burt White of LPL Financial

Greece’s critical referendum took place this weekend and the Greek people resoundingly voted “no”?—?rejecting the latest bailout deal from creditors. The referendum result, which some interpreted as a vote to exit the Eurozone, throws Greece’s future in the currency union firmly in doubt. The unexpected result has led to a roughly 2% decline in the broad European indexes but only a modest decline in the S&P 500 (as of 3 p.m. ET today, July 6, 2015). The negative market reaction in Europe is not surprising, given polls heading into the weekend suggested a vote for the bailout was

2015-07-07 00:00:00 Update on Greece by Henderson Global Investors of Henderson Global Investors

What happens next in Greece? The immediate impact of the referendum will be to greatly intensify financial and economic pressures in Greece. Now without a bailout, Greece will struggle to find the cash to pay for pensions and public sector wages. The government’s only option may be to make these payments in some form of IOUs in the weeks ahead.

2015-07-07 00:00:00 The Summer Solstice and Mid-Year Thoughts by Jeffrey Saut of Raymond James

Reflecting on the first half of 2015, while littered with geopolitical events, shows very little upside progress for the S&P 500 (SPX/2076.78). In fact, my notes of more than 50 years show no other time when the SPX was never up or down more than 3.5% year-to-date (YTD).

2015-07-07 00:00:00 Weighing the Week Ahead: Will FedSpeak Interrupt the Lazy, Hazy, Crazy Days of Summer? by Jeff Miller of NewArc Investments, Inc.

In one sense, the week ahead should be a quiet, dull semi-vacation. As Nat King Cole explained, the Lazy-Hazy-Crazy days of summer – pretzels, beer, and bikinis that never got wet. It is the lull before earnings and includes a light economic calendar. Will the A-Team need to return from the beach because of Greece? Or will it be a quiet week, disturbed only by an avalanche of FedSpeak and consequent punditry? One way or another, I think we will (finally) put the Greek drama behind us and resume the familiar debate about the Fed.

2015-07-07 00:00:00 Emerging-Market Stocks: Back on the Map by Milton Ezrati of Lord Abbett

After the volatility of the past few years, conditions once again appear favorable for this asset class.

2015-07-07 00:00:00 Are You Really Keeping Your Eye on the Ball? by Jerry Wagner of Flexible Plan Investments

I was playing catch with my great-nephew, Bryson, over the weekend. He is just two years old and is a charmer. As we tossed the ball back and forth, he caught it and threw it back on target more times than he missed.

2015-07-06 00:00:00 Why Chinese Stocks are in a Bear Market and it Doesn’t Matter by Bryce Coward of GaveKal Capital

Chinese stocks are down a cool 30% from their high less than one month ago, but it matters little to most investors.

2015-07-06 00:00:00 Exporting the “Bacon Genie” and Other Reasons to Be Bullish by Brooks Ritchey of Franklin Templeton Investments

From “Bacon Genies” to “Snuggies,” there’s little doubting Americans have a thirst for consumer goods, even those that don’t always appear to serve much practical purpose. Brooks Ritchey, Senior Managing Director at K2 Advisors®, Franklin Templeton Solutions®, explores how an evolving consumer culture is spreading throughout the globe, and how he and his team are positioning their portfolios with these types of macro considerations in mind.

2015-07-03 00:00:00 International Economic Week in Review For June 29-July 30; Greece and Canada Creating Problems, Edit by Hale Stewart of Hale Stewart

Greece is obviously the big wild card going into next week. And while the damage appears to be contained for now, there is no guarantee we won't see a negative feedback loop filter out into the market and EU economy. Canada's four months of GDP contraction are also getting a bit concerning. Even though we knew this was coming, it's still a most unwelcome development. However, other economies are at least holding their own for now.

2015-07-02 00:00:00 The Business Cycle—Middle-Aged or Elderly? by Erik Knutzen of Neuberger Berman

When it comes to the duration of the business cycle, 50 is the new 40. Much the way that better diet, health care and exercise have helped double life expectancy over the past century, central banks have prolonged the current expansion using new elixirs such as zero interest rates and quantitative easing. At 72 months, the business cycle has well surpassed the 58.4-month average of the modern era and is now more than twice the length of the pre-WWII average.

2015-07-01 00:00:00 The Smartest Man is Wild about Innovation by Byron Wien of Blackstone

For the past fifteen years I have written annually about a person I have come to call “The Smartest Man in Europe.” For new readers, he is a finance person in his 80’s who has built his reputation by identifying important trend changes early and putting serious money behind his conclusions. Descended from a mercantile family that operated canteens selling food and weather protection along the Silk Route, he was educated in Europe, trained in New York and returned home to take advantage of the wealth-creating opportunities resulting from the post-war recovery.

2015-07-01 00:00:00 Greece Firestorm Won't Stifle Consumer Comeback by Kristina Hooper of Allianz Global Investors

Investors should expect more volatility in the stock market and larger flows into US Treasuries this week given the increased likelihood of a Grexit. Rather than hide, investors could view this crisis as a buying opportunity—a chance to position their portfolios for the second half of 2015. Over the longer term, fundamentals like job creation and a healthier consumer play a far more important role.

2015-07-01 00:00:00 More Volatility: A Positive Environment for Active Managers by Chuck Royce, Francis Gannon of The Royce Funds

Dating from the year-to-date low for the 10-Year Treasury on January 30 through the end of the first half, we have observed promising signs that the market may be taking greater strides toward normalization. CEO Chuck Royce and Co-CIO Francis Gannon discuss how higher rates might benefit bottom-up stock pickers, the potential for quality companies to regain leadership as volatility increases, the possible consequences of global economic recovery for both domestic and non-U.S. small-cap stocks, and the favorable landscape for consumers and its effect on our portfolio positioning.

2015-06-29 00:00:00 US Equity and Economic Review For the Week of June 22-26; Getting Ready For a Move Higher? Edition by Hale Stewart of Hale Stewart

First quarter economic data was largely bearish, as confirmed by last week’s third revision to GDP data. While the .2% decrease was better than the -.7% in the second revision, it was still negative.

2015-06-27 00:00:00 $8 Trillion Alternative Energy Boom Is a Win for Copper by Frank Holmes of U.S. Global Investors

As the world’s population continues to grow, and as more people in developing and emerging countries gain access to electricity, the role alternative energy sources such as wind, solar and geothermal play should skyrocket. Between now and 2040, a massive $8 trillion will be spent globally on renewables, about two thirds of all energy spending, according to Bloomberg New Energy Finance. Solar power alone is expected to draw $3.7 trillion.

2015-06-26 00:00:00 Time to Consider Municipal High Yield? by David Jurca of Russell Investments

David Jurca explains why investors may want to consider municipal high yield to help manage taxes, especially since it can offer strong tax equivalent yields at a historically attractive level of volatility.

2015-06-26 00:00:00 International Economic Week In Review For the Week of June 22-26; More Good News, Edition by Hale Stewart of Hale Stewart

It appears more and more likely that Japan has shaken off the negative impact of the sales tax hike from a year ago. The EU appears to be growing. Australia, while still growing at a ~2% clip, is feeling the negative impact of the commodity bear market. The US has shaken off the weak 1Q number.

2015-06-25 00:00:00 Unconstrained Global Investing in an Extraordinary Monetary Policy Enviornment by Michael Hasenstab of Franklin Templeton Investments

As we see it, it is only a matter of time before US wages start to rise to levels where inflation is triggered. Using the Fed’s own estimates, we are quite close to what’s considered to be full employment. To us, this does not justify 0% interest rates.

2015-06-25 00:00:00 Batteries Not Included: Midyear Stock Market Outlook by Burt White, Jeffrey Buchbinder of LPL Financial

Expect the bull market to continue through 2015. In the stock market, 2015 has felt like déjà vu. In 2014, the year began with a tough first quarter and finished strong. After a weak start to the year, we believe that corporate America will provide a much needed boost for the second half and 2015 may also finish strong?—?providing the seventh year of positive returns, in the 5?–?9% range we forecast.

2015-06-24 00:00:00 Putting the Pieces Together: Midyear Economic Outlook by John Canally Jr. of LPL Financial

We continue to expect that the U.S. economy will expand at a rate of 3% or slightly higher over the remainder of 2015, once economic conditions recover from yet another harsh winter—and other transitory factors—that held back growth in the early part of 2015. This forecast matches the average growth rate over the past 50 years, and is based on contributions from consumer spending, business capital spending, and housing, which are poised to advance at historically average or better growth rates in 2015. Net exports and the government sector should trail be hind.

2015-06-23 00:00:00 Pickles?! by Jeffrey Saut of Raymond James

I have been traveling a lot recently and this week will be no exception as I am in Victoria, British Columbia currently and am leaving for Vancouver tomorrow. While traveling is exciting and educational, it is also exhausting. Moreover, sleeping in strange beds doesn’t help the exhaustion factor. To be sure, I often find myself suffering from dyssomnia in a fitful sleep accompanied by some pretty strange dreams.

2015-06-23 00:00:00 Weighing the Week Ahead: What Does the Greek Crisis Mean for Financial Markets? by Jeffrey Miller of NewArc Investments, Inc.

The calendar shows a fair amount of economic data in the coming week, but attention is likely to be focused abroad. After many years (some would say decades) of percolating, the issue of Greece and the Eurozone is coming to a conclusion.

2015-06-22 00:00:00 US Equity and Economic Review For the Week of June 15-19; Better News But Still A Touch Slog by Hale Stewart of Hale Stewart

Let’s start by looking at the leading indicators which were up .7. The breadth of the LEIs was very positive; there were no negative numbers while only 1 (the average work week) was 0.0.

2015-06-22 00:00:00 Global Review and Equity Commentary: May 2015 by Team of Thomas White International

The decline in U.S. economic activity during the first quarter was more than earlier estimates, and appears to have weakened business sentiment in other parts of the world. Most of the fall in U.S. aggregate output was due to temporary factors such as adverse weather and port disruptions that led to delayed export shipments. The stronger dollar also reduced the earnings growth of large U.S. corporations with a global footprint.

2015-06-19 00:00:00 Global Economic Perspective: June by Team of Franklin Templeton Investments

In spite of lingering concerns about Greece’s fate, the European economy would appear to have hit a sweet spot marked by steadily improving growth and inflation figures along with declining unemployment.

2015-06-19 00:00:00 Gold and Health Care Stocks Get a Clean Bill of Health by Frank Holmes of U.S. Global Investors

Even though the Federal Reserve announced this week that it would wait a little longer to raise rates, spooked investors fled to gold bullion, helping to drive prices above $1,200 an ounce. It was the greatest single-session surge by percentage in nearly a month and a half for the yellow metal, widely seen as a safe-haven investment. As I told MarketWatch yesterday, $1,200 is an important threshold for gold miners because it helps increase profitability and spur production.

2015-06-19 00:00:00 Federal Reserve, Abenomics, Trans-Pacific Partnership by Carl Tannenbaum of Northern Trust

Central banks around the world have held interest rates at or near zero for quite a while. This action was justified in the wake of the financial crisis. But there are those who think that zero, in this setting, has become a dangerous concept.

2015-06-19 00:00:00 ECRI: "Shifting Patterns in Recessions and Recoveries" by Doug Short of Advisor Perspectives (

ECRI's most recent article presents slides and notes from ECRI's Lakshman Achuthan talk at the Madrid Fund Forum conference. He discussed the relationship between lower trend growth and recessions. "ECRI believes that minimally we're returning to a period of more frequent recessions, as we saw in much of the twentieth century....Going back to at least the 1970s, growth has been stair-stepping down during each successive expansion."

2015-06-17 00:00:00 Stocks: Keep Your Eye on the Bull by Milton Ezrati of Lord Abbett

Since the equity rally of the past few years has brought most stock indexes to new highs, investors increasingly have expressed skepticism about the possibility of future gains. It is an understandable concern—but it also is misplaced. Stocks still carry attractive valuations, if not as attractive as in past years, and so have ample ability to continue to rise, even if, as expected, the economy only lumbers along the shallow recovery path it has traveled to date.

2015-06-16 00:00:00 Stay with Equities, but Prepare for Turbulence by Robert Doll of Nuveen Asset Management

U.S. equities were up fractionally last week, with the S&P 500 Index up 0.1% as seven out of ten sectors traded higher. Strong retail sales figures kept the focus on the Federal Reserve and the prospect of higher interest rates. Concerns over Greece’s debt problems pushed volatility levels higher. The banking industry performed well, while cyclical areas of the market such as transportation lagged.

2015-06-14 00:00:00 US Equity and Economic Review For the Week of June 8-12; Yes, the Rally Is Getting Long In the Tooth by Hale Stewart of Hale Stewart

Although there were few economic numbers this week, what was released was positive. Retail sales bounced back and the JOLTs survey continued to show an improving labor market. But additional signs of stock market topping emerged. Ideally, the market still needs an expanding economy that translates into higher revenue growth rather than margin expansion to move meaningfully higher.

2015-06-14 00:00:00 The People’s Republic of Debt by John Mauldin of Mauldin Economics

Among the most important questions for all investors and businessmen is, how will China manage its future and the problems it faces? There are many problems, some of them monumental – and at the same time there is an amazing amount of opportunity and potential. Understanding the challenges and deciphering the likely outcomes is itself an immense challenge.

2015-06-12 00:00:00 It Pays to Be Choosy in Emerging Markets by Morgan Harting of AllianceBernstein

Emerging equities remain rich in return opportunity, in our view. But as their recent whiplash behavior illustrates, capitalizing on this potential will require far greater selectivity than it did in the past.

2015-06-12 00:00:00 U.S. Economy Turns on the Afterburners-Is a Rate Hike Next? by Frank Holmes of U.S. Global Investors

So when will rates be raised again? Next Wednesday the world will tune in to see if Fed Chair Janet Yellen can answer that question. Though it's anyone's guess what she'll say, there's no denying that many of the economic indicators the Fed is keeping an eye on have sharply improved lately.

2015-06-12 00:00:00 Are We Mismeasuring the Economy? by Carl Tannenbaum of Northern Trust

The problem may not be with growth but rather the way we measure it.

2015-06-12 00:00:00 Tug of War by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The current stalemate in the US market could continue for some time, with bouts of volatility and pullbacks expected as the market anticipates the initial rate hike. Be prepared by staying diversified and consider buying protection, but we would view such an event as the pause that refreshes and help set up the next sustainable bull run. Investors should also look overseas as the aggressive stimulus measures being taken by the ECB appear to be beneficially impacting the economy, and may help equities perform better in the coming months.

2015-06-11 00:00:00 Developed Europe: Economy Trends Update April 2015 by Team of Thomas White International

After ending the year 2014 on a positive note, the Developed Europe economies gained further momentum in the early months of 2015. Between January and March, the region’s 19-country single currency bloc, the Euro-zone, expanded its GDP 0.4 percent compared to the fourth quarter of 2014 and 1 percent from the year-ago period, recording its fastest pace of growth in nearly two years. Economists and commentators though had expected GDP to increase 0.5 percent for the quarter and 1.1 percent on an annual basis.

2015-06-10 00:00:00 U.S. Stands Out Amid Global Sluggishness by Scott Mather of PIMCO

A year ago, PIMCO said the world was in The New Neutral, as the path to recovery dragged on years after the financial crisis. Last month, at our annual Secular Forum in which our global investment professionals gathered to discuss our long-term outlook, we affirmed that thesis, and we recently published “The New Neutral Revisited” detailing and updating our views. Scott Mather, Chief Investment Officer U.S. Core Strategies, discusses how the outlook for the U.S. differs, to a degree, from other large economies.

2015-06-09 00:00:00 Don't Deny The Jobs Recovery by Brian Wesbury, Robert Stein of First Trust Advisors

You would think that after 63 straight months of growth in private sector payrolls, the longest streak since the 1930s, everyone would agree that the job-market recovery is for real. But, that ain’t the case. A quick Google search still uncovers a whole bunch of pessimistic appraisals of jobs and the economy.

2015-06-09 00:00:00 China’s Roaring Market by Edmund Harriss of Guinness Atkinson Asset Management

Chinese stock markets have roared in the past year, since May 2014. The Chinese government has announced a $40 billion “Silk Road” fund to build a network of railways and air links to bring China and Central Asia closer together; China launched the Asia Infrastructure Investment Bank in October 2014, and since then there has been a rush to join, not only from China’s neighbors, but also five of the G7 leading economies.

2015-06-08 00:00:00 My Top 3 Fabulous Pharma Stocks by Chuck Carnevale of F.A.S.T. Graphs

I am a fervent believer that investment decisions should be made based on the relative merits of each individual investment under consideration. However, my anecdotal observations and experience suggests that many investors do not embrace that approach. This is especially true regarding investment decisions on common stocks. Instead of focusing on the opportunities and valuations available from select individual businesses, many investors are obsessed, and I allege blinded by generalized views or beliefs about the overall market and/or the economy.

2015-06-05 00:00:00 Recovery Rallies, Is Six Years Enough by Craig Callahan of ICON Advisers, Inc.

Contrary to the bearish headlines, we at ICON believe that we are in the midst of a long-term recovery. With our valuation methodology as our guide, we believe there is enough value in the market to sustain a continued recovery. Furthermore, as we saw with the post 1987 market recovery, bull markets can last longer than 6 years. We believe there is still room for market growth in the current environment.

2015-06-05 00:00:00 Employment, Wages and Housing Leading The Economy Higher by Urban Carmel of The Fat Pitch

The majority of US economic data points to strength. Employment growth is the best since the 1990s. Wages and compensation are growing at the highest rates since the recession ended. And housing, both new construction and sales, are the best in 8 years. The overall economic trend remains positive.

2015-06-03 00:00:00 No Quarter: GDP Goes Into Reverse Again by Liz Ann Sonders of Charles Schwab

Although last week was shortened by the Memorial Day holiday, it was busy on the economic front. Last in, first out: The expected downward revision to first quarter real (inflation-adjusted) gross domestic product (GDP) brought it into negative territory, for a reading of -0.7%—albeit better than the -0.9% consensus expectation. More on that in a minute.

2015-06-02 00:00:00 Is 3D Printing Following the Railway's Tracks? by Marianne Brunet (Article)

The British Railway Mania of the 1840s is considered the greatest technology hype in history. Although railroad developments were instrumental to the U.K.'s Industrial Revolution, investors ultimately overvalued the technology because they underestimated the costs associated with it. Given the growing excitement around 3D printing, is it possible that we are in for another "hype-cycle"?

2015-05-28 00:00:00 Tantrum Potential at Home, Opportunity Overseas by Russ Koesterich of BlackRock

U.S. equities continue to climb, but BlackRock Global Chief Investment Strategist, Russ Koesterich, discusses why the best opportunities may reside outside the United States, which, in fact, has been the case so far this year.

2015-05-21 00:00:00 China: A Great Wall of Worry by Milton Ezrati of Lord Abbett

Beijing likely will find a way to mitigate the effects of a slowing economy and soaring debt levels—but the risks are high.

2015-05-21 00:00:00 Quality on Sale by Adam Peck of Heartland Advisors

Investor indifference toward strong balance sheets and cash flow has created opportunities in today’s market.

2015-05-20 00:00:00 China is Choking on its Own Debt by Joseph Taylor of Loomis Sayles

We have it on good authority. And in this case that authority is an unlikely source – the People’s Bank of China (PBoC). It’s difficult to remember the last time so many paid so little attention to something so vitally important. The revelation came in the bank’s release of its 1Q 2015 Monetary Policy Report on 8 May 2015.

2015-05-19 00:00:00 Devil Inside: Dissecting the Most Popular Valuation Metrics by Liz Ann Sonders of Charles Schwab

Given that first quarter earnings season is largely in the books—and since it’s been a couple of years since I wrote comprehensively about valuation—I am tackling it again this week.

2015-05-19 00:00:00 U.S. Economy: A Variable-Speed Recovery by Milton Ezrati of Lord Abbett

A flat first quarter likely will be followed by one or two quarters of accelerated growth. Then it’s back to the muddle.

2015-05-18 00:00:00 The "New Era" is an Old Story by John Hussman of Hussman Funds

It’s not monetary easing, but the attitude of investors toward risk that distinguishes an overvalued market that continues higher from an overvalued market that is vulnerable to vertical losses. That window of vulnerability has been open for several months now, and the immediacy of our downside concerns would ease (despite obscene valuations) only if market internals and credit spreads were to shift back toward evidence of investor risk-seeking. Meanwhile, there’s no evidence to suggest that historically reliable valuation measures have somehow become irrelevant.

2015-05-17 00:00:00 US Equity and Economic Review For the Week of May 11-15; A Really Unimpressive New High, Edition by Hale Stewart of Hale Stewart

Last week’s economic news continued to disappoint. Retail sales were weak, industrial production was flat and capacity utilization decreased. As we near the end of the earnings season, the S&P 500 revenue numbers show a decline. While the SPYs made a new high, the mid-caps, small caps and transports failed to confirm, indicating the large cap move higher stands little chance of meaningful follow-through.

2015-05-16 00:00:00 Explaining the Rise in Long-Term Interest Rates by Carl Tannenbaum of Northern Trust

Explaining the Rise in Long-Term Interest Rates; Consumers Should Overcome Higher Gas Prices; OPEC and the U.S. Face Off in the Oil Markets

2015-05-11 00:00:00 Recognizing the Risks to Financial Stability by John Hussman of Hussman Funds

Our hope is that Chair Yellen’s growing recognition of speculative risks will continue, and for the sake of the U.S. economy, that the rather baseless hope of manipulating a “Phillips Curve” or a “wealth effect” will fade. If one believes in these things, it is tempting to think that more monetary easing could be “good” for the economy. If the FOMC recognizes how weak those empirical relationships actually are, and how extreme the financial distortions have become, we might still avoid another financial crisis.

2015-05-11 00:00:00 Economic & Capital Market Summary – First Quarter 2015 by Gregory Hahn of Winthrop Capital Management

Our belief is that a market is simply a clearinghouse for the price of risk and the quantitative easing programs of the central banks of developed countries are distorting the price of risk in our capital markets. As a result, valuations in bonds, stocks, real estate and other assets are distorted.

2015-05-11 00:00:00 Corporate Earnings and Inflation by Clyde Kendzierski of Financial Solutions Group

A few months ago our 2015 forecast emphasized several points we began making late last year. Taken together, those points differed dramatically from the prevailing wisdom of the time. As we begin May, they are falling into place.

2015-05-06 00:00:00 The Mistake Eveyone Is Making About Fed Rate Hikes by Lance Roberts of Streettalk Live

With the Federal Reserve now indicating that they are "really serious" about raising interest rates, there have come numerous articles and analysis discussing the impact on asset prices. The general thesis is based on averages of historical tendencies as discussed recently by David Rosenberg in his daily commentary.

2015-05-05 00:00:00 David Rosenberg - Bullish on Stocks by Robert Huebscher (Article)

The consensus narrative is negative for the economy and U.S. equity markets. But according to David Rosenberg, that is wrong. A recession is three years away, he said, and even if the Fed raises rates, equities will perform strongly this year.

2015-05-05 00:00:00 Who Is Afraid of the Inflation Ogre? by Liz Ann Sonders, Christian Menegatti of Charles Schwab

When many commentators and investors show a high conviction about something, it is perhaps a good time to explore how things could move in the opposite direction. After several trillions of quantitative easing (QE) from the major global central banks, and with trillions of QE likely ahead, the consensus appears spooked by the specter of global disinflation and deflation. The possibility of a higher inflation scenario seems to have fallen completely off the radar.

2015-05-05 00:00:00 The Real Financial Crisis That Is Looming by Lance Roberts of Streettalk Live

There is a financial crisis on the horizon. It is a crisis that all the Central Bank interventions in the world cannot cure. It is a financial crisis that will continue to change the economic landscape of America for decades to come.

2015-05-04 00:00:00 On My Radar: “The Rodney Dangerfield Expansion” by Steve Blumenthal of CMG Capital Management Group

"Earnings don't move the overall market; it’s the Federal Reserve board. And whatever you do, focus on the central banks and focus on the movement of liquidity. Most people in the market are looking for earnings and conventional measures. It's liquidity that moves markets." - Stan Druckenmiller

2015-04-27 00:00:00 On My Radar: Recession Watch – Keep an Eye on This Chart by Steve Blumenthal of CMG Capital Management Group

Understanding when a recession might begin is important to our long-term financial health. Why? The stock market declines approximately 40% during recessions.

2015-04-24 00:00:00 BofA Is Confusing Liquidity Fueled And Secular Bull Markets by Lance Roberts of Streettalk Live

Over the past couple of years, there has been a growing chorus of individuals claiming that the financial markets have finally shaken the shackles of the secular bear market that began at the turn of the century. This, of course, suggests that the markets have now begun the next long-term secular bull market.

2015-04-14 00:00:00 Tocqueville Gold Strategy Investor Letter by John Hathaway of Tocqueville Asset Management

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX), looks back at the performance of gold over the first quarter, noting that "Gold and gold mining shares appear to be as contrarian today as in 1999, before a decade?plus run in which bullion rose nearly seven?fold in US dollar terms."

2015-04-14 00:00:00 The Iran Framework by Bill O'Grady of Confluence Investment Management

On April 2, the P5+1 and Iran announced a framework to deal with Iran’s nuclear program. The framework is a roadmap to establishing a final agreement in June and could be a major step toward delaying Iran’s entry into the “nuclear club.” This report begins with a short history of Iran’s nuclear program. Next, we review the details of the framework and address the broader policy issues surrounding Iran’s nuclear program. An analysis of the real issue, regional hegemony, follows along with a review of the political factors of the deal. We conclude with the potential market effects.

2015-04-07 00:00:00 Behind Arnott's Strategy for PIMCO's All Asset Funds by John Coumarianos (Article)

If you thought a stretch of subpar performance would shake a fund manager's confidence, you'd be wrong in the case of Rob Arnott. Through Research Affiliates, his Newport Beach firm most famous for its fundamental indexing strategies, Arnott manages PIMCO's All Asset funds. These include PIMCO All Asset (PAAIX) and PIMCO All Asset All Authority (PAUIX).

2015-04-07 00:00:00 A Q1 Letter to Clients: Ben Bernanke on Interest Rates by Dan Richards (Article)

Every quarter since 2008, I have posted a template for a client letter. This letter can be used as a starting point to provide an overview of the period that just ended and thoughts looking forward. This quarter's letter addresses questions from clients about why interest rates are so low and when they are likely to rise.

2015-04-06 00:00:00 Stock-Flow Accounting and the Coming $10 Trillion Loss in Paper Wealth by John Hussman of Hussman Funds

The failure to recognize that stock-flow consistency must hold in the economy and the financial markets is the basis for an enormous amount of misunderstanding in both fields. That omission of clear thinking about the link between economics and finance contributes to misguided policies that ignore the impact of financial distortions on the real economy, and invite speculation, malinvestment, and ultimately financial crisis.

2015-03-30 00:00:00 Eating Our Seed Corn: The Causes of U.S. Economic Stagnation, and the Way Forward by John Hussman of Hussman Funds

The U.S. has become a nation preoccupied with eating its seed corn; placing consumption over investment, outsourcing its jobs, hollowing out its middle class, and accumulating increasing debt burdens to do so. What our nation needs most is to adopt fiscal policies that direct those seeds to productive soil, and to reject increasingly arbitrary monetary policies that encourage the nation to focus on what is paper instead of what is real.

2015-03-29 00:00:00 Weighing the Week Ahead: Time for an Economic Spring Thaw? by Jeff Miller of New Arc Investments

In the absence of real data it is easy and tempting to speculate. Unlike last week, the week ahead features an avalanche of data – more in both quantity and importance than we have seen in a month. With some recent significant reports showing economic improvement we expect a change of focus.

2015-03-27 00:00:00 The Monetary Illusion by Scott Minerd of Guggenheim Partners

The long-term consequences of global QE are likely to permanently impair living standards for generations to come while creating a false illusion of reviving prosperity.

2015-03-26 00:00:00 OFR: Assessing The Risk Of Overvalued Markets by Lance Roberts of Streettalk Live

A Review Of The Office Of Financial Research report on valuation risks and consequences.

2015-03-26 00:00:00 Global Economic Overview: February 2015 by Team of Thomas White International

The global economic outlook improved in February, helped by encouraging data from some of the largest countries as well as supportive monetary policy measures. Monthly job additions in the U.S. exceeded expectations in February, continuing the robust trend from last year. Though wages are yet to see meaningful growth, the strengthening labor market should help the U.S. economy sustain the current pace of expansion.

2015-03-25 00:00:00 Can ECB Policy Heal Europe’s Ills? by Mike Amey, Andrew Bosomworth, Lorenzo Pagani of PIMCO

In this interview, Managing Directors Mike Amey, Andrew Bosomworth and Lorenzo Pagani discuss the conclusions from PIMCO’s quarterly Cyclical Forum in March 2015 and how they influence our European investment strategy. They also delve into the impact of the European Central Bank’s (ECB) balance sheet expansion on growth and inflation and reflect on Europe’s improving economic health.

2015-03-24 00:00:00 The Economic Outlook by George Mokrzan of Huntington National Bank

The United States forecast is for solid average annual economic growth of 3.1% in 2015 -- fastest in the economic recovery to date overall, although areas of the economy with high energy or international exposure will likely encounter headwinds. Strengthening employment conditions, continual improvements in consumer finances and steadily rising housing markets are likely to reestablish the consumer’s lead role in the U.S. economy in 2015.

2015-03-24 00:00:00 Don't Fret Student Debt by Brian Wesbury, Robert Stein of First Trust Advisors

For the past six years, investors have faced one fear after another. One of those fears has been the more than $1 trillion of student loan debt outstanding. This debt is up 160% since the start of 2006 (and growing) while the share of student loans with payments 90 days late, or longer, has risen from 6.4% to 11.3%.

2015-03-24 00:00:00 The New World Order: Part II by Bill O'Grady of Confluence Investment Management

In the second installment of our four-part series we focus on two themes. First, we examine the global public goods the superpower provides, and second, we analyze how the U.S. has done so. The global hegemon often faces tensions between the desires of domestic constituencies and its foreign obligations. Every superpower negotiates these pressures and each tends to have its own ways of meeting both objectives. However, no superpower can subjugate the goals and aspirations of its citizens indefinitely. If the cost of hegemony becomes too high, a nation may be unable to maintain the position.

2015-03-24 00:00:00 U.S. Trade: Shortchanged by a Strong Dollar? by Milton Ezrati of Lord Abbett

Worries that the elevated value of the greenback will crimp U.S. exports—and hurt corporate profits—are overstated.

2015-03-23 00:00:00 Dividend Value Investing: No Time for Suspension of Disbelief by Meggan Walsh of Invesco Blog

When Hollywood tells a story, the expectation is that viewers are willing to suspend disbelief to fully immerse themselves in the plot. But when the market tells a story, suspending disbelief may result in overly complacent investors who blithely ignore the potential downside risk of a profit cycle in its later stages, which we see today through the lens of our full-cycle perspective.

2015-03-21 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

What Is Full Employment, and Are We There Yet?; Negative Interest Rates Are Spreading Across Europe; The Return of the U.S. Debt Ceiling

2015-03-21 00:00:00 Stuck in Neutral by Rob Isbitts of Sungarden Investment Research

We see emphasis on “neutrality” in outlook in several of the indicators we follow at Sungarden, including our Sungarden® Stock Scoring System. From a fundamental and technical standpoint, we see fewer screaming long-term buys than we have in some time, yet we also don’t see too many situations that signal pending disaster.

2015-03-21 00:00:00 The Fat Pitch Weekly Market Summary by Urban Carmel of The Fat Pitch

Strong price and breadth suggest the uptrend from the March low has further to go. A dip early in the week is a high probability buy set up. But gains from here are likely to be short lived; nibble traders may want to sell into strong gains on the expectation of weakness over the next month.

2015-03-20 00:00:00 Northern Trust Perspective by Team of Northern Trust

The long-telegraphed launch of quantitative easing by the European Central Bank (ECB) has added some accelerant to financial market trends in place so far this year. European stocks, which had been strong performers in local currencies, have continued their strong performance while European bond yields have declined even further.

2015-03-19 00:00:00 Cabela’s: Little Room for Error by Jenny Hubbard of Diamond Hill Capital Management, Inc.

Through our research process, we attempt to identify actionable investment ideas, but we often conclude that a company does not present an immediate long or short investment opportunity. A decision not to invest in a company is valued just as much as a decision to invest in one, but we are always expected to stay current on our area of coverage in case conditions change.

2015-03-18 00:00:00 Alpha Matters More in Muted Equity Markets by Chris Marx of AllianceBernstein

In a Wall Street Journal article last week, financial advisors described how exuberant investors had unrealistic expectations for stock market returns after a six-year rally. We think a more pragmatic approach should aim to beat a slower-paced market in an effort to capture compounding returns.

2015-03-18 00:00:00 Global Economic Perspective: March by Franklin Templeton Fixed Income Group® of Franklin Templeton Investments

IN THIS ISSUE: United States Prepares for Interest-Rate Hikes; But Much of the World Is Still in Monetary Easing Mode; European Outlook

2015-03-14 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

China Moves Cautiously Toward a New Normal; Deleveraging Is Unfinished in the Industrialized World; Will Lower Borrowing Costs in Europe Be a Boon for U.S Firms?

2015-03-14 00:00:00 The Airline Industry Ascended to New Records in 2014 by Frank Holmes of U.S. Global Investors

Just as the U.S. economy is in full-recovery mode, so too is the airline industry. It’s lately made an impressive about-face from only a decade ago and, in 2014, soared to several new benchmarks. This industry is flying high again.

2015-03-14 00:00:00 Will Dipping Data Lead To Dramatic Drop? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

US stocks have been resilient, although there has been an uptick in volatility. Economic data has shown some softening, but we believe it is temporary in nature. However, the risk of a correction is elevated in our view and investors should be prepared for such a possibility by having a diversified portfolio and keeping a close eye on rebalancing opportunities after pullbacks. Meanwhile, investors should also look overseas for global diversification opportunities as monetary policy easing should help to bolster asset values.

2015-03-11 00:00:00 The Expansion Settles, but Its Foundation Is Strong by Team of Northern Trust

Growth in the U.S. economy tapered a bit in the fourth quarter, but the outlook ahead remains very positive. Real gross domestic product (GDP) grew 2.2% in the fourth quarter after a 5.0% increase in the third quarter, but some special factors were at play that should ease as the first quarter of 2015 winds down.

2015-03-10 00:00:00 President Obama's 2016 Federal Budget Proposal by Tim Steffen (Article)

Both parties are focused on passing some type of tax reform this year, and in order to do that Republicans will likely have to concede on at least some of the president's wishes. Which of those may survive remains to be seen, but it's now up to the Republicans in Congress to respond with a proposal of their own.

2015-03-10 00:00:00 Happy Birthday Bull Market by Burt White of LPL Financial

The current bull market celebrates its sixth birthday today (March 9, 2015). Bull markets do not die of old age, they die of excesses, and we do not see evidence of excesses emerging today. Some of our favorite leading indicators suggest the economic expansion and bull market may continue through the end of 2015.

2015-03-07 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Quantitative easing comes to the eurozone; U.S. job growth is strong, but wage growth is not; The California port strike has troubled trade... and economists

2015-03-06 00:00:00 Market Fragility and Opportunity by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup Advisors

Investing is a funny business. It is usually wise to invest the opposite of how the market feels to you. Six years ago stocks had fallen by 50%, the financial institutions that underlie our global economy were buckling, and the economy was in shambles. Investors were running from the stock market in droves. But because prices and expectations were low and because all the major central banks flooded the world with liquidity it was actually a great time to invest.

2015-03-06 00:00:00 Opportunities in Global Financial Disintermediation by Dave Gallagher of Calamos Investments

Increasing financial disintermediation is a strong secular theme providing tailwinds in several financial industries, but a likely arduous and complicated process warrants the need for a disciplined focus on both risk and reward. The financial system essentially performs one basic function—the direct or indirect movement of funds from savers to borrowers or investors. Although financial disintermediation is formally defined as the shifting of funds from indirect to direct financing, the term is more commonly used to describe the increasing role of non-bank intermediaries.

2015-03-06 00:00:00 The Great Monetary Expansion by Scott Minerd of Guggenheim Partners

While winter weather will likely distort first-quarter economic data, accommodative monetary policy around the world means the long-term outlook remains positive.

2015-03-05 00:00:00 Positioning U.S. Community Bank Investment Portfolios for 2015 by Chitrang Purani, Thomas Luciano of PIMCO

When market uncertainty is elevated and bank profitability is an ongoing concern, taking an extreme view toward investing cash or harvesting liquidity is not optimal. Currently, we do not see as much value in interest rate or duration risk for bank portfolios as yields imply a moderate path for future policy rates. We believe there are opportunities for banks to earn income without taking excess interest rate risk or limiting flexibility against the need to fund future opportunities.

2015-03-04 00:00:00 The Misery Index by John Canally of LPL Financial

Reports on the CPI and unemployment rate for January 2015 sent the Misery Index down to 5.6%, its lowest level in 56 years. Despite the low reading of the index, headlines and polls indicate the index may not be capturing the nation’s mood. Wage growth may be the key to improving consumer sentiment about the state of the U.S. economy.

2015-03-04 00:00:00 Tigers in Africa by Niels Jensen of Absolute Return Partners

This month's Absolute Return Letter is about unrealistic expectations which is something we are all guilty of from time to time. We look at why it is unrealistic to expect equity returns to be in the double digit range over the next several years, why central banks are not printing money like many believe, plus a few other topics.

2015-03-03 00:00:00 Buffett on the Value of Patient Optimism by William Smead of Smead Capital Management

Like picking up the Good Book, a read of Berkshire Hathaway’s Annual Shareholder Letter yields insight, wisdom, and encouragement for the long-duration common stock investor in a world of short-term thinking and 30-second sound bites.

2015-03-02 00:00:00 States Feel Impact of Oil Price Collapse by Joseph Rosenblum of AllianceBernstein

Crude oil prices have fallen sharply since last summer, a bright spot for American consumers. Major oil-producing states aren’t as happy, because the loss in tax revenue is impacting budgets and economies. Some states will face real hardship; others will emerge relatively unscathed.

2015-03-02 00:00:00 On My Radar: Equity Valuations, Recessions and Market Declines by Steve Blumenthal of CMG Capital Management Group

Today let’s take a look at the hard evidence signaling slowdown. My personal view is that slowdown would not be as much of a problem if valuation measures were low. They’re not: by just about every measure the market is overpriced, overbought and over believed. What can you do? I share a simple and disciplined rules based way for you to stay invested in the market’s primary trend.

2015-03-01 00:00:00 Weighing the Week Ahead: Will the Economic News Alter Fed Policy? by Jeff Miller of New Arc Investments

The exact timing of the first Fed rate increase does not matter. There is a difference between tight monetary policy and slightly less accommodative policy. Markets do quite well in the early stages of rising rates, especially when starting from a low initial point. This will be ignored by many who will invoke “Don’t fight the Fed.” This will be the fundamental battleground between traders and investors, bears and bulls, and various political types – perhaps lasting for years. The end of the business or stock market cycle is not imminent. Bull markets do not die of old age.

2015-02-27 00:00:00 Are Expectations Too High? by Burt White of LPL Financial

The market’s continued ascent has caused some to ask if the stock market reflects excessive optimism. The pace of economic surprises as measured by the Citigroup Economic Surprise Index suggests expectations remain reasonable. We view recent economic disappointments as largely temporary, and would expect the surprise index may reverse recent declines as expectations have come down, providing support for cyclical sectors.

2015-02-27 00:00:00 Could Apple Buy a Third of the World’s Gold? by Frank Holmes of U.S. Global Investors

So what’s Apple’s next trick? How about moving the world’s gold market?

2015-02-27 00:00:00 Focusing on the Three Ds by Byron Wien of Blackstone

Looking forward several years, there will be three important factors that will determine the economic and investment outlook. They are decoupling, deflation and demand.

2015-02-27 00:00:00 On the Long Bond and Why the Widow Maker is Alive and Well by Team of GaveKal

Perhaps one of the most important questions investors need to answer today is whether we've seen the low in the long bonds yields or whether the trend lower is firmly intact. The recent spike in the 10-year bond yields from 1.65% at the end of January to 2.14% just two weeks later has no doubt complicated the situation. In this piece we'll try to layout one case for lower yields still.

2015-02-27 00:00:00 Rhyming…but not Repeating. by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Stocks have recovered their January losses and have continued to move higher. While economic growth remains solid and we remain secular bulls, investors should be prepared for increased volatility and the potential for a near-term correction. Also, European stocks may be due for at least a pause and we suggest looking to add exposure to emerging market positions if needed. Staying well diversified and keeping an eye on rebalancing is the recommended strategy.

2015-02-26 00:00:00 Equity Valuations, Recessions and Stock Market Declines by Doug Short of Advisor Perspectives (

When I initiated the dshort web page in late 2005, one of my routine topics was equity valuations, initially inspired by Nobel laureate Robert Shiller's book, Irrational Exuberance, the second edition of which was published earlier that year. I gradually expanded my focus from his cyclically adjusted price-to-earnings ratio (CAPE) to include Ed Easterling's Crestmont P/E, Nobel laureate James Tobin's Q Ratio and my own monthly regression analysis of the S&P 500.

2015-02-26 00:00:00 Family-Owned Businesses: One More Reason Not to Neglect Emerging Markets by David Ruff of Forward Investing

At the end of a year in which the U.S. handily led the world’s equity markets, many dividend investors find it hard to rouse any interest in emerging markets at all. “Why even bother?” seems to be the prevailing sentiment.

2015-02-26 00:00:00 Monetary Policy Matters by Mark Mobius of Franklin Templeton Investments

This year we expect the divergence in monetary policy among the world’s central banks to be a key theme and a likely driver of asset flows. For now, the scorecard seems to be tilted toward monetary easing since in the first month of 2015 alone, 14 central banks engaged in some form of monetary policy loosening, generally in the form of interest rate cuts or asset purchases.

2015-02-26 00:00:00 Rate Hike Rally by Scott Minerd of Guggenheim Partners

The lead-up to the first rate hike by the Federal Reserve is historically a favorable environment for U.S. equities and credit.

2015-02-25 00:00:00 At a Standstill? - The Debate Over "Secular Stagnation" by Team of Northern Trust

During one particularly stormy day recently, I asked my daughter to unearth herself from the couch and help me clear the snow from the driveway. Unfortunately, the prospective reward of industry was no competition for the television remote, and I was left to fend for myself.

2015-02-25 00:00:00 The Strange World of Negative Interest Rates by Lowell Yura of BMO Global Asset Management

This article examines explanations for negative bond yields. The article argues that central bank policies may be one of the causes. The article also suggests that to make sense of low Treasury yields, investors should be mindful of global yield correlations.

2015-02-24 00:00:00 U.S. Economy: Will Growth Be Roaring, or Boring? by Milton Ezrati of Lord Abbett

Here’s a look at key indicators—and what they signal for the pace of U.S. economic activity.

2015-02-24 00:00:00 Debt Be Not Proud by John Mauldin of Mauldin Economics

Some things never change. Here is Eugen von Böhm-Bawerk, one of the founding intellectuals of the Austrian school of economics, writing in January 1914, lambasting politicians for their complicity in the corruption of monetary policy.

2015-02-22 00:00:00 Weekly Economic Commentary by Team of Northern Trust

The dramatic retreat in the price of oil and other commodities has muddied the waters for those trying to assess inflation. The world’s central banks, most of which are charged with meeting an inflation target, are among those struggling to gain adequate visibility.

2015-02-21 00:00:00 Emerging Markets Equity Commentary: January 2015 by Team of Thomas White International

Emerging market equity prices outperformed in January on expectations that economic conditions in large Asian countries such as China and India could brighten this year. Fourth quarter GDP growth in China met expectations, helped by higher industrial production and consumer spending.

2015-02-20 00:00:00 Forward Estimates, Valuations vs. Returns, Told You So by Lance Roberts of Streettalk Live

I got into a debate recently with a gentleman who was adamant that current valuation levels in the market did not suggest trouble ahead. The problem is that his valuation argument was based on the use of forward operating earnings estimates. Let me explain why this is a faulty assumption.

2015-02-20 00:00:00 The Glass Ceiling on Rates by Scott Minerd of Guggenheim Partners

With the debt-to-GDP ratio at historic highs, the Fed doesn’t have much room to maneuver on the federal funds rate.

2015-02-19 00:00:00 Hub Group: A Long-Term Investment Thesis by Jason Downey of Diamond Hill Capital Management, Inc.

In September 2013, we outlined our favorable view of the domestic intermodal transportation industry driven by cost advantages, continued market share growth opportunities, and improving pricing power. At that time, we viewed Hub Group, Inc. (HUB) and Pacer International, Inc. as the most attractive investment opportunities within the industry. During the last seventeen months there have been material developments in each of these areas, some positive and some negative.

2015-02-19 00:00:00 Energy Sector Outlook: What We Are Watching by Burt White of LPL Financial

No sector is getting more attention right now than energy. Market participants are attracted to the potential upside after both oil and the energy sector suffered substantial declines in recent months. Many see the sector as cheap, something that is not easy to find these days in the U.S. equity market. We drive by gas stations every day where we see prices have been cut in half, serving as a constant reminder of how cheap oil is. In this commentary, we discuss what we are watching to assess the opportunity in energy.

2015-02-19 00:00:00 2015 Annual Forecast by Clyde Kendzierski of Financial Solutions Group

It’s already February, but for many readers this is the first communication of 2015 so, Happy New Year! It’s been a great 6 weeks so far and we’re looking forward to many more to come. Let’s get into it…

2015-02-19 00:00:00 Great Expectations for Small-Cap Active Management by Chuck Royce, Chris Clark, and Francis Gannon of The Royce Funds

Widening credit spreads, increasing volatility, and decreasing stock correlation should allow stock pickers the chance to emerge as performance leaders. We continue to see good times ahead for active managers who focus on business fundamentals.

2015-02-19 00:00:00 February 2015 Economic Update by John Richards of Bronfman E.L. Rothschild

Consumers in the U.S. are showing their optimism by pushing a key consumer sentiment indicator to its highest level in over a decade. Despite a drop-off in Q4 GDP to a 2.6% annualized growth rate and three consecutive months of slowing manufacturing expansion, the U.S. economy still seems to be on strong footing.

2015-02-19 00:00:00 Brighter Days Ahead for the Global Economy? by Team of Thomas White International

After seven years of uneven growth trends following the 2008 financial crisis, we believe the global economy is likely to see a moderate acceleration in 2015. While several risks remain, we are reasonably confident that there are now enough growth drivers in place to help most major economies advance.

2015-02-18 00:00:00 On My Radar: Schumpeter’s Creative Destruction by Steve Blumenthal of CMG Capital Management Group

This week let’s take a look at debt around the globe. I share a great piece from McKinsey & Company that shows just how much more debt, county by country, has been piled on since the 2007 debt induced financial crisis. Evidence is apparent in the commodity market and I also share a few ideas how you may risk manage those allocations.

2015-02-17 00:00:00 Gary Shilling - Why You Should Own Bonds by Robert Huebscher (Article)

If you followed Gary Shilling's advice for the last 30 years, you would be very wealthy. Since 1981, Shilling has consistently advocated owning long-dated Treasury securities. In a talk last week, he reiterated that advice as one piece of his three-part asset-allocation strategy for the coming year.

2015-02-17 00:00:00 Robo-Advisors Are Not New But They Foretell the Future of Financial Advice by Joe Tomlinson (Article)

So-called robo-advisors have been heralded as the next generation of technology that will transform the financial advice industry. Underneath the considerable debate that has emerged over their potential impact, an obvious fact has been overlooked: Much of what they offer is distinctively "old school."

2015-02-17 00:00:00 What Does the Current Low Interest Rate Environment Mean for Agency MBS? by Mike Cudzil, Daniel Hyman of PIMCO

After the agency MBS market in 2014 was dominated by low volatility, limited prepayment risk and strong performance, the strong rally in U.S. Treasuries in January resulted in just the opposite. With the Fed ending net purchases of MBS in October 2014, it seems unlikely for the private investment community to take the Fed’s place in the MBS market at this level of interest rates and spreads. PIMCO expects the environment for MBS in 2015 to be quite the opposite of 2014, resulting in higher volatility, cheaper valuations and more attractive excess return opportunities for the active manager.

2015-02-15 00:00:00 Self-Sustaining US Economy…So What Now? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The US economy appears to be in a self-sustaining phase of the expansion, which could mean more volatility as the Fed embarks on a tightening cycle. We remain confident the secular bull market is intact, but volatility has risen and we suggest investors who are over-exposed to US equities consider global diversification, with a preference for emerging markets. Europe appears to be stealthily improving, but Greece remains a flash point and Eurozone equity markets may have gotten ahead of themselves a bit.

2015-02-13 00:00:00 Global Airline Stocks Soaring, and Not Just Because of Low Oil Prices by Frank Holmes of U.S. Global Investors

The airline industry is notoriously competitive. There’s even an old joke: If you want to make a million dollars in the airline business, you need to start with two million.

2015-02-12 00:00:00 Scott Mather Discusses PIMCO’s Total Return Strategy by Scott Mather of PIMCO

Bonds have continued to rally so far this year, even as the Federal Reserve contemplates raising interest rates. In the following interview, Scott Mather, CIO U.S. Core Strategies, discusses recent developments in the bond markets, the outlook for the year ahead and the investment implications for PIMCO’s Total Return Strategy. Mather co-manages the strategy with Mark Kiesel, CIO Global Credit, and Mihir Worah, CIO Real Return and Asset Allocation.

2015-02-11 00:00:00 China Just Crossed a Landmark Threshold by Frank Holmes of U.S. Global Investors

Back in July 2013, the think tank Heritage Foundation predicted that China’s outbound investment “could very well exceed $80 billion [by the end of the year] and is on course to breach $100 billion by about 2016.”

2015-02-10 00:00:00 Weighing the Week Ahead: Time for “Risk On?” by Jeff Miller of New Arc Investments

With a modest schedule of data releases, we can expect more analysis of last week’s news. Trading in several markets changed course rather abruptly. With traders poised to spot any change in trend, the question will be whether this shift is for real.

2015-02-09 00:00:00 Bonds or Jeter? by Richard Bernstein of Richard Bernstein Advisors

In baseball, batters choose to either swing for the fences in hopes of a home run or go for more consistent base hits. These same principles are highly relevant to the current market environment and long-term investment success. So, see if you really want home run hitters in your portfolio?

2015-02-09 00:00:00 The International Ramifications of ECB QE by Andrew Bosomworth of PIMCO

By engaging in quantitative easing, the European Central Bank is pursuing its inflation mandate with a vengeance. Overall, we think the combination of quantitative easing, investment and lower oil prices will help eurozone growth reach approximately 1.3% in 2015. Global central bank balance sheets continue to expand: Although the Federal Reserve stopped purchasing assets in 2014, the Bank of Japan and now the ECB have stepped up buying bonds where the Fed left off.

2015-02-07 00:00:00 The Power of Lower Oil Prices by Byron Wien of Blackstone

The Ten Surprises of 2015 have two prevailing themes. The more dominant is that the decline in the price of oil is generally a positive for the world. It puts money in the pockets of consumers everywhere and it is likely to force Iran and Russia to be more conciliatory in geopolitical negotiations because both countries are suffering not only from the drop in the oil price, but also from the sanctions imposed on them. The second theme is that in spite of notable economic problems in Europe, China and Japan, the United States equity market will have another good year.

2015-02-06 00:00:00 Global Opportunities: The Next Leap Forward for Defined Contribution Investment Menus by Charles Roth of Thornburg Investment Management

Under ERISA, fiduciaries are obligated to ensure plan menus provide diverse investment options to help minimize the risk of long-term losses in account values. Global, non-traditional equity and fixed income options are sorely lacking in Defined Contribution (DC) plan menus. These op-tions can offer both lower correlation to U.S. markets and potentially strong returns, which par-ticipants increasingly need given the uncertainty surrounding Social Security’s future benefit levels.

2015-02-05 00:00:00 Macro View: Good Company, Bad Stock by Team of Guggenheim Partners

The U.S. economy is strong relative to other countries, but its equity valuations mean less upside potential for long-term investors than other areas of the world.

2015-02-05 00:00:00 Commercial Mortgage-Backed Securities: Approaching the Later Innings of a Recovery by Bryan Tsu of PIMCO

With the U.S. recovery as a supportive backdrop, PIMCO expects commercial real estate prices to rise 4%-6% in 2015. Commercial mortgage-backed securities issuance has increased for five years, and projections for 2015 are for growth of 20%-30%, driven largely by an increase in maturing loans on the supply side and the continued search for yield on the demand side. The growth in issuance does not come without concern: CMBS underwriting standards will likely continue to slip.

2015-02-03 00:00:00 Diving Into the ISM: What's It All Mean? by Mike "Mish" Shedlock of Sitka Pacific Capital

This morning the Institute for Supply Management released its much followed Manufacturing ISM® Report On Business®.

2015-02-02 00:00:00 Market Action Suggests Abrupt Slowing in Global Economic Activity by John Hussman of Hussman Funds

The combination of widening credit spreads, deteriorating market internals, plunging commodity prices, and collapsing yields on Treasury debt continues to be most consistent with an abrupt slowing in global economic activity.

2015-02-02 00:00:00 Fooled By Extrapolation by Brian Wesbury, Robert Stein of First Trust Advisors

Pundits have a bottomless reservoir of pessimism and also a magnified ability to extrapolate the most recent trends. So, when Q1-2014 real GDP fell at an annual rate of 2.1%, fear turned rampant.

2015-01-31 00:00:00 Diverging Policies…Converging Economies? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

The US economy should continue to expand but faces headwinds with weak global growth and a strengthening dollar leading to diverging central bank policies. Volatility has risen and the potential for a correction in the near term appears more likely. Nonetheless, timing the market in the shorter-term is dangerous, while the longer-term picture still looks positive for US equities. Across the pond, we remain skeptical much can be accomplished with the ECB’s QE program and continue to favor emerging markets over developed internationally. We also believe global diversification is becomin

2015-01-29 00:00:00 A Year to Think Small by Ted Baszler of Heartland Advisors

The current economic environment here and abroad could be setting up to benefit small-cap equities.

2015-01-29 00:00:00 Fed in Wait-and-See Mode by Team of Northern Trust

The Federal Open Market Committee (FOMC) concluded its meeting on an optimistic note. There were no dissents, following three at the December 2014 meeting.

2015-01-28 00:00:00 The Road Back, and Ahead by Scott Brown of Raymond James

The U.S. economy data are likely to be mixed in the near term, but there is little doubt that we are gathering steam. The plunge in gasoline prices is an enormous tailwind. However, this isn?t just an energy story. The fundamentals are getting better.

2015-01-13 00:00:00 2015 - Fasten Your Seat Belts, This Could Be a Bumpy Ride by Chris Puplava of PFS Group

While higher stock prices are often cited as the biggest beneficiary of the Fed?s several rounds of quantitative easing (QE), a lesser cited beneficiary has been overall market volatility and the credit markets. With each round of QE and/or ?Operation Twist? we?ve seen measures of financial stress in the credit markets contract.

2015-01-13 00:00:00 Market Outlook 2015: Double Digit Gain...Thank You, May I Have Another? by K. Sean Clark of Clark Capital Management Group

The U.S. stock market finds itself in rare territory as we enter 2015. For only the sixth time in the past 150 years, the U.S. stock market has registered a double-digit gain for three consecutive calendar years from 2012 to 2014. We will try to answer the question: ?Can the U.S. stock market post a fourth year of double-digit gains??

2015-01-12 00:00:00 A Five-Year Global Financial Forecast: Tsunami Warning by John Mauldin of Mauldin Economics

It is the time of the year for forecasts; but rather than do an annual forecast, which is as much a guessing game as anything else (and I am bad at guessing games), I?m going to do a five-year forecast to take us to the end of the decade, which I think may be useful for longer-term investors.

2015-01-09 00:00:00 A Tale of Two Earnings Seasons by Burt White of LPL Financial

The fourth quarter of 2014 will be a tale of two earnings seasons: the best of times and the worst of times. Despite a substantial drag from the energy sector, we expect another good earnings season overall. We expect more winners from cheap oil than losers, although the energy sector faces significant challenges.

2015-01-08 00:00:00 Levitate: More Market Mood Swings in 2015? by Liz Ann Sonders of Charles Schwab

Secular bull market is likely intact, but 2015 could bring more volatility associated with Fed policy and/or global events. Longer-term sentiment suggests the ?wall of worry? is intact; but shorter-term sentiment is more troubling. Falling oil and rising dollar have generated loads of questions from clients ? history tells a generally positive story.

2015-01-06 00:00:00 Volatility May Bring Opportunity and Challenges by Burt White of LPL Financial

As the economic and market cycles progress, increased volatility[1] should be expected; however, none of our Five Forecasters show elevated reason for concern, indicating a recession is unlikely in 2015.

2015-01-06 00:00:00 Ides by William Gross of Janus Capital Group

Beware the Ides of March, or the Ides of any month in 2015 for that matter. When the year is done, there will be minus signs in front of returns for many asset classes. The good times are over.

2015-01-02 00:00:00 2015 Investment Outlook: EuropeThe Saga Continues by David Zahn of Franklin Templeton Investments

David Zahn, head of European Fixed Income and portfolio manager, Franklin Templeton Fixed Income Group, gives his perspective on what he thinks may lie ahead as the eurozones drama continues into 2015.

2014-12-30 00:00:00 U.S. Consumers: Spend More? Bah, Humbug by Milton Ezrati of Lord Abbett

Despite an improving labor market and lower oil prices, consumer outlays should continue to expand at a slow pace. Heres why.

2014-12-23 00:00:00 Growth Headwinds Continue to Blow Through Asia in 2015 by Adam Bowe, Tomoya Masanao, Robert Mead of PIMCO

This commentary discusses the conclusions from PIMCOs quarterly Cyclical Forum in December 2014 and how they influence our Asian outlook and investment strategy.

2014-12-12 00:00:00 5 Things To Ponder: Crude Oppositeness by Lance Roberts of Streettalk Live

This past week I have been inundated with questions regarding the dive in crude oil prices and the energy sector in general. Is this a fantastic buying opportunity, or is the bigger of something bigger? The answer depends on your time frame.

2014-12-12 00:00:00 5 Things To Ponder: Crude Oppositeness by Lance Roberts of Streettalk Live

This past week I have been inundated with questions regarding the dive in crude oil prices and the energy sector in general. Is this a fantastic buying opportunity, or is the bigger of something bigger? The answer depends on your time frame.

2014-12-08 00:00:00 Peaking Process by John Hussman of Hussman Funds

In my view, we are likely witnessing the peak of the third equity valuation bubble in the past 14 years, the first two which saw major indices plunge by at least 50%. Its important to recognize that market peaks are a process, not an event. Internal deterioration has actually been developing since early July, and became measurable in early August. This process has been quite like what we observed in 2007, when deterioration became measurable in July of that year. Despite an initial selloff, the major indices recovered to a marginal new high in October 2007 before continuing lower.

2014-12-08 00:00:00 Inflection Points by Guy Scott of Janus Capital Group

U.S. equities surged over the last six years as the economy regained its footing after the financial crisis, and companies underwent substantial cost cuts to improve profitability. Today, many international companies and regional economies are early in the process of making similar positive, transformative changes.

2014-12-04 00:00:00 U.S. Economic Growth Picks Up by Team of LPL Financial

We believe the U.S. economy will continue its transition from the slow gross domestic product (GDP) growth of 2011 - 2013 to more sustained, broad-based growth. We expect the U.S. economy will expand at a rate of 3% or slightly higher in 2015, which matches the average growth rate over the past 50 years.

2014-12-02 00:00:00 The Tooth-Fairy Economics of Jeff Madrick by Laurence B. Siegel (Article)

Incentives don't matter, tradeoffs don't exist and there are no limits to what the government can give you. Those who believe this dogma are likely to still have faith in the tooth fairy. In Seven Bad Ideas, a critique of the neoclassical revival in economics that surrounded Milton Friedman and that affected policy and politics worldwide for more than a generation, Jeff Madrick emerges as tooth-fairy economics' chief exponent.

2014-11-25 00:00:00 Real Estate is Having a Moment by Christopher Gannatti of WisdomTree

Looking at equity market, one theme this year is that the U.S. has been outperforming global markets, both developed international and emerging markets. However, looking within the U.S., real estate has performed particularly well.

2014-11-25 00:00:00 Jeremy Siegel - Fair Value for the S&P 500 is 2,300 by Robert Huebscher (Article)

During the post-financial crisis period, no person has been more accurate at forecasting U.S. equity market returns than Jeremy Siegel, the Russell E. Palmer Professor of Finance at the Wharton School. In this year's interview, he explains why the fair value of the S&P 500 is 11% higher than its valuation today.

2014-11-24 00:00:00 When 'Buy and Hold' Works, And When It Doesn't by Urban Carmel of The Fat Pitch

Imagine if you had invested in the S&P 500 in 1984 and held through the tech bubble and crash and then through the financial crisis and its recovery. How would you have done over those 30 years? As it turns out, very well. On a real basis (meaning, inflation-adjusted), your holdings would have appreciated by over 400%. A $100,000 investment in 1984 would now be worth more than $500,000.

2014-11-24 00:00:00 International Equity Commentary: October 2014 by Team of Thomas White International

International equity prices saw large price swings during the month of October as fears about slower global growth led to an appreciable decline during the first two weeks. Equity prices recovered subsequently as better than expected U.S. economic data helped allay global growth fears.

2014-11-20 00:00:00 Will $2.50 Gasoline Catalyze U.S. Consumer Stocks? by William Smead of Smead Capital Management

A great deal has been written about how lower gasoline prices could stimulate discretionary purchases in the United States. RBOB gasoline futures peaked on June 20, 2014 at $3.12 per gallon and closed on November the 14th at $2.04. Those in the bearish camp like Randall Forsyth at Barrons argue that lower oil and gas prices will negate and ruin the economic benefit of the oil boom.

2014-11-19 00:00:00 Crude Oil? by Jeffrey Saut of Raymond James

Integrity, Websters dictionary defines it as, The quality of being honest and having strong moral principles. Recently the voters of America sent the D.C. crowd a message that they want integrity back in government. Consequently, I viewed the midterm election as a turning point. And, a turning point approaches on December 21st of this year. Thats when the Winter Solstice arrives.

2014-11-14 00:00:00 Mean-Reverting Profits and Other Things Worth Thinking About by Lance Roberts of Streettalk Live

Earlier this week I discussed the growing detachment between the stock market and the "real" underlying economy. One of the areas I touched on was corporate earnings that have been elevated by an immense amount of accounting gimmackry, cost cutting, and productivity increases. The problem, as I stated, is that historically earnings have grown 6% peak-to-peak before a reversion. Notice, I said peak-to-peak. The issue is that the majority of analysts now estimate that earnings will rise unabated for the next five years.

2014-11-10 00:00:00 Change Is In The Air by Brian Wesbury, Robert Stein of First Trust Advisors

While many flay away, trying to figure out the meaning of last weeks GOP wave election, it seems simple. The government has tried for more than five years to turn a Plow Horse economy into a Race Horse, and failed. Yes, the economy is growing and creating jobs, but living standards are growing slowly, or not at all, for many.

2014-11-04 00:00:00 Martin Wolf on the Financial Crisis: The Fire Next Time by Michael Edesess (Article)

If you think the global financial crisis of 2007-2009 was a one-time event caused by lax regulation and a financial industry run riot, then Financial Times chief economics commentator Martin Wolf has some bad news for you. Wolf, one of the world's most respected economists, says these circumstances were only part of its proximate cause and that the financial crisis was the inevitable product of the global economic system. If that system does not undergo radical change, says Wolf, financial crises may keep on recurring until the world economic order collapses.

2014-11-03 00:00:00 Losing Velocity: QE and the Massive Speculative Carry Trade by John Hussman of Hussman Funds

What central banks around the world seem to overlook is that by changing the mix of government liabilities that the public is forced to hold, away from bonds and toward currency and bank reserves, the only material outcome of QE is the distortion of financial markets, turning the global economy into one massive speculative carry trade. The monetary base, interest rates, and velocity are jointly determined, and absent some exogenous shock to velocity or interest rates, creating more base money simply results in that base money being turned over at a slower rate.

2014-11-03 00:00:00 Economy, Earnings and Policy Push Equities to New Heights by Robert Doll of Nuveen Asset Management

A combination of receding global growth fears, strong corporate earnings results and continued monetary policy support helped U.S. equities rise for a second week, with the S&P 500 Index climbing 2.7%.

2014-10-31 00:00:00 5 Things To Ponder: "Spooky" Things by Lance Roberts of Streettalk Live

I love this time of year, in particular it is the festivities surrounding one of the biggest commercial shopping days of the year - Halloween. According to Wikipedia:

2014-10-30 00:00:00 Recovery Reality by John Canally of LPL Financial

The U.S. economy is improving, and in many cases is back to normal, but it remains stubbornly weak in some areas. Real world indicators that point to the health of the economy include crane rental rates and customer traffic in restaurants. Economic uncertainty -- likely a drag on economic growth in 2011, 2012, and 2013 -- has faded as a concern in 2014, consistent with the Feds most recent Beige Book.

2014-10-30 00:00:00 Stay the Course in Small Caps by Jonathan Coleman of Janus Capital Group

Small-cap stocks sold off in the third quarter, but now is not the time to abandon the market cap segment. In this article, Jonathan Coleman, Co-Portfolio Manager of the Janus Venture Fund, gives his perspective on current small-cap valuations, and why an allocation to small caps is beneficial in an environment where the U.S. economy is on stronger footing than the rest of the world.

2014-10-28 00:00:00 A Framework for Superior Risk-Adjusted Returns: High Quality Stocks in Developed Markets by Baijnath Ramraika, CFA® and Prashant Trivedi, CFA® (Article)

A basket of high-quality stocks generates significantly superior investment returns compared to publicly traded benchmarks, and it does so with significantly lower risk.

2014-10-26 00:00:00 Plot Twistor a Different Book? by Liz Ann Sonders, Brad Sorensen & Jeffrey Kleintop of Charles Schwab

Volatility could continue but equity investors should keep the longer-term picture in mind, which we believe is positive. The U.S. economy is improving and monetary policy remains quite loose. The international picture is more concerning but diversification is important across asset classes. We currently favor emerging markets within a diversified international portfolio.

2014-10-21 00:00:00 Loomis Sayles Core Plus Bond Fund: Navigating Dynamic Markets with Tactical Flexibility by Sponsored Content from Loomis Sayles (Article)

The global economic cycle is a perpetual force influencing interest rates, credit availability and capital markets. For core plus managers who seek to generate total return by balancing liquidity and risk, these undulations pose a clear challenge.

2014-10-17 00:00:00 Pullback Perspective by Burt White of LPL Financial

We see the recent increase in volatility as normal within the context of an ongoing bull market. We do not believe the age of the bull market, at more than 5.5 years old, means it should end. We maintain our positive outlook for stocks for the remainder of 2014 and into 2015.

2014-10-15 00:00:00 Dilma or No Dilma? by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

During the first round of Brazilian presidential elections on October 5, the incumbent Dilma Rousseff received 42% of the votes while Aecio Neves received 34%. Since neither candidate received more than 50% of the vote, the second round of runoff elections will be held on October 26. This week, we will look at the Brazilian presidential elections along with the countrys current political and economic environment. We will briefly describe the recent political history of the country and look at the specifics of Brazils economic development. As usual, we will conclude with market ra

2014-10-14 00:00:00 High Quality Mid Caps Enjoy Performance Advantage by Sponsored Content from ClearBridge Investments (Article)

Since 1965, high-quality midcap stocks have outperformed their low-quality peers by a meaningful margin-a premium that has been most pronounced during periods of market transition. As we approach an inflection point in the current market and economy, investors should consider high-quality mid-cap stocks, which appear poised to thrive.

2014-10-11 00:00:00 Warning: Market Correction This Week? Did You See the Opportunity? by Frank Holmes of U.S. Global Investors

While stocks fell around the world this week amid growing concerns over global economic growth, Europes slowdown cant stop emerging market population growth that drives long-term commodity demand. If the short-term market volatility concerns you, a solution is short-term tax-free municipal bonds. Check out the 5 Reasons Why.

2014-10-01 00:00:00 Looking Back, Looking Ahead by Scott Brown of Raymond James

Real GDP is now estimated to have risen at a 4.6% annual rate in 2Q14. However, the second quarters strength must be balanced against the first quarters weakness (a -2.1% pace). As the third quarter ends, we still dont have a complete picture. However, figures are likely to suggest a moderately strong pace of growth and a gradual taking up of economic slack.

2014-09-30 00:00:00 Asset Allocation in a Time of Complacency by Dimitri Balatsos of Tesseract Partners

Complacency is a dangerous mindset, especially for investors. Having been generously rewarded beyond their expectations, investors were coddled in the arms of complacency as 2013 drew to a close.

2014-09-30 00:00:00 How Might Stocks Take a Hike? by Milton Ezrati of Lord Abbett

Here's a look at what happened to equities during past periods when the Fed raised rates.

2014-09-29 00:00:00 The Ingredients of a Market Crash by John Hussman of Hussman Funds

Market peaks often go through several months of top formation, so the near-term remains uncertain. Still, it has become urgent for investors to carefully examine all risk exposures. When extreme valuations on historically reliable measures, lopsided bullishness, and compressed risk premiums are joined by deteriorating market internals, widening credit spreads, and a breakdown in trend uniformity, its advisable to make certain that the long position you have is the long position you want over the remainder of the market cycle.

2014-09-27 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The Federal Reserve begins looking toward the door; China's policymakers should be clearer about their intentions; Dissents at central banks are rising

2014-09-23 00:00:00 Why "Healthspan" Trumps "Lifespan" for Clients by Dan Richards (Article)

Advisors spend a great deal of their time with clients who ask, "Will I run out of money?" As a result, few issues get more attention than the sustainable withdrawal rate in today's environment. But new research shows that an equally pressing question is, "How can I enjoy life in my 60s, before health issues creep in?"

2014-09-22 00:00:00 It’s Time for Your Portfolio to Break from Tradition by Kathleen Gaffney, Kevin Dachille of Eaton Vance

Given the current low-yield environment and with rising interest rates looming, now may be the right time to consider new strategies for generating favorable returns in your fixed-income portfolio.

2014-09-18 00:00:00 Room to Run by Marie Schofield of Columbia Management

The U.S. economy passed a milestone of sorts in August, in that the current business cycle has now surpassed the last one in length. The prior business cycle started in 2001 and continued until the December 2007 peak, lasting 6.8 years. This is longer than the post-war average of 5.6 years, but shorter than the business cycles in the 1980s and 1990s which lasted 9 to 10 years.

2014-09-17 00:00:00 America in the Driver’s Seat – Enjoy the Ride by Doug MacKay, Bill Hoover of Broadleaf Partners

Like clockwork, earnings season has drawn to a close, creating an information vacuum for the stock market, one in which the media spends more time "making" the news than perhaps reporting it. The marginal dollar at trade - or the price maker in a high frequency dominated trading world - is one more likely to be concerned about the Fed's words over the next two days than the stream of earnings produced by corporate America over the next few quarters.

2014-09-15 00:00:00 The U.S. Is Diverging From Other Developed Markets by Robert Doll of Nuveen Asset Management

U.S. equities fell amid a relatively quiet week, with the S&P 500 Index dropping 1.1%. The upcoming Federal Open Market Committee (FOMC) meeting drew quite a bit of attention amid increased speculation that the Federal Reserve may start signaling its long-awaited move to increase rates.

2014-09-13 00:00:00 Will the Russia-Ukraine Crisis Chill Europe’s Recovery? by Philippe Brugere-Trelat of Franklin Templeton Investments

As the crisis in Ukraine and resulting geopolitical tensions between Russia and the West continues with no durable solution yet, many investors have responded by exiting European companies with exposure to the Russian economy. But even as evidence mounts that the Ukraine crisis is taking a toll on many European economies, it would be imprudent for long-term investors to give up on investing in Europe. Strong corporate earnings momentum, high dividend yields and the possibility of additional support from the European Central Bank (ECB) are just some of the reasons why he remains confident that,

2014-09-12 00:00:00 U.S. rates The Draghi floor by Zach Pandl of Columbia Management

In typical fashion, last weeks European Central Bank (ECB) announcements found a way to bury the lede. The deposit rate cut to -20 basis points from -10 basis points was characterized as a technical adjustment, and the asset purchase program, while important, lacked a specific quantitative targetforcing investors to infer a rough figure from Mario Draghis comments in the press conference.

2014-09-12 00:00:00 Schwab Market Perspective: Diverging Paths…Growing Risks? by Liz Ann Sonders of Charles Schwab

The U.S. stock market continues to reach new highs but sentiment is extended and we are entering a period that has historically seen weakness. We believe the ultimate trend is higher, but bumps could get more pronounced in the near future. The U.S. economy is improving, with data suggesting self-supporting expansion is taking hold. Whether this means accelerated Fed interest rate hikes is being closely watched, while midterm elections often inject some more uncertainty into the market. The European Central Bank (ECB) finally acted, but structural issues and lack of demand remain problems.

2014-09-11 00:00:00 Why Growth Stocks Now? by John Calamos of Calamos Investments

After five years of a strong bull market, I believe theres still room for stocks to advance. Growth stocks look especially attractive. At 1.23, the premium for growth over value remains lower than the historical average of 1.44. Even when we omit the tech bubble from the long-term average, the 1.23 premium for growth is lower than that 1.37 average.

2014-09-10 00:00:00 Labor Force Participation Lowest in 36 Years - Why? by Gary Halbert of Halbert Wealth Management

Last Fridays unemployment report for August was significantly weaker than expected. While the headline unemployment rate dipped back to 6.1% (same as it was for June), the number of new jobs created last month was substantially below expectations and marked the lowest number of the year.

2014-09-09 00:00:00 How Rare are Housing Bubbles? Understanding the Case-Shiller Index and its Counterparts by Cesar A. Orosco and Laurence B. Siegel (Article)

Do house prices experience periodic bull and bear markets like the stock market? Or are they stable in real (inflation-adjusted) terms most of the time, with big disruptions once or twice in a century? Two popular house price series tell these very different stories. Knowing which is better will lead to superior investment outcomes and improved policy decisions.

2014-09-09 00:00:00 Market Perspective by The CCR Wealth Management Investment Committee of CCR Wealth Management

In our office we frequently make sport of the countless headlines we encounter on a daily basis from various media outlets across the web. These headlines are often splashed across the home pages of market or financial sitesthough often across mainstream news outlets, or the business sections of Sunday newspapers as well.

2014-09-09 00:00:00 Divergence by Kristina Hooper of Allianz Global Investors

A widening gap in monetary policy in the United States and Europe reveals the disparity in economic growth that exists. Kristina Hooper explains the implications for investors and what history reveals about periods of Fed tightening.

2014-09-09 00:00:00 Xis Purge by Bill O'Grady of Confluence Investment Management

Since taking power, Chinese President Xi Jinping has implemented a strong program to punish corruption. A large number of the Communist Party of China (CPC) have been under investigation or punished for their failings. We believe these purges are being implemented for reasons beyond the simple exercise in political power. This report will discuss the purge in detail, introduce the concepts of environmental and social capital, and discuss Chinas four stages of growth. We will conclude, as always, with market ramifications.

2014-09-09 00:00:00 Back to School With the Three Rs: Revenues, Reinvestment, and Renaissance by Burt White, Jeffrey Buchbinder of LPL Financial

We believe the three Rs are keys to the outlook for the stock market: revenues (and profits), reinvestment, and the renaissance in manufacturing. We expect stocks to garner support from these three Rs in the form of continued growth in revenues and profits, more corporate reinvestment, and continued steady gains for the U.S. manufacturing sector.

2014-09-04 00:00:00 International Equity Commentary: July, 2014 by Team of Thomas White International

International equity prices saw a modest correction in July as geopolitical tensions worsened in Ukraine and the Middle East. The risk of these conflicts spreading to wider areas and pulling in more countries unnerved the markets.

2014-09-02 00:00:00 Stronger Growth Should Push Equities Higher by Robert Doll of Nuveen Asset Management

A rash of positive news propelled stock prices higher for the fourth consecutive week, marking the longest winning streak for equities since last November. The S&P 500 Index pushed above the 2,000 level for the first time as it gained 0.8% for the week.

2014-08-27 00:00:00 EM Growth Provides Tailwind for Automation Companies by Nick Niziolek, Paul Ryndak of Calamos Investments

The pullback in Japanese equities earlier this year brought the valuations of select automation companies to attractive levels that do not fully reflect the long-term growth potential we see. The days of Henry Ford's assembly line are long gone, replaced by automated conveyor systems and robots that do much of the heavy lifting. Chinese labor costs are rising quickly, providing incentive for manufacturers to be more productive and contain costs. Also, the technical and quality requirements for manufacturing cars, phones and other electronics is increasing, requiring more precision.

2014-08-26 00:00:00 Global Economic Overview: July 2014 by Team of Thomas White International

Recent economic data from the developed world have shown divergent trends while growth in the emerging economies appears to be stabilizing. The U.S. economy expanded at a faster than expected pace during the second quarter, more than offsetting the first quarter decline, which revised estimates show was not as severe as thought earlier.

2014-08-25 00:00:00 Broken Links: Fed Policy and the Growing Gap Betweeen Wall Street and Main Street by John Hussman of Hussman Funds

The issue is not whether the U.S. economy does or does not need life support. The issue is that QE is not life support in the first place. How can policy makers help to build the economy from the middle-out, and slow the both the unproductive diversion and the lopsided distribution of resources in our economic system? We should begin by stopping the harm.

2014-08-23 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The View from Jackson Hole; U.S. Auto Sales: Tailwinds Will Prevail; The Mystery of Long-Term Bond Yields

2014-08-22 00:00:00 Our Take on the Fed Minutes by Doug MacKay, Bill Hoover of Broadleaf Partners

Usually, I don't have anything intelligent to say more than once every month or so and since I'm not a journalist, I'm never forced to make stuff up just to sell papers. I do believe, however, that the release of the Fed Minutes was worth a few of my minutes and perhaps yours. Even if you're yawning right now, please know that putting my thoughts in writing helps me to better manage your investments. As a money manager, we pick your investments, not your money managers. The buck starts and stops with us.

2014-08-21 00:00:00 A Roadmap, Not a Timetable by Scott Brown of Raymond James

On Friday morning, Fed Chair Janet Yellen will deliver the keynote address at the Kansas City Feds annual monetary policy symposium in Jackson Hole, Wyoming. Those looking for clues on the timing of the first Fed rate hike are likely to be disappointed.

2014-08-06 00:00:00 Grey Owl Q2 Investment Commentary by Team of Grey Owl Capital Management

Even after a second quarter rebound, gross domestic product (GDP) growth is barely positive for the first half of 2014. That has not stopped the S&P 500 from climbing to new highs. In fact, GDP growth has been weak for the entire recovery and, while improved, corporate sales and earnings also leave something to be desired. Stock market returns look better still, but only when compared to these weak results. Looking over a longer timeframe, the US equity market is approaching fifteen years of low single-digit returns.

2014-08-06 00:00:00 Consumer Confidence Hits 7-Year High - Really? by Gary Halbert of Halbert Wealth Management

Today well look at several key economic reports over the last week or so. Most have been better than expected. The Conference Board reported that its Consumer Confidence Index surged to the highest level in seven years in July. However, a couple of other reports well look at below paint a very different picture.

2014-08-05 00:00:00 Stock Market Valuations Suggest That This Bull Market Still Has Teeth by Team of LPL Financial

Losing under 3% in a week seems a minor concern given historical market ups and downs; nevertheless, investors may begin to wonder if stock market valuations are signaling a decline. Since the end of the last significant sell-off for stocks, the market has been in a pretty consistent upward trend. Valuation is a poor market-timing indicator; while valuation should always be considered, it is a blunt tool that should be taken into broader context.

2014-07-31 00:00:00 Are You Concerned about Small-Cap Valuations? by Tripp Zimmerman of WisdomTree

Stocks often move more than is justified by changes in their underlying fundamentals, and as a result, investors run the risk of paying too much for stocks that have become more expensive relative to their fundamentals.

2014-07-30 00:00:00 Fed's Janet Yellen To Continue Punishing Savers by Gary Halbert of Halbert Wealth Management

New revelations have suggested that our new Fed Chair, Janet Yellen, may be the most liberal person to ever hold the highest monetary office in the world. This news comes after a recent extended interview Ms. Yellen did with The New Yorker Magazine and her testimony before Congress earlier this month.

2014-07-23 00:00:00 It’s Not Time to Pull the Portfolio Ripcord… Yet by Rick Vollaro of Pinnacle Advisory Group

The second quarter started in somewhat choppy fashion as small cap and other high flying momentum stocks continued to face pressure as investors decided to shed stocks with swollen valuation multiples. The major averages fared better than their risky counterparts, and after a brief dip stocks began their ascent towards record breaking highs on the back on improving economic data, decent earnings growth, and continuing liquidity support from global central banks.

2014-07-19 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

From the Suez Canal, to Japanese bullet trains, to the American interstate highway system, to the Millennium Bridge to the Three Gorges Dam, the grandeur of infrastructure is on full display the world over. Awe-inspiring and beautiful to some, these fixtures also play a critical role in the functioning of the global economy. The choices nations make in the area of infrastructure can bear critically on prosperity.

2014-07-18 00:00:00 Reaching Escape Velocity? by Scott Brown of Raymond James

The strong pace of growth in nonfarm payrolls suggests much more than a rebound from bad weather. While recent economic figures have been generally mixed, the job market is clearly improving, led by increased hiring at small and medium-sized firms. The hope is that good news will feed on itself, lifting the pace of growth in the second half of the year. However, there are a few concerns in the outlook.

2014-07-18 00:00:00 Lack of Corporate Hubris Means Elongated Cycle by Richard Bernstein of Richard Bernstein Advisors

When we started Richard Bernstein Advisors roughly five years ago, we thought the US was entering one of the biggest bull markets of our careers. Today, we are likely in the midst of this long bull market. Despite the general consensus that a bear market is on the horizon and investors ongoing interest in protecting potential downside risk, we do not think the Fed, investors, or corporations are yet sowing the seeds for the next recession.

2014-07-17 00:00:00 Trading Secrets: The Feds Maginot Line by Tad Rivelle of TCW Asset Management

It has been six years since the Fed zeroed out rates and still we wait for assisted growth to become real growth. Beginning with the recovery summer of 2010, the Fed has proclaimed that cheap money would rocket the economy to escape velocity, launching an organic, self-sustaining economic recovery. Instead, central bank policy has vaulted asset prices into the stratosphere even as wages wait their turn on the launch pad. Low rates have failed to deliver the goodies, but the Fed has its story and is sticking to it.

2014-07-15 00:00:00 Two Top Experts Debate the Outlook for Growth by Laurence Siegel (Article)

Growth may slow, as Robert Gordon contends, at least when measured by GDP - if only because population growth is slowing. But that is not a foregone conclusion. And even if it were to happen, it doesn't mean that global standards of living would face a similar deceleration. Moreover, GDP doesn't fully capture the improvements in the standard of living that come with advanced technology.

2014-07-14 00:00:00 Col. Jessup and Rufus T. Firefly by Michael Kayes of Willingdon Wealth Management

There is a tried and true methodology for dealing with disconcerting trends in the equity market. Read on to find out what it is.

2014-07-10 00:00:00 The End of Quantitative Easing by Gregory Hahn of Winthrop Capital Management

During the Financial Crisis, as the capital markets seized up and interbank lending froze, traditional tools of monetary policy proved ineffective. The Federal Reserve implemented a series of initiatives called Quantitative Easing that essentially used the central banks balance sheet to purchase bonds in the open market and directly manipulate interest rates lower. This tool proved extremely powerful and allowed the Fed to manipulate interest rates across the yield curve which, in turn, allowed for a wave of refinancing activity that helped to lower borrowing costs.

2014-07-08 00:00:00 Why Free Trade Hurts Economic Growth by Marianne Brunet (Article)

Free trade, deregulation and limiting the federal government's powers form what Columbia professors Joseph Stiglitz and Bruce Greenwald call the Washington Consensus - the core precepts that have dominated policymaking for the last 50 years. But those ideas are misguided, they contend. Tariffs and trade restrictions, for example, are fine, especially if they are part of a broad framework that stimulates learning throughout a society.

2014-06-28 00:00:00 Weekly Economic Commentary by Team of Northern Trust

The recovery which began in 2009 has been weak and uneven. Some have blamed scarring from the financial crisis: wounds to the balance sheets of households, banks, and governments are taking a long time to heal. Under this school of thought, returning to pre-crisis normalcy is simply a matter of time, with the mending promoted by accommodative monetary policy. If the strategy works, well eventually return to the 3% real growth that weve averaged over the past generation.

2014-06-26 00:00:00 The Signal and the Noise by Scott Minerd of Guggenheim Partners

U.S. Federal Reserve policymakers are dismissing as noise signs that inflation pressure is building, but perhaps they should be listening more closely.

2014-06-14 00:00:00 Stealthy, Silent…Sustainable? by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

US stocks should continue to move generally higher although activity may remain sluggish through the summer and the possibility of a correction is elevated as per both seasonal/election cycle tendencies and elevated optimistic sentiment. The U.S. economy should help support the market as signs are increasing that we may be entering the long-waited for self-sustaining expansion. The ECB's actions weren't game changing but are helpful and European equities look attractive, while we believe the worries over a Chinese slowdown are overblown.

2014-06-13 00:00:00 Trading the Last Third of a Move by Scott Minerd of Guggenheim Partners

When bull markets mature, investors fear a coming crisis and today there are plenty of candidates from Europe to China to Thailand. Still, some of the best profits may lie ahead.

2014-06-12 00:00:00 Central Banks Chart a Course for Overheating by Scott Minerd of Guggenheim Partners

When bull markets mature, investors fear a coming crisis. Today there are plenty of candidates from Europe to China to Thailand. But bull markets climb a wall of worry and there are reasons now not to expect a looming crisis.

2014-06-12 00:00:00 Many Moving Parts by Scott Brown of Raymond James

The U.S. economy contracted in the first quarter, but it appears very unlikely that weve entered a recession. Weather disruptions and the late Easter have made it difficult to gauge the underlying trends in the economic data, but a significant second quarter rebound appears to be baked in. Still, taking the first two quarters together, growth in the first half of the year is likely to be disappointing relative to earlier expectations.

2014-06-09 00:00:00 Bright Signs for the Economy and Equity Markets by Bob Doll of Nuveen Asset Management

The macro backdrop last week was positive for the markets. As expected, the ECB cut interest rates, highlighting the favorable global monetary policy backdrop. Closer to home, solid vehicle sales and a good May labor market report gave investors additional reasons to bid up stock prices. The S&P 500 Index advanced 1.4%, marking a third straight week of gains above 1% the longest such streak since last September. Looking ahead, we believe the combination of an improving world economy, low levels of volatility and easy global monetary policy should continue to provide support for equ

2014-06-09 00:00:00 And That's The Week That Was... by Ron Brounes of Brounes & Associates

Let the summer partying begin. With the ECB alerting its Fed counterparts (and investors everywhere) that its policymakers will take whatever measures necessary to aid its economy and combat deflation, stocks again moved to record levels on key indexes and even the small-cappers recovered from the perpetual April slide and turned "in the black" for the year. The manufacturing and labor sectors appears to have put the winter storms behind them and even the consumer has shown signs of thawing out in time for the summer. Vacation anyone?

2014-06-02 00:00:00 Equities and Bonds Diverge Amid Low Volatility by Robert Doll of Nuveen Asset Management

Another week brought another record close for equities. The S&P 500 Index increased 1.2% for the week, notching a new high, but investor attention appeared to be focused elsewhere. Low levels of market volatility, a pickup in M&A activity, a difficult revenue environment for banks and improving housing data all gathered headlines, yet the bond market garnered the most focus.

2014-05-31 00:00:00 From Constantinople to Istanbul, Turkey Has Never Been Better by Frank Holmes of U.S. Global Investors

Every time he travels to Turkey, portfolio manager of our Emerging Europe Fund (EUROX), Tim Steinle, says the country continues to develop. Although technically classified as an emerging market, one wouldn?t think to label the country as such upon arrival. The population is young and growing, there are improvements to infrastructure everywhere you look, beautiful green parks are more prevalent, and the professional staffs that run many of the shops and businesses are both well organized and thriving.

2014-05-27 00:00:00 Kyle Bass: The Looming Crises in Asia by Robert Huebscher (Article)

For the last several years, nobody has been more outspokenly bearish on Japan than Kyle Bass. In a recent talk, Bass reiterated his doubts about Japan's chances of averting a debt crisis. What's more, he also said China's economy will fall below expectations.

2014-05-22 00:00:00 Why We're Often Bullish When the Market Turns Bearish by Francis Gannon of The Royce Funds

While economic anxiety has hit the market prior to the often bearish summer months, we continue to concentrate on matters less publicized: a shift in equity market leadership in favor of quality driven by rising interest rates.

2014-05-20 00:00:00 A Revised Bond Market Outlook? by Scott Brown of Raymond James

A year ago, as Fed Chairman Bernanke spoke of the possibility of tapering the Feds Large-Scale Asset Purchase program (QE3), bond yields moved higher. Theyve been range-bound over the last year, but have more recently dipped to the lower end of that range. Whats driving the bond market?

2014-05-14 00:00:00 Has Dividend Investing Lost its Luster? by Paul Stocking and Dean Ramos of Columbia Management

With interest rates rising in 2013 and after a number of years of outperformance from high-yield dividend paying equities, investors want to know if dividend investing remains an attractive strategy. With corporate balance sheets looking healthy and dividend payout ratios remaining low by historical standards, we believe dividend growth will continue to be strong. In our view, high-yielding equities will continue to provide strong total returns especially relative to fixed income alternatives.

2014-05-13 00:00:00 Is Rising Consumer Credit a Good Thing? by Kristina Hooper of Allianz Global Investors

When gauging whether a rise in consumer credit is a sign of progress or cause for concern, investors should look beyond debt levels to assess whos taking on more debt and why, as well as the pace of economic activity, writes Kristina Hooper.

2014-05-08 00:00:00 And That's The Week That Was by Ron Brounes of Brounes & Associates

Yes, spring has officially sprung. After months of hearing that "poor winter weather" excuse, investors seem ready to turn the page (and the calendar) as the 1st quarter GDP is now in the books. With that said, the numbers are expected to be stronger in the coming days and the markets are already reacting accordingly as the Dow Jones even pushed into record territory. Manufacturing and labor have shown signs of thawing out, though housing still lags behind. Earnings season has been better than expected and must of the over-analyses focuses on the outlooks these days.

2014-05-06 00:00:00 Optimists and Pessimists Find Fuel in Jobs Data by Kristina Hooper of Allianz Global Investors

Last week?s batch of hot and cold jobs numbers pointed to a conflict that the Fed saw coming months ago, writes Kristina Hooper: The unemployment rate is a flawed metric for gauging the health of the economic recovery.

2014-05-06 00:00:00 The Risk Trilogy by W. Ben Hunt of Salient Partners

Gregg Greenberg at was kind enough the other week to give me a few minutes (2:30 to be exact) in a video interview to enumerate the three biggest risks I saw facing markets today. At first I rolled my eyes at the request and the format. 150 seconds? Really? I mean, have you heard my Alabama drawl? It can take me 150 seconds just to order a cup of coffee.

2014-05-05 00:00:00 Economic Capital Market Summary by Gregory Hahn of Winthrop Capital Management

After the Financial Crisis and the resulting Dodd-Frank Act and Affordable Health Care Act, we knew there was no way we would go back to normal, whatever normal really was. Our world changed and we still continue to feel the uncomfortable mutations after the crisis. The management of Citigroup showed another disconnect with regulators as its 2014 capital plan was rejected. After several attempts to launch its healthcare website, the Obama administration announced that over 8 million people had signed up for health care insurance through the government exchange.

2014-05-03 00:00:00 Housing may be returning to a bad neighborhood by Team of Northern Trust

The head of financial stability at the Bank of England recently called rising property prices ?the very brightest [hazard] light on its dashboard.? But he may have a difficult time getting his colleagues who are charged with promoting full employment to agree with him. And if they do, it is far from clear what they might do about the issue. Some favor supervisory curbs; others prefer the more-traditional method of raising rates. The recovery in global real estate has been pronounced. While it beats the alternative, one wonders whether the hard lessons learned in recent corrections have been su

2014-05-01 00:00:00 Small-Cap Valuations: Way Too High or Room to Run? by Adam Peck of Heartland Advisors

Small-cap stocks have been on a tear for several quarters. Conventional wisdom in this situation would be to shift assets away from small-caps, and reallocate them to other asset classes. The concept sounds reasonable, but is it well-grounded in fact? What is the state of small-cap valuations today? These questions merit a closer look.

2014-04-29 00:00:00 How to Help Business Clients Unlock Wealth by Bob Veres (Article)

Is there a way to help your business clients diversify their holdings, take some risk off the table and create a side investment portfolio that will sustain them if their business runs into trouble? Is there a way you can help your clients find capital when they need it most?

2014-04-29 00:00:00 Will a Rise in Rates See a More Lasting Shift to Quality? by Charlie Dreifus of The Royce Funds

Late March saw signs of a re-emergence and shift back to the kind of quality names that we like. Portfolio Manager and Principal Charlie Dreifus discusses the recent Fed policies and their effects on the market, his outlook on the U.S. and global economy, current valuations, small-cap quality, and more.

2014-04-25 00:00:00 Rhyme or Reason? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

Stocks have seen wide swings recently, but year-to-date major indexes are roughly flat. Volatility may persist, but we suggest investors look past the near term and focus on the underlying fundamentals.

2014-04-25 00:00:00 A Strong Balance Sheet by William Smead of Smead Capital Management

In his book, Great by Choice, Jim Collins points out that companies he defines as great have good luck and bad luck just like all the other companies do. The great companies handle difficult circumstances better than good companies and take the most advantage of the breaks they get in business.

2014-04-21 00:00:00 The Federal Reserve's Two-Legged Stool by John Hussman of Hussman Funds

In viewing the Fed?s mandate as a tradeoff only between inflation and unemployment, Chair Yellen seems to overlook the feature of economic dynamics that has been most punishing for the U.S. economy over the past decade. That feature is repeated malinvestment, yield-seeking speculation, and ultimately financial instability, largely enabled by the Federal Reserve?s own actions.

2014-04-15 00:00:00 Equity Market Insight by Thomas Faust, Jr. of Eaton Vance

After a powerful rally in 2013, the first quarter of 2014 saw the bull market demonstrate a measure of resilience in the face of several headwinds. In the latter half of January, stocks fell sharply on emerging-market concerns, with volatility spiking to more "normal" post-financial crisis levels. The market bounced back strongly in February and went on to record a new all-time closing high on March 7. Performance was choppy in the final few weeks of the quarter, as investors digested mixed economic reports, geopolitical issues and the latest U.S. Federal Reserve (Fed) meeting.

2014-04-15 00:00:00 5 Things You Need to Know About the Selloff by Kristina Hooper of Allianz Global Investors

Kristina Hooper puts the sharp pullback in the stock market in perspective for investors who may be wondering about a correction.

2014-04-09 00:00:00 Reasons To Remain Optimistic In 2014 by Sandra Martin of Martin Investment Management

The equity markets have taken a respite in 2014 after returning more than 32% in 2013. Margin expansion has been the largest influence on profit growth and should continue with present low inflation expectations. We believe that mergers and share buybacks may continue to increase shareholder value for large capitalization stocks.

2014-04-08 00:00:00 How to Avoid the Coming Crunch on Advisor Compensation by Dan Richards (Article)

Here are the two key ways that life will look very different for financial advisors in 10 years: a change in the structure of advisor practices and downward pressure on compensation.

2014-04-07 00:00:00 The Other Side of the Mountain by John Hussman of Hussman Funds

Having witnessed the glorious advancing portion of the uncompleted market cycle since 2009, investors might, perhaps, want to consider how this cycle might end. After long diagonal advances to overvalued speculative peaks, the other side of the mountain is typically not a permanently high plateau.

2014-04-04 00:00:00 A New Machine: Is a Capital Spending Cycle Imminent? by Liz Ann Sonders of Charles Schwab

Activist investors have helped highlight companies bias toward stock buybacks/dividends vs. longer-term capital investments. Preconditions for a pickup in capital spending appear to be lining up. The technology and industrial sectors are likely the biggest beneficiaries.

2014-03-31 00:00:00 Shifting Policy at the Fed: Good for Long-Term Growth, Bad for Cyclical Bubbles by John Hussman of Hussman Funds

The Fed is wisely and palpably moving away from the idea that more QE is automatically better for the economy, and has started to correctly question the effectiveness of QE, as well as its potential to worsen economic risks rather than remove them.

2014-03-29 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Using energy as a pawn may work to Russias disadvantage in the long run. Chinas 2014 economic outlook is hazy. Lessons from the 2014 stress test.

2014-03-25 00:00:00 Why I Sold - Part 4 by Jim Whiddon (Article)

The months I spent considering whether to sell my successful independent RIA were difficult personally and professionally. But once my decision was made, it felt good to focus on the positive aspects of a merger that would benefit my staff and my clients.

2014-03-25 00:00:00 Stocks: "Aging Bull" Could Still Pack a Punch by Milton Ezrati of Lord Abbett

Bearish market observers fret that earnings growth will falter and that current equity valuations are unsustainable. Their worries are misplaced.

2014-03-24 00:00:00 Is the Fed Supporting the Equity Markets? by Tom Riegert of Hatteras Funds

The Federal Reserve?s unprecedented increase in reserves purchased through its quantitative easing programs has paralleled the performance of the equity markets to a startling degree. Has the Fed?s program been supporting the equity markets? We examine the strong correlation between the Fed?s balance sheet and the performance of the S&P 500 since end-2008, and ponder the effects the Fed?s long-awaited tapering will have on market volatility. Investors facing the uncertainty ahead could well find alternative investments a welcome addition to their portfolio.

2014-03-22 00:00:00 We See Opportunities in Commodities by Bob Greer, Ronit M. Walny, Klaus Thuerbach of PIMCO

Fundamentals and some recent data suggest that challenging trends for commodity investing may be coming to an end. Commodities may increase their role as an important and unique source of returns, diversification and protection from unanticipated inflation. As commodity sectors are each dominated by unique factors, we see even more opportunities to add value through active management.

2014-03-21 00:00:00 A Second Leg to Our Economic Outlook by Will Nasgovitz of Heartland Advisors

In our heavily consumer?driven economy, it can be easy to overlook the importance of corporate capital spending. We?ve seen a number of data points suggesting such expenditures are due for an uptick.

2014-03-19 00:00:00 Is the Fed's Monetary Mojo Working at Last? by Milton Ezrati of Lord Abbett

It just might be. Data suggest that the central bank?s massive liquidity boost may be starting to flow into the broader economy.

2014-03-19 00:00:00 Objects in the Rear View Mirror May Appear Closer Than They Are: A Look Back at the 1990s by Liz Ann Sonders of Charles Schwab

Human nature tells us to look back to help divine the future. Today's environment looks strikingly similar to the mid-1990s, which has pros and cons.

2014-03-14 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Global trade negotiations have stalled; This is a delicate time for Chinese finance; Where will Europes growth come from?

2014-03-12 00:00:00 Reflections on Ukraine by Bill O'Grady of Confluence Investment Management

Over the past five weeks there have been a number of significant events that have occurred in Ukraine. A president has fled, a revolutionary government is forming and Russia has taken de facto control over the Crimea. The events themselves are momentous but the broader effects are significant as well. In this report, we will offer three reflections?Putin?s Gambit, The U.S. Adrift and A Dangerous New World. Although any of these could be a topic in themselves, we will shorten these issues to offer a single journey through the current crisis. As always, we will conclude with market ramifications

2014-03-11 00:00:00 Thirsty for Income? Try Dividend Growth by Frank Caruso of AllianceBernstein

Chasing yield has become a challenging mission for investors in recent years. As yields collapsed in fixed income, investors flocked to bond-like substitutes such as high dividend-yielding stocks. Now that these stocks have become a bit pricey, we think companies with strong dividend-growth potential offer a better way to source equity income.

2014-03-10 00:00:00 Positive Payroll Report Offsets Geopolitical Concerns by Bob Doll of Nuveen Asset Management

U.S. equities increased 1.1% last week after somewhat volatile trading due to heightened tension in Ukraine. Although the crisis dominated headlines, the market relegated the major geopolitical issue to the back burner. The broader macro narrative did not change, as concerns about dampened growth momentum continued to be pacified by the distortion from adverse weather.

2014-03-09 00:00:00 The Problem with Keynesianism by John Mauldin of Millennium Wave Advisors

Keynes himself would appreciate the irony that he has become the defunct economist under whose influence the academic and bureaucratic classes now toil, slaves to what has become as much a religious belief system as it is an economic theory. Men and women who display an appropriate amount of skepticism on all manner of other topics indiscriminately funnel a wide assortment of facts and data through the filter of Keynesianism without ever questioning its basic assumptions. And then some of them go on to prescribe government policies that have profound effects upon the citizens of their nations.

2014-03-04 00:00:00 David Rosenberg: No U.S. Recession in Sight by Robert Huebscher (Article)

Following a lackluster recovery that began in June 2009, many fear the U.S. is due for another recession, given that the average post-war economic expansion lasted five years. But we’re only in the "fourth or fifth inning of the business cycle," according to David Rosenberg, who predicts growth in consumer and capital spending - and positive returns for U.S. equities.

2014-03-03 00:00:00 The Long Road Back by Scott Brown of Raymond James

Five years ago, the economy appeared to be in freefall. Monetary policy and fiscal stimulus helped to halt the downslide, but a full economic recovery was still expected to take years. This wasn?t your father?s recession that we went through; it was your grandfather?s depression. We have made progress, but we still has very long way to go.

2014-03-03 00:00:00 Equities Rise Despite Mixed Fundamental News by Bob Doll of Nuveen Asset Management

U.S. equities increased 1.3% last week as the S&P surpassed the key 1850 level and pushed to new record highs. One favorable dynamic of the rally was the upside leadership from retail stocks, as earnings were largely ahead of expectations. Fed Chair Janet Yellen suggested concern about softerthan-expected spending in a number of recent data releases, but the bar for adjusting the tapering process has not been lowered.

2014-02-26 00:00:00 Market Perspective by CCR Wealth Management Investment Committee of CCR Wealth Management

It cost $0.32 to mail a letter, unemployment was 4.9%, O.J. Simpson was found liable in a civil suit, Hong Kong was returned to Chinese rule, Timothy McVeigh was sentenced to Death, Green Bay defeated the Patriots in the Super Bowl, Titanic came crashing into movie theatres, and Dolly, the first genetically engineered lamb was unveiled to the public; the year was 1997.

2014-02-25 00:00:00 U.S. Economy: Curb Your Enthusiasm by Milton Ezrati of Lord Abbett

Amid optimistic projections of an acceleration in growth, the factors that have restrained GDP remain firmly in place.

2014-02-24 00:00:00 Confusing Crosscurrents Result in Trendless Market by Bob Doll of Nuveen Asset Management

U.S. equities finished mixed after the shortened holiday week.1 The broad market narrative did not change, as additional disappointing economic data was largely attributed to the impact of adverse weather. Comfort that the recovery may be gaining traction was evidenced through Fed discussions and the January FOMC minutes, with consensus expectations for tapering to continue at a measured pace. Some renewed concerns about a growth slowdown in China surfaced but had little impact.

2014-02-24 00:00:00 Secular Bull Or Bear? by Doug Ramsey of Leuthold Weeden Capital Management

At the January highs, the S&P 500 had gained almost 175% in just 58 months, while secondary stocks and equal-weighted market measures have gained considerably more. If it?s already over (and we don?t think it is), this cyclical bull will go down as a memorable one. But is this move the first leg of a new secular bull market? ? We think the next cyclical bear market will drive the market to levels low enough that debate will rage over the true date of the secular bear market low: was it 2009, or 201X?

2014-02-18 00:00:00 Understanding the Controversy over Dividend-Based Investing by Geoff Considine (Article)

Should investors favor dividend-paying stocks over non-payers? A long-held investment tenet contends that they should. But in a controversy that has pitted two highly respected investment firms - New York-based Tweedy Browne and Texas-based Dimensional Fund Advisors (DFA) - against one another, advisors are being asked to reexamine this issue.

2014-02-18 00:00:00 Global Growth Expectations Push Stocks Forward Despite Weather by Bob Doll of Nuveen Asset Management

U.S. equities finished sharply higher last week with the S&P 500 increasing 2.3% and all major U.S. averages up more than 2%.1 The rapid market recovery from the January pullback is a bigger surprise than the pullback that preceded it.

2014-02-12 00:00:00 Grey Owl Capital?s Third Quarter Letter by of Grey Owl Capital Management

2013 was a banner year for the US stock market. Despite equities? meager fourteen-year record of accomplishment, investors, broadly speaking, are limited to short-term memory. Last year?s performance was enough to generate significant enthusiasm for stocks. We continue to believe, the current environment warrants a more balanced approach.

2014-02-11 00:00:00 The 2013 Commentary Scorecard by Jill Mislinski (Article)

Let’s look at what prominent forecasters said in January 2013 about how the markets and economy would perform last year.

2014-02-10 00:00:00 Market Outlook by Scotty C. George of Alexander Capital

Despite the inverted gyrations of the stock market during the past three weeks, my market overview continues to be moderately bullish, of course with specific reservations about investors unbridled carryover of unrealistic expectations borne out of last years performance.

2014-02-06 00:00:00 Beyond the Mall: Why Consumers Matter by Ted Baszler of Heartland Advisors

The bottom line is, more people are working now than were a few years ago, pumping income into the economy. At the same time that employment and real wages have been staging a moderate comeback, the housing market has continued to hold firm, and equity markets have posted impressive returns. Record-high levels of personal net worth have prompted more discretionary spending. Periods of greater spending also are associated with higher levels of equity ownership, which can push P/Es higher.

2014-02-05 00:00:00 Most 'Medieval' by William Gross of PIMCO

Unlike today, when most believe that animals were put on this Earth for humanitys pleasure or utility, most people in the Middle Ages believed that God granted free will to Adam, Eve and all of His creatures. Animals were responsible in some strange way for their own actions and therefore should be held accountable for them.

2014-02-04 00:00:00 James Montier - What Worries Me Right Now by Robert Huebscher (Article)

GMO’s investment strategist James Montier discusses why corporate profits will revert to the mean, what investors should know about the controversy over CAPE valuations, and the one issue that is the "preeminent occupation" of his mind right now.

2014-02-04 00:00:00 Chinas Problems are Americas Opportunity by Justin Kermond (Article)

Fear not Federal Reserve tapering, lackluster U.S. earnings, oncoming deflation or markets heading into bubble territory, says Francois Trahan. Our economic and market growth will be fueled by structural changes driven by rebalancing in China. Dont be surprised to see a repeat of 2013s U.S. equity market performance, according to Trahan, who offered a script for countering clients unfounded fears over what might go wrong.

2014-02-04 00:00:00 Crisis in Ukraine by Bill O'Grady of Confluence Investment Management

Since November, Ukraine has experienced widespread civil unrest. In late November, Ukrainian President Yanukovych decided not to join an EU-sponsored trade pact. This led to protests from Ukrainians who desired closer relations with Europe. In this report, we will begin by discussing the geopolitics of the nations involved, examining how nations have adjusted their policies over time to changing conditions. We will analyze the risks to the region from current unrest, including a look at the impact on emerging markets. As always, we will conclude with potential market ramifications.

2014-02-03 00:00:00 Market Outlook by Scotty George of Alexander Capital

Despite the inverted gyrations of the stock market during the past three weeks, my market overview continues to be moderately bullish, of course with specific reservations about investors unbridled carryover of unrealistic expectations borne out of last years performance.

2014-02-03 00:00:00 NY Fed Models Forecasting Excess Returns Through 2018 by John Bougearel of Structural Logic CTA

The NY Federal Reserve has an equity research department. Their research department determined in 2013 that "stocks are cheap" and that investors should enjoy "excess high returns" in an abnormally low or negative real interest rate environment for the next five years through 2018. Before reviewing potential mean reversions, implications from the Year of the Horse, & George Lindsays bearish Three Peaks and Domed House model, lets attempt to quantify the NY Fed models. How high the Dow Jones might climb if it is to enjoy "excess high returns" through 2018.

2014-02-03 00:00:00 A Secular Bull Market? by Juliet Ellis of Invesco Blog

Five years from now, I believe we will look back and see that 2014 was part of the early stages of a multi-year secular bull market for US equities, characterized by rising stock prices with only short, intervening market corrections.

2014-02-01 00:00:00 Central Banker Throwdown by John Mauldin of Millennium Wave Advisors

The Federal Reserve is signaling that it is going to end quantitative easing at some point in the future; therefore, investors are trying to find the exits before the end actually comes.

2014-01-29 00:00:00 A Few Concerns by Scott Brown of Raymond James

Weve begun 2014 with widespread expectations that economic growth will pick up. Growth last year was restrained by tighter fiscal policy. With that out of the way and the housing sector recovering, the pace of expansion is poised to improve. However, there are a number of concerns. Weak growth in real wages may limit consumer spending, which accounts for 70% of Gross Domestic Product. Long-term interest rates could rise too rapidly, choking off the recovery in the housing sector. A continued low trend in inflation, a major concern for some Fed officials, could weaken growth.

2014-01-29 00:00:00 Middle East/Africa: Regional Economic Review - 4Q 2013 by Team of Thomas White International

The International Monetary Fund (IMF) anticipates weak growth in the Middle East and North Africa (MENA) region mainly due to heightened political instability. Whats more, after years of healthy performance, growth in the oil exporting nations is expected to lose pace due to lower international demand and local oil supply disruptions. Given that these countries are witnessing a population boom, the IMF emphasized the need for economic diversification by the oil exporters and job creation in private non-oil sectors.

2014-01-27 00:00:00 Broadleaf's 2014 Investment Playbook by Doug MacKay, Bill Hoover, Mike Czekaj of Broadleaf Partners

Most sell side firms publish their outlook for the economy and stock market at the end of December and in early January. As a buy side firm, we really arent under any expectation to share our outlook for the coming year and, as funny as it might sound, some of our clients dont even care to know what we think, only that we handle what they hired us to do, which is to outperform the market indices over a full market cycle and help them attain their financial goals over time.

2014-01-22 00:00:00 4 Simple Truths About US Consumers by Kristina Hooper of Allianz Global Investors

The December employment report called into question the momentum of the jobs recovery, which has clear implications for consumers. While further clarity on jobs is needed, here are some key observations that help frame the consumer-sentiment discussion.

2014-01-22 00:00:00 Market Share: The Next Secular Investment Theme by Richard Bernstein of Richard Bernstein Advisors

It is well known that corporate profit margins are at record highs. US margings, developed market margings, and even emerging market margins are generally either at or close to record highs. A myopic focus on profit margins may miss an important investment consideration. Whereas most investors remain fearful of margin compression, we prefer to search for an investment theme that could emerge if margins do indeed compress. Accordingly, our investment focus has shifted toward themes based on companies who might gain market share.

2014-01-21 00:00:00 Are Small Businesses the Engine of Job Growth? by Marianne Brunet (Article)

What do George W. Bush, Bill Clinton, Ronald Reagan and Barack Obama have in common (besides a conviction that the camera loves them)? They have all promoted the notion that small businesses are the engine of America’s economic growth. But new research shows that the role of small businesses has been overstated.

2014-01-21 00:00:00 Superstition Ain't the Way by John Hussman of Hussman Funds

When you believe in things that you dont understand, then you suffer.

2014-01-18 00:00:00 Forecast 2014: 'Mark Twain!' by John Mauldin of Millennium Wave Advisors

The surface of the market waters looks smooth, but the data above suggest caution as we proceed. Perhaps slowing the engine and taking more frequent soundings (or putting in closer stops!) might be in order. The cry should be "Mark twain!" Let’s steam ahead but take more frequent readings and know that a course correction may soon be necessary.

2014-01-14 00:00:00 Market Outlook by Scotty George of Alexander Capital

The stock markets valuation expansion has left a bittersweet taste in the mouths of some who believe that this historic sequence of "new highs" is simply smoke and mirrors and accelerated expectations. Indeed, while the wealth effect is improving the lot of many, it is also exacerbating the gap between "reality" and "perceived-reality".

2014-01-10 00:00:00 Macro Strategy Review by Jim Welsh of Forward Investing

Heavy emphasis on the fundamentals factors driving the U.S., European Union, China, and Emerging economies, and how the fundamentals are likely to impact markets.

2014-01-09 00:00:00 The U.S. Begins an (Un)employment Experiment by Sam Wardwell of Pioneer Investments

Extended unemployment benefits stopped for 1.3 million people at year-end. This doesnt change their employment status...they just stop getting unemployment compensation. Extended benefits (of up to 99 weeks) was part of the recession-fighting fiscal stimulus package. A question was: did this create a dis-incentive to find a job (aka "funemployment").

2014-01-08 00:00:00 Ready For Lift-Off? by Scott Brown of Raymond James

While some had expected a quick recovery from the recession, that was never likely to be the case. Recessions that are caused by financial crises are different from the usual downturns - they are more severe, they last longer, and the recoveries take a long time. The economy has been in recovery mode for the last four and a half years, but finally appears to be poised for an acceleration in 2014.

2014-01-07 00:00:00 Turn the Page: Outlook for Economy/Stocks in 2014 by Liz Ann Sonders of Charles Schwab

In this comprehensive (read: long...sorry!) 2014 outlook report, we assess the likelihood a correction is in the offing given the strong gains since 2009.

2014-01-06 00:00:00 Confidence Abounds by John Hussman of Hussman Funds

Its the very nature of a peak that it cant be produced except by unusual optimism.

2014-01-04 00:00:00 Forecast 2014: The Human Transformation Revolution by John Mauldin of Millennium Wave Advisors

It is that time of the year when we peer into our darkened crystal balls in hopes of seeing portents of the future in the shadowy mists. This year I see three distinct wisps of vapor coalescing in the coming years. Each deserves its own treatment, so this year the annual forecast issue will in fact be three separate weekly pieces.

2014-01-03 00:00:00 2014 Outlook: The Emergence of a Global Expansion by Team of Loomis Sayles

After years of a global recovery characterized by fits and starts, we expect more synchronized global growth in 2014. Global GDP growth will accelerate modestly from 2.7% in 2013 to approximately 3.4% in 2014, primarily driven by larger advanced economies. In particular, we are optimistic that US growth will be sustainable. The fading economic drag from government policy and the ongoing housing recovery should help boost US GDP growth toward 3% as the year progresses. The UK is poised for a similar rate of expansion in 2014, and Europe will likely post positive growth in the coming year.

2013-12-26 00:00:00 Does the CAPE Still Work? by William Hester of Hussman Funds

We feel no particular obligation defend the CAPE ratio. It has a strong long-term relationship to subsequent 10-year market returns. And its only one of numerous valuation indicators that we use in our work - many which are considerably more reliable.

2013-12-23 00:00:00 China's Consumer Stocks: Opportunities Despite Slower Growth by Richard Flax of PIMCO

A weaker macro environment and curbs on spending by government bureaucrats have hit a range of consumer businesses and, in some cases, forced a reassessment of expansion plans. While Chinese consumption may be challenged in the near term, we think the impact will be felt most in the retail sector where slowing demand is compounded by oversupply. We see opportunity in other sectors that benefit from secular demand growth and constrained supply or strong brands, notably casinos and luxury sectors.

2013-12-21 00:00:00 What Has QE Wrought? by John Mauldin of Millennium Wave Advisors

Now that we have begun tapering, we will soon see lots of analysis about whether QE has been effective. What will the stock market do? The US economy seems to be moving in the right direction, but the Fed has forecast Nirvana (seriously) - do we dare hope they can finally get a forecast right? Or have they jinxed us?

2013-12-20 00:00:00 The Mundane Truth Behind Margins by Doug Ramsey of Leuthold Weeden Capital Management

The margin expansion story of the last 20 years is a financial one, not an operating one. Investors routinely attribute todays near-record margins to operating efficiencies like factory automation and the outsourcing of labor to lower-wage foreign locales. This is certainly an attractive story, but the reality is that competition demands these actions, and many more, to merely maintain margins. We dont understand why economists who seem to be perfectly good capitalists in every other way think these innovations should result in a permanent jump in profitability.

2013-12-16 00:00:00 The World We Live In by Michael Kayes of Willingdon Wealth Management

For me, the final month of the year has always been a time to reflect upon the past as well as plan for the future. Analyzing the year soon to pass provides a valuable perspective with which to evaluate the important issues that will impact our country and economy going forward. In this context, 2013 sure has been a memorable year highlighted by horrific natural disasters, the deaths of Margaret Thatcher and Nelson Mandela, and on the lighter side, the unforgettable ending to perhaps the greatest Iron Bowl ever played.

2013-12-16 00:00:00 The Power of the Platform: The Promise and Peril of Technology Investing by Ryan Jacob of Jacob Asset Management

Without question, technologys rapid development during the past 20 years has played an incredibly powerful and largely positive role in furthering the progress and productivity of modern economies throughout the world. Technologys track record as a profitable investment theme, however, is a bit cloudier.

2013-12-16 00:00:00 2014 Investment Outlook: Economic Growth Should Broaden by Bob Doll of Nuveen Asset Management

For the first time in several years, we approach the new year without big clouds on the horizon. In the United States, accommodative monetary policy has healed many of the wounds from the 2008-2009 crisis.

2013-12-10 00:00:00 Macro Factors Distract Wealth Creation by Bill Smead of Smead Capital Management

What do Obamacare, Federal Government debt/budget deals, Quantitative Easing and jobs data have in common? To us they are all types of macroeconomic factors on which most investors focus. We believe the reason most investors focus on these types of news stories is because they can influence the US stock market over the next six to twelve months instead of the next 10 to 20 years. In this missive, we would like to challenge everyones thinking about their ultimate goal for investing in the stock market and the behaviors which lead to wealth creation.

2013-12-05 00:00:00 10 for '14 by Richard Bernstein of Richard Bernstein Advisors

Each December we publish a list of investment themes that we feel are critical for the coming year. We continue to believe the US stock market will continue its run through one of the largest bull markets of our careers. Our positive outlook extends to the following areas: US Equities, Japanese Equities, European small cap stocks, high yield municipals.

2013-12-03 00:00:00 Why Does the U.S. Have High-Cost Low-Quality Healthcare? by Michael Edesess and Kwok L. Tsui (Article)

The U.S. has worse mortality rates than virtually all other developed nations, and yet it spends twice as much per capita on health care. How on earth has the U.S. racked up such an appallingly bad health-care record, and what is the solution? A recent edition of the Journal of the American Medical Association identified many of the problems but was not persuasive in prescribing a cure.

2013-12-03 00:00:00 Philly Fed, the Geo Score and A Housing Stat Making Some Blue by Gregg Bienstock of Lumesis

Following a wonderful Thanksgiving holiday that involved way too much food, I found myself doing all I could to avoid the Black Friday masses and succeeded until I took to the highway for a journey to Albany, NY - they were leaving the malls and, perhaps it was exhaustion from their day of shopping, but the traffic and driving skills left something to be desired. Those weary shoppers amassed along I-87 brought to mind the question of how healthy (or not so healthy) is the economy?

2013-12-02 00:00:00 Economic Cycle Update: Evidence Suggesting Slow Growth Reigns by Team of Manning & Napier

Since the start of the current recovery, we have made the case that the economy would grow at a slower pace compared to most other expansions in recent memory. The consumer factored prominently in this outlook as they embarked on a long overdue period of balance sheet repair. Corporations would have little reason to invest if consumer growth was weak and large fiscal deficits would limit the ability of the federal government to contribute to growth.

2013-12-02 00:00:00 China's Great Leap by Equity Investment Team of Janus Capital Group

Chinas government just announced it would take a big step back...and let its economy take a giant leap forward. We believe Chinas proposed economic reforms will transform the economy and should allay investors main concerns about Chinese markets. In Janus latest Equity Monthly, our equity team offers its perspective on Chinas Great Leap.

2013-11-25 00:00:00 Equities Extend Gains for the Seventh Consecutive Week by Bob Doll of Nuveen Asset Management

U.S. equities finished higher again last week as the S&P 500 increased 0.4%. The Fed continued to dominate headlines, with heightened emphasis on the distinction between tapering and tightening. Bubble speculation continued to receive attention in the press, while many articles refuted such concerns. The financial sector performed well, led by banks.

2013-11-25 00:00:00 Permanently Depressed? by Scott Brown of Raymond James

One of the main economic debates of the last few years has been whether weakness is cyclical or structural. If the downturn is due to a temporary (albeit, severe) shortfall in domestic demand, then growth should pick up sharply at some point as the economy returns to its potential. If its structural, fiscal and monetary policy can do little to help. Opinions differ, but while the consensus may see the sluggish economy as reflecting mostly cyclical forces, cyclical weakness is more likely to become structural the longer it lasts.

2013-11-22 00:00:00 Shifting Global Fortunes by Mark Mobius of Franklin Templeton

Most investors, particularly those who live in developed markets, probably arent aware of the influence emerging markets have on the global economy. Im not just talking about China or just about governments. More and more large corporations are headquartered in emerging markets, a trend that I expect to continue. In addition, more of those companies that are located in emerging markets are also joining the ranks of the top companies in the world. In fact, some might be surprised to hear that some of the worlds largest initial public offerings (IPOs) have been in emerging m

2013-11-21 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

Some weekly commentaries are chock full of information, editorial content, market swings, economic data, and the like. Others, like today, reveal nothing magical about the preceding week or the outlook ahead.

2013-11-20 00:00:00 Setting Sail on the QE Express by Dawn Bennett of Bennett Group Financial Services

Ive been managing money for over 25 years and rarely have I seen the level of craziness and insanity in both our politics and financial markets in the U.S. Im frightened of this deepening manmade disaster thats unfolding in front of us right now in both the financial markets and the economy. Too much faith is being placed in untested theories and that quantitative easing is going to cure all of our ills.

2013-11-20 00:00:00 Yellen's Testimony Not Surprising: Fed Has More Work to Do by Sam Wardwell of Pioneer Investments

Janet Yellens Senate testimony in last weeks confirmation hearings was very dovish and offered no real surprises. She did not signal or hint at any change in Fed policy (it was a confirmation hearing), but suggested that the best way to achieve an exit from unconventional policy is to deliver a stronger recovery . . . and the Fed has "more work to do" to support that recovery. The risk that she will not be confirmed is considered negligible.

2013-11-18 00:00:00 The Muddle-Through Economy and Grind-Higher Equity Market Continue by Bob Doll of Nuveen Asset Management

U.S. equities finished higher last week as the S&P 500 and Dow Jones Industrial Average closed at record highs, marking the sixth straight week of advances.1 Several macroeconomic themes are important as third quarter earnings season comes to an end. Fed Chairman nominee Janet Yellen spoke before the Senate in support of current monetary policy and suggested a similar path under her leadership. Economic data was mixed for the week, and any economic weakness continues to be perceived as supporting a delay in tapering. In turn, this can be seen as positive for equities.

2013-11-17 00:00:00 The Unintended Consequences of ZIRP by John Mauldin of Millennium Wave Advisors

Two recently released papers make an intellectual and theoretical case for an extended period of very low interest rates and, in combination with other papers from both inside and outside the Fed from heavyweight economists, make a strong case for beginning to taper sooner rather than later, but for accompanying that tapering with a commitment to an even more protracted period of ZIRP. We are going analyze these papers, as they are critical to understanding the future direction of Federal Reserve policy. Secondly, we’ll look at some of the unintended consequences of long-term ZIRP.

2013-11-13 00:00:00 When Flexibility Meets Opportunity in the European Commercial Real Estate Market by Laurent Luccioni of PIMCO

The pace of asset sales by European banks has been slower than many anticipated due to the fragile economic, political and regulatory environment across the continent. A complex CRE landscape and the pervasive effects of cognitive bias, capital rigidity and the unintended consequences of regulation mean mispricing can occur frequently. Unlocking value in this environment requires a flexible approach to investing across the capital structure and the resources to source, underwrite, structure, service and operate commercial real estate assets.

2013-11-05 00:00:00 The Saudi Tribulation by Bill OGrady of Confluence Investment Management

In this report, we will discuss the basic history of U.S. and Saudi relations, focusing on the historical commonality of goals between the two nations. We will detail how the aims of the two nations have diverged since the Cold War ended and use this to examine Americas evolving plans for the Middle East. We will discuss how the evolution of U.S. policy is affecting Saudi Arabia and the pressures these changes are bringing to the kingdom. As always, we will conclude with market ramifications.

2013-11-01 00:00:00 Where Do Profits Go from Here? Up. Here's Why. by Joseph Tanious, Anthony Wile of J.P. Morgan Funds

After record-setting earnings in the first two quarters of 2013, the S&P 500 is on track to hit another historic high in profits for 3Q13. If this occurs, the first three quarters of this year will have been the most profitable ever in the 56-year history of the S&P 500. Future earnings growth through margin expansion seems unlikely, as an improving labor market and higher interest rates will most likely squeeze margins. However, stable revenue growth, share buybacks and the additional use of debt financing should support modest earnings gains in the year ahead.

2013-11-01 00:00:00 Korea Raises Voice for Shareholders by Soo Chang Lee of Matthews Asia

Corporate governance practices in South Koreas family-controlled conglomerates, known as chaebol, find their roots in a social contract that was implicit in the process of the countrys economic development under military dictatorship, which began in the early 1960s. Koreas previously autocratic government initiated economic plans and wielded power in the private sector by assigning different areas of development to each of several chosen corporate families.

2013-10-31 00:00:00 Third Quarter Letter by Team of Grey Owl Capital

Despite the recent shenanigans in Washington concerning funding the government and raising the debt ceiling, as well as the constant news coverage of the quantitative easing taper that the Federal Reserve may or may not begin, we are going to spare (at least for this quarter) both you and us another long discussion of these very real issues.

2013-10-29 00:00:00 Defining the EM Corporate Bond Opportunity by Sponsored Content from Loomis Sayles (Article)

Finance is a numbers business. Investors study prices, yields, rates of return. However, when it comes to sizing up emerging markets, we think they should also pay attention to semantics. In the past, terming a country “emerging” made it synonymous with low credit quality and higher risk. But today, many emerging markets boast strong credit profiles while parts of the developed world buckle under heavy debt loads.

2013-10-29 00:00:00 Equities Reach All-Time HighsYet Again! by Bob Doll of Nuveen Asset Management

U.S. equities marked another all-time high last week as the S&P 500 increased 0.9%. (1) Global equities reached new cycle highs for the second week in a row. Many investors have concerns that the gains will not last since the world economy remains lackluster and the liquidity driving the current rally will eventually stop.

2013-10-26 00:00:00 A Code Red World by John Mauldin of Millennium Wave Advisors

The heart of this week’s letter is the introduction of my just-released new book, Code Red. It is my own take (along with co-author Jonathan Tepper) on the problems that have grown out of an unrelenting assault on monetary norms by central banks around the world.

2013-10-25 00:00:00 Why Growth is Deep in the Heart of Texas by Frank Holmes of U.S. Global Investors

TIME Magazine?s cover this week features an engaging collage of the 50 states reassembled to fit within the boundaries of Texas. With a growing number of solid-paying jobs, affordable housing, and low taxes, ?the Lone Star State is America?s Future,? declares economist and writer Tyler Cowen.

2013-10-23 00:00:00 The Right Investment Vehicle by Craig French of WBI Investments

Remember your first car? You probably had some good times in it passing your drivers license exam, going to the prom, driving to your first job. You most likely have a different car now that youre older one more suited to your current lifestyle and needs. Ill bet your current car is a lot safer and more reliable than that first one. A car is a motor vehicle you use to reach your destination. Like a car, an investment portfolio is a vehicle you use to reach your clients investment goals.

2013-10-23 00:00:00 Economic & Capital Market Summary by Gregory Hahn of Winthrop Capital Management

It has been five years since the Financial Crisis wreaked havoc on the economy and capital markets. With equity markets trading near record highs and new issue corporate bonds coming to market regularly, the capital markets have largely recovered. However, we are concerned that the economic recovery is just an illusion that exists in spite of the efforts in Washington D.C. to kill it.

2013-10-22 00:00:00 A by Milton Ezrati of Lord Abbett

State and local government revenues have finally started growing again. The resultant boost to spending and hiring should aid the economy.

2013-10-22 00:00:00 Middle East/Africa: Regional Economic Review - 3Q 2013 by Team of Thomas White International

Economic activity in the Middle-East and North Africa (MENA) has been hindered by prolonged political unrest and civil strife. The regions vulnerability has increased over the last two years due to mounting structural challenges. Whats more, widening fiscal deficits due to the economic slowdown and dwindling foreign currency reserves remain sources of concern, as noted by a World Bank report.

2013-10-18 00:00:00 In Other News by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

It will take some time to gauge the full impact of the government shutdown and data is likely to be somewhat skewed over the next couple of months. However, sitting on the sidelines isnt a great option and stocks still appear to us to be the best place to invest money for the longer term. International growth, although not robust, appears to be more supportive as we head into 2014 than it has since the financial crisis, and we favor developed over emerging markets for the time being.

2013-10-16 00:00:00 Equity Outlook by Team of Osterweis Capital Management

As we write this outlook, our political leaders once again have succeeded in holding the U.S. government budget, and by extension the financial markets and the broader economy, hostage to their respective political agendas. We believe it is important to avoid getting caught up in the drama on Capitol Hill and remain focused on the slow but continued healing taking place in the U.S. economy.

2013-10-09 00:00:00 Taper Time - Mining, That Is by Adam Bowe, Robert Mead of PIMCO

Recent data suggest that mining investment is tapering, with the sector detracting from real growth in the first half of 2013. We see three possible growth scenarios: a handoff to the corporate sector; no handoff, with demand continuing to slow; or a handoff to the highly levered household sector, which would create long-term risks. Until we see meaningful signs of a growth handoff from the mining sector to a new balance sheet that has the capacity to expand, our base case calls for sub-trend growth and low interest rates, supporting bond prices over the cyclical horizon.

2013-10-08 00:00:00 The Death of Fixed Income? Not so Fast . . . by Giordano Lombardo of Pioneer Investments

Recent market movements have reminded investors that the fixed income market is facing a secular change, after a 30-year-long bull market driven by a continuous decline in interest rates. I believe the announcements of the death of fixed income as an asset class are greatly exaggerated, and in order to face the new reality, fixed income investors and asset allocators need to adopt a significant change of approach.

2013-10-08 00:00:00 And That's The Week That Was by Ron Brounes of Brounes & Associates

The gov is closed for business. Nuff said. Coming up in the week ahead: ISM Fed Minutes (Wednesday) Retail Sales (Friday), PPI (Friday)or maybe not.

2013-09-30 00:00:00 Government Shutdown Could Lead to a Buying Opportunity by Matt Lloyd of Advisors Asset Management

As we approach yet another self-induced the sky is falling and the other guy is to blame environment, recall that this situation is not uncommon. We have had 17 of these budget debt ceiling deadlines and yet we have unbelievably (said with extreme rolling of the eyes) been able to overcome our elected officials calls for the end of the world. The most recent time when the U.S. government shutdown was in November 1995 concluding in January 1996,when arguably the animosity and polarization was as pronounced as it is today.

2013-09-28 00:00:00 The Renminbi: Soon to Be a Reserve Currency? by John Mauldin of Millennium Wave Advisors

Contrary to the thinking of fretful dollar skeptics, my firm belief is that the US dollar is going to become even stronger and will at some point actually deserve to be the reserve currency of choice rather than merely the prettiest girl in the ugly contest the last currency standing, so to speak. But whether the Chinese RMB will become a reserve currency is an entirely different question.

2013-09-24 00:00:00 ENERGY MLPs: A Suitable and Sustainable Asset Class by Sponsored Content from ClearBridge Investments (Article)

Key Takeaways: MLPs have provided income with little correlation to other asset classes and little sensitivity to interest rates, commodity prices or economic cycles. The market for MLP stocks has expanded greatly and offers liquidity which appeals to long-term institutional investors. The renaissance in U.S. energy production is driving sustainable growth in the infrastructure that MLPs own and operate

2013-09-24 00:00:00 Michael Aronsteins Warning to Fund Investors by Robert Huebscher (Article)

Fixed-income investors may think rising interest rates are their biggest worry. But bond funds face a new risk, driven by their need for liquidity to service investors daily redemptions, according to Michael Aronstein.

2013-09-24 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

The Federal Reserve kept its word last week: until they see an improvement in jobs growth and wages they simply wont budge on their mission to keep interest rates low to stimulate borrowing and economic expansion. What this means to the markets, however, is more ambiguous.

2013-09-23 00:00:00 Seeking Global Growth: Our Outlook for Credit by James Balfour of Loomis Sayles

Global business and credit cycles are nothing new to investors. The familiar sequence of recession, recovery, expansion and slowdown plays out over time, influencing interest rates, credit availability, business climate and capital markets. Its a time-honored process, but in practice, no two business and credit cycle pairings are exactly alike. Business and credit cycles tend to be driven by specific but varying factors that accumulate until an economic tipping point is reached, after which the business and credit climates deteriorate.

2013-09-23 00:00:00 Fed Inaction Lengthens Reflationary Economy by Bob Doll of Nuveen Asset Management

U.S. equities advanced last week as the S&P 500 increased 1.32%.1 The Federal Reserve (Fed) delivered a big surprise by leaving intact the current $85 billion monthly purchase program. The Committee appears nervous about the resiliency of the economy. Chairman Bernanke pointed to three factors for postponing tapering: 1) the need for more labor market data to be confident in the outlook, 2) a desire to assess the degree to which tighter financial conditions, particularly mortgage rates, are affecting the real economy and 3) an interest in gaining clarity on upcoming fiscal debates.̶

2013-09-21 00:00:00 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Global deleveraging has a long way to go. Fiscal drama and the economy. Funding for economic statistics needs to be enhanced

2013-09-20 00:00:00 Rising Interest Rates Must End Soon by Scott Minerd of Guggenheim Partners

The yield on the benchmark 10-year U.S. Treasury bond has risen by more than 84 percent from May to early September, one of the most violent and rapid increases on record. This spike has caused severe convulsions in the bond market, leading many investors to wonder how long the torment can last.

2013-09-19 00:00:00 A Closer Look at Earnings by Ted Baszler of Heartland Advisors

To get a sense of whether forward estimates currently in place for the S&P 500 may be excessiveparticularly in light of an economic recovery that has at times moved in fits and startswe took a look at how earnings have historically related to weekly jobless claims figures.

2013-09-17 00:00:00 “Risk-On” Resumes as Uncertainty Subsides by Bob Doll of Nuveen Asset Management

Equity markets rallied last week with the hope of a diplomatic solution to the crisis between Syria and the United States. The S&P 500 advanced 2.03% for the week.1 Broadly, the S&P 500 is in a churning phase after witnessing an all-time high of 1709 on August 2 and then stalling.1 We believe the market has been on hold while waiting for lower oil prices, progress on Syria, further global growth and successful Federal Reserve tapering.

2013-09-10 00:00:00 Letters to the Editor by Various (Article)

Several readers responded to Michael Edesess article, Did Steve Jobs Really Build That?, which appeared last week. A reader responded to Stephen Roachs commentary, The Global QE Exit Crisis, which appeared on August 26.

2013-09-09 00:00:00 The Lesson of the Coming Decade by John Hussman of Hussman Funds

Even if the S&P 500 Index goes nowhere over the coming decade - as historically reliable measures of valuation suggest - it will probably go nowhere in an interesting and volatile way, providing better value and opportunities that are well-supported by historical evidence. The challenge will be to maintain discipline even when frustration begs investors to abandon it.

2013-09-09 00:00:00 And That's the Week That Was by Ron Brounes of Brounes & Associates

A couple of holidays during the week prompted some light volume and volatility as investors were forced to digest a slew of key economic releases and some potentially concerning geopolitical developments on a limited work schedule. In the end, investors took advantage of bargains leftover from a poor August, but many still maintain the same uncertainties that caused the pullback in the first place. Syria and the Fedthe headlines should be around for the foreseeable future.

2013-09-06 00:00:00 Four Interest Rate Scenarios We Could Face by Mike Temple of Pioneer Investments

Ive written a lot lately on the subject of duration and its potential impact on investor portfolios, now that the initial goals of the Federal Reserves Great Monetary Experiment appear largely accomplished and tapering of its monthly purchase of Treasuries to keep rates low is on the table. The era of lowering interest rates and rising bond prices looks finally at an end, with no place for rates to go but up. Its vital, then, that investors think about the impact that rising bond yields could have on their portfolios. Here are a few scenarios w

2013-09-04 00:00:00 The Bond Bear is Waking Up by Brian Wesbury, Bob Stein of First Trust Advisors

Weve been bond bears for quite some time, and we still are. The good news is that the violent part of the bear market has passed. We expect a slower, but still painful and consistent, move higher in interest rates during the quarters ahead. The 30-year bull market in bonds is over.

2013-09-03 00:00:00 Momentum in Europe by Janus Equity Investment Team of Janus Capital Group

We think now is a good time to be investing in Europe. European equity valuations are at the lowest level in more than 40 years, by some measures, and we are seeing green shoots in the regions downtrodden economy. Meanwhile, European companies in several industries have right-sized their cost structures or refocused their businesses, setting them up to be more competitive on a global scale.

2013-09-03 00:00:00 As Uncertainty Abounds in September, Sideways Consolidation Continues by Bob Doll of Nuveen Asset Management

Global equities struggled last week, with the S&P 500 declining -1.39%.1 Volatility rose from geopolitical uncertainty over the military strike in Syria.2 Oil prices spiked with concerns about escalation and tension but retreated due to dampened international support and expectations that a military campaign would be short-lived. The U.S. Treasury announced its borrowing capacity will be exhausted by mid-October, exposing contentious fiscal battles. Reports mentioned former Treasury Secretary Larry Summers may be leading the succession race for Fed Chairman.

2013-08-30 00:00:00 The Unfriendly Skies by Peter Schiff of Euro Pacific Capital

As if the federal government were not already doing enough to kill the U.S. airline industry with restrictive workplace rules, over-regulation, and a monetary policy that supports higher fuel prices, earlier this month anti-trust authorities at the Justice Department blocked the merger between American Airlines and US Air.

2013-08-26 00:00:00 Summers For Fed Chair by Brian Wesbury, Bob Stein of First Trust Advisors

In the next month or two, President Obama will pick someone to succeed Ben Bernanke at the Federal Reserve. At this point, we think the odds-on favorite is Larry Summers.

2013-08-26 00:00:00 Chicago Post Script, Reported Data Errors (Really) and What is a “Geo Score”? by Gregg Bienstock of Lumesis

Regular readers know I periodically suggest looking at alternative data points to gain a broader perspective. In this instance, something a little different. At the core of the DIVER platform is our database and we take data integrity very seriously. So much so that we periodically find errors in reported data. Many times, the source will correct the data as we notify them. Typically, when we find an error in a CAFR, the source will defer the correction until the next CAFR is released. In DIVER however, we will display the accurate values.

2013-08-25 00:00:00 France: On the Edge of the Periphery by John Mauldin of Millennium Wave Advisors

Charles de Gaulle said that "France cannot be France without greatness." The current path that France is on will not take it to renewed greatness but rather to insolvency and turmoil. Is France destined to be grouped with its Mediterranean peripheral cousins, or to be seen as part of the solid North Atlantic core? The world is far better off with a great France, but France can achieve greatness only by its own actions.

2013-08-20 00:00:00 August Monthly Investment Bulletins by Team of Bedlam Asset Management

For the first seven months of the year the portfolio rose by 25.2% vs. 19.3% for the index. During the month, the 6.4% gain was 150 basis points ahead. Three trends continued: the gradual increase in fund flows into equity markets relative to other asset classes, slightly improving economic data across most developed countries, and a mild deterioration in many developing nations.

2013-08-19 00:00:00 Consumers: Wallets Open, but Not Too Wide by Milton Ezrati of Lord Abbett

U.S. consumer spending is likely to remain on a slow, but steady, growth trajectory, boosting overall economic growth.

2013-08-16 00:00:00 Using Equities to Hedge Inflation? Tread With Care by Bob Greer, Raji Manasseh of PIMCO

Historically, broad equity returns have not intrinsically provided a good hedge against inflation. Three key attributes may help companies withstand inflationary environments - pricing power, supply side advantages and a willingness and ability to sustain dividend hikes at a rate faster than inflation. To realize equities long-term potential as a key source of portfolio returns, investors should consider enlisting active managers who select stocks with a view on inflation and its effect on specific companies.

2013-08-14 00:00:00 Pause: Breather Needed Short-Term, But Longer-Term Still Looks Good by Liz Ann Sonders of Charles Schwab

Sentiment has gotten a little frothy ahead of a typically-seasonally weak period, but valuation remains attractiveoh, and dont fret low volume.

2013-08-06 00:00:00 Is China the New France? by Marianne Brunet (Article)

Imagine a country that grows its economy by greatly devaluing against the reserve currency to develop a strong export sector. As the country becomes a major world power, it accumulates massive amounts of the reserve currency, and fears grow that its actions could destabilize global markets. If you think that description sounds like China today, youre right. But it also describes France in the 1920s. Lessons from that era are instructive for those seeking to forecast Chinas long-term position in the world.

2013-08-06 00:00:00 Europe's Fake Normal by Mohamed El-Erian of Project Syndicate

This summers sense of economic normality in Europe is neither natural nor necessarily tenable in the long term, because it reflects temporary and potentially reversible factors. If Europe does not return to addressing its economic challenges in a more comprehensive manner, the current calm may quickly give way to renewed turmoil.

2013-08-05 00:00:00 Two Charts Illustrate How to ?Follow the Money? by Frank Holmes of U.S. Global Investors

Too often investors get caught up in their political allegiance or parties, focus on the negative and lose confidence in stocks. As a result, they can miss great bull markets. I believe when it comes to finding investment opportunities, it?s not about the political party, it?s about the policies, both monetary and fiscal.

2013-08-05 00:00:00 The Minsky Bubble by John Hussman of Hussman Funds

In his classic treatise on speculation, Manias, Panics and Crashes (originally published in 1978), the late Charles Kindleberger laid out a pattern of events that has periodically occurred in financial markets throughout history. Drawing on the work of economist Hyman Minsky, the conditions he described are likely far more relevant at the present moment than investors may recognize.

2013-08-02 00:00:00 Fed Shows Its Dovish Side by Brian Wesbury, Bob Stein of First Trust Advisors

The Federal Reserve made several small changes to the text of its statement, which, combined, suggest a slightly more dovish posture at this meeting than at the last one in June.

2013-08-01 00:00:00 Fed in Watch-and-Wait Mode by Team of Northern Trust

The Federal Open Market Committee (FOMC) today held unchanged its current asset purchase program of $85 billion per month. The Federal Reserve avoided providing new nuances to existing forward guidance and re-issued the June policy statement with minor modifications to reflect recent economic developments.

2013-07-30 00:00:00 Conflicting Crosscurrents Move Equities Sideways by Bob Doll of Nuveen Asset Management

U.S. equities finished last week narrowly mixed, with the S&P 500 falling -0.02%.1 While the second quarter earnings per share growth continues to move higher, revenue growth remains below trend. The economic calendar is focused on this weeks release of the July employment report. Global macro headlines generated more uncertainty than direction for the markets.

2013-07-25 00:00:00 A Midyear Update: Getting Back to Normal by Douglas Cote of ING Investment Management

Though markets were whipsawed by the announcement, the Feds plan to step aside and allow normalization is a good thing. Today, the primary risk for investors to hedge is economic growth and the strong equity returns it tends to produce not financial Armageddon. While risks in Europe and China persist, U.S. fundamentals look relatively strong. Two consecutive quarters of S&P 500 earnings growth prompts a forecast update.

2013-07-11 00:00:00 Prepare for the 1-2 Punch of Declining Earnings and Multiple Contraction by JJ Abodeely of Sitka Pacific Capital Management

The market today is counting on continued earnings growth driven in large part by ongoing quantitative easing without inflationary consequences. In a recent strategy letter, we show that the markets expectation for future earnings growth is overly optimistic based on the fact that earnings are currently more than 40% above the long-term trend and mean-reversion and history suggests that real earnings are likely to decline over the next 5 years.

2013-07-09 00:00:00 ENERGY MLPs: A Suitable and Sustainable Asset Class by Sponsored Content from ClearBridge Investments (Article)

Greater capitalization. More liquidity. The energy MLP market has grown steadily, with good reason: our constant demand for energy. While oil prices go up and down, volume has stayed consistent. Production is increasing. And the infrastructure is needed to support it. Add some risk, and you’ve got an investment which could fit in a diversified portfolio.

2013-07-09 00:00:00 Jobs, the Fed, and Long-Term Interest Rates by Scott Brown of Raymond James

The June Employment report showed a labor market that is far from fully recovered, but appears to be well on its way. Federal Reserve policymakers are not going to react to any one report, but the trend in nonfarm payrolls has remained strong. Is that enough to ease up on the gas pedal? Perhaps. However, it should still be some time before the Fed has to hit the brakes.

2013-07-08 00:00:00 Obamacare and Stocks by Brian Wesbury, Bob Stein of First Trust Advisors

For much of the past four years, we have felt like psychologists who constantly must help hypochondriacs over their fear of one thing after another. There is no reason to remind everyone of the list its been endless, but the stock market and the economy have moved consistently higher despite these fears.

2013-07-01 00:00:00 The Golden Cycle by Peter Schiff of Euro Pacific Capital

The New York Times had the definitive take on the vicious sell off in gold. To summarize one of their articles: Two years ago gold bugs ran wild as the price of gold rose nearly six times. But since cresting two years ago it has steadily declined, almost by half, putting the gold bugs in flight. The most recent advisory from a leading Wall Street firm suggests that the price will continue to drift downward, and may ultimately settle 40% below current levels.

2013-07-01 00:00:00 All of the Above by John Hussman of Hussman Funds

Market internals remain broken here. That may change, and it might even change soon. Until it does, we would be inclined to tread carefully, because this may be the highest level investors will see on the S&P 500 for quite some time. Choosing between potential catalysts - credit strains in China, the risk of disappointing earnings, or economic weakness, the incoming data is consistent with one conclusion: all of the above.

2013-06-28 00:00:00 Stay the Course As Mixed Signals Move Markets by Frank Holmes of U.S. Global Investors

We maintain that gold is in extremely oversold territory and mathematically due for a reversal toward the mean. Yet when gold prices plummet, fear takes over and some investors forget the fundamental reasons to own gold: Gold is a portfolio diversifier and a store of value. It is a finite resource with increasing global demand.

2013-06-28 00:00:00 China's Near-Term Macro Outlook by Team of Nomura Asset Management

The key message from the recent Shibor volatility is that the Chinese government is now willing to tolerate slower near-term growth while carrying out reform to rebalance the economy for long term sustainable growth. The diminishing demographic dividend as a result of the aging population and One-Child Policy will result in slower potential growth for the economy.

2013-06-28 00:00:00 Inflation Lags Monetary Expansion: Prepare to be Swindled by JJ Abodeely of Sitka Pacific Capital Management

In May 1977, the consumer price index (CPI), which measures a basket of consumer goods in the U.S. economy, had risen 6.7% from the year before. The indexes had doubled over the previous 15 years, and by 1977 investors were fully aware that the rate of change was increasingi.e. the inflation rate was spiraling higher. By then, this inflationary awareness had worked its way into every corner of the financial markets, as commodities, gold and interest rates rose, and the stock market remained in a deep funk.

2013-06-27 00:00:00 Commodities: Still Worried About Supply by Doug Ramsey of Leuthold Weeden Capital Management

Golds 2013 fall has been the lone development in the two-year commodities decline that seems to have captured much attention. The CRB Raw Industrialsa spot index of 13 commodities exhibiting a much tighter linkage to the global economy than goldpeaked in mid-April 2011, coinciding with the bull market relative strength highs in the both S&P 500 Energy and Materials sectors and the absolute price highs in the MSCI stock market indexes of commodity exporters Brazil, Canada and Russia.

2013-06-27 00:00:00 Currency Wars: A Case for the U.S. Dollar by Gibson Smith, Chris Diaz of Janus Capital Group

In recent years, the U.S. dollar has tended to lose value when the global economy improves, as investors are more willing to take risks. We believe that pattern has changed and that the U.S. dollar will outperform the Japanese yen, the euro and the British pound over the medium term, even if the global economy continues to improve. In our view, current conditions justify a material deviation in currency exposure compared with certain global fixed income benchmarks, such as the Barclays Global Aggregate Bond Index.

2013-06-26 00:00:00 Trampled By the Crowd? Logic Briefly Abandoned Creates Opportunity by Scott Colyer of Advisors Asset Management

The past two week slide in asset prices has caused a resurgence of doomsday pundits warning of impending calamity. The negative interpretation of Fed Chairman Bernankes comments regarding the U.S.economys future upgraded prospects is simply not logical. A careful review of what Bernanke said at his press conference was entirely consistent with what the Fed has said and done in the past.

2013-06-26 00:00:00 2 Ways to Play the US Energy Boom by Russ Koesterich of iShares Blog

Russ offers two ideas one perhaps obvious and one perhaps not for investors looking to potentially benefit from the US energy renaissance.

2013-06-19 00:00:00 Changes in our Asset Allocation by Gregory Hahn of Winthrop Capital Management

We believe that valuations in publicly traded securities are stretched, and, although we have seen a move higher in interest rates and stocks have sold off from their high levels, investors are faced with choices that offer generally lower expected returns based on historic measures of return. Today, with the S&P 500 hitting 1650 and the yield on the 10 year US Treasury Note moving abruptly from 1.70% to 2.15%, there are generally two schools of thought on the minds of investors.

2013-06-18 00:00:00 Three Time Bombs that Threaten Retirement Plans by Dan Richards (Article)

Three poorly understood developments threaten secure retirements ? without wishing to be alarmist, I will call them time bombs. These developments will change the retirement dynamic for many Americans: increasing lifespans, escalating medical costs as people age and safe withdrawal rates on savings dropping from historical levels.

2013-06-14 00:00:00 A Sweet Find on an African Adventure by Frank Holmes of U.S. Global Investors

The heart of Africa has been beating strong in recent years due to elevated commodity prices and resilient domestic demand, despite the global economic slowdown. Among the sub-Saharan African countries, Sierra Leone was the fastest growing country last year, according to the World Bank. Its economy experienced growth that is as rare today as Fancy Red diamonds. GDP increased a whopping 18 percent.

2013-06-12 00:00:00 Who Is Your Daddy and What Does He Do? by Cole Smead of Smead Capital Management

In the 1990 movie Kindergarten Cop, Arnold Schwarzenegger portrayed a police officer who goes undercover as John Kimble, a kindergarten teacher in Astoria, OR. Early in the movie, Mr. Kimble tells his class they are going to play a game called Who is your daddy and what does he do? After a myriad of answers, one of the children asks him if his ensuing headache is a tumor. Kimble replies Its not a tumor. We at Smead Capital Management believe this was not only one of the more comical moments of Kindergarten Cop, but also a great question to ponder in today&rs

2013-06-11 00:00:00 Gundlach ? Dont Sell Your Bonds by Robert Huebscher (Article)

Dont sell your bonds just yet, according to Jeffrey Gundlach. Global economic growth is slowing, he said, and the U.S. will be competing for a larger slice of a shrinking worldwide pie. A weaker economy dims the prospects for higher interest rates. The benchmark 10-year Treasury yield ? currently 2.08% ? will be 1.70% by the end of the year, according to Gundlach, providing profits for holders of long-term bonds.

2013-06-11 00:00:00 How Asia's Growth Transitions and Policy Experiments Are Shaping the Global Outlook by Ramin Toloui, Tomoya Masanao, Robert Mead of PIMCO

Our view is that Chinese GDP growth will downshift, averaging 6%-7.5% for the next five years as net exports and investment are reaching their limits. In Asia, Japan is perhaps the economy closest to the T-junction described in PIMCOs global secular outlook: The destination of Japans journey looks increasingly uncertain, with multiple potential outcomes that could stabilize or destabilize the global economy and markets.

2013-06-05 00:00:00 The Canary in the Coal Mine by Scott Minerd of Guggenheim Partners

Ongoing monetary stimulus is leading to heightened volatility, and the bull market which has been in place since 2009 is becoming overextended. The recent string of surprise downside moves in markets may be the canary in the coal mine for global investors.

2013-06-04 00:00:00 Woody Brocks Challenge to Krugman and the Keynesians by Bob Veres (Article)

A polarizing choice confronts policymakers. Either they side with Paul Krugman and the Keynesians, and advocate for aggressive fiscal measures to stimulate Americas economic growth rate, or they align themselves with the so-called austerians, who argue that budget cutbacks are necessary to eliminate deficits. A third option is rarely discussed. Its most outspoken proponent, Horace Woody Brock, says that America should continue to borrow, but spend wisely ? and develop new policy instruments that would eliminate asset bubbles and stimulate economic activity.

2013-06-04 00:00:00 Vincent Reinhart on Debt and Growth in the U.S. and Japan by Robert Huebscher (Article)

High debt levels translate to slower growth, according to Vincent Reinhart. That conclusion will be disheartening to those who jumped on the errors several University of Massachusetts scholars found last month in Carmen Reinhart (Vincent’s wife) and Ken Rogoff’s research. But Vincent Reinhart is the author, along with his wife and Rogoff, of a study published in 2012 that documented the degree to which high debt-to-GDP levels correlate with slower economic growth in developed countries.

2013-06-04 00:00:00 Finding Healthy Stocks in Europe's Troubled Landscape by Tawhid Ali of AllianceBernstein

European equity markets continue to face severe stress as the continent struggles to contain fallout from the sovereign-debt crisis. Yet this seemingly toxic environment is creating some exceptional investment opportunities in relatively healthy companies that can control their own destinies.

2013-06-03 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

Recent history has shown us that when investors feel prosperous their spending habits become more robust. Sometimes they even throw caution to the wind and splurge on discretionary purchases they previously sought to avoid or postpone. Such is the nature of a rapidly changing landscape that what previously had been a vulnerability now becomes a necessity. The impact of financial decision-making can have a manic effect upon virtually any part of the world. This is why crises become epidemics, and cures become panacea.

2013-06-01 00:00:00 Central Bankers Gone Wild by John Mauldin of Millennium Wave Advisors

For the last two weeks we have focused on the problems facing Japan, and such is the importance of Japan to the world economy that this week we will once again turn to the Land of the Rising Sun. I will try to summarize the situation facing the Japanese. This is critical to understand, because they are determined to share their problems with the world, and we will have no choice but to deal with them. Japan is going to affect your economy and your investments, no matter where you live; Japan is that important.

2013-05-30 00:00:00 Are We There Yet? by Vitaliy Katsenelson of Investment Management Associates

I started writing my first book, Active Value Investing: Making Money in Range-Bound Markets, in 2005; finished it in 2007; and published the second, an abridged version of the first (The Little Book of Sideways Markets), in 2010. In both books I made the case that there is a very high probability that we are in the midst of a secular sideways market a market that goes up and down, with a lot of cyclical volatility, but ends up going nowhere for a long time.

2013-05-30 00:00:00 Reflation in the Balance by Richard Clarida of PIMCO

Four of the worlds major central banks are now all in when it comes to ballooning their balance sheets in correlated, if not coordinated, efforts to achieve escape velocity in their economies. In accounting for the impact of quantitative easing on two key balance sheets, we are able to interpret, monitor and calibrate the programs currently in place. This in turn can help us prepare portfolios if or when sentiments and inflation expectations shift.

2013-05-28 00:00:00 Europe's Crossroads: The End of the Muddle Through? by Andrew Balls of PIMCO

The eurozone may be nearing a critical junction, owing to its weak growth, weak institutions, debt dynamics and domestic and cross-border political challenges. The German government may take a more active leadership role after its national election, but it is more likely it will continue with piecemeal measures. Considering the current low yield environment and ample central bank liquidity, it is important to focus on absolute yield levels and returns, and consider global alternatives such as emerging market securities and currency exposure.

2013-05-28 00:00:00 Watching Risk-Reward Ratios: Economic Data Still PositiveBut Rate Is Slowing by Rob Stein of Astor Asset Management

Risk-reward ratios are on our radar screen these days as we review the most recent economic data against the backdrop of recent market movement. This is not to say that we are in any way suggesting a top, a bear market, or even that a correction is on the horizon, even taking into account this past weeks movement and volatilityalthough each of these scenarios remains a possibility. At this point, though, we do have some minor concerns about risk-reward in the markets going forward, suggesting that a slight adjustment in beta or equity exposure from current levels is prudent.

2013-05-28 00:00:00 You Now Have All of Our Attention by Blaine Rollins of 361 Capital

Mr. Bernankes opening statement was just what the market wanted to hear... "Premature tightening of monetary policy could lead interest rates to rise temporarily but would also carry a substantial risk of slowing or ending this economic recovery and causing inflation to fall further".

2013-05-25 00:00:00 The Mother of All Painted-In Corners by John Mauldin of Millennium Wave Advisors

Japan has painted itself into the mother all corners. There will be no clean or easy exit. There is going to be massive economic pain as they the Japanese try and find a way out of their problems, and sadly, the pain will not be confined to Japan. This will be the true test of the theories of neo-Keynesianism writ large. Japan is going to print and monetize and spend more than almost any observer can currently imagine. You like what Paul Krugman prescribes? You think he makes sense? You (we all!) are going to be participants in a real-world experiment on how that works out.

2013-05-22 00:00:00 Cyprus and the Eurozone...Still Stuck in the Middle by Gregory Hahn of Winthrop Capital Management

The debt crisis in the Eurozone turned another chapter as Cyprus finally reached the point of requiring a bailout from the European Union. The wisdom of Gerry Raffertys hit song Stuck in the Middle with You which was written in 1973, rings true today as we watch the EU and the European Central Bank navigate the mess in Europe. With each attempt at containment, there appears some plot twist, the proposed Cyprus bank bailout is no exception. While the bailout of Cyprus and its banks is not large in size, only 10 billion, relative to the Cyprus economy, it is significant.

2013-05-22 00:00:00 Asia Brief: China's Car Fleet The Largest in the World? by Edmund Harriss, James Weir of Guinness Atkinson Asset Management

Car sales in China have grown rapidly since 2009 and it is on course to outstrip the US in terms of the size of its car fleet by the end of this decade. This presents a major challenge to the Chinese government, which must balance its peoples happiness and political stability with economic development in an environment which has already been compromised. The momentum of demand for new passenger vehicles is likely to make air quality worse and Beijing has introduced emissions and efficiency standards to address the problem.

2013-05-22 00:00:00 Malaysia's Post-Election Investment Outlook by Scott Klimo of Saturna Capital

Earlier this year we identified ASEAN as the most attractive region within the emerging markets universe. That prediction has proved accurate. Market indices (USD returns) year-to-date through April in the Philippines, Thailand, and Indonesia are 23%, 22%, and 16%, respectively. Singapore (which we do not consider an emerging market) gained 6%, while Malaysia rose only 3.9%. So whats the outlook for Malaysia?

2013-05-21 00:00:00 Are Equity Investors Pushing the Gas Pedal Too Hard? by Norman Boersma of Franklin Templeton Investments

Whatever previous reticence investors may have had about equities last year seems to have evaporated and, with remarkable speed, turned into fear over having missed the equity rally. Some major market averages have accelerated at a pace some say is reckless, so as we head toward the mid-point of the year, Norm Boersma, CFA, chief investment officer of Templeton Global Equity Group, takes a look at reasons investors might continue to push the gas pedalor tap the brakes.

2013-05-16 00:00:00 Hold Your Houses: The Housing Recovery May Take Longer Than You Think To Reach Consumers by Joshua Anderson, Emmanuel S. Sharef, Grover Burthey of PIMCO

New residential construction needs to double from 2012 levels to meet long-run stable demand, and the pace of that increase is critical. Consumer credit growth is hindered by strict lending standards, continued deleveraging and limits to mortgage equity withdrawal. As a result, the balance of mortgage debt is unlikely to meaningfully increase in the next 12-18 months, delaying a return of the virtuous consumer cycle.

2013-05-15 00:00:00 Consumers: The Great Sobriety by Milton Ezrati of Lord Abbett

Americans have cut debt, boosted savings, and held spending in checkall of which should aid the economy.

2013-05-14 00:00:00 Is Kyle Bass Wrong About Japan? by Robert Huebscher (Article)

Its standard practice for short sellers to kick dirt on their targets, and Kyle Bass is doing just that by asserting that Japans economy is on the verge of a financial crisis. In a talk on May 3, he said that Japans demise is imminent. So far, though, Bass has been wrong ? and he has his detractors, who are far less certain of Japans destiny.

2013-05-14 00:00:00 Guide to Working with Monetary Napalm by Scott Colyer of Advisors Asset Management

Napalm is a highly incendiary form of jellied fuel. It was used extensively in the Vietnam War to quickly ignite massive fires over large areas of land. In the world of financial incendiaries, the Feds overwhelming monetary stimulus has ignited asset prices in the United States with the force and effectiveness of napalm. Is the fire short lived? Are the gains in asset prices temporary or can they be believed? Are the housing and stock markets on fire just because of the Feds quantitative easing (QE) or could there be a much more fundamental reason?

2013-05-13 00:00:00 Closing Arguments: Nothing Further, Your Honor by John Hussman of Hussman Funds

Nothing further, your honor. I am resting my case.

2013-05-08 00:00:00 Deflation Is OverPlease Come Out by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

A blooper reel of 20th century history would likely include a feature on Japanese soldier Hiro Onoda. Posted to a small island in the Philippines during the waning days of World War II, when Onodas mission proved unsuccessful he was ultimately forced to flee into the woods, where he survived on a steady diet of coconuts and bananasfor almost 30 years after the end of the war.

2013-05-08 00:00:00 Are Investors Breathing a Sigh of Relief? by Bob Doll of Nuveen Asset Management

Last week U.S. equities delivered another gain as the S&P 500 increased by 2.0%.1 On Friday, the U.S. jobs report offered relief from fears of an accelerating weakness caused by prior softness during this time in each of the last three years. However, the full set of economic data for the week supports our view of a slower second quarter in a post-sequestration environment.

2013-05-08 00:00:00 Absolute Return Letter: In the Long Run We Are All in Trouble by Niels Jensen, Nick Rees,Tricia Ward of Absolute Return Partners

In the long run we are all dead, said Keynes. Maybe so, but we could be in trouble long before then. Investors appear preoccupied with central bank policy. We argue that investors are quite right in keeping their eye on the ball but, to us, it looks as if they are focusing on the wrong ball. The real worries for the long term are demographics and negative real interest rates and the effect these factors may have on equity returns.

2013-05-07 00:00:00 Niall Ferguson: Four Reasons Why the U.S. is Failing by Robert Huebscher (Article)

Niall Ferguson is the champion of anti-Keynesian economists. Last week, he explained why America’s pursuit of Keynesian policies is leading to disastrous consequences.

2013-05-07 00:00:00 Mutual Fund Companies Need to Prepare for a Changing Environment Fund Industry Turbulence Ahead by Paul Franchi (Article)

The mutual fund industry grew explosively from the 1980s on a rare tonic of a low-inflation credit expansion powered indirectly by international trade flows. That run reached a peak in 2008 when the application of quantitative easing (QE) served to prevent industry collapse with a softer form of transition, which continues today but must end when inflation returns.

2013-05-07 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Financial markets got the news they wanted last week as Europe cut interest rates, while here at home the Federal Reserve hinted they might do even more when it comes to money printing. To top it off, Fridays employment report showed improvement from March although the details caused most to discount the excitement.

2013-05-07 00:00:00 Quarterly Letter by Team of Grey Owl Capital Management

In his April 2013 commentary, PIMCOs Bill Gross wrote, PIMCOs epoch1, Berkshire Hathaways epoch, Peter Lynchs epoch, all occurred or have occurred within an epoch of credit expansion What if an epoch changes? What if perpetual credit expansion and its fertilization of asset prices and returns are substantially altered? What if a future epoch favors lower than index carry or continual bouts of 2008 Lehmanesque volatility ?

2013-05-06 00:00:00 Aligning Market Exposure With the Expected Return/Risk Profile by John Hussman of Hussman Funds

Some risks and market conditions are more rewarding than others. My objectives for this weeks comment are very specific. First, to demonstrate using a very simple model that investment returns do indeed vary systematically with market conditions. Second, to demonstrate that overvalued, overbought, overbullish conditions have historically dominated trend-following measures when they have emerged. Third, to demonstrate the impact of accepting investment exposure in proportion to the return/risk profile that is associated with a given set of market conditions.

2013-05-06 00:00:00 That Was the Week That Was by Jeffrey Saut of Raymond James

Informally the TV show, That Was The Week That Was, is referred to as TW3and was a satirical comedy program first aired in the early 1960s. The program was considered a lampooning of the establishment. At the time it was considered a radical departure from legitimate television, but it set the stage for many more such radical departures. I revisit TW3 this morning because I have had so many requests for a formal repartee of a number of last weeks Morning Tacks woven into a more formal strategy letter.

2013-05-03 00:00:00 Job Creation May Be More Robust Than Official Statistics Suggest. by Team of Northern Trust

Job creation may be more robust than official statistics suggest; U.S. employment situation; Central bank meetings

2013-05-02 00:00:00 Twin Peaks Target Achieved, What's Left? by Doug Ramsey of Leuthold Weeden Capital Management

Pithy sound bites arent our forte. So when we came up with the Twin Peaks idea (last decades S&P 500 highs of 1527 and 1565) a few months back, we hoped wed stumbled on a market theme that might last a while. That wish was dashed on March 28th, when the S&P 500 exceeded its October 2007 peak of 1565.15.

2013-05-01 00:00:00 May 2013 Commentary by Team of Sadoff Investment Management

The slow growing economy will cause the Federal Reserve to stay the course with continued stimulus via low interest rates and Quantitative Easing (QE) for some time. This environment continues to be bullish for stocks.

2013-04-30 00:00:00 Stockman to America: Sinners, Repent! by Laurence B. Siegel (Article)

In a massive volume that melds economic history and social criticism, the former Reagan administration budget director David Stockman has documented countless ways in which America went astray over the last century. Most notably, he decried the corruption of free-market capitalism by those seeking effortless profits at the public?s expense. This is the source of his book?s title, The Great Deformation.

2013-04-29 00:00:00 Economic Slowdown Has Not Weakened Share Prices by Bob Doll of Nuveen Asset Management

U.S. equities rebounded last week as the S&P 500 increased by nearly 1.8%,1 despite continued weak economic data. We believe recent data is not yet weak enough to change forecasts. The relative stability of data and forecasts - supported by stimulative monetary policies, an improving U.S. housing market and fading political polarization in the U.S. and Europe - sends a message of reasonably low volatility and manageable downside risks.

2013-04-24 00:00:00 What's Behind China's Economic Slowdown? by Weili Huang of Columbia Management

Chinas economy grew by 7.7% year over year (yoy) in the first quarter of 2013, against the market expectation of 8.0% yoy and a prior quarters 7.9% yoy. Gross domestic product (GDP) expanded 1.6% quarter on quarter (qoq), with an annualized growth rate of 6.6%, a step down from the 2.0% qoq and 8.2% annualized growth seen in 4Q 2012.

2013-04-23 00:00:00 The New Challenges to Reinhart and Rogoff by Robert Huebscher (Article)

Advocates for debt reduction and austerity have had no more authoritative sources than Carmen Reinhart and Ken Rogoff. But last week, these two professors had to defend claims that errors in their research ? ranging from a typo in a spreadsheet to the failure to include data from New Zealand ? invalidated their much-acclaimed findings.

2013-04-23 00:00:00 Looking Back at Peak Oil: The Coming Crisis in Energy Supplies by Richard E Vodra, JD, CFP (Article)

Peak Oil ? the maximum sustainable rate of global oil production ? happened in 2012. Thats one of the main conclusions of a new report, Fossil and Nuclear Fuels ? The Supply Outlook, released in March 2013 by the Energy Watch Group. This event will have profound long-term implications for how advisors should manage clients portfolios, and how clients should plan their future expenses.

2013-04-22 00:00:00 Weekly Commentary & Outlook by Scotty George of du Pasquier Asset Management

Despite recent gains in portfolio valuations, I question whether we are really profiting from the upward surge. To be sure, there is more money in your account, according to your last three monthly statements. And whos to argue that doesnt translate to real dollars, real well-being.

2013-04-17 00:00:00 Present and Emerging Risks to the Gold Trade by Amit Bhartia, Matt Seto of GMO

The notion of gold as a hedge against systemic risks is flawed. We believe that the concept of golds role as an insurance policy needs to be narrowed significantly.

2013-04-12 00:00:00 Soft Patch - Part Four? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Stocks continue to trade at all-time highs, but concerns are rising over a possible pullback and downturn in economic growth. A consolidation of gains is likely, but trying to trade around a pullback can be quite difficult. A potential tapering of Fed asset purchases continues to be discussed, but the Fed also appears nervous over the potential for a spring downturn. Cooler heads appear to be gaining traction in Washington and at least some marginal progress is being made. Economic improvement is gaining traction in Japan, raising hopes of sustainable change, while Europe continues to suffer.

2013-04-09 00:00:00 MLPs: Winning Streak Broken, Growth Story Intact by Sponsored Content from Legg Mason ClearBridge
by Chris Eades, Portfolio Manager (Article)

After an off year clouded by investors concerns about future tax policy, ClearBridges outlook for MLPs is again brightening. Oil and natural gas production are both ahead of estimates and the resulting infrastructure build-out is continuing.

2013-04-09 00:00:00 Bond Market Review & Outlook by Thomas Fahey of Loomis Sayles

The first quarter of 2013 turned out pretty much as expected: a low volatility environment with the level of bond yields and credit spreads relatively stable. At some point, we have to be happy with earning a yield on our fixed income investments. The last several years have been a major bond bull market, particularly 2012, but with yields at low levels, there is not much room left for bond price appreciation and we should be comfortable with earning our yield and carry.

2013-04-09 00:00:00 John Hussman ? Why Prospective Returns Are Low by Robert Huebscher (Article)

Monetary and fiscal policies have driven our economy into an unstable equilibrium, pushing investors into higher-yielding securities, according to John Hussman. But those higher yields are illusory, he said, because corporate profit margins are too high to be sustainable.

2013-04-04 00:00:00 Absolute Return Letter: The Need for Wholesale Change by Niels Jensen, Nick Rees,Tricia Ward of Absolute Return Partners

The seeds of the next crisis have probably already been sown as a consequence of the lax monetary policy currently being pursued. Frustrated with the lack of direction from political leaders, most recently witnessed in the handling of the crisis in Cyprus which was a complete farce, central bankers from around the world are likely to demand change, but politicians will have to be pushed into a corner before they will respond to any such pressure. Hence nothing decisive will happen before the next major crisis erupts.

2013-04-03 00:00:00 Surprise! 2013 Rally Pales in Comparison to 2012 “Stealth” Rally by Douglas Cote of ING Investment Management

Despite the hoopla over first quarter market performance, it paled in comparison to the first three months of 2012. Driven in part by an extremely accommodative Fed, the U.S. economy is gaining traction, but Europe continues to flounder. After their first negative print in three years during the third quarter, S&P 500 companies returned to positive earnings growth in the fourth. A broad, globally diversified portfolio is the best way to balance the desire for wealth accumulation with an appreciation of volatility.

2013-04-02 00:00:00 Bernanke’s Motives Behind Quantitative Easing by Paul Franchi (Article)

We are at a turning point: away from one global monetary standard, to a yet-to-be-determined new form.

2013-04-01 00:00:00 A More Mature Bull Market by Scott Minerd of Guggenheim Partners

One of the characteristics of a more mature bull market, such as the one we are in today, is that asset prices become more susceptible to contractions due to negative news.

2013-03-25 00:00:00 Cyprus Reminds Us of Threats and Improving Global Economy by Bob Doll of Nuveen Asset Management

Equity averages sagged slightly last week. Strength later in the week made up for earlier weakness as the equity rally paused for the Cyprus crisis. We (and the consensus) perceive Cyprus as mainly a local problem and believe it supports our view to remain cautious with Eurozone weightings.

2013-03-21 00:00:00 Goldilocks Roars by Team of Bedlam Asset Management

Equity markets are producing supra-normal returns. To March 18th, the portfolio is up over 15% year-to-date, over 100 basis points ahead of the index. Many investors would be happy with such a gain over a full year rather than a mere twelve weeks, so are puzzled, the more so as respected pundits agree that the data makes for easy stories of rampant inflation, collapsing government credit and a prolonged global recession. Equity markets, however, are stubbornly refusing to follow the script.

2013-03-20 00:00:00 US Equities: Does Valuation Matter? by Mark Ungewitter of Charter Trust Company

With growing talk of a new secular bull market, its time to take a look at valuation history. While its true that anything can happen in financial markets, it seems unlikely that a new secular bull market will lift off from a P/E multiple of 17x.

2013-03-20 00:00:00 Cyclial P/E 10 Ratios at S&P 500 Peaks Prior to Bear Markets by Doug Short (Article)

Earlier this week I posted a commentary Is This Bull Market Fundamentally Driven? A Look at PE Expansion. The content was largely reprinted from an analysis at the Wall Street Rant website. Among the many email responses I received about the post, one in particular stood out. Jonathan Schoolar, a long-time veteran of the investment industry, wrote:

2013-03-18 00:00:00 Finding the Sweet Spot by Mark Kiesel of PIMCO

Where is the investment sweet spot in todays global financial markets? The uneven global growth outlook means there are opportunities and risks for both credit and equity investors.

2013-03-18 00:00:00 Outlook for the Yen by Team of Nomura Asset Management

For several quarters ahead, we estimate that the Yen will remain range bound near the level of PPP (purchasing power parity), which is estimated to be between 90 to 95 Yen/USD. Though currency movements will be affected by various factors, we think the monetary policies of both Japan and the U.S. are the most important.

2013-03-18 00:00:00 UK Budget: No Fiscal Consolidation, but Looser Money Ahead by Darren Williams of AllianceBernstein

We expect little change in UK fiscal policy in Wednesdays budget. Instead the Chancellor George Osborne may try to nudge the Bank of England towards more aggressive monetary easing, putting further pressure on the pound.

2013-03-18 00:00:00 Is This Bull Market Fundamentally Driven? A Look at PE Expansion by Doug Short (Article)

Earlier today the anonymous author of Wall Street Rant sent me a link to a commentary that asks the intriguing question Is This Bull Market Fundamentally Driven?

The approach used in the commentary to answer the question is to do some simple math with the Cyclically Adjusted P/E (CAPE) popularized by Yale Professor Robert Shiller.

2013-03-13 00:00:00 Who Cares if There's a High-Yield Bond Bubble? by Gary Halbert of Halbert Wealth Management

High-yield bonds, or "junk bonds" as they are widely known, have received a lot of attention in recent months. Is there a high-yield bond bubble? Certainly a ton of new money has gone into high-yield bond funds over the last few years. Millions of Americans who would have never considered high-yield bonds have bought in due to near zero returns on traditional savings vehicles.

2013-03-12 00:00:00 Gundlach: Investors are asking the Wrong Question by Robert Huebscher (Article)

If you're trying to assess the Federal Reserve's so-called exit strategy from quantitative easing, then you're asking the wrong question, according to Doubleline's Jeffrey Gundlach. Quantitative easing is a permanent policy tool, he said, and investors should be asking what that means for their investment strategy.

2013-03-12 00:00:00 After Last Week's US Rally: Proceed with Caution by Russ Koesterich of iShares Blog

While last week's rally was supported by better-than-expected economic data and improving investor sentiment, the magnitude of US stocks' advance is starting to cause some indicators to flash yellow. Russ explains.

2013-03-11 00:00:00 Two Myths and a Legend by John Hussman of Hussman Funds

The present market euphoria appears to be driven by two myths and a legend. Make no mistake. When investors cannot possibly think of any reason why stocks could decline, and are convinced that universally recognized factors are sufficient to drive prices perpetually higher, euphoria is the proper term.

2013-03-07 00:00:00 Capex Revival by Francis Gannon of The Royce Funds

For some time now, we have been noting the defensive nature of the investment environment, one in which fear and uncertainty continue to be the major forces driving markets. Interestingly, this trend has held true for both investors and corporations alike of late. Even after a powerful move from the low of last November, for example, investors remain fearful about cyclical or economically sensitive sectors while at the same time embracing those very sectors that benefit from easy money, are defensive by nature, and are supposedly riskless.

2013-03-04 00:00:00 And That's the Week That Was by Ron Brounes of Brounes & Associates

The sky is falling. The sky is falling. It's the millennium all over again. (How did those fears work out?) With politicos unable to reach any agreement on the budget (taxes), the "dumb, arbitrary" spending cuts began to take effect to the tune of $85 billion this year. (So much for a military preparedness.) Though the impact on the economy will not be felt overnight, some areas will begin to suffer sooner than others and biz/consumer confidence could become an issue in the near future.

2013-03-04 00:00:00 Living in the Past: Investors Finally Putting Away the Rear-View Mirror? by Liz Ann Sonders of Charles Schwab

With a very strong January in the books for stocks, and hefty inflows into stock mutual funds, are we finally seeing the investor class become believers?

2013-02-26 00:00:00 Looking For A Reason To Sell-Off by Christian W. Thwaites of Sentinel Investments

Markets were looking for a reason to correct. Risk assets had outpaced themselves since mid November and in the first seven weeks the S&P[1] had outperformed the US Treasury 10-year note by 12% and the 30-year bond by 15%. The markets will lumber through the sequester and face the next test on the debt ceiling and first quarter results. Below the surface, the outlook is mildly optimistic. Why the qualifier? Because everything, in Europe, US and Japan, must be set in the context of the asset deflation and deleveraging going on and that will go on for some years.

2013-02-26 00:00:00 Sudden Discomfort by Scott J. Brown of Raymond James

Minutes of the January 29-30 meeting of the Federal Open Market Committee showed a growing discomfort with the Feds Large-Scale Asset Purchase program (QE3). Thats not all that surprising. Even those who strongly favor the program arent exactly happy with it. However, thats a far cry from wanting to end the program anytime soon. We should learn more this week as Fed Chairman Bernanke delivers his semiannual monetary policy testimony (Tuesday and Wednesday).

2013-02-22 00:00:00 Emerging Markets Outlook: Will Emerging Markets Continue Their Run in 2013? by Scott Klimo of Saturna Capital

A number of times we have been asked whether emerging markets will continue their run in 2013. Our response typically begins with the following clarification: "Emerging markets" may be a handy way to refer to the countries that constitute a generally recognized asset class, but this group is far from monolithic. Widely differing levels of development, economic drivers, opportunities to invest, and returns exist under the emerging markets umbrella. For this reason it's not entirely correct to imply that "emerging markets" had a run in 2012.

2013-02-21 00:00:00 Gold Miners- Back in the Abyss- An Update by JJ Abodeely of Value Restoration Project

Back on May 18th, 2012 I wrote a piece titled Jumping Into The Abyss: A Bull Case for Gold Mining Stocks. The miners had declined 40% from their August 2011 highs and for a variety of fundamental reasons like valuation and the relationship between mining costs and the price of gold and technical reasons, like sentiment, I felt the case to buy was compelling. The stocks subsequently rallied more than 30% over the following 4-5 months.

2013-02-19 00:00:00 Alan Greenspan on the Market and the Global Economy by Adam Jared Apt (Article)

During his six-decade-long career in financial services, Alan Greenspan was a central figure in seminal events that drove investment markets, from the savings-and-loan crisis to the dot-com bubble to the housing crisis. Now, nearing 87, he rarely speaks in public. But he did so last week, offering his forecasts for the U.S. and European economies.

2013-02-19 00:00:00 Too Great Expectations by Richard Golod of Invesco

Global investors entered the year with newfound enthusiasm. Across the board, global equities traded higher in January, and retail money flows into global equities were the best in 17 years. Media reports about a "Great Rotation" from fixed income into equities are raising expectations about the possibility of a new secular bull market. However, I believe a little perspective is in order.

2013-02-16 00:00:00 In the Year of the Snake, Where Will Copper Head? by Frank Holmes of U.S. Global Investors

With an improving global economy and Chinas new leadership ramping up projects, will base metals, such as copper, head higher?

2013-02-13 00:00:00 Concerned by Recent Economic Data? Look Closer by Marco Pirondini of Pioneer Investments

We've seen a lot of GDP data recently that, at first look, may seem a bit concerning. But if we take a moment for analysis, much of the news is actually good for the economy and the markets.

2013-02-12 00:00:00 The Milton Friedman Centenary: One Hundred Years of Surprisingly Little Solitude by Laurence B. Siegel (Article)

Milton Friedman was once a lonely voice for capitalism in a collectivist era, and seemed doomed to a hundred years of solitude. Instead, he arguably became the preeminent public intellectual of the hundred years that followed his 1912 birth.

2013-02-11 00:00:00 And That's the Week That Was by Ron Brounes of Brounes & Associates

With folks in the Northeast finally returning to normalcy following Superstorm Sandy's impact in October, a "potentially historic" blizzard threatened the region with predicted disruptions to businesses, schools, travel, etc. Though New England is expected to catch the brunt of the damage, forecasters are calling for up to 20 inches of snow in New York City. For now, NYSE Euronext does not anticipate anything but "business as usual" at the NY Stock Exchange as contingency plans are well in place.

2013-02-05 00:00:00 Letters to the Editor by Various (Article)

A reader responds to Joe Tomlinson's article, Predicting Asset Class Returns: Recommendations for Financial Planners, which appeared last week, and another reader responds to Dan Richards' articles.

2013-01-31 00:00:00 Q4 2012 Letter by Team of Grey Owl Capital Management

During the second half of 2012, central banks turned their massive and coordinated monetary intervention "up to eleven." This is the overwhelmingly dominant economic and market force today. Despite the long-term consequences (which are very real), we believe the central bankers commitment is steadfast. It has and will likely continue to mute both real economic and financial market volatility (at the expense of long-term growth). A deeper analysis of what has changed, our assessment of the impact, and our portfolio response follows.

2013-01-25 00:00:00 Opine Less, Think More by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, looks at investing from a broad perspective and goes over in detail some of the macro themes he is examining as he tries to help the reader make sense of what 2013 will bring. He discusses potential "black swans" that he has his eye on, the bounceback of American and European stock markets, the sometimes overlooked lack of a correlation between economic growth and stock market performance, what P/E ratios tell us both historically and in the present, and where valuations can go from here.

2013-01-25 00:00:00 Housing Is Off the Floor, But Faces Ceilings. by Team of Northern Trust

Housing is off the floor, but faces ceilings. The cost of housing could be a source of increased inflation. January's FOMC meeting should not break any new ground.

2013-01-22 00:00:00 Keep Your Eye On The Ball - 2012 Year End Letter by Team of Sloan Wealth Management

The members of the Portfolio Management Team at Sloan Wealth Management (SWM) coach two baseball teams, two soccer teams, one T-ball team and one basketball team for our collective young children. Thus, we find ourselves stressing the basics. Learning the fundamentals of how to catch a pop-up will eliminate some of the fear of getting hit in the face. In 2012, we found many parallels to the capital markets as our portfolios posted high double digit returns in the face of fear.

2013-01-18 00:00:00 Quarterly Review and Outlook by Van Hoisington, Lacy Hunt of Hoisington Investment Management

The American Taxpayer Relief Act has lifted the immediate uncertainty of the fiscal cliff. Nevertheless, tax increases that are already in effect from this act, as well as the Affordable Care Act, impose a major obstacle to growth for the U.S. economy in the first half of 2013. The result of these taxes is considerable, especially in light of the poor trend in household income. In addition, these tax increases will continue to act as a drag on economic growth until late in 2015 and are unlikely to produce the revenue gains advertised.

2013-01-16 00:00:00 UK Economic Quagmire Adds Pressure for Monetary Policy Change by Darren Williams of AllianceBernstein

Bank of England governor-elect, Mark Carney, has raised hopes that the central bank may soon switch to a nominal GDP target. In our view, the costs outweigh the benefits, but the attractions of a radical new approach will grow if the economy remains stuck in the doldrums.

2013-01-15 00:00:00 Demographics and the Decline of Equity Mutual Funds by Paul Franchi (Article)

Until the last few years, mutual fund flows followed performance. Recently, however, money has flowed disproportionately into bond funds and out of US equity funds despite a strong rally in the equity markets. Changing demographics explain this shift, which has important implications for advisors and the mutual fund industry.

2013-01-15 00:00:00 What's Behind the Buyback Binge? by Milton Ezrati of Lord Abbett

The pace of stock repurchases says much about equity valuationsand companies' expectations for economic growth.

2013-01-11 00:00:00 Abe's Return May Prod Japan Forward by Kenichi Amaki of Matthews Asia

Japan's politics have entered 2013 with a mixed freshness. Former Prime Minister Shinzo Abe has clinched a rare second shot at the prime minister's post. His first term, which began in late 2006, lasted only about a year and ended with his sudden resignation. But following its landslide victory last month, his Liberal Democratic Party (LDP) has secured a two-thirds majority in the 480-seat Lower House, giving it the constitutional power to override Upper House opposition, where no single party holds a majority, on almost all issues.

2013-01-11 00:00:00 Winter Quarterly Commentary by John Prichard of Knightsbridge Asset Management

While a last minute compromise may have been reached on taxes, it represents only a brief rest stop on a required road of repair. On the positive side, we should see less annual wrangling with tax rates having been made permanent, meaning they will not automatically change at some future date (but rather only when Congress feels like changing them), with many areas also sensibly indexed for inflation.

2013-01-11 00:00:00 Fed Policy Update: Waiting for Clearer Criteria for Open-Ended Asset Purchases by Alan Levenson of T. Rowe Price

The FOMC's shift from dates to economic conditions as the basis for policy rate guidance clarified the criteria for beginning rate hikes. The criteria for ceasing open-ended asset purchases are not clear, and may reflect not only the evolution of the labor market recovery but also concerns about financial stability and the size of the Fed's balance sheet. We expect the Fed to try to clarify these criteria in the months ahead. Asset purchases will end a "considerable time" before policy rate hikes commence, and rate hikes will commence before asset sales.

2013-01-10 00:00:00 Will Emerging Market Earnings Rebound in 2013? by Morgan Harting of AllianceBernstein

For two years, emerging markets companies have delivered inferior earnings growth and investment returns compared to peers in sluggish developed market economies. Now, the consensus is that earnings growth will catapult from near-zero in 2012 to 13 per cent in 2013. Hopes were high at the end of 2010 and 2011, too, yet analysts were then forced to revise down their earnings estimates. Will 2013 represent another triumph of hope over experience? To answer that question, let's look at what investors got wrong about emerging markets in recent years.

2013-01-06 00:00:00 And That's the Week That Was by Ron Brounes of Brounes & Associates

Welcome to a new beginning, a new yeara new optimistic investor, a new bipartisan Congress, (well, maybe not). The more things change, the more they stay the same. While investors embraced the budget deal (that is less of a deal than a procrastination), the pragmatists realize that very little has changed other than the "fiscal can" has been kicked down the road for two months. Stocks skyrocketed; bonds plunged; politicos bickered. Welcome to 2013.

2013-01-03 00:00:00 Another Look at Small-Cap Myths by Francis Gannon of The Royce Funds

A few years ago we wrote about several small-cap myths. As we begin the New Year, we thought it might be helpful to revisit some of the more prominent misconceptions about our chosen asset class and to examine how they have factored into recent performance.

2013-01-03 00:00:00 A Year on the Brink by Joseph Stiglitz of Project Syndicate

The two main surprises in 2012 were the slowdown in emerging markets, which was slightly sharper and more widespread than anticipated, and Europe's embrace of some truly remarkable reforms though still far short of what is needed. Looking to 2013, the biggest global economic risks are there and in the US.

2013-01-02 00:00:00 Somewhere Over the Rainbow by John Mauldin of Millennium Wave Advisors

We are 13 years into a secular bear market in the United States. The Nasdaq is still down 40% from its high, and the Dow and S&P 500 are essentially flat. European and Japanese equities have generally fared worse. The average secular bear market in the US has been about 11 years, with the shortest to date being four years and the longest 20. Are we at the beginning of a new bull market or another seven years of famine? What sorts of returns should we expect over the coming years from US equities?

2012-12-26 00:00:00 Gundlach's High-Conviction Investment Idea by Robert Huebscher (Article)

Count Jeffrey Gundlach among those who expect Japan's currency to collapse because it can't service its debt. Japan's challenges may parallel those that the US faces, and Gundlach feels strongly that they have created a compelling investment opportunity.

2012-12-11 00:00:00 Loomis Sayles' Matt Eagan on the Macro and Fixed Income Outlook by David Schawel, CFA (Article)

In this interview, Loomis Sayles' Matt Eagan discusses the fixed income universe, Fed policy and issues facing the global macro economy. Eagan is the co-manager, along with Dan Fuss, of the Loomis Sayles Bond Fund and he manages the Loomis Sayles Strategic Alpha Bond Fund.

2012-10-16 00:00:00 Will Bonds Be ?Burnt to a Crisp?? by David Schawel, CFA (Article)

Bill Gross's recent monthly commentary painted a disturbing picture for investors - he foresees bonds being ?burnt to a crisp.? This isn't just hot air. Such a conflagration is possible, and investors in bond funds, especially those that are constructed similar to the widely followed Barclays bond index, need to heed risks inherent in today''s market.

2012-09-18 00:00:00 Still Broken After All These Years by Martin Weil (Article)

Four years ago this week, the financial crisis took the world's economies to the brink of collapse. September 15, 2008, the day Lehman Brothers failed and sent global financial markets into cardiac arrest, was my wedding anniversary. My wife and I were celebrating at the time on the Mediterranean coast of Turkey ? a memorable trip, to be sure. Reflecting back on that moment now, I?m struck by how little distance our nation has traveled since.

2012-09-18 00:00:00 Campaign Rhetoric and Our Energy Future by Michael Edesess (Article)

At their respective conventions, both President Obama and Mitt Romney spoke to a centrally important topic for America and the world: energy. Their positions ? political posturing aside ? are broadly similar. But rather than a coherent, sustainable vision for the energy future of the United States, both men's rhetoric reflected the usual exercise in political base-touching, apple pie-polishing, and third-rail avoidance. And two important, perhaps crucial, pieces of the energy puzzle were hardly mentioned at all.

2012-07-31 00:00:00 Expect Headwinds for Stocks If Hoisington is Right about Bonds by Keith C. Goddard, CFA (Article)

Might today's historically low interest rates in the U.S. persist for years to come? The latest Quarterly Review and Outlook from Hoisington Investment Management forces readers to consider that possibility, refuting the reversion-to-the-mean mindset that causes many people to expect higher interest rates in the not-too-distant future. If the Hoisington model for the economy turns out to be right, the implications for the stock market are unfavorable.

2012-07-10 00:00:00 Recession is Not Imminent by Dwaine van Vuuren (Article)

Perma-bears are bombarding us with alarm bells, sounding the doom of the US economy. We find ourselves in yet another 'summer slowdown scare,' for the third year running. In 2010 and 2011, the purported slowdowns turned out to be soft landings. Investors who ran to the sidelines stared in disbelief as the stock market roared ahead, leaving them behind. We are likely in the same position now.

2012-06-12 00:00:00 Kingdoms of the Blind by Michael Lewitt (Article)

Recent events offer a rare illustration of the combined effects of the failure of monetary, fiscal and regulatory policy to coordinate a meaningful response. Rising budget deficits, record low interest rates, J.P. Morgan's proprietary trading blunder and the botched Facebook IPO process speak to abject policy failures in virtually every aspect of finance. It's not even a question of not having learned our lessons; our collective policy intelligence actually appears to have diminished.

2012-06-05 00:00:00 Letters to the Editor by Various (Article)

A number of readers respond to our article, Can Krugman Fix Our Economy?, which appeared last week.

2012-05-15 00:00:00 Ponzi's Children by Michael Lewitt (Article)

Europe, whose economic condition is nothing less than terminal, is about to receive what physicians refer to as a 'zetz' of morphine in the form of M. Hollande. A 'zetz' is the final dose that doctors give to dying patients to hasten their passage to the afterlife. In Europe's case, however, the medicine is not going to be painless, and its administration is not based on mercy but on resentment and stupidity.

2012-05-08 00:00:00 Q2 Outlook: "Sell in May" May Not Work This Year by OppenheimerFunds (Article)

Chief Economist Jerry Webman explains why he believes the U.S. economic recovery is real and CIO Art Steinmetz talks about how stocks are as cheap compared to bonds as they have been in decades.

2012-05-01 00:00:00 Q2 Outlook: by OppenheimerFunds (Article)

Chief Economist Jerry Webman explains why he believes the U.S. economic recovery is real and CIO Art Steinmetz talks about how stocks are as cheap compared to bonds as they have been in decades.

2012-04-24 00:00:00 Bruce Greenwald on Structural Imbalances in the Economy by Eric Uhlfelder (Article)

Bruce Greenwald likes to say that he is constituted to disagree with everybody about everything, and he was true to his word at the recent Hyman P. Minksy Conference in New York. Taking immediate exception with the virtually unanimous characterization of the economic crisis as a balance-sheet recession, Greenwald, a professor of finance at Columbia University, argued that, far from being unusual, balance-sheet recessions can in fact be found at the heart of almost all business cycles.

2012-04-17 00:00:00 Muppet Capers by Michael Lewitt (Article)

Investors enjoyed strong stock market and credit market gains during the first quarter of the year, but storm clouds may be forming on the horizon. Corporate profits have likely peaked. Stocks may be the best house in a bad neighborhood, but houses in that neighborhood appear to be fully priced for now. There are also some troubling signs in the bond markets, particularly the long end.

2012-04-03 00:00:00 Fewer, Richer, Greener: Why Jeremy Grantham is (Partly) Wrong by Laurence B. Siegel (Article)

Is the human experience getting better or worse? This is a big question investors are rarely asked to confront, yet its answer has profound consequences for market returns.

2012-03-20 00:00:00 Bob Rodriguez on the Dangers in Today's Markets by Robert Huebscher (Article)

Bob Rodriguez is the managing partner and chief executive officer of Los Angeles-based First Pacific Advisors. In this interview, he discusses how the challenges faced by the US economy will impact the capital markets.

2012-03-20 00:00:00 The Wages of Denial by Michael Lewitt (Article)

Europe is insolvent, and hopelessly so. Her procurer - the European Central Bank (ECB) - can front her some money for a while, but in the end she is either going to have to repay him or suffer a very rough consequence. In the meantime, however, she can continue to entertain her customers, in this case those willing to extend her credit in one form or another. Sooner rather than later, however, these creditors are going to grow tired of her tricks and turn their attention otherwise. At that point, she will be left to deal with the ECB because nobody else will have her.

2012-03-13 00:00:00 Europe's ?Back-door QE?: Good News for Global Bond Investors by OppenheimerFunds, Inc. (Article)

By restoring confidence in the global financial system, the European Central Bank's Long Term Refinancing Operation has allowed global bond investors to participate in attractive opportunities around the world.

2012-03-13 00:00:00 The Gutenberg Economy by Michael Lewitt (Article)

As commentators near and far speculate on what 2012 will bring to the global economy and markets, there is little question that one factor will be decisive: the central banks' printing presses. Both the Federal Reserve and the European Central Bank (ECB) will keep printing dollars and euros around the clock until their presses run out of ink.

2012-02-21 00:00:00 Woody Brock on Solving America's Fiscal Problems by Robert Huebscher (Article)

Dr. Horace 'Woody' Brock is the founder Strategic Economic Decisions, an economic research and consulting service. In this interview, he discusses his recently published book, American Gridlock, and how America can grow its economy through 'good' deficit spending.

2012-02-14 00:00:00 Recession: Just How Much Warning is Useful Anyway? by Dwaine van Vuuren (Article)

In December 2011, ECRI dialled down the urgency of the timing of their call to 'within six months.' That raised the question of just how much recession warning is useful when it comes to forecasting equity market performance.

2012-01-17 00:00:00 Martin Wolf on the Eurozone and Beyond by Robert Huebscher (Article)

Martin Wolf is widely considered to be one of the world's most influential writers on economics. Since joining the Financial Times in 1987, where he is chief economics commentator, he has received numerous awards for excellence in financial journalism. In this interview, he discusses the Eurozone crisis and prospects for global economic growth.

2012-01-17 00:00:00 GMO: Something's Fishy in China by Robert Huebscher (Article)

A wide gulf separates the two most prominent views regarding China's future. Faced with slowing economic growth, one side says its leaders will deftly navigate a soft landing, while the other claims it will face an implosion similar to those that befell Japan 20 years ago and the US in 2008. Count GMO, a firm that has built its reputation on its ability to identify a bubble about to pop, in the latter camp.

2012-01-17 00:00:00 An Essential Client Conversation ?Will I be able to pay for my hip replacement at age 85?? by Dan Richards (Article)

Advisors face a big challenge in planning for boomers. Your assumptions about how long they'll live and the nature and cost of their lifestyle as they age will dramatically impact your planning decisions. Conversations with boomers about those topics and about the implications of funding health care are difficult but important.

2012-01-17 00:00:00 A Nobel Laureate?s View on the US A Debt Problem, but an Unemployment Crisis by Dan Richards (Article)

Peter Diamond is a professor emeritus at MIT and the winner of the 2010 Nobel Prize in Economics for his work on unemployment and labor market policy. In this interview, he discusses the degree to which US unemployment is a structural problem and whether it can be reduced through fiscal stimulus. This is the transcript of the interview.

2012-01-10 00:00:00 Gundlach on the Key Risk for Bond Investors by Robert Huebscher (Article)

Watch out if you own a bond fund that underperformed its benchmark by 2% or more last year, as most did. Rather than put their careers at risk by suffering a second year of poor performance, those fund managers will turn to indexation, according to DoubleLine?s Jeffrey Gundlach. And since the Barclay?s Aggregate Index holds nearly 35% of its assets in Treasury bonds with near-zero yields, its investors will endure poor returns.

2012-01-10 00:00:00 Using the ECRI WLI to Flag Recessions by Dwaine van Vuuren (Article)

In September 2011, the ECRI proclaimed a new U.S recession would begin sometime in the coming year. It based its prediction on a host of its own internal long-leading indexes, together with its widely followed weekly leading index (WLI). I want to focus on the proper use of the WLI and examine its accuracy in recession dating, in order to put this current recession call into context.

2012-01-03 00:00:00 US Recession - An Opposing View by Dwaine van Vuuren (Article)

A large number of reputable analysts and companies are forecasting a new U.S recession on the immediate horizon. Attracting the most attention is ECRI, which made a public recession call on September 30th and several television reaffirmations since. But an examination of a broader range of other composite economic indicators shows that sole reliance on ECRI's forecast would be misplaced.

2011-12-20 00:00:00 Dennis Gartman Explains His Call on Gold by Robert Huebscher (Article)

Dennis Gartman has been publishing his daily commentary, The Gartman Letter, since 1987. He's been in the news lately because of a call he made last week on the price of gold. In this interview, he discusses the reasons behind that forecast.

2011-11-08 00:00:00 Bill Gross' Revised Paradigm: The New Normal Minus by Robert Huebscher (Article)

Following the financial crisis of 2008, PIMCO articulated its 'new normal' forecast of slow growth and mediocre capital market returns. Appending the even drearier modifier 'minus' to that outlook, Bill Gross said that expectations now appear worse than even he previously feared. Gross was pessimistic in both the near and long terms, and he startled the audience with his premonition that 'capitalism is at risk.'

2011-10-18 00:00:00 Bob Doll: Why the US is Positioned Strongly by BlackRock (Article)

Investor unease has risen dramatically over the past quarter in the face of growing concerns about the world's economic and financial health. The focal point has been the intensifying debt crisis in Europe. The issues facing Europe are highly complex, but essentially are underscored by a single question: Is Europe facing a solvency crisis or a liquidity crisis?

2011-10-11 00:00:00 A Critical Look at Obama?s Economic Team by Laurence B. Siegel (Article)

Confidence Men is an exposé, by the reporter Ron Suskind, of what he claims is incompetence, infighting, and insubordination at the highest levels of economic leadership in the Obama administration during the global financial crisis. Those accusations are largely misdirected. After all, there was no playbook for the administration's economic thinkers to work from - the rapidly unfolding crisis forced them to improvise.

2011-10-11 00:00:00 The Global ?Old Normal? by Michael Nairne (Article)

Amidst a torrent of dismal economic news and plunging stock prices, investment horizons have become increasingly short-sighted. The new normal of faltering growth and painful deleveraging appears to be only too true. However, investors capable of taking a long-term, global view will find forces at work that will likely drive resurgent world growth akin to that which occurred in the decades right after World War II.

2011-09-13 00:00:00 The Handicap of Experienced Investors by J.J. Abodeely, CFA, CAIA (Article)

In the investment business, assets under management are concentrated with the largest and most established firms. Understandably, investors tend to allocate capital to managers after they've established a good track record. Unfortunately, for many, the analysis stops there. By failing to separate good results from identification of what makes a great investment manager, investors are primed for disappointment.

2011-09-13 00:00:00 The Risks of Exchange-Traded Products by Dennis Gibb (Article)

Every major financial crisis has been foretold by timely but ultimately ignored warnings. At the end of mania, the rush to secure more fees, investment performance and status trumps common sense. In the last few months, the drumbeats of warnings from financial journals and regulators about exchange-traded funds have been sounding. Few seem to be listening.

2011-09-13 00:00:00 A Response to 'A Winning Endgame' by Guy Cumbie (Article)

A Winning Endgame, Robert Huebscher's review of John Mauldin's book Endgame, made some highly problematic claims about our energy usage. Moreover, Huebscher's claim is unfounded that an energy policy, such as the cap-and-trade policy he recommended, is the right step toward solving our economic crisis.

2011-08-30 00:00:00 Scenarios for a Stock Market Bottom by Keith C. Goddard, CFA (Article)

A probability-based forecast for the U.S. stock market between now and 2013 can be constructed using historical relationships between stock prices, earnings and dividends. This yields a matrix of possible outcomes for the S&P 500 Index over the next two years.

2011-08-23 00:00:00 A Fundamental Investment Strategy for Today's Environment by Robert Huebscher (Article)

We spoke with Tim Hartch and Michael Keller, who are co-managers of the Morningstar 5-star BBH Core Select Fund (BBTEX) from Brown Brothers Harriman. The fund's strategy is strictly bottom-up, with investments in established, cash-generative businesses that are leading providers of essential products and services with strong management teams and loyal customers.

2011-08-16 00:00:00 A Commentary on the Correction by Michael Nairne (Article)

Market corrections are always painful and this one particularly so because of the lingering anxiety from memories of the 2008-2009 market crash. I explore the history of stock market corrections and examines the dynamics of the recent downturn as well as actions that may be warranted, depending on individual circumstances.

2011-08-09 00:00:00 Does Government Intervention in Financial Markets Slow Economic Growth? by Michael Edesess (Article)

As we saw with the Dodd-Frank legislation and the Consumer Financial Protection Bureau, the question underlying the debate over financial regulation is whether it stifles economic growth. Leo F. Goodstadt's book, Reluctant Regulators, provides useful insights from the experiences of Hong Kong and China. It also causes us to ponder whether our measurement of economic growth is fundamentally flawed.

2011-08-09 00:00:00 Implications of the Debt Downgrade by David A. Rosenberg of Gluskin Sheff

As we had suggested in recent weeks, a U.S. downgrade was going to likely be more negative for the equity market than Treasuries, and that is exactly how the week is starting off. The reason is that history shows that downgrades light a fire under policymakers and the belt-tightening budget cuts ensue, taking a big chunk out of demand growth and hence profits. It is not just the United States the problem of excessive debt is global, from China to Brazil to many parts of Europe. And lets not forget the Canadian consumer.

2011-08-09 00:00:00 Bright Spots by Milton Ezrati of Lord Abbett

The American consumer is not nearly as vulnerable as during the 200809 recession. During the past two years, American households have so restrained spending, absolutely and relative to income, that presently they maintain about a $590 billion annualized savings flow, up strikingly from the $190 billion annualized flow averaged in the middle of 2007. Since this current savings flow amounts to some 5% of outstanding household liabilities, households need make no further cutbacks to improve their balance sheets, leaving them to spend marginally more freely.

2011-08-05 00:00:00 Urbanization: Driving Commodity Demand by Mark Mobius of Franklin Templeton

Increasing economic activity in emerging markets has continued to push up the demand and prices for key resources such as metals and oil. Infrastructure spending is a key factor driving this rising demand, as more of the working population in emerging markets move from rural areas to the cities, increasing consumption and putting upward pressure on both hard and soft commodities. Long-term commodity prices are likely to be driven by rising global demand as well as increasing costs to obtain these commodities.

2011-08-05 00:00:00 Advisor Alert - Placing This Week's Selloff Into Context by Frank Holmes of U.S. Global Investors

The major market indices were lower this week. The Dow Jones Industrial Average lost 5.75 percent. The S&P 500 Stock Index decreased 7.19 percent, while the Nasdaq Composite fell 8.13 percent. Barra Growth outperformed Barra Value as Barra Value finished 7.53 percent lower while Barra Growth decreased 6.88 percent. The Russell 2000 closed the week with a loss of 10.34 percent. The Hang Seng Composite Index finished lower by 6.80 percent, Taiwan fell 9.15 percent, and the KOSPI declined 8.88 percent. The 10-year Treasury bond yield closed 24 basis points lower at 2.56 percent.

2011-08-04 00:00:00 The Five Horsemen of the Economic Malaise by Craig Hester of Hester Capital Management

The unwinding of the economic malaise will take years, and it will be a painful - but necessary-process. There is much fear and anxiety reflected in the financial markets. Many of the world economies are in a state of disequilibrium, with too much debt, facing high unemployment and sluggish growth. Policy options are limited, and politicians lack the courage to act. But out of such times come opportunities. We live in a world of instant news and an acute short-term focus. One of the keys to investment prosperity is to manage money with a long-term perspective while balancing risk and return.

2011-08-03 00:00:00 Disappearing Act: GDP Loses Steam by Liz Ann Sonders of Charles Schwab

Although the debt deal remains top-of-mind, the latest GDP report's weakness didn't ease the angst. The economy is now operating at "stall speed" and is at a crucial inflection point. There's not much good news other than corporate profits, which have boomed.

2011-08-03 00:00:00 Converging On The Horizon by Ed Easterling of Crestmont Research of Advisor Perspectives (

By the end of this year, the earnings cycle is likely to be well above its typical thresholds of duration and magnitude. Although earnings could again rise in 2012, the magnitude of excess margins portends a fairly significant decline when the earnings cycle reverts. In addition, the profile of cyclical cycles in the stock market may have also run its course. The market may sustain or extend its gains for 2011 by year-end, but another up-year in 2012 would make history. Not only is duration stretched, but also the magnitude of cumulative gains has now matched the historical average.

2011-08-03 00:00:00 A Deal Nears, but the Economy Remains Unstable by Chris Maxey of Fortigent

With fears of an impasse over the debt ceiling, equity markets faced a difficult week. Fortunately, leaders announced on Sunday evening that they reached a deal in principal to raise the debt ceiling. Many pundits have reiterated in recent weeks that a deal would be reached prior to the August 2 deadline, but markets and investors grew nervous over the past week. However, politicians stayed true to form. They assured the American people that, despite headlines from the past several months, Republicans and Democrats came together in the interest of their constituents to strike the best deal.

2011-08-01 00:00:00 And That's The Week That Was by Ron Brounes of Brounes & Associates

A month ago, the DC deficit/debt debate was amusing political theater. Partisan hacks earned brownie points with loyal constituents, while preparing for next years election. Two weeks ago, the theater turned into a game of chicken as Main Street and Wall Street watched with interest to see which party would blink first. Today, theater and chicken are no longer amusing. A complete and utter inability to compromise and a win-at-all-costs attitude have brought government and economy to the brink of disaster. Are there any grown-ups left in Washington?

2011-07-30 00:00:00 The 2011 Gold Season is Just around the Corner by Frank Holmes of U.S. Global Investors

September has traditionally been the beginning of the gift-giving season for gold. This is the time of year when gold jewelers are the busiest. The Muslim holy month of Ramadan begins in August and concludes with generous gift-giving in early September. Then its Diwali, known as the festival of lights in India, Christmas in the U.S., and Chinese New Year. The key to this seasonal strength over the past few years has been demand from China and India.

2011-07-30 00:00:00 Shifting Focus by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Some economic indicators are starting to perk up while corporate earnings have been strong as we wind down reporting season. Stocks will move higher in the coming months once confidence is restored. Whatever the near-term outcome of the debt debate, the US still has deficit issues to deal with and hard choices must be made to ensure economic stability for years to come. Europe finally arrived at their debt deal, but it likely falls short of what will eventually be needed. Meanwhile, China is key to emerging market performance and continues to deal with inflationary concerns.

2011-07-27 00:00:00 U.S. Businesses Appear to Have Selective Uncertainty by Paul Kasriel of Northern Trust

Business hiring remains weak and business capital spending is robust. The capital spending part is illustrated in the chart below showing the 8-quarter annualized growth in shipments of nondefense capital goods deflated by the PPI for capital goods. I would think that if abnormally-high business uncertainty prevailed today, there would have been considerably slower growth in price-adjusted purchases of nondefense capital goods than what has occurred.

2011-07-26 00:00:00 Is the 'Consumer-Less' Era the new Normal by Chris Maxey of Fortigent

In a relatively light week of economic releases, market participants were pleased to see positive news beginning to build. Housing data in particular, excluding the existing home sales report, trended in the right direction. Housing starts unexpectedly jumped 14.6% to 629,000 in June. Strength was apparent across single- and multi-family housing units. Residential investment, an important component of GDP, will offer little support to second quarter GDP figures, but the upward momentum should put the economy on a better trajectory for the third quarter.

2011-07-26 00:00:00 June the Employment Report by Brian Horrigan of Loomis Sayles

The June 2011 Employment Report was awful. But what are we to make of it? I drilled down into the details trying to make sense of it. The Employment Report from the Bureau of Labor Statistics (BLS) gives results from two different surveys of the labor market, the Establishment Survey and the Household Survey. Newspaper headlines focused on results from the Establishment Survey, from which we learned that nonfarm payrolls rose a lousy 18,000 in June from May. Private-sector payrolls rose 57,000, but government payrolls fell.

2011-07-25 00:00:00 Down to the Wire by Howard Marks of Oaktree Capital

The problem isnt the ceiling, its our behavior. The debt ceiling merely imposes a discipline that our national leaders should provide but generally havent. On this note, in his press conference on July 15, when asked about conservatives insistence on a balanced-budget amendment to the Constitution, President Obama replied, We dont need a constitutional amendment to do that [balance the budget]; what we need to do is to do our jobs. But clearly we do need some enforced discipline, because the years in which we havent run a deficit have been by far the exception of late, not the rule.

2011-07-25 00:00:00 Quarterly Letter by Team of Grey Owl Capital Management

We remain concerned about the global economy and suspect of broad asset class valuations.However, in a world of tens of thousands of securities there are always opportunities.Absent a significant market correction, we are likely to continue to hold cash or dry powder.We also continue to look to hold assets that can perform well in an inflationary environment, as dollar debasement seems to be the political path of least resistance out of our current problems.The politicians appear happy to solve the problems maana. We on the other hand are happy to make hay when the sun shines.

2011-07-22 00:00:00 2011 Halftime Report: Oil and Copper by Frank Holmes of U.S. Global Investors

Last week we recapped commodities performance for the first six months of the year and offered our outlook on gold. This week, were discussing our outlook for two other commodities that are poised to have an exciting back half of the year.

2011-07-22 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

While Obama and the Republicans seem to getting closer to making a deficit reduction deal (just dont mention tax hikes), plenty of naysayers lurk in the background, preparing to derail it. Additionally, lots of infighting has emerged as Conservatives worry that their leaders are giving in on taxes and Dems fear Obama is not requiring nearly enough on the tax front in return for spending cuts. The markets reacted positively to news the two sides are talking and virtually everyone thinks the debt ceiling will get raised before the deadline (except maybe some Tea Partiers).

2011-07-21 00:00:00 China's New Generation of Entrepreneurs by Lydia So of Matthews Asia

As investors, we are presented with an expanding universe of small- and medium-sized entrepreneurial firms with innovative business models in China. At the same time, competitive pressures are also increasing with the growing presence of both domestic and international companies in the market. It has become increasingly critical to identify and differentiate companies with sustainable business models and viable long-term strategies.

2011-07-19 00:00:00 Global Overview: July 2011 by Team of Thomas White International

The most recent economic indicators suggest a moderation in global economic activity growth, and forecasts for the current year have been lowered. Manufacturing activity decelerated for the second successive month in June across most major economies, except the U.S. Even Japan, which was expected to bounce back, reported slower growth. Among the emerging economies, economies suggest a decline in the pace of expansion. Consumer sentiment has weakened across the developed world over concerns about income growth as the labor market slipped again in select countries, most notably in the U.S.

2011-07-19 00:00:00 A Palinized Nation - No Direction, No Leadership, No Clue by Cliff W. Draughn of Excelsia Investment Advisors

America is being palinized by total lack of leadership and responsibility from both political parties on Capitol Hill. The discussion of whether the US should default on our government debt if Congress is unable to pass a budget compromise and raise the debt ceiling by August 2nd, 2011 is absurd. The result of the impasse is a gradual erosion of trust by individuals, corporations, and foreign debt holders. How did we arrive at this point of lunacy, where our leaders are actually talking about the USA defaulting on our debts? Luke 23:34: Father, forgive them for they know not what they do.

2011-07-18 00:00:00 The Consumer Marches On by Milton Ezrati of Lord Abbett

With recession fears again gripping financial markets, it pays to take another look at the American consumer. At more than 70% of the economy, he and she will determine the direction and the pace of the economy. And despite the current gloom abroad, the picture that emerges from this examination, though far from robust, carries the expectation of continued, if slow expansion, especially since consumer spending has good income support. Though many other economic measures have weakened of late and depressed the view of economic prospects, the consumer has shown remarkable consistency.

2011-07-18 00:00:00 Are Emerging Markets Ready to Lead the Global Economy? by Lupin Rahman of PIMCO

We forecast emerging economies will expand at a faster pace than advanced economies over the secular horizon. The challenge for emerging market central bankers is to remain ahead of inflation expectations and retain credibility on inflation targeting. We feel they are well positioned for this. We believe global investors remain significantly underweight emerging market assets. We expect this underallocation to decrease, providing multiyear support for the asset class.

2011-07-16 00:00:00 Commodities 2011 Halftime Report by Frank Holmes of U.S. Global Investors

Commodities don?t all perform in the same way. In any given year, a particular commodity will go gangbusters and outperform the group. However, that commodity will typically come back to Earth and underperform the following year or the year after that. This is why active management is important when investing in commodities. Active managers can benefit from rotating from winners to laggards or by investing in the companies which produce, farm or mine commodities most effectively.

2011-07-15 00:00:00 Earnings Heat Up by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Earnings season is heating up and will provide a status update on the "soft patch" and where companies' confidence level lies. Stocks have been more volatile but are they telling us something about potential future direction? Debt ceiling talks continue in Washington, with a deal still likely to come in the final days before the supposed August 2 deadline. The make-up of spending cuts, tax changes, and any entitlement reform may be key to longer-term market reaction. Contagion fears are growing in Europe and solutions are difficult to come by.

2011-07-14 00:00:00 Three Competing Theories by Van R. Hoisington and Lacy H. Hunt of Hoisington Investment Management

While the massive budget deficits and the buildup of federal debt, if not addressed, may someday result in a substantial increase in interest rates, that day is not at hand. The U.S. economy is too fragile to sustain higher interest rates except for interim, transitory periods that have been recurring in recent years. As it stands, deflation is our largest concern, therefore we remain fully committed to the long end of the Treasury bond market.

2011-07-14 00:00:00 The Brightening Air by Christian Thwaites of Sentinel Investments

A casual empiricist would conclude that the US economy is troubled: weak GNP, employment, housing and slowdowns in the important ISM and Fed surveys. But a longer perspective shows this is entirely in keeping with a recovery from a deep-seated financial and borrowing crisis. There are many signs that the US is picking itself up: manufacturing productivity, private sector job creation, corporate profitability and household deleveraging. Monetary policy has saved the economy from the insidious threat of deflation. Fiscal policy is meandering. Some of the answers are right in front of us.

2011-07-14 00:00:00 Equity Market Review & Outlook by Richard Skaggs of Loomis Sayles

In many ways, 2011 feels like a repeat of 2010, as the economy has hit a bit of a soft patch, the Federal Reserve?s quantitative easing program has come to an end, and the eurozone is faced with serious sovereign financial concerns. Stocks have pulled back, but the decline has been much more moderate than in 2010, in part because the corporate earnings cycle remains firmly positive. Companies have continued to exceed analyst estimates more often than not, and we expect the upcoming quarter to produce another round of good earnings reports.

2011-07-13 00:00:00 Treading Water by Richard Michaud of New Frontier Advisors

While unemployment remains high, corporate balance sheets are healthier, Wall Street de-leveraging is proceeding, savings rates are up, and many strategists currently consider equities cheap.The lackluster performance of domestic equities in the quarter was associated with negative returns in financials, a symptom of the continuing de-leveraging process and new regulations worldwide. However, the underlying conditions for a long sustained business expansion do not seem in-place. A cyclical expansion, typically lasting roughly four years, seems a reasonable, though far from certain, scenario.

2011-07-12 00:00:00 Americas: Economic Review June 2011 by Team of Thomas White International

The economic growth outlook in the region has moderated, as both global demand and domestic consumption growth are slowing down. Consumers are less confident than earlier this year, public spending remains restricted due to continuing fiscal challenges, and businesses have become more cautious in their hiring and investment plans. Commodity and energy prices have corrected, while manufacturing activity growth has slowed down. Even in this environment, inflation risks remain significant in some of the large emerging economies where monetary policy is being tightened further.

2011-07-12 00:00:00 Middle East/Africa: Economic Review June 2011 by Team of Thomas White International

The Arab Spring brought with it waves of revolution, disrupting economies of almost all the countries in the Middle East and North Africa (MENA) region. While governments of Tunisia and Egypt look to pick up the pieces, continued rumblings of unrest are heard from Bahrain, Libya, Syria and Yemen. The World Bank expects the lowest growth in Egypt and Tunisia, clocking in at 1 percent and 1.5 percent respectively, in 2011. However, despite uncertainty, these two economies are projected to improve in 2012 and witness economic expansion of around 5 percent in 2013.

2011-07-12 00:00:00 Developed Asia Pacific: Economic Review June 2011 by Team of Thomas White International

Developed Asia Pacific economies continued to face headwinds in June as the outlook for demand from both developed markets such as the U.S. and Europe, and emerging markets cooled. In the U.S., a lukewarm labor market caused concerns about the pace of economic recovery. In the emerging markets, persistent inflation fears were prompting higher interest rates. Both these factors are putting pressure on exports from Developed Asia Pacific economies. Japan, which specializes in exporting machinery and consumer durables, is feeling the heat of a slowdown in demand from consumer countries.

2011-07-12 00:00:00 Emerging Asia Pacific: Economic Review June 2011 by Team of Thomas White International

Emerging Asia Pacific economies continued to be troubled by persistent inflation in June. Almost every country in the region had to either hike benchmark interest rates or bank reserve requirement ratios to rein in lending and credit growth. The monetary tightening effects are largely expected to make capital more expensive and this in turn is expected to crimp growth across many emerging markets. Inflation, which thus far has been more pronounced among food and fuel items, now seems to be spilling over to structural inputs like labor as well.

2011-07-12 00:00:00 Developed Europe: Economic Review June 2011 by Team of Thomas White International

The economic data reported from Developed Europe during June were mixed. According to the European Union?s statistics agency Eurostat, annual wage growth in the Euro-zone during the first quarter of 2011 was 2.3 percent compared to 1.4 percent in the last quarter of 2010. Although the figures reflect some degree of optimism in the labor market, they are a cause of worry in the context of inflation. In order to sustain their spending power amid rising prices, workers may continue to demand higher wages, which in turn may force producers to hike prices further and spark off a wage-price spiral.

2011-07-12 00:00:00 Positive week Overshadowed by Dour Jobs Report by Chris Maxey of Fortigent

An otherwise positive week ended in disappointing fashion but the equity markets held their gains. There were only a handful of market-moving economic reports last week, with the predominance of investors focused on the nonfarm labor report on Friday. Prior to that release, however, there was generally positive data announced on other sectors of the economy. Early in the week, the Institute for Supply Management announced that non-manufacturing activity expanded for the 19th consecutive month. Similar to the manufacturing sector, though, activity continues to expand at a weakening pace.

2011-07-12 00:00:00 Back in the Uptrend by Gene Peroni of Advisors Asset Management

June did not present a meaningful technical departure from the preceding five months. This does not mean that June was uneventful; it had its fair share of peaks and valleys, the most dramatic of which occurred during the gravest worries that Greece might default on its debt. It was not the first time this year that the stock market was rocked by blazing headlines reporting devastating or monumental events. In March, stocks were driven lower following the Japanese tsunami. Whether a financial woe or a natural disaster event, the effects have been similar thus far in 2011.

2011-07-11 00:00:00 Going for Growth by Milton Ezrati of Lord Abbett

Despite the sudden return of double-dip recessionary fears, the U.S. economy should keep growing. The growth, slow as it will likely be, is critical to a continued equity market advance. But still, the recovery is maturing, and the pace of earnings growth should slow. To be sure, the high operating leverage of American firms will allow them to turn in double-digit earnings advances even in a slow-growth environment. But the growth pace should come in much slower than last year. The change will likely move the marginal investment advantage from value to growth stocks.

2011-07-11 00:00:00 A Wile E. Coyote Market by John P. Hussman of Hussman Funds

Fridays employment report, showing an increase of 18,000 in non-farm payrolls and a jump in the unemployment rate to 9.2% was widely viewed as a "shocker" Frankly, I dont understand the surprise. Between February and April, weekly new claims for unemployment (4 week average) dipped below 400,000, which was associated with a few months of nice growth in non-farm payroll employment. Since then, weekly unemployment claims have moved higher, and have been running at an average near 425,000 new claims weekly. Historically, thats a level that's correlated to zero growth in non-farm payrolls.

2011-07-11 00:00:00 Jobs Versus Government by Brian S. Wesbury and Robert Stein of First Trust Advisors

After the very strong ADP employment report on Thursday, many economists marked-up their forecasts for Friday?s official payroll report. We moved ours up 5,000, and went into the report at 140,000 net new private sector jobs. Ouch?the official report showed just 57,000 new private sector jobs and equities immediately headed south. For bulls, this data was a huge disappointment. But employment is a lagging indicator. Other data have already been into, and out of, a ?soft patch.? Moreover, as a forecasting tool, employment data has not always been perfect.

2011-07-08 00:00:00 Job Trend Slowing as Distributional Skew Remains by Phillipa Dunne and Doug Henwood of Liscio Report

Today's employment report showed that the diffusion index slipping, leading index is slipping. Drags on hiring and wages remain. U.S. fiscal picture: it doesn't deserve all the wailing The distributional skew remains: profits are up 12 times as much as wages.

2011-07-08 00:00:00 And That's The Week That Was? by Ron Brounes of Brounes & Associates

Hip hip hooray, the labor market is improving! Oops, it?s not. According to ADP and Macroeconomic Advisors, 157,000 new private sector jobs were created in June, a much better-than-expected showing and nice sign for this crucial area of the economy. However, before the ink was even dry on that report, the Labor Department contradicted it by revealing that only 18k jobs were added last month and the unemployment rate climbed to 9.2%, the highest level of the year. Additionally, jobless claims dropped in the latest weekly release, but still remain well in excess of 400,000.

2011-07-08 00:00:00 Don't Miss Your Chance to Catch a Bull Market by Frank Holmes of U.S. Global Investors

Many people missed the market?s enormous appreciation during the latest equity bull market because they were late to the game or chose to sit on the sidelines. The sideline is a crowded place these days as investors have been reluctant to fully embrace equities. Household savings for the past 12 months totaled $711 billion, the highest level ever recorded in dollar terms. You can see from the chart that?s roughly double the amount of savings recorded following the Tech Bubble. In fact, household debt-to-savings ratios are currently at levels so low, they?ve not been seen since the mid-1990s.

2011-07-07 00:00:00 Hey Hey Hey?.Goodbye: The End of Quantitative Easing? by Laird Landmann of TCW Asset Management

Commentators have described the end of QE2 as a ?major milestone- the first tightening move from the Fed since the financial crisis began.? Our view is that this is just the end of one balance sheet program and is certainly not the first monetary tightening since the financial crisis. Monetary tightening is all around us in the form of new regulation, changing lending practices and increased bank capital requirements. The Fed will monitor the impacts of these changes and adjust policy as needed. Currently, the plan is to continue to replace assets on the Fed balance sheet as they roll off.

2011-07-06 00:00:00 Economic Doldrums Overshadowed By Financial Markets by Chris Maxey of Fortigent

Economic data will rule the airwaves this week, especially the nonfarm payroll report on Friday. Economists are not overly confident that June was the month where employment growth finally kicked into high gear ? a sentiment which is supported by relatively weak initial claims reports over the last four weeks. Central bank meetings will garner considerable attention this week as well. The European Central Bank alluded to the possibility of another 25 basis point rate hike last week and there is a strong likelihood that emerging market economies will also tighten policy rates.

2011-07-05 00:00:00 Scarce Resources by Dennis Nacken of Allianz Global Investors

For decades, investors largely ignored the commodities segment. They can no longer afford to. Commodity production can scarcely keep up with the dynamic development in global demand. The supply bottleneck could remain a sustainable driver of higher commodity prices for the foreseeable future. This applies to energy, to commodities in general and agricultural products in particular: these resources are becoming scarcer?and this is a megatrend.

2011-07-02 00:00:00 China Opens World's Longest Cross-Sea Bridge by Frank Holmes of U.S. Global Investors

When the new Qingdao Jiaozhou Bay Bridge opened to traffic this week in China, it made the Guinness World Records for the longest cross-sea bridge in the world. The 26.4-mile long and 110-foot wide bridge stretches across the bay, linking the Huangdao district to the city of Qingdao and Hongdao Island. China spent 17 years planning and designing the engineering marvel to be able to withstand the bay?s high salt content and icy winters. Yet, it only took four years to build, with at least 10,000 workers on the construction team.

2011-07-02 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

The second quarter ended on a very positive note as equities enjoyed a late surge to bring the Dow into positive territory for the period (and the other indexes close to flat). Such performances didn?t seem likely just a few weeks ago, but positive news this week from Greece, signs of a rebound in manufacturing, and declining gas prices that helped ease a more fearful inflation picture put a damper on the recent negativity. Equities enjoyed their best week in two years. Let?s hope the mood lasts.

2011-07-01 00:00:00 On The Importance of Sustained Capital Investment Part 2 by Andrew Foster of Seafarer Capital

This commentary revisits the topic. It presents basic evidence to support the idea that sustained capital investment is critical in the context of developing markets. The data presented below is gathered from several countries, so as to allow for comparison across emerging markets. Admittedly, the workings of macro economies are highly complex, and drawing detailed conclusions about them is tricky. Nonetheless, national statistics do reveal the general outline of an economy and its underpinnings. That?s how I intend to use the data here ? to make broad inferences only.

2011-07-01 00:00:00 The Ultimate Shell Game by Scotty George of du Pasquier Asset Management

As governments are forced to shift policy from spending to saving, the instruments they have at their disposal become obsolete without consumer support and/or confidence. The acquisition of ?things? paid for by leverage, margin, and debt is a fruitless endeavor in today?s climate. As a result a truer ?new paradigm? must develop which: Shifts the focus from hard asset leverage to savings and cash, Raises secular interest rates, Globalizes investment capital, trade, and profitability and Provides for a fairer, equal playing field in financial assets.

2011-06-29 00:00:00 ?Attractive Yield Opportunities Remain in Floating Rate Loan Markets by Elizabeth MacLean of PIMCO

We believe the general trend toward more diversified capital structures may be positive for investors in the loan market. Recent changes in loan market investor mix have had and will likely continue to have a positive impact on loan spreads. In addition to price, leverage and other quality measures in new issues also generally remain attractive.

2011-06-28 00:00:00 Extending the Extended Period of Volatility by Chris Maxey of Fortigent

Personal income and consumer confidence will start the week with expectations of slightly higher numbers. On Tuesday, Case-Schiller data is expected to show moderate declines in home prices for April relative to March. The Treasury will follow its regular auction schedule this week with auctions of $35 billion worth of 2-yr notes, $35 billion of 5-yr notes and $29 billion of 7-yr notes. All eyes will be on Greece on Wednesday and Thursday, when Parliament will vote on the latest austerity plan. Greece noted that they will default if a new loan tranche is not available by mid month.

2011-06-27 00:00:00 Will Japan?s Crisis Cause Force Long-Term Reform? by Milton Ezrati of Lord Abbett

For all the pain suffered by the Japanese as a result of the earthquake, the disaster and its ripple effects, offer them at least some smugness. The world, obsessed new, had for years dismissed Japan as a part of the past, preferring instead to enthuse over China and emerging economies. This horrible disaster has made one thing very clear: Japan still plays a critical role in the global supply chain and economy generally. How soon, if ever, will Japan recover its former productive role? And how will the shock of the recent disaster change the Japanese economy?s long-term direction?

2011-06-25 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

If it?s not one things, it?s another. A Greek tragedy averted (for now, perhaps?); a move to limit the rise in crude and gasoline prices (necessary or panic?); a never-ending debt crisis with political ramification (not only in Greece); an (overly) cautious assessment of the latest Fed-speak. Add it all up and you have a pretty volatile week on the equity front. The second quarter cannot end soon enough. Hey Japan?how?s that restructuring plan coming?

2011-06-24 00:00:00 On the Importance of Sustained Capital Investment, Part 1 by Andrew Foster of Seafarer Capital

I have placed greater emphasis on identifying companies that maintain steady investment programs. I prefer companies that are committed to the careful but consistent development of the markets in which they operate. My premise is that such companies are more likely to generate sustained, long-term growth.

2011-06-24 00:00:00 Fed Benefits from Global Fears by John Browne of Euro Pacific Capital

This week, in the second in a series of less-than-impressive press conferences, Fed Chairman Ben Bernanke offered market observers little hope that any additional quantitative easing programs are on the horizon. The Chairman continues to cling to the position that the economy is improving (with the recent ?soft patch? attributable to external forces) to the extent that additional Fed support will be unnecessary. Left unsaid was any guidance as to who the Chairman believes will buy the massive amounts of Treasury debt formerly swallowed up by the QE II program?

2011-06-24 00:00:00 What?s Driving Platinum? by Frank Holmes of U.S. Global Investors

Following a substantial 90 percent increase since the financial crisis, platinum prices have been sluggish. During the first six months of 2011, the metal gained only a few basis points. Platinum has significantly lagged silver (up 15.72 percent) and gold (up 7.72 percent), but has outpaced palladium, its closest relative. In recent days, the market has discounted the metal because of weaker car sales in the U.S. According to the WSJ, Japan?s earthquake shut down car production, and higher vehicle prices and continued bad news about the U.S. economy prevented consumers from purchasing cars.

2011-06-23 00:00:00 A New Era of Global Financial Repression by Scott A. Mather of PIMCO

Investors need to be especially alert to increasing financial repression. Any sovereign policy that interferes with free market activity and the pricing of debt or currency can be thought of as financial repression. Repressionary policy rates percolate through the global financial markets and affect asset prices across the risk spectrum. Many emerging market countries use repressionary tactics to capture a larger share of global growth.

2011-06-22 00:00:00 Japan Outlook ? June 2011 by Team of Nomura Asset Management

Nomura?s forecast for Japan?s CY2012 real GDP growth is 3.2%, up from an expected rate for CY2011 real GDP growth of just 0.1%. Although there has been a temporary deterioration in Japanese economic indicators due to supply side constraints, such as capital stock damage, supply chain disruption, and electricity generating capacity shortfalls, we have already started to witness signs that these constraints are easing. The supply chain will return to normal this autumn, as production bases in the disaster-affected areas are restored or the users quickly switch to substitute components.

2011-06-22 00:00:00 Can U.K. CPI Really Get Back to Its 2% Target? by Mike Amey of PIMCO

?U.K. CPI (Consumer Price Index) will likely continue to be buffeted by food and energy inflation. To generate the conditions necessary to bring inflation down more aggressively would put even greater pressure on U.K. households. The Bank of England is right to be cautious on raising the Bank rate given the current state of the economy.

2011-06-21 00:00:00 What Can The Fed Do? by Scott Brown of Raymond James Equity Research

Senior Fed officials meet next week amid what is widely seen as a slow patch in economic growth. A key question for investors, as well as for monetary policymakers, is whether this slowing will be temporary. Most likely, growth should pick up in the second half of the year. However, there are downside risks in the near term. Moreover, monetary policy appears to be handcuffed and fiscal policy is set to go in the wrong direction. The wide range of data have been consistent with a near-term slowing in economic activity.

2011-06-21 00:00:00 The World Held Hostage by Credit Default Swaps? Alford on the FOMC: Watch what they say by Team of Institutional Risk Analyst

In this issue of The Institutional Risk Analyst, we feature a comment from Richard Alford on the state of thinking inside the Federal Open Market Committee regarding monetary policy -- at least based on what folks at the Fed say in public. We also comment on the latest financial bailout, in this case the apparent salvation of the European and US banks in the CDS market from taking a hit in the restructuring of Greece.

2011-06-20 00:00:00 Sector Insights Focus: Consumer Discretionary by Daniel M. Brewer and Stacie L. Cowell of Rainier Funds

International growth is a consistent theme for companies in the consumer discretionary arena. ?Consumerism? is growing globally, and those companies that are able to grow in more than just one market have more growth opportunities. Another theme in this sector is the concept of reaching the consumer in more ways than the traditional method of just providing a physical store. Retail revolves around getting the product to the consumer right at the point they want to buy it, where and how they want to purchase it. Companies have invested heavily in building out their e-commerce capabilities.

2011-06-20 00:00:00 Sector Insights Focus: Financials by James R. Margard, Mark H. Dawson, Andrea L. Durbin of Rainier Funds

The upheaval in the global financial system has made investing in financials quite challenging as of late, Rainier positioned itself well for the crisis. Because of our emphasis on financial strength and sustainability, we were able to avoid the major financial institutions that were most exposed to toxic assets and had taken on excessive credit risk. As the economy has moved into recovery mode, the financial sector hasn?t gotten any easier. Some of the biggest winners in the sector recently have been distressed institutions that aren?t projected to have positive earnings in the next year.

2011-06-20 00:00:00 Double-Dip Fears by Milton Ezrati of Lord Abbett

A robust recovery was never in the cards?as Lord Abbett has continually pointed out?even during the consensus? optimism earlier this year. But a second recessionary dip is highly unlikely. Instead, the American economy should carry on with middling growth of 2.5?3% in real terms, propelled by exports, moderate consumer spending growth, and continued, cautious advances in corporate spending, while sideways moment in housing and absolute declines in state and local government spending hold the pace back from what it might otherwise achieve.

2011-06-17 00:00:00 China Braces for Summer Power Shortages by Henry Zhang of Matthews Asia

China's power usage has grown along with the GDP. Overall power consumption rose by about 12% in the first four months of this year?in line with average growth rates. However, the availability of power is an increasing concern for some Chinese manufacturing companies. The issue is particularly serious for China's eastern and central regions during peak power consumption months. While there are a number of factors affecting power shortages, chief among them are government regulations. China is determined to become more energy efficient, and power shortages may spur efforts toward that goal.

2011-06-16 00:00:00 The Good Old Days by Liam Molloy and Bethany Carlson of Galway Investment Strategy

The news of late indicates we are indeed in the midst of an economic slow patch (as we were this same time last year). This cyclical pause occurs in the context of a secular de-leveraging here in the US, which results in a healthy albeit modest expansion. The lack of job creation in the most recent BLS report and a general longing for ?better days? has left many nostalgic for the good old days. The problem is the old days were just awful. Many of the gripes today really are nothing new. The great wealth disparity between rich and poor is an example.

2011-06-15 00:00:00 RMB Liberalization ?What All the Excitement is About by Kenneth Lowe of Matthews Asia

Investors tend to be a fairly excitable bunch, always looking for the latest trends and themes to try to make a profit. But many trends have little relevance or impact over the longer term. During the past 12 months, one of those more ?exciting? topics that have been discussed is the initial stages of renminbi (RMB) liberalization in Hong Kong?a concept that allows foreigners to get their hands on, and trade in, Chinese currency for the first time. But how excited should long-term investors be? A roundtable discussion among Matthews? managers, on the same topic, is also included.

2011-06-15 00:00:00 Understanding the Investment Process at Jensen Investment Management - Step One: Return on Equity by Team of Jensen Investment Management

We believe that Return on Equity is a very useful criterion for identifying companies that have the potential to provide attractive returns over long periods of time. Our experience and research suggest that our requirement of consistently high Return on Equity results in a universe of high-quality, profitable companies that are able to generate returns above their costs of capital in a variety of circumstances and economic environments. This paper serves to illustrate the reasons why we use Return on Equity the way we do, and why we use it for the first step of our investment process.

2011-06-15 00:00:00 GOLDRelic or Real Money? by J Michael Martin of Financial Advantage

In the past 10 years, the price of one ounce of pure gold has risen from less than $300 to $1,500, far outpacing the return on stocks and bonds. And yet, in most gatherings of professional investors it is not respected. Why is that? What drives the price of gold, anyway? And is gold really an appropriate investment in the 21st century? We set out to better understand this unique metal. Well explore the reasons that some consider gold an important asset class with unique and valuable investment characteristics, while many professionals regard it as a sort of investment sideshow.

2011-06-15 00:00:00 Bad News Bulls by Michael Dana of Dana Investment Advisors

It?s been said that the stock market climbs a wall of worry. The bear market touched a bottom in March 2009 and proceeded to rise about 85% to a high in April. We are now in the midst of a correction from that high, but the overall trend remains positive for equities. Not so much so for the economy. Well, the economy is still growing, albeit slowly. At this stage in a recovery the economy should be recovering more rapidly. The economic news is not getting better. The May jobs report indicated that 54,000 new private sector jobs were created. Economists had forecasted 170,000.

2011-06-15 00:00:00 ProVise Bullets by Team of ProVise Management Group

The more things change, the more they remain the same. That trite expression has been applied to many different things. We are applying it to what may be an early stage tech ?bubble?. Almost every investor is familiar with LinkedIn coming out at $45 per share then jumping to $120 per share in the first day of trading before settling in at $90 per share. Other examples abound. The very popular Facebook is estimated to be worth $76 billion. We have to admit that at least some of the tech companies are actually making money today with viable ideas, but the valuations still seem a bit absurd.

2011-06-14 00:00:00 Bruce Berkowitz - Ignoring the Crowd on Financials by Sam Parl (Article)

Bruce Berkowitz has said that his deep value and contrarian investing style will not guarantee short-term results, but he promises his shareholders will be rewarded for their patience over the long term. Last week, he explained why some of his positions - especially those in the financial services sector - are among the best opportunities in the market.

2011-06-14 00:00:00 Global Overview: June 2011 by Team of Thomas White International

Slower manufacturing growth triggers fears of another global economic downturn. Even as the global economy appeared to have entered a phase of stable growth, the unexpected slowdown in global manufacturing activity during the month of May has led to fears of another economic downturn. Activity indicators declined the most in developed economies where growth was expected to gain pace this year. However, unless the trend persists, it is more likely that the moderation in manufacturing activity growth is only a readjustment after several months of rapid expansion.

2011-06-13 00:00:00 Middle East/Africa Economic Review May 2011 by Team of Thomas White International

The fiscal stability of the Middle East and N.Africa region continues to be threatened by social pressures, yet rising inflation on the back of increasing fuel and energy prices and high levels of unemployment remain the main causes of concern. According to the Regional Economic Outlook report by IMF, the region is expected to grow 3.9 percent in 2011. The oil exporting countries are anticipated to record better growth thanks to high oil prices and production, while oil importing nations such as Egypt, Morocco and Jordan are expected to expand at a much slower pace.

2011-06-13 00:00:00 Americas: Economic Review May 2011 by Team of Thomas White International

In North America, the U.S. and Canada saw contrasting economic trends during the first quarter. While first quarter GDP growth in the U.S. slowed when compared to the previous quarter, growth accelerated in Canada. The U.S. housing market remains weak while the housing recovery in Canada started last year, and the labor market has also seen a similar divergence. However, the economic outlook for the two countries is expected to converge more in the coming quarters. As growth accelerates in the U.S., Canada may find it difficult to maintain its first quarter growth pace.

2011-06-13 00:00:00 Emerging Europe: Economic Review May 2011 by Team of Thomas White International

According to data from EuroStat, inflation in the Euro-zone touched a 30-month high of 2.8 percent in the month of April as prices of fuel, electricity, and housing continued to soar. In line with the broader trend, the inflation gauge in the 27-member European Union, which also includes Poland, the Czech Republic, and Hungary registered an annual 3.2 percent in April, a touch above the 3.1 percent recorded in March. Among the east European economies, the Czech Republic recorded the lowest rate of inflation during the month.

2011-06-13 00:00:00 Will the U.S. experience a Perfect Storm of fiscal woes? by Matt Lloyd of Advisors Asset Management

Right now it?s easy to latch onto the argument that the soft patch we are entering economically will transfer into quick sand. The predisposition of retail and institutional investors is greatly formed by events over the last decade as well as the sixth straight weekly loss for equity markets. With deposits and household liquidity standing at all time highs, is there truly exuberance and overly-hyped expectations for the economy and equity markets? It appears not, which should caution those who are longer-term bearish.

2011-06-13 00:00:00 Money is Flowing, But Not to Where it is Most Needed by Chris Maxey of Fortigent

Bernanke gave a speech indicating that we might be facing a period of temporary weakness. He said, ?growth seems likely to pick up somewhat in the second half of the year.? Whether Bernanke ultimately turns out to be right is uncertain, but some indicators this week supported that notion. One depiction of that phenomenon is the Citigroup Economic Surprise Index, that measures the number of economic releases surprising to the upside or downside. After reaching a peak in March, the ESI plummeted, reaching a low on June 3rd. Since that point, the index gradually began to rebound.

2011-06-13 00:00:00 The Policy Stakes Are Raised by Scott Brown of Raymond James Equity Research

Its well known that recessions that are caused by financial crises are much more severe, are longer lasting, and are followed by gradual recoveries. Another lesson from history is that during these recoveries, policies are often tightened too soon. In 1937, efforts to balance the budget led to a recession within the Great Depression. Its said that those who dont remember the past are doomed to repeat it. Following the financial crisis, consumers and nonfinancial businesses deleveraged. However, that paydown in debt pales in comparison to the deleveraging seen in the financial sector.

2011-06-10 00:00:00 Searching for the Market's 'Sweet Spot' by John Derrick of U.S. Global Investors

One of U.S. Global Investors? ?sweet spots? is investing in global small-and mid-cap companies. We generally define these companies as having a market capitalization between $1 and $10 billion. Ten billion sounds like a lot but is relatively small compared to market caps of companies such as Apple ($301 billion), Johnson & Johnson ($181 billion) and Coca-Cola ($149 billion). We like small and mid-cap companies because they tend to be less volatile than micro-caps, but still nimble enough to grow at faster rates than large companies.

2011-06-10 00:00:00 Pause or Panic? by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Economic data has deteriorated to the point that talk of a double dip recession has returned. The risk of another recession is low as most indicators remain well in expansion territory. Several factors are contributing to a soft patch, but a rebound is likely in the latter part of 2011. Along with talk of recession risk, chatter about the need for QE3 by the Fed has increased. The bar is quite high for QE3, but it is very likely the Fed will not let its balance sheet shrink in the near-term. Global growth is decelerating as well, with China tightening and Japan dealing with reconstruction.

2011-06-09 00:00:00 Taking Advantage of Cyclical Highs and Lows by Matt Lloyd of Advisors Asset Management

As we find ourselves in the throws of an economic soft patch, the anxiety to investors seems only to be a sniffle versus an outright sneeze or full-fledged cold. Many are wondering as to why the accumulation of the slowing economic news is having such a muted impact and cause many to extrapolate that a ?coming to Jesus? meeting is around the corner. As we stated last week, the conundrum of negative outlook on Treasuries by three credit rating agencies is being trumped by slowing economic metrics. It is also influenced heavily by the majority of investors believing rates will rise.

2011-06-08 00:00:00 The Economy: When Will Happy Days Be Here Again? by Team of Knowledge @ Wharton

The latest economic reports show the U.S. recovery has faltered. But someday, surely, there will be a real recovery. What forces will drive that upturn? And will the healthy economy of the future look different from those of the past -- establishing a "new normal?" Two intertwined factors are critical to any rebound, according to many experts: Home prices must stop declining and begin to rise, and consumers must spend more freely.

2011-06-07 00:00:00 Its the Jobs, Stupid! Part V by Komal Sri-Kumar of TCW Asset Management

Job creation still appears not to be a priority for the Obama administration. After the first year was spent implementing a comprehensive health care reform in the midst of a financial crisis, and bailing out financial institutions considered too big to fail, the emphasis switched to fiscal and monetary measures that had little direct impact on jobs.

2011-06-07 00:00:00 And That?s The Week That Was ? by Tom McIntyre of McIntyre, Freedman & Flynn

As we warned last week and over the past couple of months, the poor quality of the economic expansion finally has caught up to the economic statistics. Last Friday?s dismal report showing a jump in the unemployment rate to 9.1% left all of the cheerleaders from Warren Buffet to the Secretary of Labor scrambling for explanations. Given the lack of earnings or merger news, the stock market recorded its fifth straight weekly decline. As the charts illustrate, both the Dow Jones Industrial Average and the NASDAQ Composite dropped around 2.3% last week in response to the now obvious slowdown.

2011-06-07 00:00:00 Broken Records by Doug MacKay of Broadleaf Partners

Since February, the markets have been hitting new recovery highs, succumbing to market pressure, then reversing course and moving on to higher highs. The pattern is beginning to feel a lot like a broken record.Currently, we've been experiencing a renewed downtrend, with the market off 6% from its April highs. While these moves are normal following a 30% plus advance in just eight months The truth, however, is the uninterrupted steady gains we experienced from August through late February may be far more unusual for the markets than the back and forth gyrations of the past three months.

2011-06-06 00:00:00 Handicapping QE3 by John P. Hussman of Hussman Funds

As disappointing economic news mounted last week, the attention of market participants immediately turned to policy responses - will the Fed embark on QE3? In my view, there are three central questions relevant to this issue. The first is simply this: Has QE2 been successful in a way that the economy should desire more of it? The second: How much scope for intervention does the Fed have left? The third: Is Bernanke so invested in this attempt at balance-sheet expansion that he will push forward an extension of the policy despite its economic ineffectiveness and speculative distortions?

2011-06-06 00:00:00 David Kotok on Central Bank Credibility; Bob Eisenbeis: Did the Fed Print Money with QE? by Team of Institutional Risk Analyst

This week in The Institutional Risk Analyst, we republish a comment by Robert Eisenbeis, Chief Monetary Economist of Cumberland Advisers, "Did the Fed Print Money in QE1 and QE2?" Eisenbeis, who was Executive Vice President and Director of Research at the Federal Reserve Bank of Atlanta prior to joining Cumberland, corrects a puzzling comment on the Fed published last week in the Wall Street Journall by George Melloan. We assumed that Melloan and the Wall Street Journal editorial staff were aware of the rules of monetary quantum mechanics, but maybe not.

2011-06-06 00:00:00 A Slow Patch by Scott Brown of Raymond James Equity Research

The recent economic data have been disappointing, but hardly a disaster. The broad range of indicators suggest a slowing in the pace of growth not a contraction. One month does not a trend make, but the data have generated some anxieties about whether the current slow patch could be a lot longer lasting or turn into something more severe. We started this year with a good deal of positive momentum. Inflation-adjusted consumer spending rose at a 4.0% annual rate in 4Q10. The economy still faced a number of headwinds. However, the positive momentum was expected to offset these headwinds.

2011-06-03 00:00:00 Five Misconceptions Squashed by Niels C. Jensen of Absolute Return Partners

DSK is not the only one in need of a bailout! As the sovereign crisis intensifies - and it will - bond yields in some countries will go higher. But they won?t go higher everywhere. Demographic as well as technical factors (e.g. Solvency II) will drive ever more money towards bonds, and that money will have to go somewhere. Germany, Switzerland and Scandinavia are probably the safest bets in terms of where sovereign bond yields could fall further. You should also expect high quality corporate bond yields to trade through sovereign yields in many countries. The trend has already begun.

2011-06-03 00:00:00 And That?s The Week That Was? by Team of Brounes & Associates

Congress failed to pass a bill to raise the government?s debt ceiling and help avoid a default in early August. Republicans refused to support any legislation that is not tied to specific deficit reduction, even though there is a potential downgrade on US debt without any progress on a deal. The bickering continued in the aftermath of the unemployment data as both parties blamed the other for the weaker results. Republicans questioned the ?binge of taxing, spending, borrowing and over-regulating,? while Democrats claimed their counterparts are too focused on ?tax breaks for millionaires.?

2011-06-03 00:00:00 Natural Resources Q&A with the Global Resources Fund Team by Frank Holmes of U.S. Global Investors

This week Frank Holmes and the co-managers of the U.S. Global Investors Global Resources Fund (PSPFX), Evan Smith and Brian Hicks, participated in a special webcast for the Peak Advisor Alliance. Here are some candid portions of the Q&A: Q. How are interest rates currently affecting commodity prices? A. The magic number for real interest rates is 2 percent. That?s when you can earn more than 2 percent on a U.S. Treasury bill after discounting for inflation. Our research has shown that commodities tend to perform well when rates fall below 2 percent.

2011-06-02 00:00:00 Some Days (Months) Are Better Than Others by Liz Ann Sonders of Charles Schwab

May was a rough month for investors, though it ended on a sunnier note. A growth slowdown is evident, but the debate rages about whether its factors are temporary. We think May's risk-off mode is easing, but choppy action remains likely until longer-term worries subside. After an uphill ride in April, when the Dow was up 4%, May wasn't kind to investors, although the last two trading days brought some sunshine. It was the first time in nearly three years that the S&P 500 index had no up weeks in a month.

2011-06-01 00:00:00 Buy Cheap Bonds with Safe Spread by Bill Gross of PIMCO

If the government is going to artificially repress yield, then focus on the parts of a bond that are less repressed! Rather than outright default, many countries attempt rather successfully to keep nominal interest rates lower than would otherwise prevail. Over the long term, this ?financial repression? results in a transfer of wealth from savers to borrowers. Investors shouldn?t give their money away, and at the moment, the duration component of a bond portfolio comes close to doing just that ? because it doesn?t yield enough relative to inflation.

2011-06-01 00:00:00 Recovery Shows Signs of Cracking by Chris Maxey of Fortigent

There was a limited amount of economic data released last week, and most of it turned out to be disappointing. The second revision to GDP showed the economy growing at an annual rate of 1.8% in the first quarter. Though the headline figure was unchanged, several important changes occurred in the data. Specifically, the Bureau of Economic Analysis stated that consumer demand actually rose at a 2.2% annual pace in the quarter, down from the 2.7% annual rate reported. Overall, GDP was weaker than feared in the first quarter as higher inventories and not consumer spending drove expansion.

2011-06-01 00:00:00 Efficient Markets?! by Jeffrey Saut of Raymond James Equity Research

I am writing this Monday night without the benefit of seeing Tuesday mornings pre-opening futures because I will be on a plane. Still, I am optimistic given last weeks backdrop. While it is clear economic statistics have softened, we believe this is largely attributable to Japan (Fukushima), the European debt debacle, the Middle East, and our continuing weird weather. That optimism is reinforced by another all-time high in corporate profits (before tax and adjusted for inventory valuation adjustment and capital allowance adjustment), which is good for capex and employment.

2011-05-31 00:00:00 Small Windows in an Unfavorable Long-Term Picture by John P. Hussman of Hussman Funds

Last week, bullishness pulled back to 43% according to Investors Intelligence, but advisory bearishness also fell to 19.4%, with the remainder boosting the "correction" camp to 37.6%. That's not much of an easing in overall sentiment, but it was enough to give us a bit of latitude to allow us to vary our exposure between a tight hedge and a 10-15% exposure to market fluctuations. That's been of help, but mainly to offset a shallow correction in a few defensive sectors like health care. Our latitude to accept risk will vary in proportion to the average market return/risk profile.

2011-05-28 00:00:00 Railway Revolution Builds China's Consumer Culture by Frank Holmes of U.S. Global Investors

China is building the world?s largest network of high speed rails. Since opening the first high speed line between Beijing and Tianjin in 2008, the country has laid down more than 4,600 miles of new tracks. This is three times more than Japan, where the bullet train was invented. Once completed near the end of this decade, the high speed rail system will connect more than 250 Chinese cities, span 18,641 miles and reach roughly 700 million people. Currently, the high speed rail network connects about one-third of China?s cities. That figure is set to nearly double over the next two years.

2011-05-28 00:00:00 Schwab Market Perspective: Shifting Sentiment by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Economic headwinds are causing growth expectations to be reevaluated, resulting in choppier action in a majority of asset classes. The Fed is moving steadily closer to ending its purchases of Treasuries but we dont believe its a major event. Normalization of monetary policy still seems slow in coming, although we believe QE2 ending on schedule is nearly certain. Europe's debt crisis continues to plague the eurozone. Solutions appear to be limited and agreement is still anything but assured. Meanwhile, China's slowdown is also weighing on investors.

2011-05-26 00:00:00 The Case for More Monetary Elixir by Scott Minerd of Guggenheim

Ive noticed a critical mass of groupthink growing around the expiration of the Feds asset purchase program dubbed QE2. After tripling its balance sheet in 2.5 years, the conventional wisdom is that the era of quantitative easing should now give way to the era of inflation. As a result, the foregone conclusion is that U.S. interest rates will rise and bonds will underperform significantly. While I acknowledge the potential for rising rates, I dont think the expiration of QE2 is the catalyst that most believe it to be. In fact, I believe U.S. rates should remain at historically low levels.

2011-05-25 00:00:00 Global Mergers and Acquisitions Activity Continues to Rise by Team of American Century Investments

Mergers and acquisitions activity is on the rise worldwide. In the U.S. this increase has been accompanied by the return of mega-deals ($10 billion+) driven primarily by large multi-national corporations flush with cash. These deals (and the anticipation of more to come) have helped drive markets up in the first quarter of this year. But the question on the minds of many investors is whether acquiring companies are at risk of overpaying for acquisitions that?while deemed ?strategic?-may only end up transferring (not creating) value from shareholders of the acquiring to the acquired companies.

2011-05-25 00:00:00 Setting the Scene by Eric S. Ende of First Pacific Advisors

As it stands today, without a combination of reducing the growth of Medicare, Medicaid and Social Security and/or increasing taxes, the Congressional Budget Office projects that by 2022 these three programs and interest payments alone will consume all the government?s yearly revenue. That means running a single program in any of the other federal departments would immediately create a deficit for the year. And 2022 is only eleven years away!

2011-05-24 00:00:00 Risks Are Rising, but the Long-Term View Remains Positive by Bob Doll of BlackRock Investment Management

The recently weaker tone in equity markets can be attributed to a broad slowdown in economic data. A longer-term retrospective view shows that the pace of economic growth has been gradually fading over the past several months. Some of the decline can be explained by seasonal factors or factors that may prove to be temporary. In any case, however, at this juncture it appears that the recovery or acceleration phase of the business cycle may be ending. We believe the economy is now shifting into an expansion mode, and the question will become how long that expansion will last.

2011-05-23 00:00:00 One Small Step for Bernanke by Milton Ezrati of Lord Abbett

Fed has indicated its intention to let QE2 end as scheduled in June. This decision would mark the first designated step in the cautious program for policy change that Bernanke had previously outlined. If the Fed sticks with this plan it will take until early 2012 before policy makers will begin to increase market interest rates. Even at that last step, policy would remain easy as the Fed makes its gradual moves. The only difference is that the easing will gradually become less extreme. It will likely take until late 2012 or 2013 before American monetary policy even approaches restraint.

2011-05-23 00:00:00 Don't Sweat by Brian S. Wesbury and Robert Stein of First Trust Advisors

Some recent reports on the economy have been tepid and that?s likely to continue for at least a few more weeks. For example, back in early March the four-week average for initial unemployment claims hit a recovery low of 389,000; now they?re 439,000. Manufacturing production dropped the most in April for any month since the start of the recovery. Meanwhile, for May, we witnessed declines for both the Empire State index and Philly Fed index, which are measures of manufacturing activity in their regions. Both were still in positive territory but not as rapid as earlier this year.

2011-05-23 00:00:00 A Few of My Favorite Things by Jeffrey Saut of Raymond James Equity Research

To begin, commodities are likely on summer vacation before they resume their secular bull market, however, I continue to like a number of special situations. Williams Company (WMB/$30.76/Outperform) reported a solid 1Q11 quarter. Our bullish thesis on Williams is supported by (1) we believe the companys E&P assets will garner a higher valuation in the market place as a stand-alone entity when the company splits itself into two parts; (2) we believe the market is undervaluing Williams ownership of the Williams Partner GP, and (3) we expect strong growth from the Canadian midstream assets.

2011-05-16 00:00:00 Ally Financial + ING Bank? Richard Alford on Lessons Forgotten at the Greenspan/Bernanke Fed by Team of Institutional Risk Analyst

This week in The Institutional Risk Analyst we feature a comment from Dick Alford on the lessons forgotten by the Fed when it comes to financial regulation. Showing his considerate nature, Dick even uses the official histories of past crises prepared by the FDIC as the timeline to make it easier for some of our former colleagues at the Fed to follow along. But first, let's have some fun with one of the toys developed for The IRA Bank Monitor, namely our pro forma M&A analysis tool.

2011-05-16 00:00:00 The End of QE2 Should Be a Non-Event for Investors by Bob Doll of BlackRock Investment Management

Stock markets were flat-to-down last week as economic data continued to be mixed. In other markets, commodity prices continued to fall and the US dollar moved higher. While we do not believe that the long-term secular uptrend in commodity prices has ended, we do think that the cooling effect could be in place for some time, which will hopefully be a positive for both economic growth and stocks. Data suggests that the global economy has slowed recently, but we believe that it is still in the midst of transitioning from recovery to self-sustaining expansion.

2011-05-13 00:00:00 Market Turbulence Increasing by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

We are entering a traditionally tough period for the market and economic data has been raising questions about the sustainability of the recovery. While still optimistic on the longer-term outlook, there could be more choppiness in the near term as markets adjust to a changing environment. The Fed continues to buck the global trend by maintaining loose monetary policy, which contributed to a weaker dollar. But lately the dollar has gotten a lift as QE2 comes to an end, contributing to a rout in commodity prices.

2011-05-13 00:00:00 Three Reasons to Believe in $100 Oil by Frank Holmes of U.S. Global Investors

After selling off nearly 14% last week, oil prices finished this week slightly higher at $99.65 per barrel. While the end result was a net positive, the volatility continued. Oil reached $104/bbl, then fell to around $96, before nesting just below $100. As an investor, this volatility can be difficult to handle. Throw in the uncertainty of today?s geopolitical environment, and investors feel the need to downsize their positions in commodity investments, such as oil. Markets could remain volatile in the short-term, but here are three long-term indicators to support $100+/bbl oil prices.

2011-05-10 00:00:00 And That?s The Week That Was ? by Tom McIntyre of McIntyre, Freedman & Flynn

A spike down in commodity prices including oil and a jump in the dollar over European sovereign default worries combined to send the overall stock market lower last week. the Dow Jones Industrial Average fell 1.34% while the NASDAQ Composite.

2011-05-10 00:00:00 The Financial Impact of an Aging Demographic by Chris Maxey of Fortigent

A volatile week of trading resulted in the S&P 500 Index losing 1.7% and the Dow Jones Industrial Average falling 1.3%. However, those losses were tame relative to the rout experienced in commodity markets. According to the Wall Street Journal, crude oil dropped 14.7% last week, while the Dow Jones-UBS Commodity Index lost 9.1%. There was no single cause for the sudden risk aversion, but it appears that recognition of a slowing US economy, along with tighter monetary policy in developing economies, contributed to the renewed caution.

2011-05-10 00:00:00 Developed Europe: Economic Review April 2011 by Team of Thomas White International

A widely anticipated European Central Bank (ECB) rate hike and Portugal?s plea for a bailout in early April failed to dampen investor optimism surrounding the steady, albeit fragile recovery in Developed Europe. However, around mid-April, equity indices in the region did register a sharp fall in response to the news of another jump in the Euro-zone inflation rate, but recovered quickly to remain in an uptrend for the rest of the month. After recording its highest level for 28 months in February, inflation in the Euro-zone climbed further to 2.7 percent year-on-year in March.

2011-05-10 00:00:00 Americas: Economic Review April 2011 by Team of Thomas White International

Rising inflation remains the major policy concern across most economies in the Americas region and is attracting stronger policy responses, as energy and commodity prices remain elevated. While some of the Latin American countries continue with monetary policy tightening, Canada is widely expected to start hiking interest rates later this year. In the U.S., the Federal Reserve will end its quantitative easing program by the end of this quarter, though interest rate hikes are not expected until early next year.

2011-05-10 00:00:00 Global Overview: May 2011 by Team of Thomas White International

Global economic growth now appears more sustainable, as the developed economies continue to recover and the emerging economies maintain their rapid pace of growth. The Euro-zone economy is expanding faster than expected while the U.S. growth slowdown in the first quarter is widely believed to be due to seasonal factors. The IMF acknowledged that global economic activity is set to accelerate again, and maintained the global growth forecasts for both this year and 2012 at 4.5 percent. However, the IMF warned that growth remained unbalanced and that inflationary risks have increased.

2011-05-06 00:00:00 Silver and Gold, Silver and Gold by Doug MacKay and Bill Hoover of Broadleaf Partners

Silver and gold may still look good as decoration but the metals have also lost some luster in the dental profession (gold vs. porcelain crowns) and for anyone who uses a digital camera instead of old guard film. (Silver is used in film processing.) As most know, silver shot to new highs last week amidst a frenzy for precious metals and perhaps, their perceived inflation hedging capacities. This week, the story was a bit different, with the metal experiencing one of the most stunning drops since the Hunt Brothers tried to corner the silver market back in the early 1980?s.

2011-05-06 00:00:00 And That?s The Week That Was ? by Ron Brounes of Brounes & Associates

As the 10-year anniversary of 9-11 approaches, American have all too vivid memories of that dreadful day and the frightening uncertainties that have remained because of the elevated terror risks. This week, one uncertainty was lifted as Osama bin Laden, the 9-11 mastermind, was killed in a successful military operation in Pakistan. While his death does not eliminate the risk of future attacks, it brings much-needed closure to many and a newfound sense of country pride for the US military and intelligence community.

2011-05-05 00:00:00 A Roadmap For The Coming Changes In Fed Policy by Will Denyer of GaveKal

Last week?s FOMC statement, and Bernanke?s first press conference, were predictably anticlimactic. But they did confirm what the FOMC plans to do this summer, and what they currently think should be the next steps thereafter. Based on this apparent plan, market participants would be right to assume that Fed policy will continue, well after QE2 ends in June, to weigh on the Dollar and support the already elevated Euro, commodity prices, commodity currencies, etc? In other words, the Fed?s telegraphed trajectory would continue to contribute to the world?s biggest macro risks today.

2011-05-02 00:00:00 Schwab Market Perspective: Making Sense of a Mixed Bag by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Earnings season is winding down and is largely positive and CEO confidence is high. This points toward a continued improving labor outlook but could mean more grinding in the stock market. Housing remains moribund but the market seems to be largely dismissive. A ratings warning on US debt rattled the stock market but bond markets were relatively unmoved. Issues need to be addressed, but they are more likely to affect money flowing into the economy and highly unlikely to result in failure to pay obligations. Meanwhile, the Fed is striving to communicate more effectively-but about what?

2011-05-02 00:00:00 Warm Milk and Sweet Dreams by Herbert Abramson and Randall Abramson of Trapeze Asset Management

There is a lot of scary noise out there. MENA turmoil, the Japanese nuclear crisis, European debt, U.S. debt, debasing of the U.S. dollar, commodity prices, higher inflation, a potential left wing coalition government in Canada and Donald Trump as U.S. President. Understandably, our clients, and individual investors generally, are fretting. Confidence levels are low and risk aversion has become paramount. Surveys show that individual investors believe the odds of a one-third stock market drop is over 50% in any given year where true odds are closer to 2%. Investors are too fearful.

2011-04-29 00:00:00 FPA Crescent Fund Q1 2011 by Steven Romick of First Pacific Advisors

The optimists held sway in the first quarter of 2011 and ended the quarter on a good note, with the stock market having returned 5.9%. Crescent returned 4.7%, capturing 80% of the market?s return with risk exposure at just 58% of capital during the period. Two investments ? Aon and Covidien ? accounted for more than 10% of the Fund?s return in the period. No investment detracted from the return to that degree. The greatest negative impact in the quarter came from Microsoft (down 19 bps), a holding we have increased to take advantage of price weakness, given the current low expectations.

2011-04-29 00:00:00 Coal Use in China Shines Light on Growth by Frank Holmes of U.S. Global Investors

International coal prices hit $124 per ton this week, the highest levels in five months, as strong demand from reconstruction projects in Japan and reduced supply from flood-ravaged Australia has made coal supply tight. The floods in Queensland, Australia cut the country?s output of coal by 15 percent and other big coal producers such as Indonesia, South Africa and Colombia are experiencing similar production cuts due to floods of their own.

2011-04-28 00:00:00 The Fed Meets the Press by Liz Ann Sonders of Charles Schwab

The Fed's meeting ended with no surprises on rates or outlook. But the first-ever news conference added some clarity, context and transparency to the Fed's thinking. The Fed has just begun its long process toward monetary policy normalization?and that's a good thing.

2011-04-27 00:00:00 QE3 on the Horizon? by Scott Colyer of Advisors Asset Management

Everyone is concerned about what happens when QE2 ends. On one side believes that when QE2 ends, long term interest rates on Treasuries will spike as the largest buyer exits the market. They believe that the Fed may be tempted to generate QE3 in order to continue try to keep interest rates down and keep the fragile economic recovery going. On the other side of the aisle, there are folks arguing that the yields on the Treasury bonds will drop even as the Fed exits and despite the fact that they are the largest holder of U.S. debt following a slowing U.S. economy during the first quarter.

2011-04-27 00:00:00 Turkey?s Shaky Foundations: Structural Deficit Underpinned by Volatile Capital Inflows by David Rogovic of Roubini Global Economics

In 2009, at the height of the global financial crisis, a reduction in capital inflows and domestic demand caused a narrowing of external imbalances across Europe. Now, as the region returns to growth and recovers from the crisis, Turkey stands out in terms of the size and speed at which its current account deficit is expected to grow. This is due in part to a more rapid recovery, but also to a shortfall of domestic savings relative to investment. The country is more reliant now than in previous episodes on short-term and historically more volatile foreign capital to finance the deficit.

2011-04-26 00:00:00 Why Demographics will Drive Global Growth by Sam Parl (Article)

When economic pundits trade heated predictions about the massive economic shifts we see internationally, it is easy to forget the subtleties that shade their forecasts. One such shadow overhanging any intelligent debate about our global economic future is global age demographics, according to Harvard Professor Richard Cooper.

2011-04-26 00:00:00 Energy and Natural Resources Market by Frank Holmes of U.S. Global Investors

China?s apparent fuel consumption has gained 12 percent to an all-time high of 21 million tons in March. Chinese oil demand averaged 9.265 million barrels per day during the first quarter. Even at $4 per gallon of gas, gasoline demand in the U.S. maintained levels around 9 million barrels per day, according to the U.S. Department of Energy. Aluminum shipments by North American service centers have rebounded in March. Total U.S. and Canadian shipments were 155 kilotons. This is the highest volume since October 2008 and represents a 25 percent month increase, 29 percent year.

2011-04-26 00:00:00 The End of QEII: It?s Time to Make the Donuts by Tony Crescenzi, Ben Emons, Andrew Bosomworth and Lupin Rahman of PIMCO

With quantitative easing the Federal Reserve has in essence picked the pockets of Treasury bond investors throughout the world. Ultimately, the U.S. must own up to its past sins and let the deleveraging process play itself out. The U.S. must invest in its people, its land, and its infrastructure, as well as promote free trade, to achieve economic growth rates fast enough to justify consumption levels previously supported by debt.

2011-04-26 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

As the markets fumble and roil, bounce intraday from Fed pronouncements and geopolitical unrest, should we be cautious or aggressive at these levels? Although the averages defy gravity by maintaining lofty valuations, I would think twice before betting the farm on its continuation. Although most data indicate that we are ?turning the corner? from recession, the same risks that got us in trouble originally still exist for the most part. In addition, as if climbing a ?wall of worry,? the more robust the numbers get, the more frightened some become.

2011-04-26 00:00:00 Are You Watching Your Brokered Deposits? Bob Eisenbeis: What's a Central Bank to Do? by Team of Institutional Risk Analyst

In this issue of The Institutional Risk Analyst, we feature a comment from Bob Eisenbeis, Chief Monetary Economist of Cumberland Advisors. Bob clearly states the obvious in his excellent analysis of the choices facing the Federal Open Market Committee, namely that the Fed continues to steer monetary policy based upon largely domestic factors, this even as the global role of the dollar creates dangers for the US and other nations as they flee the perils of deflation.

2011-04-22 00:00:00 Don?t Fear a Pullback in Prices by Frank Holmes of U.S. Global Investors

The S&P credit agency sent shockwaves through the global financial system on Monday. This sent markets lower and the prices of commodities such as oil rocketing back above $110 per barrel and both gold and silver to new highs. It should be clear the S&P announcement was just a warning, the rating was affirmed at AAA. The fears quickly subsided and U.S. markets hit fresh three-year highs. Essentially there?s only a one-third chance of a downgrade and anyone who?s ever listened to the weather man knows that a 33 percent chance of rain means you probably don?t need your umbrella.

2011-04-21 00:00:00 Equity Investment Outlook by Team of Osterweis Capital Management

The bifurcation of the market, with small caps outperforming large caps, has led to a valuation disparity between overvalued small caps and undervalued large caps, which we believe can be profitably exploited. We, and others, have observed for some time that many excellent, growing large cap stocks are quite cheap relative to both the overall market and to more richly priced smaller companies. We expect that, over time, more investors will agree and large cap stocks may then begin to outperform the general market, as they have to a modest extent this year.

2011-04-21 00:00:00 Banking Sector in India: Counting on Credit Growth by Team of Thomas White International

In 2008, when the global banking industry was being shaken by the tremors of the unfolding financial crisis, only one bank in India felt the aftershocks, and this, only because one of its overseas subsidiaries had made an opportunistic bet on debt issued by the failed investment bank Lehman Brothers. While the market valuations of all the leading banks in India slipped as equity prices tumbled, their businesses were not affected and their balance sheets remained healthy. Most domestic commentators continue to hold up this as evidence of the inherent strengths of the Indian banking industry.

2011-04-21 00:00:00 Equity Market Review and Outlook by Richard Skaggs and Thomas Davis of Loomis Sayles

The global equity bull market continued in the first quarter despite significant global strife. Most major US indices posted total returns of about +5.0% to +8.0%. Continuing the trend since the March 2009 low, small cap and mid cap stocks outperformed their larger brethren. US markets were among the best in the world, although the MSCI World Index also posted a solid gain of 4.9%. Emerging markets were among the weaker equity asset classes. As the returns demonstrate, however, emerging market stocks remain the winners by a wide margin over the past five- and ten-year periods.

2011-04-19 00:00:00 Gangs of New York by Jeffrey Saut of Raymond James Equity Research

I love New York City! Still, as I walked from the airplane into the terminal last Monday, I got the feeling I was traveling back in time, La Guardia is in need of a refresh. All in all, I felt like I was in a third-world country, not the greatest city in the world. Nonetheless, my trip started with a couple of hedge funds. At noon a segment on Breakout." From there, it was off to see some PMs before the next media hit at Fox Business with, Brian Sullivan. While I am kindred spirits with these media anchors, by far the highlight of last Monday was dinner with President Bill Clinton.

2011-04-19 00:00:00 Americas: Economic Review March 2011 by Team of Thomas White International

The economic repercussions to the Americas region from Japan's earthquake are expected to be limited. Though Japan is a large trading partner the percentage share of Japan in their total external trade is low. However, some of the large manufacturers, especially in electronics and automobiles, may face slower output because of shortage in supplies from Japan. Similarly, the escalation of political unrest in the MENA region, have not yet caused a flare up in energy prices. Though retail prices of gasoline have risen, they are not considered high enough to cause damage to consumer spending.

2011-04-19 00:00:00 Middle East/Africa: Economic Review March 2011 by Team of Thomas White International

The turmoil in the Middle East region continues, with Libya exploding into civil war, and troops from the Gulf Cooperation Council being called in to suppress the protests in Bahrain. In terms of the economic repercussions, stock markets in the MENA are estimated to have lost around $140 billion in market capitalization during the last month. According to the Arab Monetary Fund, the market capitalization of 16 Arab bourses was valued at $862 billion on March 4, compared with $1.002 billion on January 25, a day before the political crisis in Egypt triggered upheaval across the Middle East.

2011-04-18 00:00:00 Now Hiring by Milton Ezrati of Lord Abbett

The jobs market has begun to improve. True, the pace is much too gradual for many, but still there can be no mistake that business has at last started rehiring. Not only have payrolls increased but also other indicators foretell further fulltime hiring. What is more, the unfolding jobs recovery, despite people?s understandable impatience, seems pretty much on track with past cycles. Prospects for any continued improvement, then, should give Washington cover to cease its largely singular focus on jobs and deal with longer-term issues. Recent signs are fairly consistently positive.

2011-04-16 00:00:00 Will China's Economy Overheat? by Frank Holmes of U.S. Global Investors

China?s GDP growth continued at a blistering pace during the first quarter of 2011, rising 9.7 percent from the previous year. Once again this outpaced many forecasts and reignited the discussion of China?s overheating economy. While its robust growth may raise a few eyebrows, the economy isn?t in danger of ?red-lining.? Andy Rothman points out that the first quarter growth figures ?[aren?t] dangerously high given the GDP growth rate and strong income growth? After rising nearly 8 percent during 2010, inflation-adjusted urban incomes rose 7.1 percent during the first quarter.

2011-04-16 00:00:00 Inside Information by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Earnings season gives an 'insider' look at economic growth. Businesses see and react to changes in the economy before the broader macro data show a clear trend. The Fed has floated some trial balloons about reining in its extremely accommodative policies, the time for which is overdue. Budget issues remain a problem at all levels of government, but likely wont derail the recovery at this time. Despite ongoing debt problems in peripheral European nations, the ECB hiked interest rates. Europe still faces significant issues that make it more likely to underperform other areas of the world.

2011-04-15 00:00:00 Is the US Headed for a Japanese-Style Deflation? by Daphne Gu of FundQuest

The Great Recession of 2008 ended in June 2009. However, for the majority of 2010, the market was directionless, mired with shocks from European sovereign debt and mixed economic indicators. Inflationary concerns, born of massive liquidity from monetary authorities of the developed world, drove real assets to sky-high levels. Conversely, the traditionally lagging indicator of unemployment, sitting near 9%, has increasingly become a leading indicator of the broad market. Thus, many investors are pondering the possibility that the US might be on the path to a Japanese-style deflation scenario.

2011-04-15 00:00:00 Concerned About Inflation? by Brad Sorensen of Charles Schwab

Inflation has become a bigger topic of discussion among investors and in the media as of late. While we have noted in numerous publications that we don?t believe inflation is a near-term concern due to a number of factors, investors are wondering how to position themselves should inflation start to take hold. First, despite common perception, gold has not historically been a very good hedge against inflation. Due to the possibility of gold prices being a bit extended after the recent run, we don't recommend gold as an investment for those concerned about inflation.

2011-04-15 00:00:00 And That?s The Week That Was ? by Ron Brounes of Brounes & Associates

Though Reps and Dems came together to find $39 billion in budget cuts to avoid a government shutdown, the mood in DC is far from amicable and no one is singing kumbaya. On the heals of Tax Day, Prez O submitted his plan to rein in the deficit by $4 trillion over 12 years that includes spending cuts AND tax hikes aimed at biz and the well-off. While a bipartisan commission praised the proposal as a "solid, responsible plan," would-be Presidential candidates lined up to offer their opposing views, particularly against anything resembling a tax increase.

2011-04-12 00:00:00 Sentiment Creeps Back into Overly Bullish Territory by Chris Maxey of Fortigent

Over the past six months, actions by the Federal Reserve to purchase assets through its quantitative easing program played a major role in driving market prices. As the markets prepare to transition away from quantitative easing, investors are facing the prospects of a tougher market environment. The upcoming earnings season will go a long way in determining whether this recovery is ready to stand on its own.

2011-04-12 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

As we expected last Monday the stock market did nothing but tread water last week. Hesitation before the earnings season begins this week, along with the pause, while our national government debated whether to shut down, were the two dominant reasons for the peace and quiet. the Dow Jones Industrial Average as well as the NASDAQ Composite were flat for last week.

2011-04-12 00:00:00 Equity Market Review & Outlook by Richard Skaggs and Thomas Davis of Loomis Sayles

The global equity bull market continued in the first quarter despite significant unrest across parts of Northern Africa and the Middle East, a massive earthquake in Japan, sovereign debt issues in Europe, and inflationary pressures in certain emerging economies. US markets were among the best in the world, although the MSCI World Index also posted a solid gain of 4.9%. Emerging markets were among the weaker equity asset classes. As the returns demonstrate, however, emerging market stocks remain the winners by a wide margin over the past five and ten year periods.

2011-04-11 00:00:00 Charles Plosser and the 50% Contraction in the Fed's Balance Sheet by John P. Hussman of Hussman Funds

Last week, an unusual event happened in the money markets that should not escape the attention of investors. The yield on 3-month Treasury bills plunged to less than 5 basis points. As I noted this past January in Sixteen Cents: Pushing the Unstable Limits of Monetary Policy, a collapse in short-term yields to nearly zero is a predictable outcome of QE2, based on the very robust historical relationship between short-term interest rates and the amount of cash and bank reserves (monetary base) that people are willing to hold per dollar of nominal GDP.

2011-04-11 00:00:00 Bond Market Review & Outlook by Thomas Fahey, Teri L. Mason and David W. Rolley of Loomis Sayles

The power of easy money policy to dampen volatility is evident in the global bond markets. There has not been any systemic credit spread widening or major jump in risk aversion on the back of the significant political upheaval or natural disaster. The collective investor conclusion seems to be that the impact of the losses will not derail global growth, and Japanese reconstruction may even contribute to it later this year. Specifically, Chinese growth still looks on track for a strong year, and labor markets in the US have at last begun to show something like a normal recovery.

2011-04-11 00:00:00 Despite Near-Term Risks, Stocks Remain Resilient by Bob Doll of BlackRock Investment Management

The preponderance of the economic and market-related news skewed to the negative last week, with an additional earthquake in Japan, rising oil prices, an interest rate hike by the European Central Bank (ECB), escalating debt problems in Europe and increasing noise about the since-averted potential federal government shutdown. Despite this backdrop, however, US equities remained resilient and were roughly flat for the week, with the Dow Jones Industrial Average up marginally to 12,380, the S&P 500 Index down 0.3% to 1,328 and the Nasdaq Composite down 0.3% to 2,780.

2011-04-11 00:00:00 Does Tax Reform Stand a Chance? by Milton Ezrati of Lord Abbett

The budget debate goes on, scrapping over the still-unfinished 2011 budget and, more importantly, positioning for the more fundamental issues of the 2012 budget. President Obama has already issued his budget for 2012 and the years beyond. These are exciting times for Washington?s policy wonks. For investors, these matters are important, if sometimes mind-numbing. Related to these larger deficit issues, but also separate from them, are the newly raised questions of corporate tax reform. These will form the subject of this second in Lord Abbett?s occasional series on fiscal matters.

2011-04-09 00:00:00 Risk 3.0 Investment Solutions for the New Market Realities by Mitchell Eichen and John Longo of The MDE Group

In spite of the stock market rebound from its March 2009 lows, the 2007-2009 bear market still looms large. Investors have lost faith in the conventional methods of portfolio management. Investor confidence was not merely shaken, but shattered. Risk was either improperly measured, or considered a distant second to return. In this paper, we introduce a new approach to portfolio management that builds upon prior work. The main contribution is that specific kinds of risk are explicitly considered. The portfolio is then optimized, using human judgment, for the current market outlook.

2011-04-09 00:00:00 The Curve in the Road by John Mauldin of Millennium Wave Advisors

We have chosen deliberately to take the inflation road. We have not traveled that road for some time. The Fed may think they know what is around the curve and what to do if inflation comes back, but no two crises are the same. I worry about these things. If the Fed and the US government wanted a weaker dollar, the return of inflation, and the potential for yet another boom-bust, they could not have designed better policies than the ones they?re pursuing.

2011-04-08 00:00:00 Postcard from Indonesia by Lydia So of Matthews Asia

During a recent research trip to Southeast Asia, I spent time meeting management teams in Bangkok, Jakarta, Singapore and Kuala Lumpur. I always find it valuable to be able to compare growth opportunities and challenges facing various industries and companies within the region while I am on the ground. Compared to a decade ago, these Southeast Asian cities have all developed relatively high levels of urbanization, affording residents and visitors the modern comforts and conveniences of such things as public transportation, financial services and easy access to fast food chains.

2011-04-08 00:00:00 And That's The Week That Was? by Ron Brounes of Brounes & Associates

All those rabid anti-government, ?conspiracy theorists? may soon get what they most desire. As of Friday afternoon, politicos were continuing their game of chicken as the clock kept ticking toward the first government shutdown in 15 years. While both parties have made concessions on spending programs, the old reliable abortion issue has entered the mix. The latest WSJ poll reveals that Americans blame congressional Republicans (37%) most, countering the partisan hope that Prez O 20% and the Dems 20%, had the most to lose. For now it appears that the American people have the most to lose.

2011-04-07 00:00:00 Weekly Market Update by Team of American Century Investments

?Dodd-Frank? is shorthand for the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The main focus of the legislation is on increasing regulation/supervision of banks and other major players in derivatives, lending, and securitization businesses. Few of the law?s provisions are aimed directly at the registered fund industry, likely reflecting the industry?s distance from the 2008 financial crisis and general effectiveness of the framework already in place. Nevertheless, a number of provisions could affect mutual funds and their investment advisers in meaningful ways.

2011-04-07 00:00:00 Inflation and the U.S. Bond and Stock Markets by Jim O'Shaughnessy of O'Shaughnessy Asset Management

With the Federal Reserve well into QE2 in its response to the recent economic crisis and recession, we thought it would be an ideal time to review the effects of inflation and deflation on the returns of US bonds and stocks. The adjusted monetary base for the United States has exploded over the last several years. As a result many economists and investors expect inflation to increase in the coming years. Let?s review the history of US inflation and the returns for U.S. stocks and bonds and see what it can teach us about the returns of stocks and bonds during a variety of inflationary periods.

2011-04-06 00:00:00 Great Speculations: Why China Is So Bubble-Friendly by Adam Wolfe of Roubini Global Economics

China can blow bubbles faster and bigger than any other country, but the Extraordinary Salt Mania of March 2011 takes the cake for speed, size and bizarreness. Shortly after radiation was reported to be leaking from Japan?s nuclear plant, rumors spread that China?s sea salt could be contaminated by radiation and that salt could prevent radiation sickness. The apparent demand and a perceived supply shock caused prices to spike upward of 85% in days. Media reported that a Mr. Guo bought 6.5 tons of salt, three days later prices collapsed after word from officials that there was no shortage.

2011-04-05 00:00:00 A Trading System that Disproves Efficient Markets by Erik McCurdy (Article)

Efficient market adherents claim it is impossible to outperform the stock market over the long term. Although their principles are the foundation of modern investment theory, other compelling models, including the one I propose here, reveal that precisely the opposite is true, supporting the thesis that markets are highly inefficient.

2011-04-05 00:00:00 Good, But Its Not Enough by Scott Brown of Raymond James Equity Research

Happy days are here again. The job market is now adding jobs at a pace stronger than population growth however, not by much. Its been clear for some time that large-scale job losses are far behind us. The problem in the labor market has been weakness in hiring. Small and medium-size firms have begun to add jobs in recent months. Yet, with so many jobs lost in the downturn, there is a huge amount of ground to make up. The private sector shed a net 8.8 million jobs during the Great Recession (starting in December 2007 and bottoming in February 2010).

2011-04-05 00:00:00 Employment Manufactures Another Month of Positive Growth by Chris Maxey of Fortigent

Equity markets surged into quarter end, with the S&P 500 index rising 1.4% and the Dow Jones increasing 1.3%. For the first time since Feb the S&P 500 increased in two weeks. After hitting a trough on Tuesday morning, several positive employment reports encouraged the equity markets to move higher. As expected, manufacturing activity had a deceleration, as the ISM Purchasing Managers Index fell from 61.4% in February to 61.2% in March. Readings above 50% are representative of expansion in the manufacturing sector. Although the index fell, it is still the third highest reading since 1990.

2011-04-05 00:00:00 When Doves Cry: Debates Rage About QE2's Finale by Liz Ann Sonders of Charles Schwab

Will the Federal Reserve's quantitative easing (QE2) pull into the dry dock in June as intended? If so, what are the implications for stock and bond investors? Might the Fed begin tightening policy before many think?

2011-04-05 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks continued their recent rebound despite a lack of resolution of any of the issues dominating not only the business news but the global headlines as well. The Dow Jones gained 1.3% on the week, which was exceeded by the gains seen in the NASDAQ Composite of 1.7%. Much of last week focused upon two things: The first was the price of oil and our involvement in Libyal. Secondly, the focus was on what, if any, fallout would be seen in last Friday?s employment data for March. This was important especially in light of the recent severe drops in consumer confidence and the price of gasoline.

2011-04-05 00:00:00 And That's The "QUARTER" That Was... by Ron Brounes of Brounes & Associates

?It?s a small world after all.? The past quarter was proof positive that developments across the world truly impact the global economy and investment markets (or do they?). A pro-democracy movement spread across the Middle East, crude prices surged to levels not seen in 2 years and inflation fears resurfaced. Japan suffered an earthquake that brought the economy to a virtual standstill and the initial price-tag for reconstruction stands at over $200 bln. While analysts claim the rebuilding process will prove positive for global trade, excessive debt could slow a ?speedy recovery.?

2011-04-04 00:00:00 Core Incompetency by Michael Pento of Euro Pacific Capital

For years the Federal Reserve has told us that in order to detect inflation in the economy it is important to separate ?signal from noise? by focusing on ?core? inflation statistics, which exclude changes in food and energy prices. Because food and energy figure so prominently into consumer spending, this maneuver is not without controversy. But the Fed counters the criticism by pointing to the apparent volatility of the broader ?headline? inflation figure, which includes food and energy. The Fed tells us that the danger lies in making a monetary policy mistake based on unreliable statistics.

2011-04-02 00:00:00 Above the Fray by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Attacks on Libya and recovery efforts in Japan have dominated the headlines, but behind the scenes US economic growth remains solid and we remain optimistic on the stock market. Commodity prices have backed off a bit and the Fed is likely to see QE2 through to its June 2011 end. Of particular concern is the unwillingness or inability for Congress to agree on a budget that addresses the growing deficit issues in the US. Japan has a significant debt burden with which to deal as it rebuilds, while Europe is struggling to come up with a comprehensive plan to deal with the eurozone debt crisis.

2011-04-02 00:00:00 Expert Roundtable on Inflation: Should You Be Worried? by Mark W. Riepe, Liz Ann Sonders, Rob Williams, Michael Iachini & Brad Sorensen of Charles Schwab

Inflation is a rise in the general level of prices of goods and services; your money buys less. With oil and other commodity prices rising, the Federal Reserve's current easy monetary policy and the economy picking up, many investors are worried about inflation. Mark Riepe, head of Financial Research and president of Charles Schwab Investment Advisory, led a roundtable discussing why Wall and Main Street may have different perspectives on inflation. The roundtable also covers our inflation outlook, ways to protect your investments and inflation-savvy investments you might want to consider.

2011-04-01 00:00:00 And That?s The Week That Was ? by Ron Brounes of Brounes & Associates

New quarter?renewed optimism?ongoing challenges. The second quarter 2011 kicked off with promising news on the labor front as more private sector hires and a lower jobless rate confirmed that employers have enough confidence to begin adding to the payroll. While the favorable outlook has long been apparent in the corporate boardrooms, the labor market had remained a big concern, leading consumers to hold off on major purchases. Since November 2010, however, the unemployment rate has dropped by a full percentage point, a trend that speaks nicely to the recovering economy as a whole.

2011-04-01 00:00:00 The Bedrock of the Gold Bull Rally by Frank Holmes of U.S. Global Investors

Naysayers started calling gold a bubble back when prices hit $250 an ounce and though gold?s bull market has tossed and flung the bubble callers around for almost a decade now, their voices have only gotten increasingly louder as prices broke through $1,000, $1,200 and now $1,400 an ounce. However, gold prices appear asymptomatic of the signs generally associated with financial bubbles.

2011-03-30 00:00:00 ?Agri?-vation by Scotty George of du Pasquier Asset Management

Recent events in the Middle East, combined with weather, have put tremendous pressure upon raw materials prices. The fear is that cyclical pricing pressure might become secular (generational) trends, accelerating inflation in energy prices, foodstuffs, and industrial components, thus undermining a tenuous uptick in consumer spending, global trade, and consumer confidence. While Wall Street rejoices that something, anything, has stimulated trading activity and profit margins, the world watches as surpluses contract and statistics become human convoys of disaster.

2011-03-29 00:00:00 Tilting Toward Energy by Brad Sorensen of Charles Schwab

Despite dramatic current events impacting markets, tactical shifts to your energy-sector allocation could add a small performance boost over the next several months. Volatility will likely remain elevated as events unfold in the Middle East and recovery continues from the devastating disaster in Japan. For investors looking to make shorter-term, tactical adjustments to a portfolio.

2011-03-28 00:00:00 Will The Job Market Rev Up? by Scott Brown of Raymond James Equity Research

Over the last year, the level of job destruction has trended very low. The problem has been a lack of job creation. Normally we look to small, newer firms to account for the bulk of new hiring in an expansion. However, small firms have been constrained by a variety of forces, the most significant being tight credit. That may be starting to change. The job market has a strong seasonal component. The next couple of months will be key to the outlook for jobs and the overall economy.

2011-03-28 00:00:00 China Part I ? Planning for its Future by Mark Mobius of Franklin Templeton

As a result of some labor shortages and rising wages in the low-end labor intensive manufacturing sector, some managers are moving parts of their production out of China to lower-cost countries such as Vietnam. This raises the question of unemployment in the export-oriented area which, combined with inflation, could result in social turmoil and labor unrest, if it?s not well-managed. One positive aspect is that the Chinese government recognizes the issues and addresses many of them in their new Five-Year Plan.

2011-03-28 00:00:00 Equities on the Rise Despite Geopolitical Risks by Bob Doll of BlackRock Investment Management

Risk assets (and equities in particular) powered to a strong week of gains, with the Dow Jones Industrial Average climbing 3.1% to 12,221, the S&P 500 Index advancing 2.7% to 1,314 and the Nasdaq Composite rising 3.8% to 2,743. Although a number of near-term risks remain (particularly related to the unpredictability of escalating unrest in the Middle East), we maintain our view that equity markets are likely to continue their longterm trend of outperformance.

2011-03-28 00:00:00 A Central Bank Match by Chris Maxey of Fortigent

Equity markets donned the rally cap last week as the S&P 500 index finished higher by 2.7% and the Dow Jones Industrial Average experienced a 3.1% gain. Stability in the price of crude oil and improvement in Japan lent a helping hand to the markets, as did the announcement that AT&T would buy T-Mobile. On the domestic front, investors turned a blind eye to the slew of negative economic data. Housing, in particular, experienced the brunt of the disappointment. Existing home sales offered the first piece of bad news after falling 9.6% to 4.88mln on a seasonally-adjusted annual rate in February.

2011-03-27 00:00:00 QE2 - Apres Moi, le Deluge by John P. Hussman of Hussman Funds

As rules of thumb go, "the trend is your friend" historically performs better than "don't fight the Fed". While the market tends to perform better when both are true, the exception is the overvalued, overbought, overbullish, rising-yields syndrome, which is uniformly negative regardless of the random subset of historical data one examines. There is certainly a tendency for "unpleasant skew" featuring a persistent series of marginal new highs for some period of time, but on average, those are ultimately overwhelmed by steep and abrupt losses that finally clear this syndrome.

2011-03-27 00:00:00 Changes in the Inflation Rate Matter as Much to Investors as the Level by Bill Hester of Hussman Funds

It is clear from February's inflation data that there was a broad increase in price levels last month, especially for goods used during the early stages of production. The Producer Price Index rose 5.6 percent from its level a year earlier, up from 3.6 percent in January. On a month-to-month basis, the PPI rose 1.6 percent, doubling its recent pace. That increase was partially fueled by higher food prices, which makes up about a fifth of the overall PPI. Commodity prices tracked within the PPI Index rose 8 percent from a year ago, up from 5.6 percent last month

2011-03-26 00:00:00 Unintended Consequences by John Mauldin of Millennium Wave Advisors

Governments around the world need to be alert and make difficult choices to deal with a world excess liquidity. From an investor?s point of view, enjoy the current ride in emerging markets but recognize that they are high beta to the U.S. economy and stock markets. The next time the United States goes into recession?and there will be a next time?it is likely that emerging markets will suffer significant losses. So, emerging markets are a trade and not a long-term investment.

2011-03-25 00:00:00 What's Driving Russia's Outperformance? by Frank Holmes, John Derrick and Tim Steinle of U.S. Global Investors

All ten sectors of the S&P 500 Index increased this week. The best-performing sector for the week was energy which rose 4.08 percent. Other top-three sectors were technology and materials. Financials was the worst performer, up 0.50 percent. Other bottom-three performers were utilities and healthcare.

2011-03-24 00:00:00 Shiller P/E Still Points to Extreme Overvalution by David A. Rosenberg of Gluskin Sheff

One of our favourite equity valuation metrics, the Shiller Cyclically Adjusted P/E ratio, continues to suggest that the equity market remains overvalued (the cyclically-adjusted P/E uses 10-year earnings to smooth out volatility). At 23.7x, it suggests an overvaluation of over 40% relative to historic norms (and in this case the data goes back to the late 1800s). Note that this indicator has been over 23x for three months in a row, something we haven?t seen since early 2008.

2011-03-23 00:00:00 Germany's Solid Outlook Anchors Wobbly Eurozone by Katharina Jungen of Roubini Global Economics

The German economy is set to power ahead in 2011, as indicated by high-flying business and consumer sentiment surveys and full order books. The initially export-led economic upswing, stands to broaden further given the positive outlook for investment activity and private consumption. Despite the contribution from the moderating external sector, GDP growth will remain above potential, not least due to a sizeable carryover effect from 2010. RGE expects buoyant GDP growth in 2011, boosted by a sharp rebound in construction activity following the weather-related slump at the turn of 2010/11.

2011-03-23 00:00:00 PIMCO Cyclical Outlook: U.S. Economy, Global by Saumil H. Parikh of PIMCO

PIMCO continues to foresee a multi-speed global recovery over the next few years. The U.S. is experiencing a cyclical economic rebound, but its strong durability is uncertain. Several countries in Europe face headwinds to growth over our cyclical horizon. Japan?s growth rate will likely fall in the near term, but reconstruction activities should stimulate growth over time. We expect real economic growth in key emerging economies to remain at a solid rate during 2011, but lower than 2010.

2011-03-22 00:00:00 There are Still So Many Unknowns by David A. Rosenberg of Gluskin Sheff

There are still many unknowns with regard to the global macro picture, but what we do know are the following 10 things: 1. There are more upside than downside risks to the oil price. 2. Japan was already the number-one importer of liquefied natural gas (LNG) and this status will be accentuated as replacements for a damaged nuclear grid is sought. 3. Nuclear energy development takes a near-term hit here by the politics of the Japanese crisis but not a permanent hit. 4. The aftershock in Japan will be related to contaminated food supply so we can expect to see more inflation on this score too.

2011-03-19 00:00:00 Middle East Politics and Oil: The Influences on Global Interest Rates, Credit Spreads & Stock Prices by Tom Fahey, Ryan McGrail, Richard Skaggs and Joseph Taylor of Loomis Sayles

The market has added a substantial risk premium to the price of oil given the unrest in the Middle East and North Africa. Prices have increased by more than 20% since December 2010; half of that increase occurred during the past three weeks in reaction to unrest spreading to Bahrain, one of the Gulf States. Market participants have raised their probability calculations for black swan events. There may be excess pessimism in the market, as reflected in increased concerns about unrest spreading to the other Gulf States. Those concerns are potentially overblown.

2011-03-19 00:00:00 How the VAR Model and Japan?s Tragedy Affect Investors by Frank Holmes of U.S. Global Investors

The threat of disaster from the damaged Fukushima nuclear power plant unleashed a ferocious sell-off of Japanese equities, but the damage to other major markets has been limited. Already experiencing a slight pullback prior to the events on March 11, U.S. equities and emerging markets have held up quite well. The MSCI Emerging Markets Index has only pulled back 2 percent since the earthquake and the S&P 500 Index only 3 percent.

2011-03-19 00:00:00 What the Heck is Going On??? by Team of Emerald Asset Advisors

In recent weeks, the capital markets have weathered a bout of volatility not seen for quite some time. What are the main causes and how does this volatility affect our strategies and your portfolios? While there are many flashpoints around the world, we will highlight the "Big 3" (Japan, the Middle East, and federal budget issues) that have made the most headlines, and those which we believe have had the greatest and most recent impact on volatility.

2011-03-18 00:00:00 Has the Game Changed? by David A. Rosenberg of Gluskin Sheff

An object at rest will remain at rest unless acted on by an unbalanced force. An object in motion continues in motion with the same speed and in the same direction unless acted upon by an unbalanced force. This is otherwise known as Newton?s first law of motion. In market parlance, this implies that a trend remains in force until such time as an exogenous shock causes it to either stall or reverse. Economic, geopolitical, and natural disaster events aside, equity markets around the world have definitely broken their intermediate-term uptrend.

2011-03-17 00:00:00 5 Dividend Champions to Work Your Money as hard as You Worked for It! by Chuck Carnevale of EDMP

You worked hard over your lifetime to build a nest egg in order to fund your retirement. Doesnt it make sense that now that youre retired your money should work as hard for you as you worked for it? When you were working, you were accustomed to receiving a raise in pay each year. Why should that end now, just because you are retired? It doesnt have to, because investors today have the good fortune and opportunity to invest in blue-chip 'Dividend Champions' (companies that have increased their dividend every year for at least 25 years) which are trading at historically low valuations

2011-03-16 00:00:00 Fukushima vs. Three Mile Island vs. Chernobyl by Mikka Pineda of Roubini Global Economics

This year marks Chernobyl's 25th anniversary, and how ironic it is that the world has a new nuclear emergency on its hands: Japan's Fukushima power plant. The situation at Fukushima continues to worsen, with explosions at two more reactors and the radiation released surpassing that of Three Mile Island. The 40-year-old reactors were due for decommissioning at the end of this month. The Fukushima nuclear incident will likely be upgraded from a level 4 to a 5 on the International Nuclear and Radiological Event Scale. Chernobyl was a level 7?the only level 7 event so far.

2011-03-15 00:00:00 Running on Empty by Michael Lewitt (Article)

Despite the increasing undercurrent of negative news creeping into the financial markets, the stock market remains strong. HCM expects equities to continue to perform well for the foreseeable future (i.e. through the end of June) although most of this letter will discuss the reasons why it shouldn't. In some ways, this market is a lot like Charlie Sheen. It pretends to have tiger blood and the powers of a warlock, but deep inside it is suffering from an addiction to a substance (i.e. debt) that will ultimately kill it.

2011-03-15 00:00:00 Consumers Right the Ship by Chris Maxey of Fortigent

A confluence of macroeconomic events created selling pressure during the week, sending the S&P 500 Index lower by 1.3% and the Dow Jones Industrial Average down 1%. Releases on the domestic economic situation continued to show positive momentum, ranging from improvement in retail sales to a pickup in consumer credit. There was some concern about weaker consumer confidence figures and deterioration in weekly jobless claims, but it was clear last week that consumer balance sheet deleveraging continues. Retail sales for Feb increased 1% from Jan for a total increase of 8.9% in 12 months.

2011-03-15 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Last week?s financial markets reflected the uncertain outcome of the various mid-east conflicts, as well as the horrific news from Japan that an earthquake of unimaginable intensity has rocked that country, both of which have global economic implications. Overall, the stock market was calm. The Dow Jones Industrial Average fell just one percent while the NASDAQ Composite dropped 2.5% as fears of slower growth were compounded late in the week by news of the earthquake in Japan, which is home to many technology supply-parts manufacturers.

2011-03-12 00:00:00 And That?s The Week That Was ? by Ron Brounes of Brounes & Associates

The volatility is back. In Jan., the Dow encountered but two days of triple digit moves. In Feb., that number jumped, but only to three. Already by March 11, the index has moved by 100 point or more (up or down) on four occasions this month. Geopolitical events in the Middle East, Asia, and Europe have brought renewed uncertainties to the marketplace and prompted some recent profit taking and maybe even a flight-to-quality into treasuries. This week, the ?nays? had it as the Libyan conflict continued and threats of its spreading to oil giant Saudi Arabia remained fresh on investors minds.

2011-03-12 00:00:00 Inflation and Hyperinflation by John Mauldin of Millennium Wave Advisors

Companies and households typically deal with excessive debt by defaulting; countries overwhelmingly usually deal with excessive debt by inflating it away. While debt is fixed, prices and wages can go up, making the total debt burden smaller. People can?t increase prices and wages through inflation, but governments can create inflation, and they?ve been pretty good at it over the years. Inflation, debt monetization, and currency debasement are not new. They have been used for the past few thousand years as means to get rid of debt. In fact, they work pretty well.

2011-03-12 00:00:00 Volatility on the Rise by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Geopolitical unrest and rising inflation concerns have conspired to increase market volatility. We remain bullish on US stocks and believe that this recent increase in consternation will ultimately be healthy for stocks. The US government keeps kicking the debt can down the road, while the Fed seems unconcerned about inflation and is intent on completing QE2. We believe changes are needed at both entities to foster sustainable economic growth. The European debt crisis is bubbling up again, while the ECB is talking interest-rate hikes. Future growth depends on the path of both issues.

2011-03-11 00:00:00 Middle East turmoil not yet a significant threat to the global economy by Team of Thomas White International

The political unrest spreading across the Middle East and the resultant disruptions to the regional economy are not considered very significant for the global economic prospects for this year. Though oil prices have reacted on fears of lower supplies from the region, there have been no actual disruptions so far and any perceptible deceleration in global economic growth is expected only if prices shoot up further. It is widely believed that, unless the agitations spread to the region?s major oil producers like Saudi Arabia, the prospect of a sustained upsurge in energy prices is limited.

2011-03-11 00:00:00 Americas: Economic Review February 2011 by Team of Thomas White International

Rising energy prices, due to the political upheavals in the Middle East, are becoming the primary economic risk for the Americas region. While the subdued inflationary trends will provide banks leeway to hold interest rates, they may be forced to advance their rate hikes if prices rise at a faster rate. In contrast, several of the emerging economies are expected to slow down this year. These economies may see interest rates rising faster, which may slow their pace of expansion even more. Also, higher interest rates will likely keep their currencies stronger and may restrict export growth.

2011-03-11 00:00:00 Europe: Economic Review February 2011 by Team of Thomas White International

Various data released in Feb. confirmed once again that the economic recovery in Europe is gaining momentum. Nevertheless, investor sentiment on the continent, and indeed everywhere in the world, remained largely subdued during the month due to the growing political uncertainty in the Middle East and N.Africa region. Since rising food, raw material, and crude oil prices have already pushed up inflation to worrying levels in most parts of Europe, the recent surge in oil prices amid the protests in Libya and some MiddleEastern countries eclipsed encouraging signals about the Euro-zone economy.

2011-03-11 00:00:00 Asia Pacific: Economic Review February 2011 by Team of Thomas White International

Asian economies recorded some of their best performance for the full year 2010. In particular, Southeast Asian nations witnessed a banner year, clocking their best performance in recent memory. However, although the full year record was exemplary, growth in the final months of 2010 began to cool off. While a rising currency continued to trouble export-based economies, inflation haunted almost all central banks in the region. Central banks, having to choose between raising interest rates and attracting foreign capital, opted to hike rates.

2011-03-09 00:00:00 Gold or Goldilocks? by Kevin Feldman of BlackRock Investment Management

After a roller coaster January, gold prices have been soaring to nominal highs again of late. Given the recent rise in price, I thought this would be a good time to revisit the case for having a small amount of gold in your portfolio. Investors flocked to gold in 2009 and 2010 because of worldwide concern over the stability of the financial system, and as a result the precious metal?s price skyrocketed, passing $1400 an ounce. Last month, Barron?s warned its readers that the gold rush is over. Suggesting investors were likely to search for assets with greater expected returns than gold.

2011-03-08 00:00:00 Consumer Confidence Turns Back Down by David A. Rosenberg of Gluskin Sheff

According to an RBC consumer outlook poll, one in three U.S. households is already ?significantly? cutting back on spending because of rising gasoline prices. And this was a survey taken at a time when the national average price at the pumps was around $3.20 per gallon ? wait and see what happens when it costs four bucks to fill up the tank ? that is the pain threshold for 41% of the consumer sector as per this poll.

2011-03-08 00:00:00 Will the Global Recovery be Brought to its Knees by Commodity Prices? by Chris Maxey of Fortigent

There is a dangerous trend developing in food and energy costs, one that threatens to derail the global recovery. Thus far, consumers are able and willing to accept higher commodity prices. With consumers still feeling the effects of the worst recession in nearly a century, though, there is only so much that people will be willing to tolerate and the second half of the year may be too far away, at least when it comes to crude prices.

2011-03-07 00:00:00 Toryism, Socialism and Housing Reform: Real and Imagined by Christopher Whalen of Institutional Risk Analyst

This commentary is background for the presentation entitled "GSEs: The Future Role of Government Sponsored Enterprises in the US," at the Global Association of Risk Professionals event on Tuesday, March 8, 2011, in New York. The Obama Administration recently advanced some proposals to reform several government agencies that control the market for housing. Treasury/HUD plan is really a menu of possible options, eliminating what would not work and making it clear that change will happen slowly, if at all.

2011-03-07 00:00:00 Random Post-Employment Thoughts and Consensus On Oil Impact by David A. Rosenberg of Gluskin Sheff

The consensus is that the U.S. labor market is healing. That may well be the case but the slack in the job market remains huge allowing for a structural rise in the unemployment rate. Only 15% of the recession job losses have been recouped despite the fact that expansion has surpassed the downturn. The consensus is that the world economy has gotten used to high levels of oil prices so this latest run-up in crude poses little risk to the economic outlook. But it is change that matters to growth, not levels. As for the macro impact, do not understate the potential for economic contraction.

2011-03-07 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

The case for gold and energy-related price spikes is rooted, in part, by good intentions hedging against dollar fluctuations, inflation risk, and political discord. But unlike a level of rational speculation one might expect to see, one has to wonder whether the market?s players are overdoing their hand just a bit. Simply, the world of commodities gambling has been turned into a shootout. While oil production and distribution (as with gold) has been spiking over the last 3 years, real demand has only turned up modestly.

2011-03-07 00:00:00 Investment Commentary by Bob Doll of BlackRock Investment Management

A tug of war is taking place in the markets, with crosscurrents of good economic reports on the positive side and a continued rise in oil prices from the conflicts in the Middle East on the negative side. Last week, US equities were up modestly, with the Dow Jones Industrial Average rising 0.33% to 12,169, the Nasdaq Composite advancing 0.13% to 2,784 and the S&P 500 adding 0.10% to close at 1,321.

2011-03-04 00:00:00 And That's The Week That Was? by Ron Brounes of Brounes & Associates

Unlike Egypt?s Mubarak, Libya?s Gadhafi is not going down without a strong fight. With tensions escalating throughout the region, the world?s oil supply and crude prices soared above $104/barrel over the past few days to levels not seen in 29 months. While optimists point out that Saudi Arabia has been quick to pick up the slack for any shortfall out of Libya, others worry that a prolonged crisis limits its ability to do so indefinitely. The bigger pessimists fear that the uprising could spread to Saudi (Anyone think it may be time to reduce our dependency on foreign oil?)

2011-03-04 00:00:00 The Job Market, Oil Prices, and the Fed by Scott Brown of Raymond James Equity Research

Higher oil prices have raised new concerns about the strength of the economic recovery. If sustained, the rise in gasoline prices will restrain the pace of economic growth noticeably, but does not appear to be large enough (so far) to derail the expansion. Meanwhile, a federal government shutdown looms as lawmakers bicker over the future path of expenditures. Austerity at all levels of government is well-intentioned, but is not advisable at this point in the economic recovery.

2011-03-03 00:00:00 What Happens If There is No QE3? by David A. Rosenberg of Gluskin Sheff

?who picks up the slack if the Fed stops its bond-buying program?? The answer is hardly complicated since we have a template for this. It is a very simple guidepost. Last year, from April 23rd through to August 27th, the Fed allowed its balance sheet to shrink from $1.207 trillion to $1.057 trillion for a 12% contraction as QE1 drew to a close. Go back a year to the Federal Open Market Committee minutes and you will see a Federal Reserve consumed with forecasts of sustainable growth and exit strategy plans. A sizeable equity correction coupled with double-dip fears were nowhere to be found.

2011-03-03 00:00:00 Multi-Asset Real Return: Assessing & Exploiting Price Pressures in their Many Forms by Kevin Kearns, Laura Sarlo and James Balfour of Loomis Sayles

An asset manager?s challenge is to preserve and grow the purchasing power of investors? portfolios under a variety of economic conditions. Understanding the breadth of global inflationary or deflationary trends that can occur, and the ways different assets might perform in these environments, is critical to this objective. Based on our research, we have determined that no single asset class can protect investors from inflation. On the contrary, we believe the flexibility and diversification offered by a multi-asset-class strategy is necessary to help weather changing inflation regimes.

2011-03-02 00:00:00 Two-Bits, Four-Bits, Six-Bits, a Dollar by Bill Gross of PIMCO

A successful handoff from public to private credit creation has yet to be accomplished, and it is that handoff that ultimately will determine the outlook for real growth and stability. Because quantitative easing has affected all risk spreads, the withdrawal of nearly $1.5 trillion in annualized check writing may have dramatic consequences. Who will buy Treasuries when the Fed doesn?t? The question really is at what yield, and what are the price repercussions if the adjustments are significant.

2011-03-01 00:00:00 Disasters Rocking U.S. Dollar? by Axel Merk of Merk Funds

From earthquakes in New Zealand to revolutions in the Middle East, natural and man-made disasters are rocking the world. We are all too often made to believe that in times of crisis there?s a flight to the U.S. dollar. However, the U.S. dollar has instead had a rocky ride of its own thus allowing the crisis-ridden Eurozone to shine. What?s going on? Is there no crisis, or has the U.S. dollar lost its appeal as a safe haven?

2011-02-28 00:00:00 When Inflation Fuels Deflation by Chris Maxey of Fortigent

Global macroecon concerns led to the sharpest weekly sell off in the S&P500 Index in three months. For the week, the S&P 500 Index was down 1.7% and the Dow Jones Industrial Average fell 2.1%. A multitude of catalysts were behind the selloff, including concerns about the situation in Africa and the Middle East, surging commodity prices, in particular crude oil, and finally, a feeling that equity valuations were moving into overbought territory. There were only a handful of important domestic economic releases last week, including several data points on housing and the state of the consumer.

2011-02-28 00:00:00 Moment of Surrender: Regimes Fall, Oil Prices Spike by Liz Ann Sonders of Charles Schwab

Geopolitical tensions swell along with oil prices, pushing the stock market lower. The absence of a longer-term oil- supply shock suggests the price spike could be short-lived. Consumers will take a hit, but the broader economy should avoid a double-dip recession.

2011-02-27 00:00:00 Bank Stress Index Up in Fourth Quarter; Can China Slow Down Bank Lending? by Christopher Whalen of Institutional Risk Analyst

The Q4 2010 results from the latest IRA bank stress index ("BSI") survey are in and the US banking industry saw slightly higher stress than in the previous quarter. At the start of 2010, we wrote in The IRA Advisory Service that Q1 was likely to be the best quarter of the full year 2010. As it turns out, Q1 2010 was the lowest BSI score for the full year and since the start of 2009. Operational stress as measured by the BSI has been rising in the US banking industry steadily since Q1 2010.

2011-02-27 00:00:00 Cash or Credit - Implications for the Financial Markets by John P. Hussman of Hussman Funds

From the standpoint of prospective investment returns, it is important to recognize that the main effect of quantitative easing has been to suppress the expected return on virtually all classes of investment to unusually weak levels. It's widely believed that somehow, QE2 has created all sorts of liquidity that is "sloshing" around the economy and "trying to find a home" in stocks, commodities, and other investments. But this is not how equilibrium works.

2011-02-25 00:00:00 What Really Drives the Market by David A. Rosenberg of Gluskin Sheff

Well, we used to say there were four key drivers: 1. Fundamentals; 2. Fund flows; 3. Technicals; 4. Valuation; Then we introduced another one last week: 5. The Fed?s balance sheet; Now that is not going to be included in any of the Graham & Dodd textbooks, that is for sure. But since Dr. Bernanke embarked on his non-traditional monetary maneuvers two years ago, there has been an 86% correlation between the S&P 500 and the movement in the Fed?s balance sheet. And now there is a sixth: 6. Corporate earnings surprises Yes, this works with a 90% historical accuracy rate.

2011-02-25 00:00:00 Asia Insights from EM Analyst Conference by Allan Lam of Franklin Templeton

Many tend to focus on China and India, the two rising Asian economic powers, and there are reasons why we believe both, which are currently among the top five largest economies in the world will likely be among the top three in 2020. Land and labor costs remain cheap in China. In addition, the country appears to have a competitive edge in terms of work ethics, relatively flexible labor laws and excellent logistics. India?s strength is in its young, growing and increasingly well-educated population, which is fluent in English. This has enabled the country to become a leader in IT consultancy.

2011-02-25 00:00:00 Oil And Vinegar by Scott Brown of Raymond James Equity Research

Higher oil prices have raised new concerns about the strength of the economic recovery. If sustained, the rise in gasoline prices will restrain the pace of economic growth noticeably, but does not appear to be large enough (so far) to derail the expansion. Meanwhile, a federal government shutdown looms as lawmakers bicker over the future path of expenditures. Austerity at all levels of government is well-intentioned, but is not advisable at this point in the economic recovery.

2011-02-25 00:00:00 Worry ... Friend or Foe? by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Interest rates have moved higher, inflation concerns are growing, debt issues remain and global tensions are heightened. All valid concerns, but in our opinion not enough to derail stocks?although they could potentially in the future. Violence in the Middle East and North Africa is creating tension in global markets, but there are other concerns for emerging markets as well. Europe is becoming a bifurcated situation, with investors distinguishing between those with debt issues and those without.

2011-02-23 00:00:00 Reevaluating ?Chindia?: The Story of the Elephant and the Dragon by Arpitha Bykere, Adam Wolfe and Arnab Das of Roubini Global Economics

The emerging market powerhouse known as ?Chindia? is becoming a focal point of global attention as China and India show themselves to be growth dynamos of the coming Asian Century. But examining these countries? intrinsic differences is more illustrative than listing their similarities?and the two countries are likely to be on a divergent path over the next five years in the areas of growth, economic policy and politics.

2011-02-23 00:00:00 It's All About the Timing by David A. Rosenberg of Gluskin Sheff

The calendar of events that could create recurring bouts of market volatility is coming into closer view: February 25: Irish elections. Is a default coming? March 4: U.S. government shutdown; this is the date that the latest resolution expires. The hardliners in the GOP are digging in their heels over $60 billion of spending cuts. April 1: U.S. nonfarm payroll report for March. The jobless claims data suggest no improvement from poor February results. Then end of QE2 and the knowledge that movements in the Fed?s balance sheet in the last 14 months have had an 86% correlation with the S&P 500.

2011-02-23 00:00:00 FPA Perennial Shareholder Letter by Eric S. Ende of First Pacific Advisors

The major issue affecting global markets continues to be the amount of debt outstanding worldwide. Governments and consumers in many of the world?s developed countries are under the microscope as lenders question whether these borrowers will be able to make interest and principal payments on their loans. We expect these concerns to remain for some time to come.

2011-02-23 00:00:00 Right Brains and the Dismal Science by Herbert Abramson and Randall Abramson of Trapeze Asset Management

It has been said that successful investors need to employ not only the left side of their brains which is the analytical or scientific part but also the right side which is the centre for creative thinking. Thats because much of investing has to do with the unpredictable, the down cards, variables about future demand, growth, political policy changes, psychological responses, weather, oil spills, and so forth. Value investors dont want to pay for the down cards, but want to buy so cheaply in the here, that there is little or no risk of losing, and the hereafter can take care of itself.

2011-02-23 00:00:00 Right Brains and the Dismal Science by Herbert Abramson and Randall Abramson of Trapeze Asset Management

It has been said that successful investors need to employ not only the left side of their brains which is the analytical or scientific part but also the right side which is the centre for creative thinking. Thats because much of investing has to do with the unpredictable, the down cards, variables about future demand, growth, political policy changes, psychological responses, weather, oil spills, and so forth. Value investors dont want to pay for the down cards, but want to buy so cheaply in the here, that there is little or no risk of losing, and the hereafter can take care of itself.

2011-02-22 00:00:00 Fiscal Contraction is Coming ... This is a Key Theme by David A. Rosenberg of Gluskin Sheff

Well, if you haven?t yet heard, major budgetary restraint is coming our way in the second half of the year, and so we would recommend that you enjoy whatever fiscal and monetary juice there is left in the blender. There isn?t much that is for sure. The weekend newspapers were filled with reports of how the conservative wing of the Republican party have banded together to ensure that spending cuts will be in the offing. The state and local governments are already putting their restraint into gear.

2011-02-22 00:00:00 Investment Commentary by Bob Doll of BlackRock Investment Management

The bearish view of the current rally is that it is liquidity-driven and based on artificial propping-up by overly easy monetary and fiscal policy support. While we agree that the stimulus from the Federal Reserve and other policy makers has been an important pillar in helping to restore economic growth and drive risk asset prices higher, we also believe that the economy is transitioning into a self-sustaining expansion. In our opinion, this environment of improving growth, low inflation and a supportive policy backdrop continues to represent a ?sweet spot? for risk assets.

2011-02-20 00:00:00 December 2010 Semi-Annual Report by John P. Hussman of Hussman Funds

For the third time in a decade, the Federal Reserve has embarked on a policy that addresses structural economic problems by provoking speculation in asset prices. The first two attempts were ultimately followed by stock market declines greater than 50% each. As we enter 2011, the stock market remains in what we view as an already strenuously overvalued advance, which has driven our estimates for S&P 500 Index total returns to less than 3.2% annually over the coming decade. My expectation is that this attempt to create ?illusory prosperity? will end no better than it has in the past.

2011-02-19 00:00:00 Let Yourself Feel Good Again by Doug MacKay of Broadleaf Partners

The stock market has continued to perform exceedingly well so far in 2011 and is now up roughly 7% year to date. While an oil spill or European contagion type event could always disrupt the progression, the stock market, S&P 500 profit levels, and leading economic indicators are all pointing to a similar conclusion. The economy is likely to graduate from its recovery phase to an outright expansion sometime this year. It's time to start letting yourself feel good again.

2011-02-18 00:00:00 Breakfast with Dave by David A. Rosenberg of Gluskin Sheff

The Treasury market retains a nice bid here and equities now look a bit wobbly or at least engaging in a pause. European bourses are in the red column for the most part and Asia was mixed with Japan, Hong Kong, and Korea posting gains but China and India were both clocked for a 0.9% and 1.6% loss, respectively. Even though China raised reserve requirements by a half-point again, the oil price is receiving support from concerns over the spread of social unrest in the Middle East towards Libya and Bahrain.

2011-02-16 00:00:00 Politics of Inflation by Axel Merk of Merk Funds

In arguing food inflation is not the Federal Reserve?s (Fed?s) fault, Fed Chairman Bernanke points the finger at everyone but him. Just as with a lot of Bernanke?s policies, his argument may hold in an academic setting, but the real world is a bit more complicated.

2011-02-15 00:00:00 Food Chain: Do Spiking Food Prices Warn of Generalized Inflation? by Liz Ann Sonders of Charles Schwab

Food inflation has heated up and has incited global unrest. But for now, it's unlikely to become a monetary phenomenon. Investors should expect geopolitical risk to stay elevated in 2011, with implications for emerging markets performance.

2011-02-14 00:00:00 Fiscal Drag Coming and No More QEs by David A. Rosenberg of Gluskin Sheff

In an otherwise uneventful weekend, what did come out is that fiscal stimulus is about to turn towards restraint in a significant fashion. Even the White House recognizes the need for fiscal discipline and is on the precipice of unveiling a much more austere budget. And this will coincide with massive tax hikes and spending cuts at the lower levels of government too. The surgery is much more preferable now than becoming a banana republic down the road.The future of QE2 is looking more certain ? it will live to see June of this year but the chances of a QE3 are remote.

2011-02-14 00:00:00 What Will Propel Equities Further? by Milton Ezrati of Lord Abbett

The positive outlook for equities draws on many sources, but basically rests on two pillars: 1) continued economic growth that will sustain an earnings expansion and 2) still-favorable valuations prevail, despite the great rally since March 2009. Neither point, of course, is beyond complaint. Nothing in any investment outlook is absolutely secure. Now, as ever, prospects are overshadowed by a cloud of risks. But the likelihoods still favor the earnings growth and a favorable response from equity markets.

2011-02-14 00:00:00 Investment Commentary by Bob Doll of BlackRock Investment Management

For many investors, the shift into equity markets is still in the early stages and equity valuations are hardly stretched, suggesting that the upward moves have further to run. While pullbacks and corrections will no doubt occur along the way, we believe they should be short and shallow and should be taken advantage of to add to positions.

2011-02-14 00:00:00 Recovery Here to Stay with Equities Flashing Caution by Chris Maxey of Fortigent

Equity markets continue to melt higher, despite several unfavorable technical developments. The market began its recent rally in September of last year, with only a brief respite in November. Since that time, each pull back is used as an opportunity to pile more money into equities and with the Federal Reserve offering massive liquidity to all corners of the market, this phenomenon could potentially last longer than any are willing to admit.

2011-02-13 00:00:00 Rich Valuations and Poor Market Returns by John P. Hussman of Hussman Funds

At present, my view on monetary policy is that the inflation outlook following the completion of QE2 will be quite unstable, because small changes in interest rates are likely to induce very large changes in the willingness of individuals to hold base money. Any external upward pressure on interest rates beyond a fraction of a percent will have to be rapidly offset by a large reduction in the outstanding monetary base in order to avoid a deterioration in the value of money relative to goods and services (i.e. inflation).

2011-02-12 00:00:00 Balancing Act by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Strong US economic signals and solid earnings continue to provide a positive backdrop for stocks. We expect pullbacks if optimistic sentiment gets too elevated, but remain optimistic about the stock market. Inflation concerns are rising, but the Federal Reserve is unlikely to react with tighter policy. There's not much it can do to fight commodity inflation, but Treasury yields are rising in response to headline inflation, even with little near-term risk of companies passing on rising costs.

2011-02-11 00:00:00 The Year of the Rabbit by Craig Hester of Hester Capital Management

The global financial markets in 2011 are likely to reflect many of the characteristics of the rabbits personality: quick to react, avoiding conflicts, erratic, resilient yet determined. The year started on a fast note. The S&P 500 jumped out to a 3.3% gain before selling off late in January over concerns regarding political instability in the Middle East. Global tensions, sovereign debt, state and federal finance, the economy and earnings may affect financial markets this year. One can expect a year of volatility, but a market that will display resiliency in the face of these uncertainties.

2011-02-10 00:00:00 The Two Faces of Ben Bernanke by Peter Schiff of Euro Pacific Capital

When the rest of the world no longer links their currencies to ours, the Fed will truly not have to worry about fueling global inflation. Instead, all of its inflation will burn through our banks accounts right here at home. And that blaze, so concentrated, will burn a lot hotter than the fires we see abroad.

2011-02-10 00:00:00 Betting Against the House; Is This the Time to be Going Long? by David A. Rosenberg of Gluskin Sheff

Housing starts are at around 550k annualized units right now and household formation averages in the 1.1 to 1.2 million range. At what point do you think this dovetails and a housing recovery takes place? Great question. This is one overextended U.S. stock market, that is for sure. We have a dividend yield on the S&P 500 of 1.8% with a 10-year bond yield at 3.7%. The dividend yield, by the way, is where it was at the market peak in October 2007. The cyclically-adjusted P/E ratio on the S&P 500 is now 23.3x, where it was back in May 2008. At the lows, it was trading at 13.3x.

2011-02-10 00:00:00 FPA Crescent Fund Q4 2010 by Steven Romick of First Pacific Advisors

We do not have a strong view as to what will transpire over the intermediate-term with respect to the economy or securities markets, nor do we have a great love for the opportunities the markets have to offer. In general, we require more upside than the market currently permits, because the downside (for reasons discussed) is not inconsequential. Taking a look at the S&P 400 Midcap Index gives some idea as to why that may be the case. Midcap stocks have increased 129% since the 2009 trough. That kind of move generally sucks the oxygen out of the room as far as good risk/reward investments go.

2011-02-09 00:00:00 Testing the Wisdom of Ben Graham?s Formula (part one) by Chuck Carnevale of EDMP

Ben Graham?s formula for valuing a company V* = EPS x (8.5 + 2g) established a solid foundation for future value investors to build upon. The small ?g? in the formula represents your reasonably expected 7 to 10 year growth rate. Consequently, Ben Graham?s formula was forward-looking. In this article we looked at modern historical performance in order to test the validity of this famous value formula. Remarkably, the formula proves itself to being very precise when applied in the real world to businesses that grow earnings between zero and 5% per annum.

2011-02-09 00:00:00 How to Play in 2011 by David A. Rosenberg of Gluskin Sheff

At the start of every year I remind myself that each individual year has its own story. For example, 2007 taught us that it never hurts to take profits after the market doubles and that if something is too good to be true (housing and credit bubble) it probably is. The 2008 lesson focused on capital preservation strategies and the urgency of managing downside risks. 2009 it was vital not to overstay a bearish stance in the face of massive fiscal and monetary stimulus. Last year?s lesson was how to handle the many post-stimulus market swings that are inherent in a post-bubble credit collapse.

2011-02-08 00:00:00 Undoing Meredith Whitney's Damage by Hildy Richelson, Ph.D. (Article)

Meredith Whitney did the municipal bond market an immense disservice with her misguided comments on 60 Minutes when she predicted massive defaults. Two recent articles in this publication provided accurate rebuttals to her analysis, but they failed to clarify important reasons why muni bond investors do not face the imminent peril that Whitney predicted.

2011-02-08 00:00:00 Give ?Em Credit; Looking at Sales, Not Just Earnings by David A. Rosenberg of Gluskin Sheff

Across many indicators, this goes down as a horrible recovery, especially in view of all the stimulus. Of course things look much better than they did in the ?double dip? risk days of last summer but absent the impact of the GDP deflator?s collapse and the decline in the savings rate, Q4 real GDP would have actually come in closer to +0.5% SAAR than the posted +3.2% print. We are hearing how great S&P 500 sales are doing so far for Q4 ? up 7.7% and beating estimates by the highest margin in 5 years. We scoured the data and found almost all the growth in sales is coming from outside the US.

2011-02-07 00:00:00 Jobs Data Redux and Inflation Spasm Ahead by David A. Rosenberg of Gluskin Sheff

The labor market in the US is not improving. Lost in the debate over the weather impact was the benchmark revision to 2010 ? overstated by 215k or 24%. The economy generated 909k jobs last year -insignificant considering that the population grew around 160k/month. The level of employment today is where it was in 2003. There have only been a handful of times in the past when both food and energy prices were rising so sharply in tandem. Since almost 25% of the CPI basket is in food and energy directly, it would seem logical to assume that we are going to get headline inflation in coming months.

2011-02-07 00:00:00 Strong News and Stronger Markets by Charles and Louis Vincent Gave of GaveKal

Bears have little to munch on right now: economic activity is bouncing back strongly, jobs are being created (albeit at a slow pace), global trade is soaring, the great majority of companies are reporting better than expected sales, and US profit margins are making new all-time highs. Given this plethora of good news, financial intermediaries are responding coherently and once again expanding their balance sheets.

2011-02-07 00:00:00 Why Credit-Sensitive Bonds Still Make Sense by Milton Ezrati of Lord Abbett

Clearly if Europe?s sovereign debt problems careen out of control, a global flight to quality would likely reoccur, bringing U.S. Treasury and agency yields back down. But if as expected the European Union (EU) manages the situation, then the recent unwinding of the former flight to quality should continue, rendering Treasuries and agencies problematic investments at best, and leaving the only fixed-income opportunities in credit-sensitive investments.

2011-02-07 00:00:00 The Economic Recovery Pushes Ahead Despite The Strange Labor Report by Chris Maxey of Fortigent

Encouraging. Confusing. Disappointing. Mixed Bag. These were all terms used to describe the labor report for January. Ultimately, it may turn out that none of those terms are relevant and investors would be better served in pretending this report was a figment of our imaginations.

2011-02-07 00:00:00 Investment Commentary by Bob Doll of BlackRock Investment Management

Although we expect some hiccups along the way, improving economic growth and corporate earnings point the way toward a continuation of the equity bull market. We are in the midst of the first global economic recovery that is being led by emerging economies, and the U.S. is only at the beginning of transitioning into a self-sustaining expansion, suggesting that economic improvements still have a way to go. As the economy improves, we are beginning to see equity market correlations fall ?stock prices are being driven more by fundamentals and less by macro factors, a trend we expect to continue.

2011-02-04 00:00:00 Portfolio Commentary : Fourth Quarter, 2010 by Jay Compson of Absolute Investment Advisors

For our 4Q commentary we have decided to alter our approach and provide direct insight into our managers? thoughts by pro?viding portions of their commentaries in a series of indepen?dent ?short stories.? Collectively they represent many of the thoughts that we have utilized for writing our quarterly com?mentaries, but we feel the current environment offers a unique time to hear things ?directly from the horse?s mouth.?

2011-02-04 00:00:00 US Employment ? Snow Job? by David A. Rosenberg of Gluskin Sheff

It is next to impossible to make book on the January employment report. The data were not as weak as the disappointing headline would suggest, but there was nothing here to say that the U.S. labor market is progressing at anything close to resembling a normal post-recession recovery. The headline nonfarm payroll report came in light at +36k, well below consensus views of 146k and whispered numbers ahead of the report that were bordering +180k. Adjusting for our estimate of what the Bureau of Labor Statistics birth-death model artificially added, the headline would have been -52k!

2011-02-04 00:00:00 January Employment Report ? Pace of Job Growth Inadequate for Fed to Change Current Stance by Asha Bangalore of Northern Trust

The number of jobs created since the recovery commenced in June 2009 is troubling and raises the level of concern for policymakers. The level of employment, irrespective of how it is measured, is still significantly below the prior peak even after 19 months of economic growth. Job creation is proceeding in the desirable direction but at a tepid pace such that it is does not offer sufficient justification for the Fed to end the $600 billion purchase of Treasury securities (also known as QE2) before the planned expiration date of June 2011.

2011-02-04 00:00:00 An Excerpt from Endgame by John Mauldin of Millennium Wave Advisors

Growth does not look that great, and people don?t feel the recovery. This is unlikely to change. The U.S. and most developed economies are currently facing many major headwinds that will mean that going forward, we?ll have slower economic growth, more recessions, and higher unemployment. Three large structural changes have happened slowly over time that we expect to continue going forward. The U.S. economy will have higher volatility,lower trend growth, and higher structural levels of unemployment (The United States here is a proxy for many developed countries with similar problems.)

2011-02-03 00:00:00 Feb 2011 Absolute Return Letter by Niels C. Jensen of Absolute Return Partners

We celebrate the Chinese New Year - the year of the rabbit - by taking a closer look at what is now the second largest economy in the world. We embrace the longer-term opportunities which present themselves, but we also discuss some of the near term challenges, which include uncomfortably high inflation combined with surprisingly weak economic growth towards the end of 2010. Enjoy the read!

2011-02-02 00:00:00 Unrest in Egypt, Uncertainty in the Region by Rachel Ziemba and Ayah El Said of Roubini Global Economics

Egypt?s political direction could have profound effects on regional stability?potentially involving, the Israeli-Palestinian conflict and efforts to contain Iran?s nuclear ambitions?with broad economic and financial ramifications. The recent economic and political developments do not bode well for Egypt?s debt, and this contagion could continue to spread within the region, leading to the persistent underperformance of local currency debt and equity markets. Regarding wider implications, the oil market remains the key link between instability in the Middle East and the global economy.

2011-02-02 00:00:00 Random Thoughts from the Lone Star State by David A. Rosenberg of Gluskin Sheff

I still consider this to be a bear market rally. With respect to the economy, the illusion of sustainable prosperity has done wonders for consumer spending in the U.S. The consumer has been an upside surprise and the ISM was a whopper too as these manufacturing indices have been in general around the globe. There are so many other headwinds out there. Dramatic cutbacks and tax hikes at the state and local government levels are in motion. Federal government austerity is next. The housing market has not yet stabilized.

2011-02-01 00:00:00 Can Economics Save the Economy? by Robert Huebscher (Article)

Christina Romer, Greg Mankiw and Paul Krugman were among a group of thought leaders who spoke at a conference in Cambridge last week. They cited a lack of sufficiently powerful and politically feasible policy options, calling into question whether economists will be able to produce the clear path to the stronger recovery that the Obama administration seeks.

2011-02-01 00:00:00 Back in Black: Economy Moves to Expansion From Recovery by Liz Ann Sonders of Charles Schwab

Real GDP moves from recovery to expansion, but growth remains below potential. Inflation concerns globally replacing double-dip recession concerns as key theme in 2011. Egyptian unrest and rising volatility could further temper optimism, which could bring back the "wall of worry" the stock market likes to climb.

2011-02-01 00:00:00 Fourth Quarter Letter by Team of Grey Owl Capital Management

In spite of Bernanke?s objective to put a floor on asset prices, including equities, we remain conservatively positioned. Equity and credit markets appear overvalued. In addition, with the U.S. and most developed-market economies significantly more leveraged than in the last 50 years, economic growth will likely be more volatile. Further, many potential exogenous forces could negatively influence public markets: over-leveraged municipalities, the PIIGS, and continued issues in the US housing market to name a few. Finally, there is no evidence that monetary policy can create real growth.

2011-01-31 00:00:00 The Investment Outlook: An Overview by Milton Ezrati of Lord Abbett

This is the first of a four-article series on the macro considerations behind Lord Abbett?s fixed-income and equity outlooks. This first installment offers an overview. The three pieces that follow will, in turn, take up the reasons behind 1) the general preference for credit-sensitive fixed-income issues; 2) the positive overall stance on equities; and 3) the call for a thorough capitalization mix within equities.

2011-01-29 00:00:00 A Bubble in Complacency by John Mauldin of Millennium Wave Advisors

The just released Q4 GDP of 3.2% may be overstated by 0.5% to 1.0% as a result of statistical adjustments. Consumer spending advanced, but that must be tempered by the support from fiscal and monetary policies. The growth in the deficit poses imminent danger of another recession, and the political landscape makes it unlikely a solution will emerge. Mauldin would like to see 'thought leadership' in the upcoming presidential election cycle, in order to build support for viable policies to revive the economy.

2011-01-28 00:00:00 The Fed Sticks to the Status Quo by Liz Ann Sonders of Charles Schwab

The Fed announced no changes to its interest rate and quantitative easing round two (QE2) policies. There were no dissenters, with two new voting members changing their tune about QE2. The risk is growing that the Fed will stay easy too long, which could have implications for bond yields (and bond investors).

2011-01-28 00:00:00 Is There Really Joy in Mudville? by David A. Rosenberg of Gluskin Sheff

The Q4 GDP data, while a tad light on the top line versus the consensus and whispered estimates of 4% did confirm that the spring and summer lull was just that, as opposed to the onset of a double-dip downturn. The 3.2% annualized real growth rate followed a 2.6% trend in Q3 and 1.7% in Q2. The configuration of the GDP report should help real GDP growth maintain its trend in the current quarter. The critical test will be the second quarter, when the incremental fiscal stimulus fades and the effects of higher food and energy prices depress the ?real? macro numbers.

2011-01-26 00:00:00 Plan C for UK Fiscal Consolidation by James Mason and Parul Walia of Roubini Global Economics

The UK government has engaged in a forceful reduction of its fiscal deficit (?Plan A?) to ensure debt sustainability and thereby reduce the risk of a loss of market confidence in public finances. The move has been effectively endorsed by Bank of England Governor Mervyn King, who has said that further quantitative easing could be used to support the economy if necessary (?Plan B?). In RGE?s view, however, the risk to the market was overstated, as the UK has enjoyed safe-haven status while pressures have intensified in eurozone countries.

2011-01-25 00:00:00 'Fear, Hope & Greed' by Jeffrey Saut of Raymond James Equity Research

I believe the evidence for a pullback is mounting. Since September 1, 2010, every time the Russell 2000 (RUT/773.18) has closed below its 20-day moving average (DMA), buyers have showed up the very next day. Not so last week. In fact, last week was the first down week for the SPX in eight weeks as the divergences in the stock market continue to grow. As legendary Dow Theorist Robert Rhea observed, mounting divergences suggest stocks are being distributed (read: sold) by smart money.

2011-01-24 00:00:00 Muni Update by David A. Rosenberg of Gluskin Sheff

The unfunded liability that has to be closed at the lower levels of government is estimated to be $1 trillion and the combined deficit that has to be closed for this year is far higher than we initially thought at $135 billion. Second, there is reportedly talk in Congress of a broader bankruptcy bill that would give the states the power to adjust their pension obligations and rework union contracts. However, no bailouts are coming and the GOP is adamant about that. Staff cuts, service reductions, and tax hikes are coming in this critical 12% of the economy. Count on it.

2011-01-24 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Earnings are coming in at a very strong pace. The problem is that stock prices in many cases have risen in anticipation of these results. As far as the economy is concerned the bulk of the evidence released last week was encouraging, but the impact of higher oil prices is really starting to be interpreted as a negative for future consumer spending and corporate hiring plans.

2011-01-24 00:00:00 Monetary Stimulus is Gaining Traction by Milton Ezrati of Lord Abbett

The Federal Reserve?s recent recommitment to a second round of quantitative easing (aka QE2) has come at a time when past efforts at monetary stimulus seem at last to have gained traction. Accelerations in various measures of money supply suggest that the economy is finally drawing on the copious amounts of liquidity the Fed previously injected into it even before the most recent round of quantitative easing.

2011-01-23 00:00:00 Sixteen Cents: Pushing the Unstable Limits of Monetary Policy by John P. Hussman of Hussman Funds

Completing the Fed's planned purchases under QE2 will require a decline in 3-month T-bill yields to just 0.05% in order to avoid inflationary pressure. Otherwise, liquidity preference will not expand enough to absorb the addition to base money, even if we assume GDP growth at 4%. Given the extreme stance of monetary policy, the avoidance of inflationary pressures increasingly relies on a very persistent willingness by the public to hold the outstanding quantity of base money in the financial system. Small errors will have surprisingly large consequences. This is not a stable equilibrium.

2011-01-22 00:00:00 Together at Last! by Stephen J. Taddie of Stellar Capital Management

Many people get lost when economists start talking about monetary and fiscal policy. By definition, fiscal policy is the use of government expenditure and revenue collection to influence the economy through borrowing, spending and taxation. Monetary policy is the process by which the monetary authority of a country (the Federal Reserve, or ?Fed?, in the U.S.) controls the money supply in that economy through targeting interest rates or buying and selling securities from its portfolio. In the end, the two policies are just two different tools used to manage an economy.

2011-01-22 00:00:00 And That's The Week That Was by Ron Brounes of Brounes & Associates

With another corporate earnings season moving into high gear and equities riding a seven week winning streak, a healthy bit of skepticism (not necessary pessimism) has crept into the investor mindset.Some analysts still want to see more revenue growth as opposed to cost-cuts in the earnings reports.Others fear that ?the trend is your friend? may be a nice guide, but investors may be disregarding the ongoing debt issue in the EU and the rise in interest rates throughout emerging markets.

2011-01-21 00:00:00 What Will Turn Me More Bullish On Tthe U.S.A. by David A. Rosenberg of Gluskin Sheff

Here's a list of ideas: An energy policy that truly removes U.S. dependence on foreign oil (shale case, coal, nuclear). A complete rewrite of the tax code that promotes savings, investment, and a revamp of the capital stock. A credible plan that reverses the runup in the debt to GDP ratio. A massive mortgage write-down by the banks. A creative strategy to put people to work instead of paying them to be idle ... and more

2011-01-20 00:00:00 Word on the Street: Cautious Optimism by Eagle portfolio managers of Eagle Asset Management

The general consensus among Eagle managers is that companies are more optimistic than they have been in many years. Businesses are starting to loosen their purse strings, albeit slowly and deliberately, to take advantage of competitive opportunities. Eagle managers continue to believe independent, diligent research is paramount in selecting stocks right now and that this likely will prove to be an excellent opportunity for long-term investors.

2011-01-19 00:00:00 Breakfast with Dave by David A. Rosenberg of Gluskin Sheff

In more than 20 months, the equity market has managed to turn in the same performance it took 60 months to achieve in the last bear market rally. Strip out the financials, and indeed, the entire equity market is now behaving as if the destruction of debt and household balance sheets either never happened or that the aftershocks are completely yesterday?s story. Governments around the world, especially in the U.S.A., have managed to convince nearly everyone that prosperity is here and will persist to perpetuity. But ? if it is too good to be true, it probably is. This is an illusion.

2011-01-19 00:00:00 2011 Capital Markets Outlook by Joseph V. Amato of Neuberger Berman

During 2010, macroeconomic factors largely dominated the financial markets, creating a volatile, emotional environment as investors appeared at times to be thinking less about what stocks to own than whether they should own stocks at all. As a result, many equities with very different fundamental characteristics often showed very high correlations to one another, while valuations converged. Over time, we believe that the market will differentiate these stocks based on their individual fundamentals. A similar statement can be made about other assets as well.

2011-01-19 00:00:00 China's Inflation Problem Looms Large by Peter Schiff of Euro Pacific Capital

The global economy has become so unbalanced that government ministers recognize that something has to give. To a very large extent the distortions are caused by China?s long-standing policy of pegging its currency, the yuan, to the U.S. dollar. But as China?s economy gains strength, and the American economy weakens, the cost and difficulty of maintaining the peg become ever greater, and eventually outweigh the benefits that the policy supposedly delivers to China. In the first few weeks of 2011 fresh evidence has arisen that shows just how difficult it has become for Beijing.

2011-01-19 00:00:00 Market and Performance Summary by Jonathan A. Shapiro of Kovitz Investment Group

The broad market, as represented by the Standard & Poor?s 500 (S&P 500), rose 10.8% for the quarter and 15.1% for the full year. We remain optimistic regarding forward returns, not because the market has been strong, but because we believe we still hold a basket full of undervalued securities even after these robust gains.

2011-01-18 00:00:00 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

Today, bond and stock inventors sit at the edge of a new paradigm, indeed, where inexpensive money has yielded about as much as possible from corporate balance sheet expansion, while lower interest rates no longer offer high yield or capital gains probabilities to fixed income investors. The difficulty today, however, is that stocks are at a significant inflection point where the likelihood of perpetual sustainable upside gains is limited.

2011-01-18 00:00:00 Headwinds Ahead by David A. Rosenberg of Gluskin Sheff

It is difficult to understand why it is that everyone is so whipped up about U.S. growth prospects. Even the latest set of data points has been less than exciting. Retail sales, payrolls, and consumer confidence have all been below expected and all of a sudden we see that jobless claims are moving back up. We have federal fiscal support, which at the margin is subsiding. And we have massive monetary support, and on this the Fed is going to be facing much more intense congressional scrutiny going forward. At the same time, about half of last year?s GDP growth was inventory accumulation.

2011-01-18 00:00:00 Equity Investment Outlook by Team of Osterweis Capital Management

During the fourth quarter, the stock market staged a strong rally, reflecting both growing evidence of a sustained economic recovery and the reversal (thanks to the Republican victory in November) of the seriously anti-business tone in Washington. These two factors enabled investors to begin thinking not just of a recovery from the recent crisis and recession, but of a more sustainable and enduring expansion. As a result, they were able to bet on a longer stream of favorable corporate earnings.

2011-01-18 00:00:00 The Fed?s Dual Mandate ? Therein lies the Dilemma by Jason R. Graybill and Neil D. Klein of Carret Asset Management

High-quality municipal bonds should continue to move in concert with U.S. Treasury bonds. We expect supply to decrease slightly to be more closely aligned with softer demand. The media will continue to cast a light on the challenges facing the market. As the overall economy improves, we envision states and local municipalities following suit. Downgrades may continue to occur but the most severe cuts should be limited to the marginal parts of the municipal landscape. In closing, we expect structural change to occur, in a positive way, over the next few years.

2011-01-17 00:00:00 Adding Up the Inflation Carnage; US Consumer Hitting an Air Pocket by David A. Rosenberg of Gluskin Sheff

This is just the fifth time in modern history that BOTH food and energy prices have risen at a double-digit annual rate for any length of time ? 1979, 1980, 1996, and 2008. At this rate, the energy bill is going to create a drag U.S. household spending power by $60 billion this year. Beneath the veneer of all the enthusiasm is the reality that real organic incomes are under pressure.

2011-01-15 00:00:00 Further Fuel? by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Stocks may be vulnerable to a near-term pullback thanks to elevated sentiment, and earnings season could provide an impetus for some profit taking. The economy appears to be strengthening and we remain optimistic. Despite signs of growth, the Fed seems insistent on letting QE2 play out, pointing to continued high unemployment and housing. The new congress also has to deal with these issues, while attempting to pare deficit spending. International exposure is important, but we recommend taking some profits and rebalancing if your emerging-market exposure gets above your target allocation.

2011-01-14 00:00:00 Quarterly Review and Outlook, Fourth Quarter 2010 by Van R. Hoisington and Lacy H. Hunt of Hoisington Investment Management

An even slower growth rate of real GDP should be recorded over the next four quarters, suggesting the unemployment rate will be essentially unchanged a year from now. As we have noted previously, this modest expansion is due to the significant over-indebtedness of the U.S. economy. We see seven main impediments to economic progress in 2011 that will slow real GDP expansion to the 1.5%-2.5% range.

2011-01-14 00:00:00 2011 Outlook: International and Emerging Market Equities by Benjamin Segal and Conrad Saldanha of Neuberger Berman

We anticipate modest but positive global economic growth in 2011. Economic growth in emerging markets should benefit developed-market firms with global reach as well as emerging-market companies. Issues we are closely watching: the potential for currency/trade wars, asset bubbles and inflation in the emerging markets, increasing regulation and possible negative impacts of monetary tightening. Many overseas corporations are profitable and healthy, with cash available for M&A, higher dividends and other corporate activities.

2011-01-14 00:00:00 Creating an Illusion of Prosperity by David A. Rosenberg of Gluskin Sheff

The question really today is still one of sustainability. If the Fed and our public officials were as comforted as the financial markets now seem to be over the sustainability of the recovery, then after a full year into it the central bank would not have embarked on another monetary experiment and the government would not have dipped into Social Security as a means to put more change in people?s pockets for spending purposes. Money, as an aside, that isn?t really ours.

2011-01-12 00:00:00 Malaysia's Middle-Income Malaise by Nouriel Roubini of Roubini Global Economics

Malaysia?s policy makers have been forced to confront the factors blocking the country?s rise to high-income status. Facing higher labor costs, the economy has been unable to maintain a growth model based on low-value-added manufacturing that was largely successful for the 30 years prior to the 1997 Asian financial crisis.

2011-01-12 00:00:00 Tolerable Accuracy by Christian Thwaites of Sentinel Investments

It paid to be practical in 2010. We started the year with relief that we averted catastrophe but were dimly aware it would be tough. How could it not be? Financial markets were in disrepair and the economy looked like it had only just made it through a re-stocking cycle. All other parts of the economy looked down for the count. But in the end, despite euro sovereign emergencies, deflationary fears and a phony currency war, both the real economy and financial assets had a strong year.

2011-01-10 00:00:00 "Illusory Prosperity" - Ludwig von Mises on Monetary Policy by John P. Hussman of Hussman Funds

Perhaps more than any other economist, Ludwig von Mises got the theory of money and credit right, because he made distinctions between various forms of money and credit that are often conflated by other theorists. The amount of real physical investment in the economy is, and must be, precisely equal to the amount of output not allocated to consumption but instead to savings. Unlike many other economists, Von Mises not only recognized this identity, but carried it through to what it implied for monetary policy.

2011-01-10 00:00:00 Global Instability by David A. Rosenberg of Gluskin Sheff

With inflation in China over 5%, Chinese policymakers are going to spend 2011 in restraint mode. Count on it. We are in the throes of a global currency war and late last week we saw Brazil move aggressively to rein in the real?s strength by imposing reserve requirements on domestic banks? foreign exchange positions. We have food prices surging and this is very likely going to cause social strife in the emerging market world - India, China and Indonesia come to mind. The Eurozone sovereign debt situation is looking increasingly tenuous.

2011-01-10 00:00:00 Is a Sovereign Default on the Agenda for 2011? by Chris Maxey of Fortigent

Last year will unequivocally be remembered as the year the sovereign credit crisis unfolded in earnest. We were fortunate that no major sovereign defaults occurred during that period, but can we hope to be so lucky in 2011?

2011-01-10 00:00:00 Investment Commentary by Bob Doll of BlackRock Investment Management

We see a number of potential risks for the economy and the markets in the year ahead, including sovereign debt issues, emerging markets inflation and the possibility of higher tax rates, but we remain positive on the overall environment. Inflation should remain low throughout 2011, economic growth should accelerate slightly with the quality of that growth improving, and corporate earnings should remain strong an environment that should provide a solid backdrop for stocks to post further gains over the course of the year.

2011-01-08 00:00:00 And That's The Week That Was by Ron Brounes of Brounes & Associates

So was the holiday season really as strong as most retailers claimed? So is inflation about to rear its ugly head? Next week should help answer these questions as some key data will be released. After the disappointing same-store sales numbers, investors are eager to see the December retail sales report; the recent run-up in crude price may begin to work its way into the PPI and CPI data. Investors also look to start a new equity market winning streak to keep hope alive that January turns out to be a positive month (and the rest of the year will follow suit).

2011-01-08 00:00:00 Forecast 2011: Better than Muddle Through by John Mauldin of Millennium Wave Advisors

Mauldin reviews his prior-year forecast. He was right on currencies and gold, but missed the bull market in equities. For 2011, he likes gold relative to the euro, pound and yen, but is less bearish on the pound than he was a year ago. He fears the Kamchatka volcanoes (in Russia) will trigger a spate of bad wealth which will lead to scarce resources and inflation. He is optimistic about the job market and employment, and forecasts that the US economy will grow 2.5-3% in 2011. He fears, however ,that structural problems in the work force will leave many untrained for employment.

2011-01-07 00:00:00 U.S. Real GDP vs. Potential GDP ? Time to Assess this Yardstick by Asha Bangalore of Northern Trust

The U.S. economy has registered six quarters of economic growth, inclusive of the projected increase in real GDP during the fourth quarter of 2010. There is enormous room for growth before inflation becomes a concern. The recovery phase ended in 2010 and expansionary phase of the current business cycle should commence in 2011. Cognizant of this information, markets will evaluate the performance of the economy in a different light going forward.

2011-01-07 00:00:00 Weekly Asia Update: Postcard from China by Xin Jiang of Matthews Asia

Automation is one of the many possible solutions for China. There is plenty of room for China to catch up with its industrialized Japanese neighbor. China?s current level of industrial automation is comparable to that of Japan in the early 1980s, based on the percentage of computerized machine tools, the market size of the core machinery components needed for factory automation, and the level of automation in vehicle manufacturing.

2011-01-06 00:00:00 Some Risks Worth Factoring In For The Year Ahead by David A. Rosenberg of Gluskin Sheff

Home price declines are an added significant risk to household wealth and spending. The Dallas Fed just published a report concluding that home prices have potential to decline more than 20% from here. Perhaps the banks can handle that, but the implications for the household wealth effect, consumer confidence and spending are hardly constructive.

2011-01-05 00:00:00 Market Review & Outlook by Doug MacKay of Broadleaf Partners

In 2011, we remain optimistic, believing the economy will progress from its recovery phase into expansion territory sometime during 2012. A more favorable regulatory and political environment should be a positive for corporate America, which may finally begin to spend its huge accumulated cash hoards, not solely by returning it to shareholders in the form of stock buybacks and dividends, but by also hiring new employees and upgrading their capital equipment as demand trends improve. A continued trend of bond market outflows and equity inflows should also prove constructive for the stocks.

2011-01-05 00:00:00 And That's The 'Year' That Was by Ron Brounes of Brounes & Associates

While the consumer has emerged from hibernation, an improved labor picture would boost this favorable trend. The Fed hopes that QE2 will help build on the recent economic momentum, though many doubters surely remain. Earnings comparisons get more difficult in the coming quarters, though analysts expect improved revenue growth to contribute to the positive results. The tax ?compromise? means a continuation of the bullish mindset in equities (for now). Developments abroad will impact the domestic markets as the EU looks to move beyond its debt issues, and China leads the global recovery.

2011-01-05 00:00:00 What The Bulls May Be Ignoring ... At Their Peril ... Plus Some Ideas For 2011 by David A. Rosenberg of Gluskin Sheff

The bullish case is pretty well established right now and there is no sense repeating them but what may be ignored are these half-dozen. Nothing of course says that the market can?t keep going up over the near-term. risks, I list. Just as the onus was on the double-dippers last summer given the sentiment and market action, the onus now is clearly on the V-shaped enthusiasts.

2011-01-04 00:00:00 Think International, Think Small by Wasatch Funds of Wasatch Funds

Outperforming in today?s investment climate requires taking advantage of the wealth of opportunities available globally. Foreign stocks offer strong growth potential and attractive fundamentals, particularly small cap and micro cap companies. In this paper we explore what makes international investing particularly compelling, and the unique advantages of foreign small and micro cap companies, including: higher growth potential, better valuations due to the market inefficiencies of smaller companies and lower correlation with U.S. stocks, and under representation in portfolio allocations.

2011-01-04 00:00:00 The Coming Decade of Sideways Markets by Robert Huebscher (Article)

'We are in the middle of a sideways market, and we still have another decade to go,' says Vitality Katsenelson. In this interview, Katsenelson shares his insights on the decade ahead and the many factors that may keep China from leading us out of the recession.

2011-01-04 00:00:00 Glory Days: Another Good Year in 2011? by Liz Ann Sonders of Charles Schwab

Setting targets doesn't make sense to us, but we do believe in reading the market's tea leaves, and the outlook is healthy. However, frothy sentiment has us a little concerned in the very near-term. Investors need to be mindful of complacency, but also to make sure they're not still loaded up on bonds?a major capitulation from bonds to stocks is possible.

2011-01-04 00:00:00 Getting a Grip by David A. Rosenberg of Gluskin Sheff

We can expect a showdown between the House Republicans and the Administration over the debt ceiling in Q2. At stake could be a good dose of spending restraint as ?pay-go? rules make a sudden reappearance after being neglected by the lame-duckers last year. There is always the reality of the payroll tax cut coming to an end in December and how that will crimp personal income in 2011. Of course, there is always the prospect of a Q4 corporate spending binge as the bonus depreciation allowance expires. The last 3 quarters of 2011 are going to be very interesting

2011-01-04 00:00:00 Job Growth ? The Key To The 2011 Outlook by Scott Brown of Raymond James Equity Research

While the outlook for economic growth has improved, a number of headwinds remain in the near term. Lingering problems in the housing sector, tighter state and local government budgets, and the decrease in the federal fiscal stimulus will restrain overall economic growth. In addition, higher gasoline prices may dampen the pace of consumer spending growth. However, stronger job growth would help counter these pressures, providing fundamental support for the housing market and helping to lift state and local government tax receipts.

2011-01-03 00:00:00 New Year Fraught with New Risks? by Chris Maxey of Fortigent

With 2010 officially behind us, it is time to consider what risks and opportunities lay ahead for investors for 2011. Just as 2010 proved to be the year of the sovereign credit crisis, 2011 will not be forgotten as a year without its own potholes. From the economic side of the ledger, the biggest concern remains employment. Despite improving economic growth and a Federal Reserve that has shown a penchant for doing everything in its power to stimulate the economy, employment growth is virtually nonexistent since the recovery began.

2010-12-28 00:00:00 Emerging Markets in 2011 ? Strong Economies, Rising Prices by Mark Mobius of Franklin Templeton

I believe emerging markets are now in a secular bull market, and as discussed below, I expect this trend to continue into 2011. Even more money is likely to be directed into these markets as investors around the world realize that emerging economies on average are growing three times faster than developed economies, and generally have more foreign reserves and lower debt-to-GDP ratios than their developed counterparts.

2010-12-28 00:00:00 Consumer Confidence Index: Down Slightly But Well Below the Historical Trend by Doug Short of Doug Short

Let's take a step back and put the Director of the Consumer Research Center's rather rosy interpretation of consumer confidence in a larger perspective. The chart below is intended to help evaluate the historical context for this index as a leading indicator of the economy. Toward this end I have included recessions and GDP. The linear regression through the index data shows the long-term trend of this very volatile indicator. Today's 52.5 reading is significantly below the 85.3 of the current regression level (38.5% below, to be precise).

2010-12-27 00:00:00 Treasury Moves?Four Reasons Why by Milton Ezrati of Lord Abbett

Treasury bonds recently have made an impressive and, to some, frightening move?a sudden reversal of the long flight to quality that previously had so bid up Treasury prices and reduced the yields to ridiculous lows. Many explain this sudden reversal in terms of Washington?s recent decision to extend the Bush-era tax cuts for another two years. Certainly, there is reason to make such a link, but there is more going on than just this compromise, enough to keep the trend in place for some time to come. Here are four references on what lies behind this reversal.

2010-12-25 00:00:00 The Skinny On Thursday?s Data Flow by David A. Rosenberg of Gluskin Sheff

We got a flurry of U.S. data releases on 12/24 that, at the margin, added some comfort for the growth bulls. Initial jobless claims came in roughly as expected at 420k on a seasonally adjusted basis for the week of December 18, down 3k from the prior week. The 4-week moving average is at 426k and this time last year it was sitting at 479k, so the pace of firings has clearly receded sharply. The issue at this time is really one of hiring and going beyond part-time help.

2010-12-23 00:00:00 No, Krugman, You're Eating America Alive by Neeraj Chaudhary of Euro Pacific Capital

Here we go again. This week, Paul Krugman, the 2008 Nobel Prize winner in economics and the go-to guy for progressives who need a morale boost, launched another misguided attack on Austrian School economists. From his New York Times soapbox, he referred to the free-market Austrian ?hard money? philosophy as a ?zombie idea? that is inexplicably eating the brains of the voting public.

2010-12-22 00:00:00 The Year in Review by Doug MacKay of Broadleaf Partners

For 2011, we believe this trend of bond outflows and equity inflows will likely continue, overwhelming any concerns about valuations or fundamentals.In the short run, I've come to realize that fund flows, or investor desires for specific favored asset classes over others - tends to exacerbate price movements in both directions, often for much longer than most expect.I see great things for the stock market in 2011. While an improving economy will help, a shakeout in bonds may be just what the doctor ordered to get investors truly interested in stocks again.

2010-12-21 00:00:00 Ed Hyman: We Are Not Japan by Katie Southwick (Article)

Despite his worrisome outlook earlier this year, the ISI Group's Ed Hyman provided an upbeat forecast of the US economy, arguing that we are in the midst of an economic recovery that will lead to expansion. We are demonstrating that we are not Japan, he said.

2010-12-17 00:00:00 Fed Decision: Stick to the Status Quo by Liz Ann Sonders of Charles Schwab

The stock market may not be fighting the Fed, but are bonds? Treasury yields and stocks can rise simultaneously, but dollar strength could bite. Investors are being driven to reallocate away from bonds and toward stocks.

2010-12-15 00:00:00 Europe Remains a Clear Downside Risk by David A. Rosenberg of Gluskin Sheff

Europe remains a clear downside risk for the global economic outlook with the problems spreading to Spain and Portugal. Contagion risks are being underestimated by Mr. Market who has been myopically focused on irresponsible fiscal expansion in the US and recent hopes that QE2 would morph into QE3. As some proof that the recent economic data flow are over-rated, and likely exaggerated by seasonal influences, the Fed barely raised its macro outlook and actually seemed to dampen its view of the housing sector.

2010-12-14 00:00:00 Looking Back at a Year of Policy Mistakes by Michael Lewitt (Article)

As we approach the end of 2010, the global economy remains captive to a boom-and-bust cycle resulting from years of pro-cyclical monetary, fiscal and regulatory policies. With very limited exceptions, the same policies that contributed to the 2008 financial crisis remain in place. The only difference is that government balance sheets are far more leveraged than they were heading into that crisis.

2010-12-14 00:00:00 A Notable Year of Emerging Market Growth by Mark Mobius of Franklin Templeton

I view 2010 as a year of economic resurgence. Many emerging markets recorded strong GDP growth as they continued to recover from the impact of the 2008 financial crisis. In several cases, robust domestic consumption, government expenditure and intra-regional trade offset weak external demand from developed markets. This led many countries in Asia and Latin America to return to pre-crisis growth levels much faster than expected. China and India were among the world?s fastest-growing major economies during the year, with China overtaking Japan as the world?s second-biggest economy.

2010-12-14 00:00:00 The Case for Dividend-paying Stocks by David A. Rosenberg of Gluskin Sheff

Despite all the noise that the Democratic left is making, the tax bill is going to pass very soon. There is a tangible positive effect here from the tax bill and pertains to dividends. Under the deal, the top tax rate on dividends will stay at 15%. If most of the spasm in the bond market is behind us, one would have to think that a focus on dividend growth is going to have some payoff with the taxation uncertainty put to bed. The U.S. nonfarm nonfinancial corporate sector is sitting on $1.93 trillion of cash/equivalents, which is at a 51-year high representing 7.4% share of total assets.

2010-12-13 00:00:00 Opposing Forces by Scott Brown of Raymond James Equity Research

Economic recoveries are never straight-line expansions. They tend to be uneven across time and across sectors. That means a continuation of mixed economic figures over the near term and further volatility in the financial markets as investors attempt to gauge the underlying strength. Volatility creates opportunities.

2010-12-13 00:00:00 Dr. Copper by Jeffrey Saut of Raymond James Equity Research

The most important chart patterns of December (at least so far) are the charts of the 10- and 30-year Treasury bonds, whose yields have backed up more than 10% since the end of November (see the first chart on page 3). The second most impressive chart for the month is copper, which is up 10.8%. Copper is often referred to as ?Dr. Copper? for it has a better predictive record on economic growth than many economists; and last week copper came a cropper as it traded to new all-time price highs.

2010-12-13 00:00:00 Economic Insights: Consumers Save Themselves by Milton Ezrati of Lord Abbett

Like the Southern belle of romance, American households have begun to revive from their former swoon. Reestablished savings flows have, during the past year or so, begun to pay down the debt-overhang built up in previous years. Households still have a long way to go before they can return their finances to the sound state they enjoyed in, say, the mid-1990s, but matters have improved enough to support a modest expansion in spending and enough to support a continued, if slow, overall economic recovery.

2010-12-13 00:00:00 Bullish Sentiment Nears Extreme Levels As Investors Pile Into Equities by Chris Maxey of Fortigent

According to EPFR Global, a research provider that aggregates mutual fund flows, the week ending December 8th saw investors allocate $13.7bln of new capital to stocks funds while only investing $146mln in fixed income funds. Domestic bond funds experienced withdrawals of more than $1bln. Interestingly, money market funds picked up more than $32bln in new funds, the highest total in 22 weeks. Whether this is a wise time to jump back into equity securities remains a hotly debated issue but based on several metrics, this may not be the most opportune time to increase equity exposure.

2010-12-12 00:00:00 Warning - An Updated Who's Who of Awful Times to Invest by John P. Hussman of Hussman Funds

In recent weeks, the U.S. stock market has been characterized by an overvalued, overbought, overbullish, rising-yields syndrome that has historically been hostile to stocks. Last week, the situation became much more pointed. Past instances have been associated with such uniformly negative outcomes that the current situation has to be accompanied by the word "warning."

2010-12-11 00:00:00 U.S. Tax Cuts Extended - This Is Bullish For Stocks by Monty Guild and Tony Danaher of Guild Investment Management

The tax breaks will mean even more QE?and the bond market seems to agree with us. This weeks? poorly bid U.S. Treasury auctions says that while investors agree that tax breaks are good for encouraging economic growth, they also drive government deficits higher. Bond offerings from the U.S. Treasury are going to go up, and the Fed had better buy the Treasury?s bonds, because it is apparent investors don?t want them. QE is here to stay.

2010-12-11 00:00:00 Unintended Consequences by John Mauldin of Millennium Wave Advisors

The recent rise in interest rates is due to the reallocation of globally indexed funds away from sovereign debt and into something else. The may be a prelude to a sovereign default or a more rapid rise in rates, which could unfold very quickly. Global deleveraging is not over. QE2 and the nervousness of investors around the world are pushing up interest rates.

2010-12-10 00:00:00 Interim Update and Comment by Van R. Hoisington and Lacy H. Hunt of Hoisington Investment Management

Federal Reserve Chairman Ben Bernanke said in a recent television interview that economic growth was not ?self sustaining.? This description also applies to an economy that is in a classic growth recession. A growth recession is characterized as an economy where GDP grows but the unemployment rate also moves higher. A close look at the U.S. economy bears out Chairman Bernanke's description.

2010-12-09 00:00:00 Come On Rich! Our Take On Richard Bernstein?s Themes for 2011 by David A. Rosenberg of Gluskin Sheff

It is extremely difficult to judge what part of the economic cycle we are really in. If you look at the unemployment rate, the workweek, the industry CAPU rate, the levels of consumer confidence, housing starts and sales, you would think we were still in a recession. But if you looked at profit margins and the ISM index, you would come to the conclusion that we were mid- or even late-cycle.

2010-12-08 00:00:00 No Comfort in November for U.S. Employment by Nouriel Roubini of Roubini Global Economics

November data clearly calls for caution. The stall in the improvement in wages and the average workweek is especially concerning. Sustainable growth in aggregate consumption will be driven by wage growth, which needs to improve from its severely depressed levels. Most importantly, it is quite clear that future employment gains will be well below the levels required to make a meaningful dent in the unemployment rate, which will continue to be just shy of double-digit territory for some time.

2010-12-08 00:00:00 Second Take on The Latest Financial Stimulus Announcement by David A. Rosenberg of Gluskin Sheff

There wasn?t really that much ?new? information in the Obama announcement, except for the fact that the President ended up repealing everything he said he stood for during the election campaign, like reducing the extreme income bifurcation that was exacerbated during the Bush era. Then again, who is going to risk a renewed contraction in the economy and then take the blame? How can anyone take the U.S. seriously when the country fails to get enough votes over the weekend to bring the deficit reduction package recommended by the White House debt-reduction panel to the House and Senate floor.

2010-12-07 00:00:00 Looking at the Tax Compromise Measures by David A. Rosenberg of Gluskin Sheff

The just-announced comprise tax measures along with the Fed?s pump-priming, have pretty well extinguished double-dip risks, notwithstanding the myriad of other headwinds. This amounts to a new stimulus measure. If the U.S. government opts for a series of fiscal measures that could end up adding as much as $750 billion to the existing large public debt burden, the fixed-income market is not exactly going to like it. Elsewhere, EU finance ministers ruled out an immediate aid package for Portugal or Spain (putting the onus on the ECB to restore calm).

2010-12-07 00:00:00 Markets Rebound Despite Poor Jobs Report by Chris Maxey of Fortigent

Earlier in the fall, pessimists were pointing towards a slowing ISM index as a surefire harbinger that a ?double-dip? recession was on the way. That did not happen, fortunately, and manufacturing activity has since rebounded. Several subcomponents also provided encouraging data. In particular, the employment index finished the month at 57.5, a clear-cut sign that manufacturers are continuing to hire in order to keep up with growing demand. Somewhat less positive was the prices paid index, which remained elevated at 69.5 in November.

2010-12-06 00:00:00 Cutting Through the Noise by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Economic data is rarely clear-cut, but we believe the weight of the evidence indicates a strengthening US economy. The negative rhetoric surrounding the Federal Reserve's recent decision reached a crescendo, but while we were among the first to voice our belief that it wasn't necessary, we believe the dire warnings of potential consequences from a second round of quantitative easing (QE2) are overblown. The European debt crisis continues to plague world markets. Finally, we believe the European Central Bank (ECB) needs to be more proactive instead of continually reactive.

2010-12-06 00:00:00 Labor Market Update: Still Struggling by Scott Brown of Raymond James Equity Research

The November Employment Report was disappointing. The holiday shopping season apparently got off to a strong start, but that failed to translate into a corresponding jump in retail employment (at least, on a seasonally adjusted basis). Manufacturing jobs were soft. State and local government continued to shed jobs, reflecting budget strains. What?s in store for 2011? The November jobs data aren?t encouraging, but the recovery is likely to remain on track.

2010-12-06 00:00:00 Creating a Mirage of Economic Growth by Doug Carey (Article)

Bubble formation is not random. Some may believe it is, but bubbles are in fact a predictable byproduct of the fractional reserve system upon which our economy is built. By stimulating and amplifying lending through its fractional reserve system, the Federal Reserve systematically creates the mirage of growth, from which deception systemic crises inevitably result.

2010-12-04 00:00:00 Rebalancing the World by Mark Mobius of Franklin Templeton

We are currently witnessing a largely one-way flow of capital, as money moves from countries of disinflation or deflation to countries with inflation, possibly perpetuating the situation for both. We need to see a rebalancing of the world economy. In recent history, financial authorities in the developed world have encouraged a period of easy credit and loose monetary policy, driving a debt-fuelled rise in consumption. There needs to be more ?balance? in the world economy, so high-savings countries should spend more and develop their own vibrant domestic market as we see in the U.S.

2010-12-04 00:00:00 Decoupling, Further Defined by Andrew Foster of Matthews Asia

Emerging market equities? particularly those sectors most associated with decoupling themes?are now subject to elevated valuations. It appears that some investors have grown overly convinced that decoupling is a one-way, short-term bet. Don?t bet on it. Instead, take your time, and set any expectations for decoupling over the longest horizons.

2010-12-04 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

Retail Ireland, retail, China, retail, tax cuts, retail, QE2, retail, jobs, retail. Yes, investors have plenty on their minds these days. Hopefully, the news from retail can continue to compensate for some of the more concerning dynamics at play.

2010-12-04 00:00:00 Reframing A Case For High Yield Bonds by Tom Fahey of Loomis Sayles

Our contention is that high yield bonds are likely to continue to be a respectable store of value. We base this on their valuation profile and fixed income characteristics, which tend to stand out in the midst of a protracted economic recovery and ongoing deleveraging process that could have significant implications for economic growth and yield potential.

2010-12-03 00:00:00 Fundamentals and the Stock Market by Matthew Rubin of Neuberger Berman

Is continued discomfort in the stock market justified? It can be argued that the economy is relatively weak, and with high unemployment, the weak housing market and a new focus on fiscal restraint, few expect rapid expansion anytime soon ? not exactly a bullish sign for an asset class that is supposed to benefit from expansion. However, from a number of vantage points, stocks are displaying what we consider attractive characteristics that suggest the benefits of maintaining substantial exposure to equities in the current environment.

2010-12-03 00:00:00 Fish, Chips & Latkes with Dave: Market & Data Musings by David A. Rosenberg of Gluskin Sheff

The recovery is obviously still so fragile that the Fed felt the need to expand its balance sheet by an additional 25% and policymakers in DC fear that the economy can slip back into recession if the Bush tax cuts and the 99-week emergency jobless benefit plan are not extended. Job market conditions have improved, but the reality is that the preponderance of the employment gains in the past six months has been in part-time positions. The tailwinds to US profits from accelerating global growth, not to mention a weak dollar, which has turned the corner, are about to become headwinds.

2010-12-01 00:00:00 Confident Or Not? by David A. Rosenberg of Gluskin Sheff

The Conference Board?s measure of U.S. consumer confidence report was all the rage in November with an above-consensus print of 54.1 from 49.9 in October and 48.6 in September. But, five of the nine major regions were actually down in November. In a possible sign that the GOP victory may have been at play, the West South Central region, which includes Texas, soared from 68.8 to 92.6 ? the fourth largest spike ever!

2010-12-01 00:00:00 Open and Shut by Howard Marks of Oaktree Capital

Today some assets are fairly priced and others are high, but there are no bargains like those of 2008. Capital and nerve can?t hold the answers in such an environment. We?re no longer in a high-return, low-risk market, especially in light of the inability to know how today?s many macro uncertainties will be resolved. Instead of capital and nerve, then, the indispensable elements are now risk control, selectivity, discernment, discipline and patience.

2010-11-30 00:00:00 QE2: Beware the Perils of its Success by Vitaliy Katsenelson (Article)

QE2 is like a drug prescription that comes with a list of side effects that are often worse than the disease it was supposed to cure. It is difficult to know the unintended consequences of QE2, but it may result in a substantial decline in the dollar, stagflation, lower economic growth and much higher interest rates.

2010-11-30 00:00:00 Currency Focus: QE2 and the Course Ahead by Ugo Lancioni of Neuberger Berman

We believe the dollar is likely to move higher on an intermediate-term basis. QE2, in our opinion, could lead to stronger economic growth in the U.S. and eventually drivehigher yields, making the dollar more attractive to investors. In our view, the impact of QE2 was already in the price of the U.S. dollar at the time of the announcement. And the market is generally still shorting dollars.

2010-11-29 00:00:00 Valuation Opportunity by Milton Ezrati of Lord Abbett

Because the fears forged during the 2008?09 crisis still linger, investors continue to avoid equities. For a while, extreme caution drove almost all new flows of funds into cash and U.S. Treasury bonds. As these flows drove down Treasury and agency yields, investors sought returns in more credit-sensitive bonds, but still, they largely avoided equities. The pattern has by now distorted valuations enough to present a special opportunity in stocks, even after their impressive rise from spring 2009.

2010-11-29 00:00:00 A List of Concerns ? A Dozen of Them by David A. Rosenberg of Gluskin Sheff

Among Rosenberg?s concerns: China undergoing a significant, though likely brief, economic adjustment by 2012; The contagion reaching Spain, which would likely be game over for the euro; A renewed deflation in home prices in the US; State and local government budgets ? the critical source of downside risk for the U.S. economy in 2011, which could easily result in 1.5-2.0 percentage points of withdrawal from GDP growth.

2010-11-29 00:00:00 A Time to Invest in Africa by Nile Capital Management of Nile Capital Management

In this report, I will summarize my answer to the often-asked question: ?Why is this a good time for investors to focus on Africa?? I also will explain why the best way to participate in African markets and manage their risks is through an actively managed fund that offers ?feet-on-the-ground? expertise in Africa.

2010-11-29 00:00:00 Holiday Shopping Off to Enouraging Start by Chris Maxey of Fortigent

Early indications from the weekend shopping spree suggest that it was an overall success for retailers. Perhaps even more encouraging was the news that consumers would be less reliant on credit cards for purchases this holiday season.

2010-11-29 00:00:00 Not Fade Away: European Debt Crisis Hits Markets by Liz Ann Sonders of Charles Schwab

Optimism is waning as global concerns are taking center stage, notably in the euro-zone. Investors shouldn't be complacent, but should heed the more-positive message coming from the US economy.

2010-11-28 00:00:00 House on Ice by John P. Hussman of Hussman Funds

If our policy makers had made proper decisions over the past two years to clean up banks, restructure debt, and allow irresponsible lenders to take losses on bad loans, we would be quickly on the course to a sustained recovery. Unfortunately, however, we have built our house on a ledge of ice.

2010-11-24 00:00:00 US Q3 GDP and Profits Analyzed by David A. Rosenberg of Gluskin Sheff

The Q3 real GDP is better, but momentum has clearly waned. Based on the hits that the household sector will likely face in the early part of 2011, Q1 growth is likely to be disappointing. On a sequential basis, corporate profits are still clearly rising, but at a more moderate rate than before. Not only did housing starts get clobbered in October, but existing home sales fell unexpectedly as well. Retailers are anticipating a solid holiday shopping season, and yet, they are aggressively marking down their prices well in advance.

2010-11-23 00:00:00 The Fed Under Attack by Scott Brown of Raymond James Equity Research

Despite hopes that the anti-QE rhetoric would die down, the noise continued last week, and unfortunately, become more political. One of the key aspects of the Fed is its independence. The Fed is answerable to Congress, and ultimately, to the American people. However, it is not controlled by Congress - nor would we want it to be controlled by Congress. Attacks on the Fed and its latest round of asset purchases aren't helping

2010-11-19 00:00:00 Gold Standard or Political Discipline? by Stan du Plessis and Andreas Freytag of VoxEU

President of the World Bank, Robert Zoellick, caused a stir this week by hinting at a need to return to the gold standard. While supporting the drive for pro-growth policies and the desire to maintain an open international trade system, this column argues that a return to gold would struggle to achieve this and could even be a destabilising force.

2010-11-19 00:00:00 Philly Fed Up, NY Empire Down by David A. Rosenberg of Gluskin Sheff

Despite mixed indicators, it looks like real GDP is chugging along at a tepid though still above-water annual rate of between 1% and 2% at an annual rate. The fragility is what is important. Gold still looks very good in this uncertain and unstable environment.

2010-11-17 00:00:00 Shifting Politics, Tightening Policies in China by Nouriel Roubini of Roubini Global Economics

The Central Economic Work Conference in early December should signal an end to the 'moderately loose' monetary policy that has allowed the long cycle to dominate the short since late 2008. There will likely be little commentary about renminbi (RMB) flexibility at the conference; nevertheless, we expect that technocratic control of China's monetary policy should marginally increase the rate of RMB appreciation against the USD.

2010-11-17 00:00:00 Gold's Allure Tied to Interest Rate by Michael Pento of Euro Pacific Capital

The continued bull market in the price of gold has been one of the staple discussions in the financial media for the better part of a decade. But, in that time, almost no consensus has emerged to explain the phenomenon. The truth is the main drivers for the price of gold are the level and direction of real interest rates and the intrinsic value of the dollar.

2010-11-17 00:00:00 Can You Handle The Truth by David A. Rosenberg of Gluskin Sheff

The S&P 500 has been locked in a rough 1,000-1,200 range now for 14 months. Most pundits still believe we are in a cyclical bull market but that is not the case ? it has been a sideways market now for over a year. Moreover, after testing support in July, the market hit resistance levels in November, so it would seem logical to expect the index to make a run at the low end of the range. The only question is whether support will hold up once again.

2010-11-16 00:00:00 Jeremy Siegel on the Upside for Equities and the Virtues of QE2 by Robert Huebscher (Article)

In our annual interview, Jeremy Siegel, the Russell E. Palmer Professor of Finance at the Wharton School, offers his forecast for equities - a 10% to 20% gain in 2011, along with a continued rally through the end of this year. He also explains why the current round of quantitative easing is exactly what is needed to stimulate the economy.

2010-11-15 00:00:00 Lighten Up, Francis by Scott Brown of Raymond James Equity Research

The increase in the deficit over the last couple of years is due largely to the recession and efforts to minimize the impact of the economic downturn. Quantitative easing isn?t some hair-brained scheme, but is simply another form of monetary policy accommodation. The dollar is down, but not out of line with its longer-term trend. Stop the hysterics, please.

2010-11-15 00:00:00 U.S. Consumer Confidence - Less than Meets the Eye by David A. Rosenberg of Gluskin Sheff

So, when you do the simple math, Joe Sixpack sees inflation at 3% in the coming year (from 1% now) and then averaging 2% in the next four years. Depending on how food and fuels play out, this could well be consistent with a zero or even sub-zero environment as far as core consumer price trends are concerned. This is why long Treasuries are likely to remain in a secular bull market for some time to come.

2010-11-15 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The stock market succumbed to profit taking last week. The reasons are many, but revolved around a poor earnings report from Cisco Systems, a growing skepticism of the Fed?s announced plan to goose the money supply, and finally what the mainstream media is reporting as a rather disappointing trip to Asia by President Obama even as he tried to put his electoral defeat here at home behind him.

2010-11-15 00:00:00 Fall Quarterly Commentary by John G. Prichard of Knightsbridge Asset Management

Economic and employment conditions remain soft amidst continued deleveraging. Developed market debt and currency issues remain. There are however offsetting positives. Corporations are in good shape with lots of cash and moderate leverage. Household finances are improving as well. Further, it is important to remain cognizant of the fact that conditions can change and equities are forward looking. Housing and autos, common drivers of economic expansion, should kick in at some future point.

2010-11-12 00:00:00 Analyzing China's Banking Sector Reform by Richard Gao of Matthews Asia

China's banking reform has effectively transformed its state-owned banks into commercial banks running under international practices.

2010-11-12 00:00:00 Don't Shoot the Messenger by Michael Dana of Dana Investment Advisors

This election has seen the installation of some non-political, business type people into office. These people know how to start a business, hire people and meet a payroll while balancing the books. We take this as a plus as capitalism is still the best economic system and will flourish in a regulatory friendly environment. We hope both parties (or is it three?) have a better understanding of the word bipartisan. That?s what it will take to avoid gridlock and get this country moving forward again. So what can Congress and the President do to right this ship? We would have several suggestions.

2010-11-11 00:00:00 A Kind Word For Ben by Paul McCulley of PIMCO

The Fed makes policy consistent with its legislative mandate handed down by the democratically elected government of the United States. Price stability (mandate-consistent inflation) that promotes bubbles in asset prices and debt creation is a prescription for a debt-deflation bust and a subsequent liquidity trap. Acting irresponsibly relative to conventional wisdom is precisely the right approach for reversing an economy facing, or worst yet, mired in a liquidity trap.

2010-11-11 00:00:00 Leadership Changes in Latin America by Mark Mobius of Franklin Templeton

In Latin America, we are seeing a large and young population moving up rapidly to the new ?consumer? middle class, but at the same time having one of the lowest loan penetrations in the world. The rise of this consumer middle class and growth in per capital GDP is resulting in an increase in domestic spending, which drives the domestic economy. Secondly, the region has vast resources available at low cost.

2010-11-09 00:00:00 New Strategies in Alternative Investments by Robert Huebscher (Article)

Alternative investments, broadly speaking, and hedge funds, more specifically, have performed as intended over the last 20 years, modestly increasing returns and significantly reducing risk when added to a traditional stock-bond portfolio. Selecting the appropriate vehicle is the challenge, and that task has been made easier by the introduction of new exchange-traded strategies.

2010-11-09 00:00:00 Keynesian Confusion by Michael Lewitt (Article)

Keynesian policies are inflicting untold damage on the U.S. and global economies today. Keynes did not have to be misread. The reason that the current recovery is below par is that the economy is experiencing a massive paradox of thrift. We doubt that reducing already low rates is going to stimulate much of anything other than more frustration on the part of savers. Sooner or later, everything being earned on the upside of this liquidity-induced rally will be given back in spades - the only question is when.

2010-11-09 00:00:00 Gridlock, Inertia, or Hope? by Scotty George of du Pasquier Asset Management

'How will the election results impact upon the markets and my portfolio during the next year?' Scotty George evaluates the data.

2010-11-09 00:00:00 Latest GDP Growth Report Points to Continued Economic Weakness by Team of American Century Investments

After one quarter of robust gross domestic product (GDP) growth late last year - characteristic of an economy snapping out of a recession - the trend that has followed has been very uncharacteristic, with a substantial downward shift in GDP growth. American Century Investments investigates quarterly shifts in consumer spending and investing and other factors that effect GDP.

2010-11-09 00:00:00 There Was a Fed Chairman Who Swallowed a Fly by Peter Schiff of Euro Pacific Capital

In reality, quantitative easing will produce the exact opposite of its intended result. In the short-run, it may create the illusion of economic growth and temporarily add some service sector jobs, but once the QE ends, the growth and jobs will vanish. Then, the Fed will most likely try once again to douse the fire it started with another round of QE gasoline, creating an even larger and less manageable inferno.

2010-11-09 00:00:00 Chinks in the Armour by David A. Rosenberg of Gluskin Sheff

Nobody thought a year ago that things would have weakened to such an extent that we would have needed QE2 or the extension of Bush tax cuts. The Fed is doing $600bln in quantitative easing, which is about one-third what it did last year. I?m not convinced that it alone will prevent the economy from weakening, even if contraction risks have abated. Now what will it take to turn me more positive? Well, a sustained job creation for one and if we can get initial jobless claims down to 400k that would be huge. But I have to admit, QE2 does not do it for me.

2010-11-09 00:00:00 An Inflationary Death Spiral by Michael Pento of Euro Pacific Capital

I have no doubt that Bernanke will be remarkably successful in his stated goal of driving inflation higher. I simply disagree with his nonchalance about the long-term consequences. There is currently no easy exit strategy for the Fed. There is only the prospect of Americans suffering through either a deflationary depression or hyperinflation.

2010-11-08 00:00:00 Crossing the Threshold into a New World ... Or Not by Chris Maxey of Fortigent

There is no doubt that the events which transpired last week are without precedent. The long-term implications of quantitative easing by the Federal Reserve are entirely unknown. Should the Fed?s program conclude on schedule, private investors would need to step to the plate and replace the incremental demand lost from the Fed. It is unlikely private investors could replace that demand, which would lead to enormous upward pressure on interest rates.

2010-11-07 00:00:00 Bubble, Crash, Bubble, Crash, Bubble... by John P. Hussman of Hussman Funds

Given that interest rates are already quite depressed, Bernanke seems to be grasping at straws in justifying QE2 on the basis further slight reductions in yields. By irresponsibly promoting reckless speculation and illusory "wealth effects," the Fed has become the disease. The economic impact of QE2 is likely to be weak or even counterproductive. Even though the S&P 500 is substantially below its 2007 peak, it is also strenuously overvalued once again.

2010-11-07 00:00:00 Fall 2010 Quarterly Commentary by Jonathan A. Shapiro of Kovitz Investment Group

As for the next decade, we are optimistic. This view is based primarily on two factors. The first is the entry level. We believe that current valuations of our portfolio holdings are very attractive, both on an absolute level and relative to history. While it doesn?t guarantee any outcome, starting at these levels certainly stacks the probabilities firmly in our favor.

2010-11-05 00:00:00 Global Market Commentary by Monty Guild and Tony Danaher of Guild Investment Management

Investors should keep gold for long-term investment, as well as oil-related holdings. The U.S. dollar, Japanese yen, British pound and the euro are poor long-term prospects. Investors should continue to hold shares of growing companies in India, China, Singapore, Malaysia, Thailand, Indonesia, Colombia, Chile and Peru, as well as food-related shares such as grains, wheat, corn, soybeans and farm suppliers. Finally, investors should continue to hold U.S. stocks for a further rally.

2010-11-05 00:00:00 More on QE2 - Will it Work? by David A. Rosenberg of Gluskin Sheff

Quantitative easing is no antidote for structural economic problems, even if it manages to give investors a short-term sugar high. Let's learn from the Japanese QE experiment. The day the Bank of Japan launched the program on March 19, 2001, the Nikkei surged 7.5 percent, from 12,190 to 13,103. Three months later, as it became painfully obvious that the real economy was not responding well to the shock therapy, the Nikkei index slid 16 percent to just over 12,000.

2010-11-05 00:00:00 Beware the Fed Tide by John Browne of Euro Pacific Capital

This week desperation became palpable at the Fed. In both the formulaic statement that accompanied its Federal Open Marked Committee policy decision and Chairman Ben Bernanke's unusual (and clumsy) Washington Post op-ed follow up, the guardians of our currency expressed grave disappointment at the slow pace of U.S. economic recovery and emphasized the continued threat of deflation. The Fed is now pledging to defeat this recession using any monetary means necessary. Unfortunately, their embrace threatens to smother our economy.

2010-11-05 00:00:00 Thoughts on Liquidity Traps by John Mauldin of Millennium Wave Advisors

Lacy Hunt writes that the Oct employment situation was dramatically weaker than the headline 159k increase in employment measures. The most distressing aspect is the loss of another 124K full-time jobs, bringing the 5-month loss to 1.1 million. John Hussman discusses liquidity traps, where investors prefer cash to debt (because of low interest rates) and the central bank loses control. Fiscal policy, not monetary policy, impacts economic growth and inflation - and the proper fiscal measures, such as infrastructure spending, may be the best hope for growth.

2010-11-05 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

Dissecting election results, a Fed policy meeting statement, several key economic releases, and new earnings reports can prove pretty stressful. This week saw a somber Obama offer an olive branch to Republicans following their big victory in the midterms. Bear in mind, Prez Clinton suffered a similar fate in 1994 and lived to fight another day. Politicos now expect conciliation over taxes, health care, offshore drilling, and other GOP action items as Big Oil, Big Pharma, and Wall Street prepare for another boom. (The pressure is on, Speaker Boehner.)

2010-11-04 00:00:00 U.S. Challenges and Hope by Charles and Louis Vincent Gave, Anatole Kaletsky of GaveKal

Why, in spite of record profitability and very strong cash flows, are U.S. firms not hiring more? One very simple explanation is the dramatic drop in the value of the assets of U.S. corporations. The net worth of U.S. non-farm, non-financial corporations stood at $16 trillion in 2Q07. By the last quarter of 2009, this net worth had dropped to $12.3 trillion. Now that the net-worth of U.S. corporations is expanding again, however, U.S. unemployment could improve rapidly given supportive fiscal and regulatory policy.

2010-11-04 00:00:00 Thanksgiving Pie by Doug MacKay and Bill Hoover of Broadleaf Partners

Where might the unexpected upside come for investors? Two areas. Dividends may attract some money away from the bond market as a source of yield, providing some relative capital appreciation potential for stocks. On a longer term secular basis, the emerging market consumer may also be worth paying attention to. As the wealth of overseas economies grows and makes its way into the hands of its citizens, a growing middle class should emerge with the same needs and wants that many of those in the United States have enjoyed for years.

2010-11-04 00:00:00 Thoughts on QE2 by David A. Rosenberg of Gluskin Sheff

While the Fed could have done more yesterday, it didn't because the economy is doing better than expected, even if it is still quite fragile. Auto sales, for example, rose to 12.3 million at an annual rate in October from 11.8 million in September (best result since August 2009). However, recall that motor vehicle sales also jumped 2.4 percent in September and all that translated into was a +0.08 percent inch-up in total real consumer spending, which was one of the weakest months of the year. Consumer spending excluding auto will now be essential to watch.

2010-11-03 00:00:00 Five Bitter Pills or One Sweet but Deadly? by Michael Pento of Euro Pacific Capital

The current Chairman of the Federal Reserve believes that diluting the dollar is the cure for everything from a recession to male pattern baldness. And like other snake-oil salesmen before him, Mr. Bernanke is heavy on promises and light on results. Michael Pento presents five prescriptions that money printing can't fulfill.

2010-11-02 00:00:00 More of the Same by Scott Brown of Raymond James Equity Research

Real GDP rose about as expected in the third quarter. Details were mixed, but remained consistent with the view that the pace of growth, while still positive, is subpar - far below a rate that would be associated with a significant reduction in unemployment. What to expect from here? More of the same, most likely. The economy continues to face a number of serious headwinds, but the recovery is likely to remain on track.

2010-11-02 00:00:00 The New Abnormal by David A. Rosenberg of Gluskin Sheff

We are definitely in an abnormal economic environment. We just came off a 2 percent real GDP growth performance in a quarter - the fifth in this nascent recovery - where the economy is usually humming along at a 4.3 percent clip and on a lot less government stimulus. Make no bones about it, heading into year two of the post-recession recovery, the pace of activity is usually accelerating, and doing so at a 5 percent rate. The Federal Reserve with its continued monetary expansion just may well see something in the economic outlook that has yet to fully register with Mr. Market.

2010-11-01 00:00:00 Lessons From a Lost Decade by John P. Hussman of Hussman Funds

If the past decade has a lesson for investors, that lesson should have two components. The first is that valuations matter. Although valuations often have little impact on short-term returns over periods of less than a few years, they are undoubtedly the single best predictor of long-term market returns. Moreover, high valuations are ultimately followed by far deeper periodic losses than emerge from low valuations. Put simply, greater risk does not imply greater reward if the risks that investors take are overvalued and inefficient ones.

2010-11-01 00:00:00 Looking Past the Graveyard by Scotty George of du Pasquier Asset Management

We are two months removed from the end of this year, 2010, and already investors are bracing themselves for 2012 as if next year won't count. With unemployment widening and portfolio values simply treading water, many have their sights set on a rebound year in 2012 that they think has more promise than 2011. In fact, informal opinion polling suggests that many see 2011 as nothing more than a postscript to a miserable three year cycle begun when the global credit crisis erupted.

2010-10-30 00:00:00 Schwab Market Perspective: So Now What? by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

The Federal Reserve and upcoming elections are in sharp focus and results and actions in these two areas could determine whether the momentum seen since September can continue. Earnings season was better than expected and the market reacted as such. But confidence remains a major issue, with brewing mortgage-related problems and continued uncertainty around tax policy causing consternation. Debt remains a major issue that's just now being addressed and protectionism still threatens economic expansion. China remains a bright spot for global growth.

2010-10-29 00:00:00 Asset Allocation in an Uncertain Economy by Robert Huebscher (Article)

Advisors should not bet on whether the recession will be L-, V-, or W-shaped. Instead, Ron Albahary said they should use strategic asset allocation and overweight or underweight those asset classes that have historically done well at certain points in the economic cycle. Albahary is the CIO of Convergent Wealth Advisors, a Washington, DC-based wealth manager.

2010-10-29 00:00:00 Postcard from Vietnam by Taizo Ishida of Matthews Asia

As much as two-thirds of Vietnam's GDP can be attributed to strong personal consumption in a country of 86 million (with an average age of 26). Over the past 20 years, the country has shown impressive economic expansion, averaging 7.1 percent growth per year, which has pushed GDP per capita up to just over $1,000 U.S. Although Vietnam still faces potential problems with inflation, it is still encouraging to witness the real changes taking place in the country's consumer behavior.

2010-10-29 00:00:00 Asset Allocation: Fall 2010 by Tony and Rob Boeckh of Boeckh Investment Letter

Excess liquidity will continue to act as a tailwind for equities, commodities and non-dollar currencies well into 2011. Deflation will dominate in the short term; the inflationary threat is probably further away than most investors expect. Gold is expensive relative to the inflationary outlook. Fixed income markets are heavily influenced by government intervention. While it is likely that continued intervention will succeed in depressing bond yields below market levels, even a modest increase in inflationary expectations would undermine these actions. We recommend shortening duration.

2010-10-27 00:00:00 Fifty Not Nifty by David A. Rosenberg of Gluskin Sheff

Consumer confidence came in at 50.2 in October versus the 49.9 expected. Of course, the media types were hyping up the number as another reason to load up on equities. Let's get a grip. In periods of economic expansion, consumer confidence averages 100.3 on the nose. For all the rejoicing, today's level is half what is normal for an economy supposedly out of recession, and in recessions, consumer confidence averages 72.9. We are 22 points south of the level that historically typified economic contractions. Yikes!

2010-10-26 00:00:00 Emerging Market Uprising: What it Means for Investors by George Magnus of Boeckh Investment Letter

This special report by George Magnus, a senior economic advisor at UBS Investment Bank, takes a look at some key economic and investment issues regarding emerging markets and China. Magnus, who has just completed a book on emerging markets, argues that while EMs have boomed in recent years, there are a number of unresolved problems which suggest the past may not repeat, and investors must be careful.

2010-10-26 00:00:00 Hope is Not a Strategy by John West of Research Affiliates

Most pension funds and 401(k) calculators assume total returns in the 7-8 percent range. Is this assumption realistic, however, with a mature economy saddled with unprecedented debt levels and an aging workforce? This commentary examines retirement plan assumptions and calculates that we can reach this return level only if we assume top quartile results for stocks, bonds, and alternatives over the next 10 years. That's like expecting a decade of sunshine in the markets.

2010-10-26 00:00:00 Have the Financial Markets and the Real Economy Become Disconnected? by Team of American Century Investments

There are solid and logical reasons why equity markets have been up substantially since the start of the third quarter. The U.S. economy remains in a fragile situation and the global financial system is far from healthy. Nonetheless, progress is being made and, barring any new crises or setbacks, the case for the market's recent rise can be justified. What's different this time is that two sectors that have traditionally led economic recoveries in the U.S. - consumer spending and real estate - will remain on the sidelines for the foreseeable future.

2010-10-25 00:00:00 Bernanke Leaps into a Liquidity Trap by John P. Hussman of Hussman Funds

The belief that an increase in the money supply will result in an increase in GDP relies on the assumption that velocity will not decline in proportion to the increase in monetary base. Unfortunately for the proponents of 'quantitative easing,' this assumption fails spectacularly in the data - both in the U.S. and internationally - particularly at zero interest rates. Once short-term interest rates drop to zero, further expansions in base money simply induce a proportional collapse in velocity.

2010-10-25 00:00:00 Key Dates Approaching by Scott Brown of Raymond James Equity Research

The first week of November looms large for the markets. The November 2 midterm elections are expected to result in a power shift on Capitol Hill - but how much will actually change? The Fed's November 3 monetary policy decision has important implications for interest rates, the dollar, and the economy in general. The October Employment Report (due November 5) will help shape the near-term economic outlook and set expectations for future Fed policy moves.

2010-10-18 00:00:00 Equity Investment Outlook by Team of Osterweis Capital Management

Housing is still deflating, but commodities are mixed. The concern longer term is that the Fed is printing money in order to stimulate the economy. At some point, all this liquidity in the system could cause inflation to accelerate, perhaps to a level that the Fed cannot contain. We are not forecasting either serious deflation or serious inflation. On the other hand, we do not regard the probability of a negative outcome as trivial.

2010-10-18 00:00:00 Mexico - Problems and Prospects by Milton Ezrati of Lord Abbett

Mexico's drug-related violence is a tragedy for the country and a conundrum for all those who invest there. However, as long as the U.S. economy can continue its advance, slow as it will likely be, Mexico?s economy, equity market, and currency should find support. Once the recovery in the United States begins to create jobs, as it should later this year and into 2011, remittances from Mexican nationals working north of the border will begin to add marginal momentum to Mexico?s economic growth, and hence to its market prospects.

2010-10-18 00:00:00 'Gone in 60 Seconds' by Jeffrey Saut of Raymond James Equity Research

The likelihood of the QE2 has risen dramatically since Ben Bernanke's Jackson Hole speech. This is being reflected by the 'stubborn rally' in most asset classes. If Bernanke did not think QE2 was needed, he surely would not allow such speculation because he does not want to surprise the various markets. Any ensuing pullback will be mild and contained above the 1130 - 1150 level on the S&P 500. Nevertheless, Jeffrey Saut is cautious, which he has not been since April.

2010-10-15 00:00:00 Q310 Portfolio Commentary by Jay Compson of Absolute Investment Advisors

Asset prices appear to be solely supported by the potential effects of QE2. Global credit markets, where liquidity could be highly strained given the large flows into bond funds and the hazardous reach for yield, are particularly disconcerting. While the Fed could successfully create asset inflation in the short term, the asymmetry of these policy efforts is to the downside, and patience should be better rewarded. Additionally, a dollar rally is quite possible given current sentiment, and could create much volatility in both global equity and credit markets.

2010-10-15 00:00:00 Interesting Insights from Bernanke; A Double-Dip Signpost by David A. Rosenberg of Gluskin Sheff

Despite a speculative equity market binge, a weakening U.S. dollar, an economy that seemingly avoided a double-dip recession last quarter and a renewed boom in commodity prices, what continues to prove elusive in this so-called recovery is pricing power in the broad retail sector. The headline rate of inflation sits at 1.1 percent today. The core inflation rate, proven to be the key driver for bond yields, is now running at a mere 0.8 percent year-over-year rate, the lowest level since March 1961.

2010-10-14 00:00:00 Who's Doing the Buying? by David A. Rosenberg of Gluskin Sheff

So who's buying equities right now? Good question. We know it's not the retail investor and private clients - they have been selling into this entire bear market rally and rebalancing their asset mix in favor of income. It's not the mutual funds, because institutional private managers already have cycle-low cash ratios. There would seem to be three principal buyers right now: pension funds struggling to reach their 8 percent assumed annual returns, hedge funds, and the proprietary trading desks at big commercial banks.

2010-10-13 00:00:00 What's Ahead in Q3 Earnings Season; Our Fair Value of the S&P by David A. Rosenberg of Gluskin Sheff

The consensus is still expecting U.S. operating earnings per share growth of $95-plus in 2011, but at a time when profit margins are at a cycle high, not a trough. Judging from past performance at cycle highs, however, it may be more prudent to be valuing the equity market at $75 EPS growth, rather than $95. Slap on an appropriate multiple and you can see why an underweight position in equities still makes sense, speculative fervor sparked by quantitative easing notwithstanding.

2010-10-12 00:00:00 Beggar Thy Neighbor, Beggar Thyself by Michael Lewitt (Article)

In the latest edition of the HCM Market Letter, Michael Lewitt argues that reported attempts by countries to devalue their currencies will only result in higher inflation and not economic growth. QE2 will similarly fail, and the necessary "heavy lifting" for the economy should be through fiscal, not monetary, policy. A continuation of Keynesian policies, as advocated by Paul Krugman, will also fail. Lewitt warns of dangers in ETFs and offers his investment recommendations.

2010-10-12 00:00:00 It's a Mad World by David A. Rosenberg of Gluskin Sheff

Gold could be the only asset class that makes sense right now. If the bond market is right, then we will get deflation, and gold is a hedge against the uncertainty such an environment would entail. If the equity market is right, then we will get gobs of liquidity out of the Fed and then go off to a new reflationary credit cycle - gold would benefit in this scenario, too. And if the commodity complex is right, then we are heading towards a new inflationary cycle, and of course gold is a classic way to play this scenario.

2010-10-11 00:00:00 No Margin of Safety, No Room for Error by John P. Hussman of Hussman Funds

Over the past 10 years, the S&P 500 has achieved a total return, including dividends, averaging -0.03 percent annually. Over the past 13 years, the total return for the S&P 500 has averaged just 3.23 percent. These poor returns were entirely predictable during the late 1990s based on the historical relationship between valuations and subsequent returns. What's more, current valuations suggest similarly poor returns over the next five to seven years.

2010-10-11 00:00:00 Will the Holiday Shopping Season Boost Employment? by Chris Maxey of Fortigent

The National Retail Federation announced last week that it expects holiday sales to increase by 2.3 percent from last year. That is good news following a decline of 3.9 percent in 2008 and a meager 0.4 percent growth rate in 2009. In addition, consultant Challenger, Gray & Christmas estimates that the retail sector will add as many as 600,000 jobs over the next three months. That is better than the 501,000 jobs added during the holidays last year, but still well below the pre-crisis levels of more than 700,000.

2010-10-11 00:00:00 In QE We Trust by Komal Sri-Kumar of TCW Asset Management

Senior monetary officials worldwide have complained about the massive inflows of capital into their financial markets resulting from expectations of monetary easing in the United States. One of the major pitfalls of quantitative easing is that beggar-thy-neighbor currency interventions do not result in increased growth for all participating countries. Instead, they sharply increase the risk to exporters and international investors and, eventually, dampen global growth.

2010-10-08 00:00:00 Narratives vs. Facts: Why U.S. Stocks are Surging Despite Anemic Economic News by David Edwards of Heron Financial Group

Investors chasing yields have bid up the prices of corporate bonds and preferred stock, while Treasury bonds, near post-war lows, barely yield more than inflation. Emerging markets stocks and bonds are doing well, but the high returns of 2008 are unlikely to happen again. Indeed, after a decade of pariah status, perhaps the only asset class that offers a reasonable risk-adjusted return is U.S. stocks. Even so, expect no more than 8 percents returns including dividends until the debt deflation process is complete in another 5-10 years.

2010-10-08 00:00:00 Still Vulnerable by Van R. Hoisington and Lacy H. Hunt of Hoisington Investment Management

Economic growth has been largely due to an unsustainable, and probably over-extended rebuilding of inventories. The proposed QE2 is unlikely to succeed, and the U.S. economy faces four problems: excess leverage, counterproductive fiscal policies, sub-optimal tax policies and excess bureaucracy. Treasury bonds are not in a bubble and represent good long-term investments.

2010-10-07 00:00:00 You Can't Make This Stuff Up! by David A. Rosenberg of Gluskin Sheff

In the October 6 New York Times, op-ed contributor Daniel Gross called on the American consumer to 'get back into the game.' 'The renewed willingness and confidence to spend money we don't have,' Gross wrote, 'is vital to the continuing recovery.' There was no mention in the article of the fact that with a 70 percent share of GDP, U.S. consumer expenditures never exactly went into hibernation, even if spending decisions have changed. And haven't employment and income always been the vital components to sustainable growth?

2010-10-07 00:00:00 Emerging Markets Commentary by Conrad Saldanha of Neuberger Berman

With emerging market economies posting substantially higher growth rates, many investors are increasingly attracted to emerging equity markets. Equity returns, however, tend to be driven more by earnings growth than by GDP growth. Returns are also influenced by other factors such as a country's financial market structure, fiscal and monetary policies, and legal standards. Furthermore, index or ETF investing may not capitalize on stock-specific factors that contribute to the underlying economy's performance.

2010-10-07 00:00:00 Government Policy and the Markets: Prepare For Some Big Changes by Tony and Rob Boeckh of Boeckh Investment Letter

Proponents of gold base their arguments on predictions of eventual monetary ruin, a dollar collapse and high inflation. The bond market, however, is far bigger and more sophisticated than the gold market, and it indicates that inflation expectations are nonexistent. Bond yields are far below their long-run equilibrium levels and if anything, are forecasting deflation and possible stagnation. The huge disconnect between gold and bonds should serve as a reminder to gold bulls to tread carefully, unless they are sure that the bond market has it wrong.

2010-10-06 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

The economy remains unsteady as an uncertain labor picture continues to limit consumer activity. And yet, corporations have accumulated trillions of dollars in cash and money markets yielding near 0 percent have forced managers to seek other options. Looking ahead, the Fed's stimulus debate wages on although many expect a more limited bond buying program than the $1.7 trillion one offered last year. As for the markets, companies still have lots of cash looking for a home and hopefully equities have more room to run.

2010-10-06 00:00:00 Deflation Economics: Quantitative Easing and the Portfolio Balance Channel by Thomas Fahey of Loomis Sayles

The level of assets on central bank balance sheets has been relatively stable since the initial burst of quantitative easing in late 2008 and early 2009. As growth slows, however, money and credit numbers could drop significantly. Central banks could still do more to spur a more complete economic recovery. Until then, bond yields should remain low. Perhaps 10-year Treasury yields below 3 percent are low enough to reverse the real demand for money and force portfolio rebalancing. Investors will need to watch the corporate sector for signs of cash hoarding and hiring as evidence of that.

2010-10-05 00:00:00 Win, Lose or Draw: Do We Have a Win-Win Scenario? by Liz Ann Sonders of Charles Schwab

U.S. stocks are not expensive and they're most certainly under-owned. Most individual investors are either pessimistic or indifferent about the stock market, suggesting the 'wall of worry' - the contrarian nature of the market to perform best when pessimism is highest - is alive and well. In the near term, the stock market is likely overbought, and a little pullback to improve the sentiment picture would be helpful. On the other hand, however, strong stock market would be a terrific confidence builder, as Alan Greenspan noted last week.

2010-10-05 00:00:00 Cyclical Outlook by Paul McCulley of PIMCO

The influence of emerging economies is on the rise, while developed countries are retrenching. Monetary policy in the developed countries will remain extraordinarily accommodative for an extended period, with policy rates pinned close to zero and use of quantitative easing. PIMCO will therefore position its duration and curve strategies accordingly: overweight investments in the developed world, concentrated in the 'belly' of yield curves. In contrast, an increasing share of its positioning in the 'spread sectors' will be allocated to the emerging markets, including their currencies.

2010-10-05 00:00:00 In a Word, Surreal by David A. Rosenberg of Gluskin Sheff

Why do so many people think bonds are in a bubble when they are actually the most detested asset class out there? After all, as we saw in the tech mania of the late 1990s and the housing mania of 2003-2006, bubbles usually involve a mix of adulation, admiration and adoration with the asset class in question, which is obviously missing in the current case as it pertains to Treasury securities. You can't lift up a newspaper or watch a business program on TV and not see pundit after pundit talking about the dangers of being invested in bonds. Something here is amiss.

2010-10-04 00:00:00 What's On My Mind?: Five Developments Driving Investor Sentiment by David A. Rosenberg of Gluskin Sheff

The bottom-up S&P 500 operating EPS estimate currently driving equity valuations is $95. That would be a 14 percent gain on top of this year's anticipated 36 percent bounce. Here's the rub: to get that $95 operating EPS for 2011, we either need to see at least 7 percent nominal GDP growth, which last happened in 1989 when inflation was 5 percent, not close to zero, or margins manage to reach new all-time highs. The base case now, however, is for low single-digit nominal growth and some margin compression so frankly we could be looking at something closer to a $75 earnings stream next year.

2010-10-04 00:00:00 Is it Feasible to Have Your Cake and Eat it Too? by Chris Maxey of Fortigent

Suggesting that the bond markets are in a bubble is dangerous at this point in the economic cycle. The intervention of the Federal Reserve into the government bond markets will inherently depress yields, while a lack of clarity around economic growth will encourage individuals and corporations to refrain from embracing excessive spending. This in turn could lead to stagnant growth and further desire to hold less risky assets. For now, bond investors can sleep well knowing that sometimes, just sometimes, you can have your cake and eat it too.

2010-10-01 00:00:00 Postcard from Japan: Before the Dawn by Andrew Foster of Matthews Asia

Matthews Asia portfolio manager Andrew Foster recently returned from Japan, where he met with companies from a variety of industries. As in past trips, many of these companies seemed to be resting on their laurels, even as present growth was flagging. During this most recent visit, however, a subset of companies in different industries seemed to share a realistic outlook, combined with a sense of urgency to improve performance. Each of these companies cited the strength of the yen as a key factor that would allow them to execute overseas acquisitions, especially in the U.S.

2010-10-01 00:00:00 A Fall Surprise... by David Baccile of Sextant Investment Advisors

If billionaire money manager John Paulson is correct, and inflation reaches low double-digits by 2012, the discount rate used by investors to estimate the present value of their stock investments will rise sharply, which will have a very negative impact on equity prices as present value calculations decline. Sure, companies will be able to pass along price hikes and inflation should have a positive impact on nominal earnings growth, but the higher discount rate will overwhelm any benefit to the bottom line.

2010-10-01 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

So much for ?sour? Septembers. This year, ?super? September is more appropriate. The bulls were out in force last month as equities experienced their best September since 1939. The week was met with some profit-taking and quarter-end window dressing (is that still allowed?) as investors eyed an uncertain Fed policy and a heated election season.

2010-09-29 00:00:00 Multiple Risks From a Multispeed Eurozone Recovery by Nouriel Roubini of Roubini Global Economics

Although the euro zone's recovery from recession has been better than initially envisaged, there are still external and domestic pressures - some persistent, some new - as potential threats to 2011 growth. The standout performance of the core and Northern European economies, particularly Germany, alongside renewed weakness in the periphery is giving rise to a multi-speed recovery. This adds a new set of risks - such as the implications of one-size-fits-all monetary policy - to the existing list.

2010-09-27 00:00:00 Not Yet Out of the Woods by John P. Hussman of Hussman Funds

While we know the Economic Cycle Research Institute data has deteriorated further since June, we won't have GDP figures for a while yet. Given the data in hand, it's clear that past growth downturns of the same extent have often gone on to become recessions. The bulk of the growth that we did observe coming off of the June 2009 economic low was driven by a burst of stimulus spending coupled with a variety of programs to pull economic activity forward. These synthetic factors are now trailing off, with little intrinsic economic activity to propel a recovery.

2010-09-27 00:00:00 What Happened on Friday? by David A. Rosenberg of Gluskin Sheff

On Friday, a very successful hedge fund manager came on CNBC and told viewers that the equity market now was a one-way ticket up. If the economy sputtered, he said, the Fed would step in and engage in more quantitative easing, and that would propel the equity market higher. And if the economy chugs along, then there will be no need for more Fed balance sheet expansion but the stock market will enjoy the fruits of stronger earnings growth. The third scenario he did not mention is that the economy will weaken to such an extent that the Fed will indeed re-engage in QE, but that it will not work.

2010-09-27 00:00:00 Hemlines and Investment Styles by Howard Marks of Oaktree Capital

High quality, large cap stocks have good potential over a range of possible scenarios, and are more attractive than bonds, which will do well in periods of economic weakness or deflation but poorly during periods of market strength or inflation. Treasury bonds and other high grade bonds currently have all environmental factors in their favor, but are priced rich. For them to do well from here, with yields so low, everything has to work out the way the bond bulls hope. Given current yield spreads, high yield bonds should outperform high grade bonds in most foreseeable long-term environments.

2010-09-27 00:00:00 The Myth and Mistake of Quantitative Easing by Brian S. Wesbury and Robert Stein of First Trust Advisors

Last week the Federal Reserve signaled its readiness to engage in further quantitative easing. This would be a colossal mistake. Quantitative easing does not boost real economic activity or inflation - it is not an injection of new money, like traditional monetary easing. During quantitative easing the Fed borrows money from banks and the Treasury to buy assets. All this does is shift what would have been held in the private sector onto the Fed's books. This does not create new money and therefore does not create inflation or lift aggregate demand.

2010-09-27 00:00:00 The Chinese Conundrum That Will Not Go Away by Chris Maxey of Fortigent

The determination by the U.S. government to revalue China's renminbi is another smoke and mirrors tactic to divert our attention from the true crux of the problem, a faltering economy with little hope for regaining stable ground for at least the next several years. Even if China appreciates its currency, there is no guarantee that it will provide a boost to the American economy. Jobs that were long ago outsourced to China will simply move to the next-cheapest home; they will not return to the U.S.

2010-09-24 00:00:00 Cash Kindling by Robert Stimpson of Oak Associates

The US stock market?s potential resurgence is tied to a renewed and sustained wave of capital spending from corporate America. While consumers delever, most corporate balance sheets are tremendously well capitalized, with high levels of cash, profitability and low debt. High uncertainty levels about the economy seen today are likely to dissipate, thereby creating a more conducive environment for making spending decisions. The stock market?s next chapter will be written by corporations spending the cash they have accumulated. This should unfold over the next 4 to 6 quarters.

2010-09-22 00:00:00 So the Recession is Over, Eh? by David A. Rosenberg of Gluskin Sheff

By now, based on when the recession ended, we should be at a new high in real GDP. As things stand, however, real GDP is still 1.3 percent lower now than it was at the end of 2007. Steep declines in GDP are typically followed by vigorous recoveries, but this time we had the largest decline in GDP since the 1930s and despite unprecedented amounts of monetary, fiscal and bailout stimulus, the recovery has been extremely weak ? real GDP growth of 3 percent is far less than half of what one would ordinarily expect to see coming out of such a deep downturn.

2010-09-21 00:00:00 Consumer Spending Increases, But the Outlook is Cloudy by Chris Maxey of Fortigent

Is the global economic recovery about to grind to a halt? This column provides evidence on economic performance in the decades following macroeconomic crises. It finds much slower growth, as well as several episodes of 'double-dips,' as well as many instances of plain 'bad luck' that strike at a time when the economy remains highly vulnerable.

2010-09-21 00:00:00 Diminished Expectations, Double-dips, and External Shocks: The Decade After the Fall by Carmen M. Reinhart and Vincent Reinhart of VoxEU

Is the global economic recovery about to grind to a halt? This column provides evidence on economic performance in the decade after a macroeconomic crisis. It finds much slower growth, as well as several episodes of 'double-dips,' as well as many instances of plain 'bad luck' that strike at a time when the economy remains highly vulnerable.

2010-09-21 00:00:00 The Recession is Over! But No Recovery in Housing by David A. Rosenberg of Gluskin Sheff

Well, the National Bureau of Economic Research made it official yesterday: The recession ended in mid-2009. The equity market rejoiced, which itself is amusing since the stock market is supposedly a discounting mechanism, but it goes to show that old news sells well. Meanwhile, the National Association of Home Builders housing market index disappointed in September, coming in flat, at 13, instead of inching up a point to 14, as was widely expected. This well below the stimulus-led yearly high of 22 set in May.

2010-09-20 00:00:00 Sequential Signals by John P. Hussman of Hussman Funds

The U.S. economy is still in a normal 'lag window' between deterioration in leading measures of economic activity and (probable) deterioration in coincident measures. Though the lags are sometimes variable, as we saw in 1974 and 2008, normal lags would suggest an abrupt softening in the September ISM report (due in the beginning of October), with new claims for unemployment climbing beginning somewhere around mid-October. If we look at the drivers of economic growth outside of the now fading impact of government stimulus spending, we continue to observe little intrinsic activity.

2010-09-20 00:00:00 A Long Recovery Road by Scott Brown of Raymond James Equity Research

It's well known that recessions caused by financial crises tend to be more severe and longer-lasting, and the recovery process is typically lengthy. In a 'typical' recession, consumers postpone purchases of homes and motor vehicles. As the economy recovers, you get a slingshot effect as that pent-up demand comes back into play. However, that's not going to happen this time. The key element in this recovery is time. Fiscal and monetary policy can help limit the downside, but there's no miracle cure. Ultimately, the recovery is dependent on the private sector.

2010-09-20 00:00:00 Gold Breaks Out ? Again; Investment Strategy in a Deflationary Environment by David A. Rosenberg of Gluskin Sheff

What is amazing is that there are just about as many naysayers about gold out there as there are bond bears. Until the investment elite catches on, the odds of these two asset classes continuing as relative outperformers are quite high because no bull market ends until the masses fall in love with the asset or security in question. What makes the gold story so interesting is that bullion has so many different correlations - with inflation, with the dollar, with interest rates, with political uncertainty - and it also has different faces.

2010-09-18 00:00:00 The Chances of a Double-Dip by John Mauldin of Millennium Wave Advisors

This commentary features a letter from Gary Shilling on the chances of a double-dip recession. Shilling notes that investors early this year believed that rapid job creation and the restoration of consumer confidence would spur retail spending. A funny thing happened, however, on the way to super-charged growth. In April, investors began to realize that the euro zone financial crisis, which had been heralded at the beginning of the year by the decline in the euro, was a serious threat to global growth. Stocks retreated, commodities fell, Treasury bonds rallied and the dollar rose.

2010-09-17 00:00:00 Can The USA Slip Into Outright Deflation? by David A. Rosenberg of Gluskin Sheff

The last time we flirted with deflation was in 2003, the year when the Fed cut rates to 1 percent. If the core goods consumer price index were to ever revert back to its historic lows of 2003 and bump against the current historic low in the core services CPI, then we would indeed slip into a mild deflation of -0.2 percent. That prospect, however, is not even remotely priced into nominal bond yields, even with the 10-year note sitting around 2.7 percent and the long bond yield just under the 4 percent mark.

2010-09-15 00:00:00 Ten Questions: USA vs. Japan by Asha Bangalore and James Pressler of Northern Trust

The combination of lackluster growth and disinflation in the U.S. has led to comparisons with Japan's dire experience following the collapse of asset prices in the 1990s. A frequent question is whether Japan's 'lost decade' will play out in the United States. The Q&A included in this commentary identifies similarities and differences between the experiences of the two countries, with an emphasis on the recovery path. It appears that the U.S. is unlikely to mimic the economic path of Japan in the 1990s.

2010-09-15 00:00:00 A Bond Bubble? by David Baccile of Sextant Investment Advisors

Longer-term interest rates may not be particularly cheap right now, but there is no indication that a bond bubble has formed and is ready to pop. When it comes to predicting what the global economy will look like in 2011 or 2012, there is still considerable uncertainty and at least some tangible risk deflationary pressures will continue to build. With yields on 10-year U.S. Treasury bonds under 3 percent, investors are not being paid enough to totally embrace long-term maturities, but to shun them altogether would not be a prudent decision either.

2010-09-14 00:00:00 The Centre Cannot Hold by Michael Lewitt (Article)

"A refusal to shed discredited monetary and fiscal policies and embrace creative and politically bold solutions is keeping our economy mired in high levels of structural unemployment and below-trend growth," writes Michael Lewitt in the latest edition of the HCM Market Letter. He also believes that "misguided faith in Keynesian solutions to debt crises, a near-religious belief that mild deflation must be avoided... and uninformed media hype about the alleged benefits of mergers and acquisitions" should be added to the list of bad ideas that lead economic policy and markets astray.

2010-09-14 00:00:00 Does the Fed Ultimately Control Interest Rates? by Michael Pento of Euro Pacific Capital

In forecasting the consequences of current economic policy, many pundits are downplaying the risks associated with the surging national debt and the rapid expansion of marketable Treasury securities. In the end, central banks can only temporarily distort the savings and demand equation. The more the Fed prints, the higher the eventual rate of inflation will be. If mainstream pundits truly believe the Fed can supplant the entire public and private market for debt indefinitely, then we won't want to be around when that fantasy inevitably becomes a nightmare.

2010-09-14 00:00:00 Sometimes We Get Lucky by Monty Guild and Tony Danaher of Guild Investment Management

Monty Guild and Tony Danaher strongly recommend that investors sell long- and intermediate-term U.S. bonds, including U.S. Treasury bonds, U.S. government agency securities, municipal bonds and corporate bonds. It would be very unwise to bet that interest rates will stay down. Guild and Danaher also comment on the rising risk of inflation, the drug war in Mexico, the rise of the Japanese currency and bullish prospects for gold.

2010-09-13 00:00:00 Impulse Response by John P. Hussman of Hussman Funds

The next three months represent the most serious window for the U.S. economy and labor market. The typical 23-26 week lag between leading indicator deterioration and new unemployment claims deterioration suggests that we may observe upward pressure on new claims for unemployment beginning about mid-October. However, these lags can be somewhat variable, and the leading indicators tend to have a better correlation with price fluctuations in the securities market. By the time the coincident economic evidence is clear, securities markets have often completed a large portion of their adjustment.

2010-09-13 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Last week's trading was heavily influenced by the so-called better-than-expected employment report for the month of August. The market had really discounted a very bad outcome and so when that scenario failed to materialize, the stock market was prepared to rally. Thus, the month of September has already reversed much of the damage that was done during the month before. Should Congress vote to extend cuts for all taxpayers for the next two years, then the rally just might have the justification to continue.

2010-09-10 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

Labor Day?Religious holiday?hardly worth coming to work at all this week. After some early fears about European financial institutions being more ?stressed? than initially reported, investors (who chose to work this week) focused on some positive signs in the economy. On light volume, stocks traded relatively flat, while fixed income investors struggled to digest all the new supply (treasury and corporate). By next week, the summer doldrums should be long forgotten and investors can once again get back to work and focus on the keys to the markets.

2010-09-09 00:00:00 An Important Turn in U.S. Jobs by Anatole Kaletsky, Charles Gave, Pierre Gave, FX Chauchat and Will Deyner of GaveKal

GaveKal examines several topics related to investment strategy. The U.S. employment situation is in line with other post-recession periods, which belies the 'jobless recovery' thesis. 'Real' U.S. incomes (excluding government transfer payments) are improving faster than they did after the 2001 recession. Rumors about the death of inflation may have been exaggerated, while six major Western bond indicators are flashing sell signals. Meanwhile, investors seem prefer lending to heavily indebted governments rather than to the prosperous, resilient and well-managed listed corporate sector.

2010-09-08 00:00:00 What is Wrong With QE by Komal Sri-Kumar of TCW Asset Management

The clamor from some economists for additional quantitative easing in the United States comes after two years and $1.5 trillion of such easing have already taken place. Similarly to the Japanese experience, the U.S. economy's growth has slowed to a crawl after just a few quarters of adrenaline rush due to increased liquidity. Even though newly minted cash has surged, bank lending to the private sector has not. And, again not surprisingly, U.S. banking sector profitability has sky-rocketed.

2010-09-08 00:00:00 Brazil's Economy Exhales by Nouriel Roubini of Roubini Global Economics

Brazil's cooling economic growth in the second quarter resulted from the withdrawal of excess accommodation, a less benign global backdrop and a high base. Looking into the second half 2010, the country's growth could temper further if July's industrial output figures and the purchasing managers' index for August are any indication. Although demand drivers such as labor conditions, credit and consumer confidence remain resilient, they are easing, which suggests economic activity will keep settling into more sustainable levels.

2010-09-07 00:00:00 It's a Depression and Other Thoughts by David A. Rosenberg of Gluskin Sheff

This is what a depression is all about - an economy that 33 months after a recession begins, with zero policy rates, a stuffed central bank sheet, and a 10 percent deficit-to-GDP ratio, is still in need of government help for its sustenance. We had this nutty debate on Friday on Bloomberg Radio in which another economist claimed that there was no evidence of any indicator pointing to renewed economic contraction. And yet, that very day, the ECRI leading economic index came in at a recessionary -10.1 percent print for last week.

2010-09-07 00:00:00 The Battle Between Double-Dip and Slower Growth Rages On by Chris Maxey of Fortigent

Moderate optimism began to wash over the markets last week, as the S&P 500 Index rose 3.7 percent and the Dow Jones Industrial Average increased 2.9 percent. The rally was driven by several factors, including an improvement in the tone of various economic releases, primarily the much discussed labor report and a strong announcement on manufacturing. Based on releases from last week, it became more apparent that the economy is on track for a period of slower growth and that the possibility of a double-dip is still slim.

2010-09-03 00:00:00 Buy and Hold Still Holds by John Browne of Euro Pacific Capital

As Americans have justifiably lost faith in the stock market, the classic buy-and-hold investment strategy has fallen from favor. The problem is that retail investors are wrongly equating the performance of stocks as a class with the trajectory of American stocks in particular. Fortunately, buy-and-hold still works in many parts of the world. Meanwhile, retail investors sitting in U.S. bonds and bank accounts will ultimately pay a steep price through inflation.

2010-09-03 00:00:00 Postcard From China by Matthew Gao of Matthews Asia

As a result of rising incomes and infrastructure build-up, tourism-related industries are growing rapidly in China. In recent years, the number of budget hotels (which have room rates of below US$30) has grown at an outstanding pace, now with nearly 4,000 in China, up from about 500 in 2005. Not only are Chinese tourists traveling more within China, they are also taking more international trips. It seems that China is gradually expanding its consumption power outside its own borders - to the delight of its neighbors in the region.

2010-09-03 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

What a difference a month makes. While naysayers and pessimists dominated the investor sentiment in August, the eternal optimists stepped forward in September (well, at least, for the first three days) and made a statement about perceived value in equities. Stocks took their cues from some decent economic releases (including key labor data) and bulls awoke from hibernation in time to stop the month-long carnage (and keep the Dow safely above 10k and ?in the black? for the year). Enjoy the holiday weekend (but don?t get complacent?sentiment can shift on a dime).

2010-09-01 00:00:00 A Schizophrenic Market by David Baccile of Sextant Investment Advisors

On the surface it seems the markets are experiencing a relative period of calm with equity prices about flat year-to-date and up around 10 percent versus a year ago. The credit markets have also stabilized since the second quarter when it appeared that one or more of the European countries could be forced into defaulting on their debts. However, a look beneath the surface shows some very deep and turbulent cross-currents.

2010-09-01 00:00:00 Bullish Sea Change in a Land of Little Victories by Doug MacKay and Bill Hoover of Broadleaf Partners

The odds of slower growth rather than a double-dip went up considerably with Wednesday morning's Institute for Supply Management manufacturing index release and probably even more so for the markets as a whole. The index came out at a strong 56.3, compared to expectations of 52.9. Generally speaking a reading under 50 indicates contraction rather than expansion in the manufacturing sector. While the manufacturing sector expansion may not represent a sea change akin to what investors became accustomed to in the go-go 1990's, it is nevertheless positive.

2010-08-31 00:00:00 Risk vs. Risk by Herbert Abramson and Randall Abramson of Trapeze Asset Management

The best stock market returns occur when interest rates are relatively low and supportive of under-owned equities, with lots of cash on the sidelines to fuel a rally. Markets are currently at or inflecting up from 'floors' or buy points. Probabilities remain high that markets will rise significantly from here even if we have another temporary setback. Accordingly, Trapeze Asset Management remains fully invested (even using some leverage in margin accounts) while continuing to have no short positions, particularly with the prevailing low valuations.

2010-08-31 00:00:00 Nitty Gritty Details of the Labor Market Make Headlines by Asha Bangalore of Northern Trust

The elevated 9.5 percent official unemployment rate and the broader 16.5 percent jobless rate highlight the dire status of the labor market even after four quarters of economic growth. Financial markets have yet to follow closely the report on job openings, however, which contains information each month about the total number of job openings, the pace of hiring and separations in the economy. Harvard economics professor Robert Barro discusses the implications of the job openings report in a recent article for the Wall Street Journal.

2010-08-31 00:00:00 Looking Further Into The Job Market by Scott Brown of Raymond James Equity Research

The job market has been a critical focus in the economic recovery. People tend to concentrate on net employment figures (overall payroll gains or losses). However, there's a lot going on under the surface. The underlying details hold the key to why the economic recovery is going to be gradual.

2010-08-30 00:00:00 Hussman Funds 2010 Annual Report by John P. Hussman of Hussman Funds

At present valuations, exposure to market and credit risk is not likely to be well-compensated over the long-term, and may be associated with substantial losses in the intermediate term. Recent advances may simply be the product of a fragile post-crisis bounce, similar to those following other historical credit crises in the U.S. and abroad. The quarters immediately ahead present the greatest risk of fresh credit strains and concentrated economic risk.

2010-08-30 00:00:00 Weekly Investment Commentary by Bob Doll of BlackRock

While the recovery has been slow, we have made significant progress. On a real basis, U.S. gross domestic product has regained 70 percent of what was lost during the recession and on a nominal basis, GDP has regained all of it, meaning that the United States is in a nominal expansion. In any case, investors in U.S. stocks can expect continued volatility ahead. The S&P 500 Index has remained in a rough trading range of between 1,020 and 1,120. While a dramatic breakout from this range is unlikely for now, as economic conditions slowly improve, the positive forces should win out.

2010-08-27 00:00:00 Why Another Fiscal Stimulus Won't Do by Mohamed A. El-Erian of PIMCO

The main debate in Washington today is whether or not to do more of the same: another fiscal stimulus and another round of quantitative easing by the Federal Reserve. This conflicts with evidence that a broader and more holistic response is needed. Policymakers must address key structural issues, including the drivers of growth and employment creation; the high risk of skill erosion and lost labor productivity; financial deleveraging in the private sector; debt overhangs; the uncertain regulatory environment; and the unacceptably high risks facing the most vulnerable segments of society.

2010-08-27 00:00:00 Double-Dip Economy: Does Quantitative Easing Really Matter? by Christopher Whalen of Institutional Risk Analyst

While the financial markets await the latest pronouncement from Fed Chairman Ben Bernanke, the Institutional Risk Analyst features a comment from friend and former colleague at the FRBNY Richard Alford. He asks whether any of the policy options being considered by the U.S. central bank are meaningful to the American economy. As Paul Krugman wrote in the New York Times on Friday, 'policy makers are in denial.'

2010-08-27 00:00:00 Increasing Risks by Tony and Rob Boeckh of Boeckh Investment Letter

Capital preservation is of critical importance in this volatile, highly uncertain world. Within that conservative context, Boeckh has been relatively bullish on risk assets. The time has come to add another layer of caution to portfolios. The S&P 500 may well remain in an extended trading range, but we may be much closer to the upper boundary than the lower. Seasonally, we are heading into a period when markets tend to be weak, and some important declines have occurred.

2010-08-27 00:00:00 Perception Versus Reality by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Market volume continues its traditional August swoon, making it difficult to gauge much from stock market action. Economic data continues to tell a mixed story, as growth slows and risks rise. Confidence is key to consumer spending, business investment and stock market performance. The Federal Reserve and the government are attempting to instill that confidence in the American public, but so far have had little success. Emerging markets continue to show signs of growth and China's market has been performing well. Germany also has posted some nice numbers lately, but Japan remains a concern.

2010-08-25 00:00:00 Mind the (Current Account) Gap by Nouriel Roubini of RGE Monitor

Turkey's current account deficit is unlikely to show a sustainable decrease without significant reforms. This means country needs to keep attracting sufficient capital flows from abroad to finance the shortfall. Increasing short-term capital flows, however, are raising Turkey's vulnerability to sudden shifts in global risk appetite. The danger is that an increase in risk aversion could place upward pressure on interest rates to attract the necessary external financing.

2010-08-24 00:00:00 Bonds or Stocks - Who is Right? by Chris Maxey of Fortigent

Over the past several months, bond and equity markets have been on starkly divergent paths. Investors are growing increasingly concerned that perhaps the bond market knows something that the stock market is overlooking. One reason for this divergence is corporations. Emerging from one of the most severe recessions in the last century, companies are more than willing to hoard cash and favor a 'wait and see' approach before resuming expansion. Meanwhile, individual investors continue to sell equities in favor of fixed income securities.

2010-08-23 00:00:00 Tax Growth by Milton Ezrati of Lord Abbett

The Bush tax cuts of 2001 and 2003 are set to expire at the end of this year. If the president and Congress just sit on their hands, income taxes will rise across the board, from the lowest to the highest brackets, as will estate, capital gains and dividend taxes. Much debate swirls around the economic effects of these imminent tax increases. Most agree that the heightened tax burdens will detract from the flow of spending and the general dynamism of the economy.

2010-08-23 00:00:00 Markets Pushed Back by Eric S. Ende of First Pacific Advisors

After the events in Greece, it was clear that the shift from expansion to fiscal tightening would put a damper on economic growth. The question of whether the U.S. economy will fall into a double-dip recession therefore misses the larger point. If another recession happens, markets will weaken, governments will stimulate, and the whole cycle will start again. If the economy avoids the second dip, however, the level of economic growth for the next five years should still be lower than the five that preceded the downturn.

2010-08-23 00:00:00 Markets Are Pricing in the 'New Normal' by Charles Gave of GaveKal

Either the upcoming U.S. elections, in a repeat of 1994, will bring about a Congress able to reduce the pace of government spending, thus triggering a massive sell-off in government bonds and a significant rally in equity markets, or the expansion of the U.S. government will continue, in which case investors in U.S. government bond markets will likely thrive in a repeat of what happened in Japan over the past two decades. You can guess which outcome the biggest fixed income investment houses are rooting for.

2010-08-19 00:00:00 The Bond Bubble Debate: 'One Rosie' Takes on 'Two Jeremies' by David A. Rosenberg of Gluskin Sheff

What we have on our hands is a powerful demographic appetite for yield at a time when income is under-represented on boomer balance sheets. The two most significant determinants of the trend in long-term bond yields - Fed policy and inflation - continue to flash 'green' at a time when the yield curve is still historically steep and destined to flatten. Finally, the central bank has already assured us that short-term rates will remain at rock-bottom levels for as long as the eye can see. David Rosenberg also comments on growing acceptance of frugality by retailers.

2010-08-18 00:00:00 Pay No Attention to the Headlines by Christian Thwaites of Sentinel Investments

Market valuations are attractive, especially after the recent correction to below 1,100 on the S&P. What should work is buying companies with strong and sustainable cash flows and proven management. What will not work is chasing risk, and investing in companies that dilute shareholders and operate with high leverage. Don't look for an immediate catalyst. This is a market where stealth, opportunity buying and stock picking work. If you hear the word 'momentum,' run.

2010-08-18 00:00:00 Bank Credit ? One Month Does Not Make a Trend, But... by Paul Kasriel of Northern Trust

U.S. commercial bank total credit increased at an annualized rate of 8.3 percent in July. If this is the beginning of an upward trend in bank credit, then we can feel a lot more confident about the prospects of rising real GDP growth rates in 2011. Subsequently, if bank credit continues to grow on a sustained basis and aggregate demand growth starts to pick up in the first half of 2011, then the Fed would be expected to begin raising policy interest rates around mid-year.

2010-08-17 00:00:00 A Double-Dip Recession Remains Unlikely ? A Mid-Year Update by Bob Doll (Article)

The past couple of months have been difficult for investors, but we are holding to our view that the recovery will continue and stocks will gain ground. Bob Doll, Vice Chairman and Chief Equity Strategist for Fundamental Equities at BlackRock, discusses the current situation, the predictions he made at the beginning of 2010 and opportunity in the financial markets for the second half of the year. We thank BlackRock for their sponsorship.

2010-08-17 00:00:00 Economic, Investment and Asset Allocation Overview ? July 2010 by Jeff Spitzmiller, Jim Worden and Alan Chauhan of Iron Point Capital Management

A buy-and-hold U.S. stock portfolio alone can't be expected to provide attractive returns over the coming years. Alternative asset classes and certain segments of the stock and bond markets are current areas of focus for Iron Point Capital Management. The firm currently favors high-yield bonds, floating rate securities, alternative investments and emerging market debt and equity, amongst other investments that can provide excess return, risk reduction or the ability to capitalize on long-term trends.

2010-08-17 00:00:00 When Unconventional Become Conventional by Paul McCulley of PIMCO

Conventional monetary policy is undergirded by the doctrine of central bank independence, founded on the proposition that fiscal authorities, hostage to the political process, inherently are prone to an inflationary bias. When the economy suffers from private sector deleveraging and a fat-tail risk of deflation, however, conventional monetary policy is not enough. In such circumstances, the central bank has a profound duty to act unconventionally, ballooning its balance sheet by monetizing assets, either government or private, or both.

2010-08-17 00:00:00 Not the Time For a Jubilee by David A. Rosenberg of Gluskin Sheff

We are in the early stages of a secular credit collapse following the biggest credit bubble in human history. The housing bubble was the result of a universal, irrational and linear belief in real estate asset appreciation that developed in the 1990s and reached its glorious peak in 2007. Now we are rolling back into pronounced economic weakness, with contraction in GDP likely to soon follow the stagnant economic conditions of the current quarter.

2010-08-16 00:00:00 A Fragile Economic Outlook Continues by John P. Hussman of Hussman Funds

The recent few quarters of economic expansion are the result of enormous fiscal and monetary stimulus, without much 'intrinsic' private sector expansion at all. Now that inventories are replenished and the fiscal stimulus is tapering off, the underlying and still uncorrected fragility in the economy is likely to reassert itself for a time. While the Economic Cycle Research Institute has expressed increasing economic concerns, however, it has not yet warned conclusively of a double-dip.

2010-08-16 00:00:00 Late Summer Slumber? by Liz Ann Sonders of Charles Schwab

The stock market rallied nicely in July after reaching the bottom of its recent range. Incoming data remains mixed but indicates that the economic expansion continues. However, risks remain elevated. The Federal Reserve downgraded its view and is discussing how to combat possible deflation, while federal and state governments continue to grapple with budget issues. Chinese growth has slowed, but the stock market is providing some positive indicators. Central banks around the world are creating a muddied picture.

2010-08-13 00:00:00 Q2 Economic and Market Outlook: ?Soft Patch? or ?Double-Dip?? by Ken Taubes of Pioneer Investment Management

Inflation should remain well-contained for the next year or two, but a credible plan to cut budget deficits and a return to positive real interest rates will be needed to prevent the bond market from pricing in rising inflation in the medium term. In this environment, the U.S. dollar can continue to strengthen versus other major currencies, and capital markets, especially equity markets, can deliver attractive returns.

2010-08-13 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

No doubt, investor sentiment can shift on a dime. Perhaps, we can blame some of the market moves on overreaction and light volume from the end of summer blahs. After closing out the second quarter on a sour note, the equity market regained its bullish form in July, but again hit a serious road block this week. A perceived pessimistic Fed statement following the policy meeting sent investors running for cover as four straight down days left the major indexes back ?in-the-red? for the year.

2010-08-11 00:00:00 Not in Kansas Anymore by David A. Rosenberg of Gluskin Sheff

The transition to the next sustainable economic expansion and bull market in these types of business cycles takes between five and 10 years, and is fraught with periodic setbacks. While an underweight positions in equities still makes sense, a bar bell between basic materials and defensive dividend stocks is a prudent strategy, with the overall emphasis in the asset mix tilted towards bonds, especially the BB-rated sliver or that part of the higher quality non-investment grade space that currently has the greatest unexploited potential for spread compression and capital gains.

2010-08-09 00:00:00 Corporate 'Cash' - Cheering the Asset and Ignoring the Liability by John P. Hussman of Hussman Funds

There is a lot of apparent 'cash on the sidelines' because the government and many corporations have issued enormous quantities of new debt, often with short maturities, while other corporations have purchased it. It will remain on the sidelines until the debt is retired. The government debt has been issued to finance deficit spending. At the same time, a great deal of corporate debt has been issued over the past year apparently as a pre-emptive measure against the possibility of the capital markets freezing up again.

2010-08-09 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

For some time we have been discussing the twin factors of a truly jobless recovery versus very strong corporate profits. While much of the media focuses upon the jobs issue because of its political impact, the stock market is mostly concerned with profits and productivity trends of those working. Corporations simply will not expand or hire under the uncertainty of changing tax, healthcare and energy policies. As a result, the economy is now being held hostage to the upcoming mid-term elections as an indication of just what direction the central planning policy of Washington D.C. will take.

2010-08-09 00:00:00 It's the Jobs, Stupid! - Part III by Komal Sri-Kumar of TCW Asset Management

The unemployment rate is a leading indicator of economic activity in this business cycle due to the potent force of discouraged consumers, rather than a lagging indicator, as we have been taught in our economics courses. That, in turn, means that we cannot ignore the large number of jobless workers in the belief that economic growth will subsequently cure the problem we won't have sustained economic growth unless we lower unemployment first. The disappointing employment numbers last Friday are indicative of this trend.

2010-08-09 00:00:00 Is There Hope For the U.S. Consumer? by Chris Maxey of Fortigent

Consumers face a challenging environment in the second half of the year as stubbornly high unemployment and stagnant wages will limit their ability or desire to spend. The rapid improvement in corporate profitability should encourage hiring at the beginning of 2011, but the road will be long and bumpy. Meanwhile, a series of economic reports this week are likely to provide confirmation that economic growth is slowing.

2010-08-07 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

Although the economy remains in recovery mode, the labor statistics confirmed that it may not be as strong as many were hoping. Several quarters of lackluster growth appear to be on the horizon. Even though the unemployment rate held steady at 9.5 percent, the June payroll data was revised lower and the 'underemployment' rate stands at a high 16.5 percent. Retailers braced for a feeble 'back-to-school' shopping season as same-store sales for July came in below expectations and department stores and teen retailers reported the most disappointing results.

2010-08-06 00:00:00 August Monthly Economic Update by Justin S. Anderson of Cambridge Advisors

Compared to U.S. government bonds, stocks may be a better investment if we stay in a slow-growth rather than negative-growth environment. Yields are low and the Federal Reserve is expected to keep short-term rates low for quite some time. Higher yields may be found in corporate bonds or foreign government bonds. Emerging market governments have lower debt as a percentage of their growing GDPs and may also provide higher yields to investors.

2010-08-04 00:00:00 How the Other Half Looks by Nouriel Roubini of RGE Monitor

The global adjustment process has been delayed. In order to support growth and income generation, the over-saving investment- and export-driven nations - China, emerging Asia, Germany and Japan - continue to look to the overspending countries following an Anglo-Saxon model. There is a risk of a weak recovery of global aggregate demand relative to supply, which could contribute to deflationary pressures. As such, the recovery will continue to be multi-speed and rocky, exit strategies will remain uncoordinated and the risk of policy gridlock is high.

2010-08-04 00:00:00 Uncertainty Changing Investment Landscape by Robert Claridia and Mohammed El-Erian of PIMCO

The unusual uncertainty in the economic outlook reflects the disruptive combination of deleveraging, reregulation, structural unemployment and other ongoing structural changes. It seems that, wherever we look, the snapshot for 'consensus expectations' has shifted from traditional bell-shaped curves to a much flatter distribution of outcomes. This changing shape of distributions affects conventional wisdom in the investment world.

2010-08-03 00:00:00 The Role of Taxes in Future Growth by Chris Maxey of Fortigent

Democrats who were previously in favor of allowing the Bush-era tax cuts to expire at the end of this year are suddenly swimming in the opposite direction, with several favoring extensions to the tax credit, given the poor economic backdrop. It is easy to find evidence to support both camps, but the simple reality is that economically restrictive policies will create a drag on growth at a time when the economy can ill afford them.

2010-07-31 00:00:00 Bull/Bear Standoff by Liz Ann Sonders of Charles Schwab

Bulls and bears both have strong cases. With earnings results and economic data indicating continued growth, we lean toward the bullish side?although risks to the bullish case are elevated. Uncertainty and concern regarding government actions continue to weigh on sentiment, while the Federal Reserve leaves all options on the table. Some questioned the credibility of European stress tests, but the market responded favorably. Meanwhile, China's growth appears to be moderating but remains relatively robust.

2010-07-30 00:00:00 The Fed Has Not Run Out of Options, As Yet by Asha Bangalore of Northern Trust

The worst of the financial crisis is history, but the U.S. economy is still struggling to establish self-sustained economic growth. There is an ongoing debate among economists and policy advisors as to what is the best course -- fiscal austerity or stimulus -- to restore financial and economic tranquility. Discussions about the Fed's options in the event of further weakening of economic conditions in a deflationary environment have also surfaced.

2010-07-30 00:00:00 Inflation in 2010 and Beyond? Practical Considerations for Institutional Asset Allocation by Michael Katz and Christopher Palazzolo of AQR Capital Management

Traditional institutional portfolios with risk characteristics similar to a 60/40 stocks/bonds allocation are not well-positioned for unexpected inflation. Stocks are not effective inflation hedges, particularly in the short and medium term. Meanwhile, traditional institutional allocations resemble a 'bet' on low inflation. A risk-based approach to strategic asset allocation, however, may generate more balanced performance across both inflationary and deflationary periods.

2010-07-30 00:00:00 Slow Motion Recovery and What Would Make Me Bullish by David A. Rosenberg of Gluskin Sheff

Legions of economists are claiming that it is normal to see the economy take a breather at this stage of the cycle, but in truth, what is 'normal' in the context of a post-WWII recovery is that four quarters into it, real GDP expands at over a 6 percent annual rate. That puts the current 2.4 percent growth rate into a certain perspective. David Rosenberg also lists 10 economic developments that could turn him bullish.

2010-07-30 00:00:00 Core|Satellite Investing with First Eagle Funds by Team of First Eagle Funds

Many practitioners of core/satellite investing use the core of their clients? portfolios to generate market-like returns with market-level risk exposure, or beta, and use satellite investments to produce excess returns, or alpha. Within this framework, passive investment vehicles ? index funds and ETFs ? have become standard core investments. First Eagle questions this approach, and believes an actively managed global portfolio should be the core.

2010-07-28 00:00:00 Market Thoughts and the Long-Term Outlook for Inflation by David A. Rosenberg of Gluskin Sheff

The bull market in bonds will end reasonably close to the point in time that inflation (or deflation) bottoms. This is because the major economic factor that correlates consistently with the direction of market-determined interest rates, at least for long term Treasury Bonds, is CPI Inflation. Core inflation should recede from around 1 percent now to near 0 percent in the next 12-to-24 months, which would imply an ultimate bottom in the long bond yield of 2.5 percent and 2 percent for the 10-year T-note.

2010-07-27 00:00:00 Sizing Up the Jobs Growth Challenge by Team of American Century Investments

While labor market data indicates the economy is still adding jobs, the pace of additions is far slower than what is needed to meaningfully reduce our 9.5 percent unemployment rate. Much of the half-a-percentage-point rise in employment during the second quarter of this year came from the hiring of up to 700,000 temporary workers for the decennial Census survey. Now that this effort is winding down, some economists are forecasting that short-term unemployment will rise again.

2010-07-27 00:00:00 We're All Chartists Now by David A. Rosenberg of Gluskin Sheff

Fed chairman Ben Bernanke may not be the world's best forecaster. He has the deepest rolodex, however, deeper than that of any CEO. And when he uses the phrase 'unusually uncertain' to describe the economic outlook, it is irrational to ascribe anything fundamental to the current market rally. The technical picture has indeed improved. The market gets it wrong, however, as often as it gets it right. There is still potential for many disappointments in earnings reports to come.

2010-07-26 00:00:00 Earnings Season Masks the Slowdown in Q2 Economic Growth by David A. Rosenberg of Gluskin Sheff

Program trading, algorithms, momentum trading, technicals ? all are at play. Meanwhile, the Treasury market has steadfastly refused to budge from a double-dip view, with real rates still under downward pressure, and while the breadth of the market has been decent, this rally has continued to lack volume ? down a further 2 percent on Friday on the NYSE. We are also at another key technical juncture ? the Dow and Nasdaq have retaken their 200-day moving averages while the S&P 500 and the Nasdaq are caught between the 50-day and 200-day m.a.'s.

2010-07-26 00:00:00 Earnings Bolster Investor Confidence by Chris Maxey of Fortigent

Investors found reason to cheer last week after a round of impressive earnings reports buoyed confidence. The challenge for the broader economy, however, is that companies are becoming more profitable but are unwilling to pass on those gains to their respective employees. Instead, they are stockpiling cash at the expense of employee compensation. Moving into the second half of 2010, as executives begin solidifying budgets for the next fiscal year, we could see an uptick in hiring.

2010-07-24 00:00:00 The Artificial Economic Recovery by Tony and Rob Boeckh of Boeckh Investment Letter

Economic recovery in the U.S. and elsewhere has slowed rapidly and forecasts are being downgraded accordingly. The massive stimulus packages stopped a self-feeding downward spiral, but they have given us only an artificial recovery. Government tax revenues will be disappointing and expenditures will remain elevated. A fragile economy, however, should not push investors away entirely from risk assets. High levels of risk and uncertainty argue for continued focus on wealth preservation and sound diversification.

2010-07-23 00:00:00 Postcard From Behind the Wheel in China by Kenichi Amaki of Matthews Asia

After experiencing swift growth in 2009, China has become the world's largest auto market in terms of unit sales. With approximately 80 manufacturers now competing for a share of this immense market, China's car industry is also quickly becoming the world's most competitive. The argument for investing in this market is compelling. Not only is penetration so far still low, and thus full of potential, the industry is growing faster than China?s overall GDP. This is not to say, however, that the growth will be in a straight line

2010-07-22 00:00:00 It's Greek to Me by Howard Marks of Oaktree Capital

The current positives for investors include moderate valuations, rising corporate earnings and the likelihood we're already in a recovery. On the other hand, consumers are still too traumatized to resume spending strongly. Conservatism, austerity and increased savings are good for individuals but bad for a stagnant overall economy. Anyone who invests today in a pro-risk fashion out of belief in the recovery must be confident he'll be agile enough to take profits before the long-term realities set in.

2010-07-21 00:00:00 Equity Investment Outlook by Team of Osterweis Capital Management

The economy is not headed towards a serious double-dip recession, but rather towards a slowdown or moderation of its growth rate. That is, the economy has been improving, just not as fast as investors envisioned earlier this year. Osterweis is therefore staying the course, focusing on solid companies with strong or improving balance sheets and a history of stable or growing dividends. They are also keeping some cash as a buffer against further erosion in the overall market and as a buying reserve to use when compelling bargains emerge.

2010-07-20 00:00:00 The Opportunity in Build America Bonds by Jeff Westergaard (Article)

While the unique aspects of Build America Bonds (BABs) and recent Treasury Department actions are meaningful, the risks to investors have been over-emphasized. BABs remain an attractive vehicle for investors and issuers, and the market for them is likely to grow.

2010-07-20 00:00:00 Why Not Another World War? by Peter Schiff of Euro Pacific Capital

There is overwhelming agreement among economists that the Second World War was responsible for decisively ending the Great Depression. The truth is, however, that America cannot spend its way out of the current crisis, no matter how great a spectacle it creates. Even if the government spent on infrastructure rather than war, it would still have no means to fund it, and there would still be no guarantee that the economy would grow as a result. Instead, what the country needs is more savings, more free enterprise, more production and a return of American competitiveness in the global economy.

2010-07-19 00:00:00 Don't Take the Bait by John P. Hussman of Hussman Funds

Investors who allow Wall Street to convince them that stocks are generationally cheap at current levels are like trout - biting down on the enticing but illusory bait of operating earnings, unaware of the hook buried inside. We should be skeptical about valuation metrics built on forward operating earnings and other measures that implicitly require U.S. profit margins to sustain levels about 50 percent above their historical norms indefinitely. More sober and historically reliable measures of market valuation create a much more challenging picture.

2010-07-19 00:00:00 Deflation: Should the Fed be Buying Gold? Hugo Salinas-Price on the Silver Peso by Christopher Whalen of Institutional Risk Analyst

This piece features a commentary from Hugo Salinas-Price, founder of Mexican retailer Grupo Elektra, on his proposal for the introduction of a silver-backed peso. Legislation to that effect now is under serious consideration before the Mexican Congress. Salinas describes the Mexican peso as a 'derivative' of the dollar, a troubling prospect since the dollar itself is a derivative of nothing, at best a mere representation of a unit of work. Christopher Whalen also discusses the U.S. financial reform bill, and the latest Federal Open Market Committee meeting.

2010-07-19 00:00:00 'New Normal' Nowhere in Sight by Brian S. Wesbury and Robert Stein of First Trust Advisors

With GDP scheduled for release next week, Brian Wesbury and Robert Stein's estimate for annualized second quarter real GDP growth is 3.5 percent. While this is a significant reduction from their 5.5 percent forecast made in March, it is still higher than what the 'new normal' camp is predicting. Productivity growth is strong, monetary policy is (and will continue to be) easy, inventories are razor-thin, and corporate profits are growing rapidly. For the next four quarters, ending in mid-2011, Wesbury and Stein thus again anticipate growth at around a 4 percent rate.

2010-07-19 00:00:00 Double-Dip? Seven Reasons Why Not by Milton Ezrati of Lord Abbett

It seems these days that half the headlines in the financial media fear a double-dip recession, as do half the conversations on Wall Street. There certainly are risks, not the least in Europe's financial difficulties. But still, there are reasons to question such widespread concerns. History, after all, offers only one true double-dip experience, and that grew out of a policy error. Moreover, the actual data on the economy flies in the face of such an outlook. Milton Ezrati outlines seven reasons to doubt the double-dip outlook.

2010-07-19 00:00:00 U.S. Lessons From Last Week: A Fiscal Dead End by Komal Sri-Kumar of TCW Asset Management

With the Obama administration's $787 billion stimulus money mostly spent or committed, the fiscal deficit has risen and borrowing needs have gone up, but the private sector is still incapable of generating sufficient employment or economic growth. While the $8,000 first-time home buyer credit temporarily helped housing, and 'cash-for-clunkers' was a boon to the automotive industry and car dealers last fall, the end of programs like these has typically been marked by a falloff in demand.

2010-07-17 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

So much information; so little time to digest. While earnings season kicked off to some mixed results, investors also eyed critical news from BP, Goldman, Apple, the Fed, and even Playboy as they attempted to determine the next direction for the markets. The early weak euphoria was replaced by newfound late-week concerns and stocks did another about-face as the game of streaks continued. Aren?t the summers supposed to be slow and boring?

2010-07-16 00:00:00 Government Policies Pushing Towards Depression by John Browne of Euro Pacific Capital

As leaders around the world look to tighten the reins on out of control spending, President Obama and his Democratic supporters in Congress believe that their stimulus actions have succeeded and should be redoubled. Armed with nothing more than faith in government and a belief that spending is both a means and an end, it appears that the U.S. stimulus policy will continue. The net result of these efforts will not be a more vibrant economy, but the perpetuation of fear and confusion in the business community and the continuing expansion of deficits that will lead inevitably to higher taxes.

2010-07-14 00:00:00 U.S. Equity Newsletter by Team of W.P. Stewart

One thing is certain - there is a lot of bad news around and many people are now forecasting a double-dip recession. 'Bad news,' however, may already be factored into prices. Global growth is still expected to be solidly positive in 2010 and 2011, albeit somewhat skewed to the emerging markets. Corporate balance sheets are very robust, productivity has never been higher and earnings growth remains strong even on somewhat reduced estimates. Equities should therefore offer significantly better returns than bonds or cash.

2010-07-14 00:00:00 Demographics, Destiny and Equity Markets by George Magnus of Boeckh Investment Letter

This letter contains a special feature by George Magnus, senior economic advisor at UBS Investment Bank, on the coming negative change in global demographics. The world population is aging rapidly and the proportion of retired to working people is rising sharply. While these are slow-moving forces compared to, say, banking crises, they are powerful and inexorable trends that cannot be 'fixed.' Rather, we, and governments, must adjust to them, and investors must pay attention to their complex investment implications.

2010-07-14 00:00:00 The Fundamental Trendline is Still Down by David A. Rosenberg of Gluskin Sheff

What we are grappling with is this: If the consensus earnings forecast is 'the market,' then the S&P 500 is de facto pricing in $96 of operating earnings next year - a new peak. That is a 35 percent increase from here, and it is extremely difficult to see profits soaring that much at a time when margins are already back at cycle highs and with the prospect of slowing nominal GDP growth. It just does not add up.

2010-07-13 00:00:00 Animal Spirits and the Economic Outlook II by Scott Brown of Raymond James Equity Research

The U.S. economic recovery appears to have entered a moderation phase, where growth is likely to remain positive in the near term but may not be as strong as was hoped for a few months ago. Recoveries from financial crises take time. This was never expected to be a sharp recovery and improvement in the labor market was projected to be very gradual. Recoveries are never smooth, but it seems clear that consumer and business psychology will play important roles in the near term.

2010-07-12 00:00:00 Four Major Impediments to Economic Normalcy by Van R. Hoisington and Lacy H. Hunt of Hoisington Investment Management

Although the four coincident indicators that the NBER utilizes in judging recession troughs have turned positive, two of them (income less transfer payments and employment) have only marginally shifted upwards and are subject to significant revisions. Thus, history may come to judge that the NBER was very wise to hold off making this end of recession call. The past several quarters may be nothing more than an interlude in a more sustained economic downturn, with further negative quarters still ahead. Such an outcome will suppress inflation further and quite possibly lead to deflation.

2010-07-12 00:00:00 In Search of Your Sleeping Point by Cliff W. Draughn of Excelsia Investment Advisors

Asset allocation is an art involving quantitative analysis of financial markets combined with common sense. A buy-and-hold strategy is a dead decision during markets such as these. We have had the worst May in stocks since 1940. No credit still equals no jobs, China is destined for turmoil as its real estate market unwinds, and the Consumer Confidence Index is down to 52.9 in June from 62.7 in May. Fair value on the S&P is 950, which would indicate another 7 percent decline in stock prices from here.

2010-07-12 00:00:00 The Crowd Zigs, Time to Zag? by Chris Maxey of Fortigent

When the crowd is zigging, it is best to trust one's contrarian instincts and zag. The ratio of bearish to bullish investors has steadily risen since early May, when concerns about sovereign stability began to unravel. In the week ending July 8th, 57 percent of individual investors reported being bearish in the intermediate term, against only 21 percent that hold a bullish stance. Investor sentiment is sitting at the lowest point since March 2009, and we all know what happened in the intervening months.

2010-07-10 00:00:00 It's More Than Just Birth-Death by John Mauldin of Millennium Wave Advisors

Mauldin examines the methodology used by the BLS when it calculates unemployment. He reviews claims by Jeff Miller of New Arc (which we published on Thursday) that distortions caused by unreported data are greater than those of the birth/death model. Mauldin also discusses a conversation he had with Mohammed El-Erian, who said that unemployment may now be a leading (instead of lagging) indicator of economic growth.

2010-07-09 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

Enough with the rumors and innuendoes?the optimism and concerns?the favorable forecasts and downgrades?the fundamental number crunching and the charting?Let the earnings season begin. For weeks, some analysts have spoken of stronger comps and feared disappointments. Others looked at the economic recovery and continued to believe that enhanced manufacturing activity is just now beginning to show up in the profit numbers. The waiting is over?Alcoa kicks off the season on Monday.

2010-07-09 00:00:00 Potholes in the Recovery Road ? Reduce Speed Ahead by Paul Kasriel of Northern Trust

The second-half GDP growth forecast has been lowered to 1.8 percent and Q4/Q4 GDP growth in 2011 will be 3.2 percent. This is a business cycle unlike any other in the post-war era. In prior cycles, as the Fed raised the funds rate, growth in bank credit slowed. In the current environment, even with the Fed holding the funds rate at less than 25 basis points, bank credit continues to contract. Thus, we are going to utter the six most dangerous words in economic forecasting: This time it might be different.

2010-07-06 00:00:00 U.S. Economy Hits a Speed Bump, to Put it Mildly by David A. Rosenberg of Gluskin Sheff

There is certainly nothing on the fundamental front to elicit a rally at present as double-dip risks continue to rise; there should, at a minimum, soon be a growth slowdown of significance. The reason why everyone bought into the V-shaped recovery view was because the equity market told them that it must be the case. Now, however, we have a situation where $1.6 trillion of wealth has been wiped off the books in the past three months as a result of the stock market setback, and so it?s no coincidence that at the margin, question marks are surfacing over the longevity of the recovery.

2010-07-06 00:00:00 Animal Spirits and the Economic Outlook by Scott Brown of Raymond James Equity Research

Near-term economic expectations have softened over the last few months and the risks to the growth outlook have become tilted more to the downside. There's nothing to suggest that a double-dip recession is imminent or even likely over the next few quarters. However, the one element that's hard to get a handle on is psychology. Fears of a double-dip could become self-fulfilling if enough firms stop hiring.

2010-07-06 00:00:00 Second Half Growth Will Slow, but is a Double-Dip Certain? by Chris Maxey of Fortigent

While it is easy to remain pessimistic on the state of the economy, especially following the events of 2008, the signs of a double-dip recession are simply not there yet. Slower growth is a given at this point, but this should not come as a surprise considering that it has been well-documented that previous stimuli would become a detractor to growth in the second half of 2010 and through 2011. Further stimulus packages are already being debated, even in the face of fiscal tightening by countries across Europe, as politicians face difficult battles at the polls.

2010-07-02 00:00:00 Latest Reports Suggest Slowing of Economic Conditions in the United State by Asha Bangalore of Northern Trust

Auto sales, jobless claims, construction outlays, housing sector data, and ISM factory survey - each of these reports underscore the fragile nature of the recovery.

2010-06-30 00:00:00 ECRI Data, Our Themes in the Morning Press, and Radically Restructuring Entitlements by David A. Rosenberg of Gluskin Sheff

David Rosenberg sets the ECRI?s record straight, arguing that the Lex column should ask about the recent equity market drop rather than the unpredictable rally. Rosenberg comments on the themes of inflation and deflation in the press and how society is becoming familiar with Bob Farrell?s rule, ?Exponentially rapidly rising or falling markets usually go further than you think, but they do not correct by going sideways.?

2010-06-30 00:00:00 Asset Allocation Thoughts by Tony and Rob Boeckh of Boeckh Investment Letter

This commentary provides an asset allocation framework for investor?s portfolios that reflects our macro view, concerns about the general riskiness of the financial world and a variety of issues that go into the asset allocation process. In general, we continue to be positive on risks assets in the context of our continuing focus on wealth preservation and diversification. Probabilities favor a recovery in stock and commodity prices rather than an extended bear market.

2010-06-30 00:00:00 Home Price Data is Very Misleading by John Burns of John Burns Real Estate Consulting

Executive decision makers want to know whether prices are trending up or down, and that question has never been harder to answer. Burns suggests that merely looking at headlines as a basis for research or information is a surefire way to get misinformed. When forced to answer the question, John Burns Real Estate says that most home prices are reverting to 2003 prices ? some areas have overcorrected and some have not fully corrected. That covers them on a national scale, yet they know the truth is much different depending on what submarket or pool of homes you are talking about.

2010-06-29 00:00:00 Inflation Protection Investment Strategies by Vern Sumnicht (Article)

The value of the dollar is sure to erode, and investors will be left to grapple with the inflationary consequences. As Vern Sumnicht shows in this guest contribution, recent policies suggest steep inflation may be just around the corner. Fortunately, investors have some options to bolster their portfolios against the threat of inflation.

2010-06-29 00:00:00 Breakfast With Dave by David A. Rosenberg of Gluskin Sheff

In today's issue of Breakfast With Dave, David Rosenberg comments on a continued rally in bonds that will remain the most painful trade out there given how the non-commercial accounts are positioned. He also comments on the big drag from the State and local government sector and mixed news on the American consumer. -Big drag from the State and local government sector -Mixed news on the American consumer ? just take a look at the slew of conflicting articles in today?s WSJ

2010-06-28 00:00:00 Recession Warning by John P. Hussman of Hussman Funds

Warning: the US economy appears to be headed into a second round of decline. Looking at lessons learned across countries and centuries, Dr. John P. Hussman argues that that ?the economy is again turning lower, and that there is a reasonable likelihood that the U.S. stock market will ultimately violate its March 2009 lows before the current adjustment cycle is complete.? The current argument that this outcome is ?unthinkable? is not evidence but rather reflects reliance upon incomplete data and narrow-minded perspectives.

2010-06-28 00:00:00 On The Merits of Hedged Equity by Chris Maxey of Fortigent

Despite positive predictions for the housing market, existing home sales fell in May. This may be due to a number of first time buyers who snapped up distressed properties, requiring a longer wait between contract acceptance and closing date. At the same time, new home sales plummeted and median home sale price fell. A glimmer of hope exists in this market as home prices are in the positive over a year-over-year basis.

2010-06-28 00:00:00 Mohammed El-Erian on a Disappointing G-20 Compromise by Mohamed A. El-Erian of PIMCO

Mohammed El-Erian digests the 'unusually long communiqu from the G-20 Summit in Toronto.' El-Erian expresses his concerns about the future of a post?global financial crisis world that is in desperate need of better cross-border policy coordination and harmonization.

2010-06-25 00:00:00 Beyond the Growth Vs. Austerity Debate by Mohamed A. El-Erian of PIMCO

This weekend?s G-20 meeting will likely fuel, not resolve, the heated debate triggered by a combination of exploding debt and deficits in industrial countries, and the recognition that many now face a future of muted growth and high unemployment. In one corner stand the 'growth now' camp, arguing that expansion is a prerequisite to service their debt sustainably. Against them stand the 'austerity now' camp, who want budget cuts to lower risk premiums and stave off disruptive debt restructurings. The two sides are both right, and wrong.

2010-06-22 00:00:00 China Rising by Brian S. Wesbury and Robert Stein of First Trust Advisors

China just decided it will once again let its currency - the yuan - get stronger against the U.S. dollar. Yuan appreciation will do two things. First, it will lower Chinese inflation relative to U.S. inflation. Second, it will raise the living standards of Chinese citizens. Where previously the Chinese government might have wanted the peg in order to encourage export growth, now the political calculus is starting to favor expanding the purchasing power of its workers. This is a sign of maturity for both the economy and Chinese policymakers.

2010-06-17 00:00:00 Consumer Metrics Institute's Growth Index by Doug Short of Doug Short

Doug Short provides charts comparing the Consumer Metrics Institute's growth index with gross domestic product and the S&P 500 since 2005. Thus far the growth index has been an effective leading indicator of GDP. As such, a double-dip recession appears to be a distinct possibility amidst the end of the various government stimulus efforts, the potential contagion of the financial stress in Europe, the ongoing environmental catastrophe in the Gulf of Mexico and another round of consumer belt-tightening.

2010-06-17 00:00:00 The New Economic Reality - Part III by Monty Guild and Tony Danaher of Guild Investment Management

Inflation can occur in either an economic expansion or a depression. In either case gold, currencies of countries with conservative financial management and stable banking systems, real estate, and other real assets can do well. In an inflationary expansion fast growing companies and producers of commodities will also do well. During deflation, bonds will do well if the issuer can make the payments. Gold often holds its value in terms of buying power even in a depression.

2010-06-14 00:00:00 Born on Third Base by John P. Hussman of Hussman Funds

Wall Street seems to have no idea that every bit of growth we've observed over the past year can be traced to government deficit spending, with zero private sector expansion when those deficits are factored out. Unless the credit spreads, the S&P 500, or the yield curve reverse, a further decline in the Purchasing Managers Index to 54 or below would be sufficient to confirm a 'double-dip recession.' By itself, such a level might not be particularly troublesome. In concert with other evidence, however, it would be sufficient to complete the syndrome of risk factors.

2010-06-14 00:00:00 Equites Jump, But Uncertainties Persist by Chris Maxey of Fortigent

Equity indices logged solid gains this past week, with the S&P 500 index up 2.5 percent and the Dow Jones Industrial Average up 2.6 percent. The positive outcome was a result of light trading on Thursday and Friday, although it appears there is little conviction in the rally, with trading volume falling well short of the 50-day average over the course of both days. A measure of confidence from the Yale School of Management shows that individual investors are becoming disenchanted with the market, which makes them hesitant to buy equities during periods of correction.

2010-06-11 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

So just who is corporate public enemy number one these days: BP? Goldman Sachs? AIG? While BP has been garnering much of the negative attention these days, Goldman?s unfavorable image resurfaced (and, of course, AIG always remains lurking in the background, especially whenever Goldman?s challenges are revealed). This week, the markets tried to disregard that negativity and equities enjoyed their first ?up? week in the past month. Even a late-week lower-than-expected retail sales release couldn?t overcome the new-found optimism of some well-timed ECB and Fed comments.

2010-06-11 00:00:00 Schwab Sector Views: Why Sectors? by Brad Sorensen of Charles Schwab

Views on the S&P 500 sectors.

2010-06-11 00:00:00 The Frog in the Frying Pan by John Mauldin of Millennium Wave Advisors

Jonathan Tepper of Variant Perception, a research firm in London, writes this column as a guest contribution. He says that Mauldin's Muddle Through Economy is the product of several major structural breaks in the economy, which have important implications for growth, jobs, and the timing of a future recession: lower GDP growth will lead to more frequent recessions and higher economic volatility; high unemployment rates will be the norm, especially for less educated workers.

2010-06-10 00:00:00 April 2010 Commentary by Bill Middleton of Sound Portfolio Advisors

Perhaps the most encouraging signs in markets today are general pessimism and lowered expectations. Mass expectations tend to be dead wrong, and are therefore excellent contra-indicators. The first- and second-best performing asset classes of the past 10 years, gold and real estate, were so ill-regarded prior to 2000 they weren't even included in the data provided by the Wall Street Journal in January of that year. The best performing asset class for the 1995-1999 period, science and technology, was by far the worst performing for the following 10 years.

2010-06-10 00:00:00 Some Unpleasant Keynesian-Minsky Logic by Paul McCulley of PIMCO

Thirty years ago, virulent inflation demanded robust monetary authority independence, so as to pursue a draconian monetary policy that even disciplined fiscal authorities when their loose policies contradicted the overriding goal of winning the war against inflation. For the past decade, however, a more collaborative relationship between monetary and fiscal authorities has been required in order to cut off the fat tail of deflation risk, notably in recessions. The European Central Bank needs to realize this, even if future policies threaten to unmoor long-term inflation expectations.

2010-06-08 00:00:00 Why Wall Street Won't be Reformed by Robert Huebscher (Article)

Michael Lewitt, author of the highly respected HCM Market Letter, has just released a new book, The Death of Capital. In this interview, he identifies the challenges facing those who seek to regulate Wall Street, and why most of the proposed reforms are likely to fail.

2010-06-08 00:00:00 "Missing Elements" of Mr. Laffer's Incomplete Story by Asha Bangalore of Northern Trust

Supply-side economist Arthur Laffer recounts his experience with the Reagan administration to illustrate his arguments about the positive impact of tax cuts on economic growth with in a piece for the June 7 Wall Street Journal. Laffer predicts dire economic consequences if the Bush tax cuts are allowed to expire at the close of 2010. If Laffer's thesis is correct, however, then why, for example, did the economy post noticeable growth after the tax increases of 1993? And why did the U.S. economy undergo such a weak period of economic expansion following the Bush tax cuts of 2001 and 2003?

2010-06-08 00:00:00 Weekly Commentary & Update by Tom McIntyre of McIntyre, Freedman & Flynn

The year-over-year advance in current indicators is at a 50-week low and could be ready to turn negative soon. This has happened 12 times in the past and it produced only 3 recessions. Consequently, it is too early to predict a double dip for this year, but clearly a slowing down is in the cards and this along with the absence of temporary census workers will make for several months of disappointing employment numbers. President Obama needs to get some better advice from his advisers as to how to handle this situation.

2010-06-08 00:00:00 Can Emerging Markets Save the World Economy? by Mohamed El-Erian and Michael Spence of PIMCO

High growth and financial stability in emerging economies are helping to facilitate the massive adjustment facing industrial countries. But that growth has significant longer-term implications. If the current pattern is sustained, the global economy will be permanently transformed. Specifically, not much more than a decade is needed for the share of global GDP generated by developing economies to pass the 50 percent mark when measured in market prices.

2010-06-04 00:00:00 The New Economic Reality - Part II by Monty Guild and Tony Danaher of Guild Investment Management

Some investors believe that deflationary influences will lead to an immense slowdown in world economic activity, and thus thus are selling stocks, buying bonds and short-selling commodities. Others think government action to forestall the deflation will end up creating inflation, and are buying commodities, buying stocks and avoiding bonds As the two sides pull markets back and forth, volatility will continue. To deal with the volatility, Guild is holding a large percentage of client assets in cash and gold, which can rise in either an inflationary or a deflationary situation.

2010-06-03 00:00:00 Some Days Are Better Than Others... Just Not These Days by Liz Ann Sonders of Charles Schwab

The wall of worry is back - and that's not a bad thing. Thanks to the correction, valuation has improved, while excessively bullish sentiment is no more. Growth estimates should be pared back for the second half of this year and next year, as well. Europe's debt crisis has become a deflationary event. The Treasury yield curve presently predicts the risk of a recession this year or next, however, as near-zero. The most likely shape of the recovery continues to be a 'square root,' with a V-shaped recovery followed by a leveling out of growth.

2010-06-03 00:00:00 A Bear Market or Just a Correction? by David A. Rosenberg of Gluskin Sheff

So far the S&P 500 is down nearly 10 percent from the highs, so this is indeed a correction thus far. More often than not, however, declines like these morph into something more severe. Right now we are looking at a 50 percent retracement of the March 2009-April 2010 run-up, which means 943 on the S&P 500. Lows in the market tend to occur with the index 20 percent below the 200-day moving average, which at this stage would be 879. So at least we have a defined range of when to begin to put money to work.

2010-06-02 00:00:00 FASB Fanatics At It Again by Brian S. Wesbury and Robert Stein of First Trust Advisors

The Financial Accounting Standards Board wants to force banks to use 'fair value or 'mark-to-market' rules not only for the securities they own, but also the loans they make. The number one problem with fair value accounting is that market prices for assets are forward-looking. In good times, prices reflect a positive outlook. In bad times, they reflect a negative outlook. And when markets freeze up, financial institutions must use prices that do not reflect actual cash flow. This creates a vicious downward cycle of losses, bank failures, more fear and lower 'observable' prices.

2010-06-02 00:00:00 Manufacturing, Construction and Gold by David A. Rosenberg of Gluskin Sheff

Deflation is still the primary trend, coupled with massive reflation efforts and the unintended consequences that come along with those efforts. The name of the game is therefore to focus on strategies that deliver income, minimize volatility and emphasize capital preservation in a secular bear market, and to use commodities as a buffer in a financially unstable world. Rosenberg also comments on rising manufacturing activity and construction, and rising gold sales at the U.S. Mint.

2010-06-01 00:00:00 Europe: Value or Value Trap? by Dan Trosch, CFA (Article)

European equities seem much cheaper than in the US, says Dan Trosch of Fortigent in this guest contribution. Europe trades at a 26% Price to Book discount and a 20% Price to Cash Earnings discount to the US. Some European industries and stocks are deservedly cheap and value traps; other industries and stocks are attractive and will benefit from global growth in exports and other macro trends.

2010-06-01 00:00:00 Global Equity Markets Slip on Greek Debt Crunch by Team of American Century Investments

Fears of a Greek default have heightened concerns about the financial stability of several other peripheral European countries. Spain, Ireland, Italy and Portugal, however, are not in the same situation as Greece. Italy in particular is in a separate, stronger category than the others. It is less reliant on foreign financing, with Italians owning a high percentage of their own sovereign debt. Italy also lagged in the economic boom prior to the global recession, a blessing in disguise because its banking sector is now not as over-leveraged to the housing market as banks in other countries.

2010-06-01 00:00:00 Margins Peak, Gold Saves Lives by David A. Rosenberg of Gluskin Sheff

There is no ?get-out-of-jail-free? card when it comes to the places where market prices could go during this period of pullback in investor risk appetite. The appetite for risk usually comes back because the Fed cuts rates. This time around, we may have to see more balance sheet expansion and more money printed. Gluskin still loves the bond market, but gold is a very good hedge here just in case we are wrong on the inflation call or if the markets begin to anticipate the massive reflation efforts that are still to come.

2010-05-28 00:00:00 The Recovery Marches On... by Scott Brown of Raymond James Equity Research

Real GDP rose at a 3.0% annual rate in the revised estimate for Q1, down from 3.2% in the advance estimate, although the story didn't change much. This was the third consecutive quarterly increase in real GDP. More importantly, the economy appears to be transitioning to a more sustainable recovery, less reliant on the shift in inventories and the government's fiscal stimulus, and supported more by consumer and business demand. Job growth, a key element in a sustainable economic recovery, has returned. Unfortunately, the economy still faces a number of headwinds in the near term.

2010-05-26 00:00:00 Renewed Risks and Multi-Speed Global Recovery to Restrain World Trade Flows by Nouriel Roubini of RGE Monitor

Global trade growth is unlikely to reach its pre-recession highs in the short term, with exports of several trade-dependent economies, particularly emerging markets, growing at a slower pace due to weaker import demand in the U.S. and EU amidst consumer deleveraging, fiscal austerity and slow recoveries in labor markets and household wealth. In the medium term, however, structural reforms in emerging markets and surplus countries to increase domestic demand will boost trade among emerging markets, as well as global trade flows, changing their direction and composition.

2010-05-25 00:00:00 W, Not V and Using ECRI Data as a Market Indicator by David A. Rosenberg of Gluskin Sheff

The downdraft in the market in recent weeks reflects the financial risk related to the European debt crisis, the monetary tightening in China and the re-regulation of the financial sector that is currently making its way through to Congress. The next leg down in the equity market specifically and cyclical assets more generally is economic risk. As the events of 2002 showed, more-than-fully valued markets do not need a double-dip scenario to falter - a growth relapse can easily do the trick. It?s still time to be defensive and too early in this correction to be picking the bottom.

2010-05-21 00:00:00 The First Official Correction in Equities by David A. Rosenberg of Gluskin Sheff

There?s no sense getting overly bearish over the latest stock market correction. For those of us with cash on hand, who had been waiting for this opportunity in a Godot-like fashion, the correction comes as good news. For the economy, it cannot be a bad thing to have oil prices come down, which helps add cash to consumer pocketbooks and protect profit margins. And of course this wonderful bond rally has acted as a source of social policy, as it has helped pull mortgage rates down to six-month lows, to 4.8 percent for the U.S. 30-year fixed rate product.

2010-05-21 00:00:00 Take Your Pick - A Tale of Two Investment Trends by Monty Guild and Tony Danaher of Guild Investment Management

The developed world is deleveraging and Europe is moving toward deflation and depression. Meanwhile, the Chinese, Southeast Asian, and Indian-led developing world is growing and experiencing inflation. Guild?s portfolios are largely in cash and, and they will spend it as bargains appear. Investors should consider buying gold and begin looking at China?s market, which is becoming attractively priced. In the case of oil, Brazil, India, Korea, and Singapore Guild plans to wait until the fear subsides and use the correction as an opportunity to buy into these markets.

2010-05-20 00:00:00 Shiller P/E Ratios, Deflation, and FOMC Notes by David A. Rosenberg of Gluskin Sheff

During the past 130 years, whenever the Graham/Dodd/Shiller normalized P/E ratio goes above 20.6x (it is 21x today), the market experiences a significant correction - a correction of 31 percent on average over the next 16 months. It never fails. Rosenberg also examines new evidence of deflation from the labor market, and statements from the Federal Reserve suggesting that the central bank will not consider raising interest rates until 2012.

2010-05-18 00:00:00 The Next Frontier: Business Services in Asia by In-Bok Song of Matthews Asia

Thanks to improved education levels, Asia now has a bigger pool of quality human resources seeking better employment of their skills. Meanwhile, the cost of this labor in Asia is rising. One area that therefore needs to evolve in Asian economies is business services. Continued productivity growth is one of the most important benefits we can expect from evolving business services. Software and information technology services would arguably have the most direct impact on productivity growth in the industrial, commercial, distribution, technology and health care sectors.

2010-05-18 00:00:00 Letters to the Editor by Various (Article)

In a letter to the Editor, a reader responds to Niall Ferguson's thesis in last week's article, A Historical Perspective on the Slight Depression.

2010-05-17 00:00:00 Volatility on the Rise by Liz Ann Sonders of Charles Schwab

Volatility in stocks has increased during the past several weeks as investors have grappled with numerous global concerns. Is this the start of a longer-term problem or is it just a short-term phenomenon? Developments in the housing and job markets hold the key to further economic improvement. Meanwhile, the European debt crisis was addressed with a massive package, but long-term issues remain, and China's rapid growth rate could lead to overheating and inflation.

2010-05-17 00:00:00 A Shift in Our Fed Rate Outlook by Brian S. Wesbury and Robert Stein of First Trust Advisors

Early this year, it seemed that the Federal Reserve would start lifting interest rates from their current level of near zero by mid-year 2010. It seemed that zero percent interest rates would be too low, that the economy would be in recovery and that inflationary pressures would continue to increase. Even though all of this is still true, the Fed has made it clear in recent months that they are willing to hold interest rates down for a period of time that is much more 'extended' than people realized. Indeed, the Fed could continue holding rates at current levels through the end of 2010.

2010-05-14 00:00:00 Schwab Sector Views: Sea Change? by Brad Sorensen of Charles Schwab

Market volatility has heated up during the past couple of weeks as more eyes have turned toward the debt problems plaguing Europe. After a nice run in equities, it's certainly not surprising to see some sort of pullback, especially in areas of the market that may have outperformed to start the year. The United States is entering a time of more-steady growth, with flattening leading economic indicators, which typically represents a shift in sector leadership. The information technology sector, for example, should outperform the market, while materials should underperform.

2010-05-10 00:00:00 Brushwood is to Forest Fires as Leverage is to Financial Crises by David Edwards of Heron Financial Group

Leverage ratios are way down since the financial crisis. The issuance of leveraged securities such as collateralized debt obligations, collateralized loan obligations and commercial mortgage-backed securities is nearly completely halted, and so the 'brushwood' necessary to stoke the next financial crisis is almost entirely absent. Heron also comments on the significance of Greece, Thursday's 'flash-crash,' the weakness of financial regulation, technicals vs. fundamentals, and investment strategy.

2010-05-10 00:00:00 Fighting a Good Greece Fire by Doug MacKay and Bill Hoover of Broadleaf Partners

Recently televised riots on the streets of Greece, a collapsing euro, and ineffectual monetary policy efforts by a politically divided European Union have all heightened concerns and comparisons of the current Greece 'fire' to our own mortgage mess a couple of years ago. While our banks and financial system are much less exposed to Greek and European debt than the European banks were exposed to our own mortgage problems, our Fed and Treasury departments, unlike Europe, stood united in doing whatever they could to prevent a second Great Depression.

2010-05-10 00:00:00 The Technicals Were Ripe For a Correction... by Chris Maxey of Fortigent

Last week's sell-off clearly resulted from a buildup of tension in technical factors coupled with overriding concern about the unfolding debacle in Europe. Numerous signs were flashing the caution light prior to last week. On the other hand, even though the technical factors were ready for a breakdown, a majority of the economic releases from last week suggest the recovery is still in its infancy. Investors should brace for another volatile week following the announcement that Europe will ready nearly $1trillion to bolster its capital markets.

2010-05-10 00:00:00 Euro-Sclerosis No Longer and Last Week's Market by David A. Rosenberg of Gluskin Sheff

In what can only be described as a spectacular showing of solidarity, European Union finance ministers managed to cobble together a 750 billion euro stabilization program. This is over and above the 110 billion euro Greek bailout package announced last week and is widely seen as a very powerful countermove against the 'wolf pack' that had been attacking the peripheral euro area financial markets over the past few weeks. Equities, commodities , credit and lower-tiered sovereign bonds should all improve markedly. Gluskin also comments on last week's uncertainty in capital markets.

2010-05-10 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The concern in Europe is justified. Their one currency with multiple fiscal policies has led to this disaster. The Euro is now doomed to second tier status and may soon be out of existence altogether. The prospect of this scenario caused the European authorities to cobble together a rescue package (complete with huge support from the U.S. taxpayer via the International Monetary Fund) that sent world markets soaring. Meanwhile, the outlook for our economy remains solid. High unemployment rates will keep interest rates low, which will be very good for the stock market.

2010-05-07 00:00:00 The Big Picture, the Investment Landscape, and Our Portfolio Strategy by Team of Litman Gregory

Debt reached binge levels during the past decade. Money to reduce the debt will have to come from somewhere, and much of it will come from reduced spending. Spending cuts could produce a sluggish economy, possibly for many years to come. There are some positives that could contribute to a better outcome, however, including continued strength from emerging economies. Domestically, we could see stimulus spending, low rates, and inventory rebuilding create a virtuous circle in which businesses with strong balance sheets add jobs, and consumer and business confidence builds and feeds on itself.

2010-05-03 00:00:00 Ten Reasons for a Dose of Caution and Other Thoughts by David A. Rosenberg of Gluskin Sheff

One could say the stimulus is keeping the economy above water; however, the recovery thus far lacks the same organic vigor we saw in the failed recovery and risk asset rally in the opening months of 2002. Real final sales, despite all the government?s efforts, have only managed to recover at a 1.5 percent annual rate since the recession supposedly ended last summer. In a typical post-recession bounce-back, the rebound is closer to 3.5 percent and with far less intervention out of the Fed, Treasury, White House and Congress.

2010-05-03 00:00:00 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Last week's GDP report showed inflation in the U.S. at the lowest levels since the 1950s. The Federal Reserve understands this and promised last week to keep interest rates near zero for 'an extended period of time.' Thus, once we get past these conflicting and depressing headline stories, the investment climate remains good. Corporate profits are surging, interest rates are very low and trillions of dollars sit on the sidelines watching every scary news report and missing out on one of best stock rallies in a century.

2010-05-03 00:00:00 Stocks Sink on Fear of Credit Contagion by Bob Doll of BlackRock

Before last week, the rapid ascent in equity prices had been a cause for concern, and as last week's downturn shows, markets remain vulnerable to corrective forces. To date, the problems of the sovereign debt crisis, global policy tightening and regulatory restrictions have been outweighed by the broader improvements in the global economy and rising corporate profits. Given the low returns offered by cash and the still-reasonable valuations for stocks, this trend should continue.

2010-05-01 00:00:00 Resilience Resonates by Liz Ann Sonders of Charles Schwab

The stock market has absorbed numerous body blows recently, but continues to chug along?waiting for a big price correction to buy could be detrimental. Economic data remains solid, confounding some recovery skeptics and providing the Fed ample reason to slowly return to normalcy. European debt problems are growing and concerns over contagion are rising; there's no quick fix, and some politically unpopular decisions are going to have to be made.

2010-04-27 00:00:00 The Four Horsemen of Growth: David Kelly?s Guide to Markets by Katie Southwick (Article)

With unprecedented volatility now largely behind us, J.P. Morgan's Chief Investment Strategist David Kelly believes that the economy is entering a period of recovery. To move forward, we must abandon our negative mindsets and focus on opportunities for expansion.

2010-04-23 00:00:00 Equity Investment Outlook by Team of Osterweis Capital Management

During the first quarter, the stock market continued to work its way higher as evidence mounted that the economic recovery was solidly underway. While Osterweis is reasonably comfortable with the very near term outlook for the economy, it is quite concerned with the longer-term implications of the rising federal deficit, as well as about how the economy will perform as monetary and fiscal policy inevitability shift from maximum stimulus to a more neutral stance. The company, therefore, wants to focus its 'bets' more on individual companies than on broad macro-economic trends.

2010-04-23 00:00:00 Postcard from Vietnam by Elizabeth Dong of Matthews Asia

During his recent visit to Hanoi and Ho Chi Minh City, Matthews Asia's Elizabeth Dong had the opportunity to compare some of Vietnam's emerging sectors, as well as some more well-established industries, including its telecommunications industry?one area in which Vietnam has surpassed its neighboring countries. The government has anchored its monetary policy on the depreciation of its currency, the dong. A depreciating currency makes goods cheaper and wages more competitive, which in turn increases foreign direct investment and promotes exports, but also causes high inflation

2010-04-22 00:00:00 U.S. Politics and Bank Reform Legislation by Monty Guild and Tony Danaher of Guild Investment Management

Election years often bring wild political actions as politicians defend their poor records by blaming anything that comes to mind. If the rhetoric against banks is not too strong, the rally could continue. If the rhetoric gets out of hand, we will see a market correction for a few weeks with a resumption of stock price increases later in the year. Guild continues to invest in Asian growth countries, oil, gold, and export driven companies who can grow earnings while shipping products worldwide.

2010-04-21 00:00:00 The Bernanke Put: Creating Tetrodotoxin Investors by Cliff W. Draughn of Excelsia Investment Advisors

The 'Bernanke Put' of low interest rates over an extended period of time has effectively lured investors to pursue greater and greater levels of risk without critically thinking about the ramifications of upcoming mortgage resets, consumer spending versus income, credit contraction, valuations, and unemployment. Our country has never experienced leverage of this magnitude. In this environment, we must remember the lesson from Benjamin Graham: 'The margin of safety takes priority over all other investment considerations.'

2010-04-21 00:00:00 Reading the Tea Leaves for Q2 and Beyond by Nouriel Roubini of RGE Monitor

While the second half of 2009 brought signs of stabilization in growth rates and industrial production for many economies and early 2010 has brought continuing strong global trade and improvement in output, the path to a self-sustaining recovery is not yet clearly shaped, at least in advanced economies. The recovery will be multi-speed. Most advanced economies, weighed down by debt, excess capacity and slack in labor markets will grow well below potential and in many cases, their potential output growth has fallen.

2010-04-21 00:00:00 Market Review by Team of Applied Finance Group

During the depths of the downturn a little over one year ago, many investors were quick to provide a lesson on the mathematics of loss. A 50 percent decline would require a subsequent 100 percent gain - not a 50 percent gain - to get back to even. Such truths, it seemed, were a justification for remaining bearish and a comfort perhaps to some, in making the painful decision to sell. Unfortunately, while the mathematics of loss is indeed an investing truth, it may also be an author of lies by suggesting that the only investor goal worth its salt is 'getting back to even.'

2010-04-16 00:00:00 Our Quarterly Review by Jonathan A. Shapiro of Kovitz Investment Group

With only a few temporary setbacks, the stock market has continued its move higher since touching its most recent low in early March 2009. Much hand wringing has been done over the S&P 500's approximately 75 percent move since that time, but lost in translation is the fact that prices last March implied a pending financial and social breakdown. These panic-driven prices bore little resemblance to actual or going concern business values, and measuring from that point clearly overstates and exaggerates the return. The worries facing the U.S. and many other regions are still prevalent.

2010-04-14 00:00:00 Where is Inflation Going? by David A. Rosenberg of Gluskin Sheff

Inflation is going down. Fully 87 percent of the time, for five decades, U.S. core inflation has been lower the year after a recession ended, while core inflation has been down 75 percent of the time two years after a recession ended. This is because, even as the economy moves off the bottom, the output gap lingers and exerts downward pressure on inflation. In addition, nominal GDP growth rates have been in the 3-4 percent range in U.S. and Canada over the past five to 10 years. This has big implications for assumed returns in pension funds as the population ages.

2010-04-13 00:00:00 What Correlates With Bond Yields: The Core and the CPI Are All That Matter by David A. Rosenberg of Gluskin Sheff

Monetary policy is the strongest single predictor of bond yields, with an 88 percent correlation. Inflation and inflation expectations, meanwhile, drive Fed policy, and core inflation commands a 75 percent historical relationship with bond yields. Slack in the economy drives inflation expectations, and we currently have tremendous spare capacity in goods, labor and housing. Rosenberg also comments on the tenuous prospects for a big recovery, despite hopeful signals from equity markets.

2010-04-13 00:00:00 Investment Review by John K. Schneider of JS Asset Management

The great recession has ended and the recovery appears more robust than generally forecasted. The U.S. gross domestic product grew 5.6 percent in the fourth quarter, the fastest quarterly pace since 2003. The economic consensus forecast for 2010 of less than 3 percent growth is likely too low and we believe could be closer to 4 percent. While productivity generally improves after the end of a recession, the surge over the last three quarters of 7.4 percent was the highest in more than 30 years. This is yet another sign that corporate earnings leverage will be great.

2010-04-12 00:00:00 Setting the Record Straight on the Bond Debate by David A. Rosenberg of Gluskin Sheff

Bond bears argue that the U.S. government has never before raised so much debt to finance the bloated fiscal deficit and roll over existing obligations. With credit contracting, rents deflating, the broad money supply measures now declining and unit labor costs dropping at a record rate, however, it hardly seems plausible that inflation is a risk at any time on the near- or intermediate-term forecasting horizon. Rosenberg also comments on currency, equity, commodity and corporate bond valuations, as well as money and credit contractions.

2010-04-12 00:00:00 Sizing Up a Saw-Toothed Portrait of Potential Sustainability by Team of American Century Investments

A number of key leading indicators - including recent stock market performance, the expanding manufacturing sector, and the steep upward slope of the Treasury yield curve - point toward continued recovery. In addition, the unemployment rate, while still high, does not appear to be moving higher, and has in fact come down from its recent 10.1 percent high reached last October. History suggests that after an unemployment peak is attained, significant improvement follows soon afterward; there hasn't been a historical tendency for the unemployment rate to 'plateau' at levels near its peaks.

2010-04-09 00:00:00 Market Thoughts by David A. Rosenberg of Gluskin Sheff

The recent rally shows us that markets can stay overvalued far longer than many people realize. While technicals and momentum could take the market higher in the near term, investors should still not abandon capital-preservation strategies. The primary trend is what is important, not the noise surrounding it. Right now the primary trend is one of private sector credit contraction, as well as excess supply in finished goods, retail space, houses and labor, all of which is deflationary. This makes an ongoing emphasis on income-gathering securities and assets critical.

2010-04-09 00:00:00 Employment Situation: Current Recovery vs. Other Jobless Recoveries by Asha Bangalore of Northern Trust

The economic recoveries following the 1990-91 and 2001 recessions have been coined as "jobless recoveries" and it is widely predicted that the current recovery will be "Jobless Recovery 3.0."

2010-04-06 00:00:00 Ben Bernanke: The REPO Man and Castles Made of Sand by Christopher Whalen of Institutional Risk Analyst

Without the implicit backing of the U.S. Treasury and Federal Reserve System, the remaining large dealers of over-the-counter assets and derivatives could not function in the post-crisis marketplace. This reality is most visible in the tripartite market for repurchase agreements or REPOs, the basic tools Wall Street uses to finance its working capital book. Now that it's April and the Fed's quantitative easing purchase program is ending, it seems fair to ask: What trick is Fed Chairman Ben Bernanke going to perform next to maintain the stability of market prices?

2010-04-06 00:00:00 Do Not Give Up on Stocks: Stay Active by Jay Feeney of Robeco Investment Management

Stocks clearly have much better fundamental earnings support now than they did in mid-2009, when profits were still in a downward spiral. Money, however, is flooding away from active strategies and into passive indexing and ETFs. At this juncture, the headwinds against expansion are considerable and this stacks the balance of risk in favor of active stock-picking strategies that maintain a strong valuation bias. Higher-quality large cap stocks should also be emphasized, since the rally off the bottom has favored lower quality names, leaving the larger names with more attractive upside.

2010-04-06 00:00:00 Liz Ann Sonders on the US Economic Recovery by Robert Huebscher (Article)

Liz Ann Sonders is Senior Vice President and Chief Investment Strategist at Charles Schwab & Co. In this interview, she discusses her positive outlook for the US economy, which she believes has been recovering since last summer.

2010-04-05 00:00:00 Stylized Facts, U.S. Earnings Update and the Unemployment Numbers by David A. Rosenberg of Gluskin Sheff

Things are not really as they appear. U.S. consumer spending is higher because the savings rate has slipped. Organically, spending is actually doing quite poorly as wage-based incomes remain under pressure. The earnings outlook is bright, however, and regressions suggest that we will get 15 percent earnings per share growth in 2010. Finally, while it may be encouraging to see employment finally begin to rise after such a lengthy and precipitous decline, especially in the business sector, the labor market still remains in the grips of a serious deflationary undertow.

2010-04-05 00:00:00 Labor Market Turnaround by Bob Doll of BlackRock

The March payrolls report likely signaled the start of a long-awaited rebound in the employment picture, which should benefit the broader economy. As fiscal and monetary stimulus begins to fade over the coming months, the economy is going to require some self-sustaining mechanisms to kick in, and growing employment levels would certainly be beneficial. Over the course of the next year, we expect the economy to successfully shift from a recovery to an expansion. Investors should continue overweighting equities and credit-related fixed income assets and underweighting cash and Treasury bonds.

2010-04-05 00:00:00 Half Empty or Half Full? by Scott Welch of Fortigent

Global equity markets closed out the quarter well, with all major world indices except China posting positive quarterly performance. Earnings improvements, dramatic P/E expansion and a slowly recovering global economy all contributed to the run-up. Several potentially dark clouds, however, float across an otherwise sunny investment sky. One is simply a function of the extended market rally and corresponding expansion in market P/E ratios. By several indicators, the market seems to be veering into over-valued territory. Fortigent also comments on muted but real GDP growth, and the week ahead.

2010-04-02 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

The Brounes & Associates market/economic commentary for the week ended April 2, 2010. For those of you forced to get up early for the labor numbers, here you go. The economy added 162k jobs in March, the best showing in three years, while the jobless rate held steady at 9.7 percent. For those of you still asleep (or who just been back to sleep)?enjoy your holiday (and don?t worry about how those temp census workers impacted the number)

2010-04-01 00:00:00 First Quarter Economic Review by Thomas H. Luster of Eaton Vance Investment Managers

2010 is off to a strong start, building on the accelerating recovery that began in 2009. In the fourth quarter of 2009, GDP posted a healthy 6 percent growth rate, driven by strong government outlays, increased business activity - mainly, rebuilding very low inventory levels - and a nascent recovery in consumer spending.

2010-04-01 00:00:00 Market Insight by Payson S. Swaffield of Eaton Vance Investment Managers

Evidence mounts that the U.S. economy is moving away from the depths of the Great Recession. The U.S. economy expanded at a 5.6 percent annual rate in the fourth quarter of 2009, and corporate profits surged. While unemployment stands at 9.7 percent, there are indications that the jobs picture may be improving, and inflation has remained in check. The U.S. stock market has responded favorably to the current environment, with the Standard & Poor?s 500 Index climbing more than 5 percent since calendar year-end.

2010-03-30 00:00:00 Stocks May Have Gotten Ahead of Themselves by Bob Doll of BlackRock

The current environment is one of a broadening global economic recovery marked by improving corporate earnings, low interest rates, increasing business and consumer confidence, and a labor market that should soon turn positive. Markets have turned increasingly bullish on the chances for economic growth. Stocks may have gotten ahead of themselves in the short term, however, as some technical indicators now look stretched. Nevertheless, an ample amount of cash remains on the sidelines and the macro backdrop suggests that the long-term path of least resistance for stocks continues to be up.

2010-03-30 00:00:00 Gary Becker's Optimism by Brian S. Wesbury and Robert Stein of First Trust Advisors

The commentary responds to a recent Wall Street Journal interview with Nobel prize-winning economist Gary Becker. Becker is the founder, with Milton Friedman, of the Chicago school of economics. Becker said the financial crisis did not undermine his belief in free markets, and that he remained hopeful that competing interest groups would protect the country in the long run from a systematic bias toward bad policy. While Becker primarily blames new financial instruments for the economic crisis, however, Wesbury and Stein blame mark-to-market accounting rules.

2010-03-29 00:00:00 Market Thoughts by David A. Rosenberg of Gluskin Sheff

The market is overvalued by more than 25 percent, but is also extremely overbought after going 24 sessions without a decline of 1 percent or more. Eighty-nine percent of the stocks on the S&P 500 are now trading above their 50-day moving averages, and the Dow has advanced in 17 of the last 24 days. This suggests that the prop desks at the five large banks are all selling securities, with leverage, to each other. There is no sign of any other major buyer, including the Fed. This provides reason for caution, because the banks could decide to switch direction at any time.

2010-03-22 00:00:00 Useful Frameworks For Investment Analysis by David Edwards of Heron Financial Group

The S&P 500 rallied in March to an 18 month high, but is still below pre-recession levels. The daily volatility of the stock market has declined to levels not seen since the summer of 2006. The overall stock market, however, is still slightly overvalued. Corporate earnings and Federal Reserve policy over the next year will determine whether current levels are sustainable, and whether the U.S. avoids another double-dip recession. Sound frameworks for investment analysis will be crucial.

2010-03-18 00:00:00 Dollar: Beleaguered No More? by Komal Sri-Kumar of TCW Asset Management

After weakening for most of the past decade, the dollar has appreciated significantly against the euro and the pound sterling, the two major European currencies, over the past three months. This is due more to the weakness of European currencies than to the strength of the dollar. Fears of stagnation in Europe, uncertainties over upcoming U.K. elections, and concerns that Portuguese and Spanish debt sovereign may come under attack by hedge funds have all dragged on European currencies. Compared to this turbulence, the U.S. economy seems like a safe haven.

2010-03-17 00:00:00 Are Married Women Less Risk-Averse? If So, Why? by Graziella Bertocchi , Marianna Brunetti and Costanza Torricelli of VoxEU

Does marriage make people less averse to risk? This column argues that this is the case for women, but not for men. But married women's different attitude towards risk has fallen over time as the prevalence of marriage in society has faded. For women who work, marriage makes no difference.

2010-03-15 00:00:00 On OTC Derivaties: Interview with Bill King by Christopher Whalen of Institutional Risk Analyst

The Institutional Risk Analyst interviews Bill King, founder of Chicago-based derivatives firm M. Ramsey King Securities. Their conversation centers on a new report by the bankruptcy court examiner in the Lehman Brothers liquidation that provides another piece of evidence linking over-the-counter derivative structures and accounting fraud in the style of Enron and WorldCom. The IRA also examines the FDIC's recent bank securitization reform efforts, as well as the recent rally of CitiGroup, Barclay's and other large-cap financials.

2010-03-12 00:00:00 Changing Seasons by Doug Mackay and Bill Hoover of Broadleaf Partners

The economy is shifting from its early recovery phase of rapid growth into a late expansion phase of moderate growth. While low interest rates were critical to market success in 2009 during the early stages of the expansion, economic growth patterns tend to have greater influence in later stages. As economic seasons change, it will be necessary for investors to weed out bad stocks, prune healthy ones and transplant names in order to maintain the vitality of their overall portfolios.

2010-03-11 00:00:00 What the PBoC Cannot Do with Its Reserves by Michael Pettis of Michael Pettis

What the People's Bank of China does to the value of China's currency and how it invests its reserves matter a lot to China and the world, but not always in the way China and the world think. To get it right, we need to keep in mind the functioning of the balance of payments, the PBoC and other balance sheets, and the way the two are interrelated.

2010-03-09 00:00:00 What's Next for the High Yield Market by Team of Pioneer Investment Management

The economy can achieve 3 to 4 percent growth in 2010. This growth rate, along with low interest rates, should provide a favorable environment for riskier fixed income asset classes such as high yield. Corporate profit margins, cash flows and productivity are all near record levels relative to prior cycles, and balance sheets are relatively healthy. This puts companies in a good position to capitalize on the recovery. A strategy that balances high yield, equity, convertible and bank loan securities is prudent, given the anticipated investment environment.

2010-03-08 00:00:00 Turning Cautious by Scotty George of du Pasquier Asset Management

The current global rallies in stocks seem to be short-cycle upswings within the existing secular bear trend. Low interest rates are leaving no other suitable alternative for investors, and high grade fixed-income opportunities are few and far between. Interest rates may rise, however, before year end as global debt continues to mount. Investors should therefore look for an above-average exposure to cash in the short term while waiting for downward movement in stocks in the long term.

2010-03-08 00:00:00 Economic Data Improves Gradually by Chris Maxey of Fortigent

The Federal Reserve Beige Book confirmed that the economy shows signs of expansion, but that labor markets show only tentative signs of improvement. The S&P 500 went up 3.1 percent and the Dow Jones Industrial average increased 2.3 percent after last Friday's employment figures were not as bad as expected. Real estate activity is picking up, but officials are still apprehensive about what will happen when the home-buyer tax credit expires at the end of April. Maxey also looks at this week's upcoming events and releases.

2010-03-05 00:00:00 The Dominoes of Default by John Browne of Euro Pacific Capital

The sovereign debt crisis in Greece has drawn attention to countries with similar fiscal conditions, including the United Kingdom. Fueled by socialist fiscal policies, the debt ratio in Britain is rapidly approaching Greek levels. The pound sterling has lost 25 percent of its value relative to the U.S. dollar since mid-2008. U.S. sovereign debt is in nearly the same proportion relative to GDP as debt in the U.K. If the U.K. defaults on its debt, the U.S. may be the next domino to fall.

2010-03-02 00:00:00 Budget Proposals - Red on Arrival by Milton Ezrati of Lord Abbett

The latest White House budget proposals reveal that fiscal policy will offer little control over the river of red budgetary ink already at flood. The White House expects the deficit to run at $1.6 trillion, up from last year's record $1.4 trillion, taking the deficit up to about 10.6 percent of GDP. Furthermore, despite optimistic growth projections, deficit forecasts barely get below 4 percent of GDP by 2014. These deficits would raise the country's overall debt from the present $7.5 trillion to $18.6 trillion, or about 80 percent of GDP, by 2015.

2010-03-01 00:00:00 Bank Credit Still Contracting by David A. Rosenberg of Gluskin Sheff

Outstanding bank credit fell $33 billion during the week of February 17, adding to a seven-week cumulative decline of $150 billion. Bank lending to households and businesses fell at a 12 percent annual rate over the past 13 weeks. As long as bank credit is shrinking, the jury will still be out on Fed rate hikes during the second half of this year and the ability of the economy to sustain above-potential growth. In addition, the revised Q4 GDP numbers indicate a lack of pent-up consumer demand with most spending directed to essentials, reinforcing a bearish, deflationary U.S. economic outlook.

2010-02-26 00:00:00 The Multiplication of Money by John Mauldin of Millennium Wave Advisors

Mauldin begins with a review of the situation in Greece, highlighting recent social unrest, and concluding that the most likely resolution will be relief from the IMF. Next, he rejects recent reports that hedge funds will short the euro and cause it to decline relative to the dollar. He then argues that the reported expansion of M0, M1 and M2 money supply is inconsequential (for inflation), because it is more than offset by a decrease in the velocity of money.

2010-02-25 00:00:00 Statement by Christopher Whalen Congressional Oversight Panel Hearing on GMAC TARP Assistance by Christopher Whalen of Institutional Risk Analyst

Christopher Whalen tells a TARP assistance congressional oversight panel in a prepared statement that bank holding company GMAC Financial Services must restructure before it can support the growth of General Motors and its community of dealers and consumers, and that there is currently no compelling business or financial reason to rescue GMAC. GMAC banking unit Ally Bank received an "F" rating from the Institutional Risk Analytics Bank Stress Index for the fourth quarter of 2009.

2010-02-24 00:00:00 Lacking Confidence by David A. Rosenberg of Gluskin Sheff

U.S. consumer confidence fell 10.5 points in February, to 46.0, the lowest reading since last April. The consensus estimate was 55.0. While some blame a seasonal bias or winter storms for the decline, news about European default risks, a declining stock market and continued employment difficulties may also be at play.

2010-02-23 00:00:00 Letter to the Editor by Various (Article)

In this letter to the Editor, an advisor responds to last week's article, Boom and Bust, by Michael Lewitt of Harch Capital Management.

2010-02-22 00:00:00 Financial Economics, Deregulation and OTC Derivatives: Interview with Yves Smith of Naked Capitalism by Christopher Whalen of Institutional Risk Analyst

This is an interview with author Yves Smith, the creator of Naked Capitalism. Smith?s new book explores the methodological shift of economics in the 1940s and 1950s, when economists decided to make their discipline more "scientific" and thus more mathematical. This methodological shift ignored the flaws neoclassical and financial economics, and led to the deregulation of financial services, which in turn allowed for predation and looting.

2010-02-22 00:00:00 Markets Gain on Improving Sentiment by Chris Maxey of Fortigent

Equity markets settled down tremendously this past week after a week of volatile trading, posting a 3 percent gain for the S&P 500 index. Subsiding fears about the impact of Greece on global markets support market gains. The CBOE Volatility Index fell in February to 20 from a high of 27. Maxey also comments on mortgages, inflation, and upcoming data releases.

2010-02-20 00:00:00 G7 Weekly Economic Perspectives by Christopher Probyn and Geoffrey Somes of State Street Global Advisors

U.S. housing starts rose 2.8 percent in January, and industrial production jumped 0.9 percent to its highest level since December 2008. Investor risk appetites revived, boosting commodities and sending equities higher for the second week in a row, while government bonds eased.

2010-02-20 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

Traders were eager to help the markets regain upward momentum after the President's Day weekend. Favorable news about Europe's future role in helping Greece and other countries with their budgetary issues fueled trader optimism, as did positive earnings reports and signals that manufacturing was leading the economic recovery with no signs of inflation. Equities closed higher on each of four trading days and approached break-even for the year.

2010-02-19 00:00:00 Will Productivity Gains Sustain US Economic Recovery if Employment Remains Subdued? by Joseph G. Carson of Alliance Bernstein

Productivity gains have exceeded real GDP growth by 3 percentage points during the economic recovery as companies have slashed payrolls and other costs. These productivity gains are critical to overall economic performance, including profitability and standard of living improvements, and will offset any risk of weak employment.

2010-02-19 00:00:00 My Take on the Fed by David A. Rosenberg of Gluskin Sheff

The Federal Reserve's decision to increase the discount rate from 0.5 percent to 0.75 percent was only a surprise because of the timing. The rate hike was part of the Fed's long-discussed exit strategy from its emergency stimulus plan. A number of other emergency measures are also scheduled to end this month.

2010-02-19 00:00:00 Fun with Charts by Doug Mackay and Bill Hoover of Broadleaf Partners

Investors need not worry about the Fed's recent increase in the discount rate by 25 basis points, to 75 basis points, even though this rate hike may be the first in a series of many such increases. The last time the Fed started to raise rates, in mid-2004, the S&P 500 climbed from roughly 1100 to 1567 three years later.

2010-02-18 00:00:00 At a Cross Road: Will Obama Follow Clinton?s Experience, or Go Rogue? by Michael Ghioldi of Applied Finance Group

President Obama often praises former president Clinton's economic policies, but his populist proposals often in run in opposition to Clinton's fiscally conservative record. Washington must adopt a new pro-business rhetorical stance in order to promote new hiring and investment.

2010-02-16 00:00:00 The Federal Reserve's Exit Strategy: Unlegislated Bailout of Fannie and Freddie by John P. Hussman of Hussman Funds

John Hussman of Hussman Funds says the U.S. Treasury and the Federal Reserve circumvented the need for Congressional approval and engineered a tacit government bailout of Fannie Mae and Freddie Mac. More than 60 percent of the U.S. foreclosure market falls under the umbrella of these two government-sponsored enterprises. He also examines other factors affecting the current market climate.

2010-02-16 00:00:00 Outlook Report: 2010 Searching for the Afterparty by Robert N. Stein of Astor Asset Management

Markets will grow in 2010, but foreign and domestic gains will be harder to find than they were a year ago. The market's panic and robust recovery suggest a return to growth rates closer to historical norms, with some areas outperforming others. Sectors that performed best during the recession may be the highest performers during the recovery.

2010-02-16 00:00:00 Boom and Bust by Michael Lewitt (Article)

The US and global economies are "trapped in a cycle of boom and bust as a result of fiscal and monetary policies from which there is no easy escape," says Michael Lewitt of Harch Capital Management. Lewitt believes the S&P will rally to 1,200-1,250, but says the long-term prognosis is "somewhere between grave and terminal." We are privileged to provide this excerpt from Lewitt's monthly newsletter and encourage our readers to subscribe to it directly.

2010-02-13 00:00:00 Winter Quarterly Commentary by Alan T. Beimfohr and John G. Prichard of Knightsbridge Asset Management

Alan T. Beimfohr and John G. Prichard of Knightsbridge Asset Management say in their winter quarterly commentary that the federal government will need to time its balancing of the budget just right in order to avoid either a repeat downturn or accumulating inflation. The Fed, meanwhile, will also need to withdraw monetary stimulus at just the right time.

2010-02-11 00:00:00 U.S. Congress a Help or a Hindrance? by Monty Guild and Tony Danaher of Guild Investment Management

Monty Guild and Tony Danaher of Guild Investment Management say markets are undergoing a correction after the 2009 rally. Debt in Portugal, Ireland, Greece and Spain will keep investors on edge over the next few weeks or months, as will inflationary fears in China.

2010-02-09 00:00:00 China?s Quest for a Shortcut to Greatness by Vitaliy Katsenelson (Article)

The Chinese economy must be getting out of control, because the Chinese government is doing the unthinkable: It is desperately trying to put the brakes on its economy. Author and fund manager Vitaliy Katsenelson looks back at how China got into this trouble and looks forward to China's prospects.

2010-02-09 00:00:00 Near-term Gains for the US Dollar?/Prospects for Japanese Recovery by Asha Bangalore and James Pressler of Northern Trust

In Northern Trust's daily global commentary, Asha Bangalore says speculation against the euro could result in a near term gain for the dollar. The dollar appreciated 5.6 percent against the euro in the four weeks ending February 5. James Pressler looks ahead to Japan's release of fourth quarter GDP data next week. He predicts a growth figure of 0.6 percent, despite the consensus estimate of 0.9 percent.

2010-02-08 00:00:00 G7 Weekly Economic Perspectives by Christopher Probyn of State Street Global Advisors

In SSgA's weekly market roundup, Christopher Probyn says the latest Purchasing Managers Indexes suggest that activity is picking up, albeit unevenly, across the G7. Concerns over sovereign credit, regulatory policy and the sustainability and strength of the global recovery, however, are holding down appetites for risk.

2010-02-06 00:00:00 A Bubble in Search of a Pin by John Mauldin of Millennium Wave Advisors

Mauldin covers three topics. He digs into the employment numbers and concludes that it is a "mixed bag" - the numbers of unemployed rose but the unemployment rate declined. Looking at the Reinhart-Rogoff book, he argues that Fed policy makers were at fault for failing to recognize the housing bubble. Last, he discusses Greece's fiscal problems in a historical context.

2010-02-06 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

Ron Brounes' weekly market and economic recap.

2010-02-03 00:00:00 Investment Commentary by Bruce A. Weininger of Kovitz Investment Group

Kovitz is a $1 billion Chicago-based asset manager. This commentary reviews their investment philosophy (value-driven without attempting to ?time? the market), and includes a discussion of certain types of leverage that can be beneficial to the investor (e.g., operating leverage) and others that can be harmful (e.g., revaluation and multiple expansion risk). In this context, they comment that ?the bond market might be a bit frothy and perhaps in some form of a bubble.?

2010-02-02 00:00:00 2010 Off to a Tepid Start by Chris Maxey of Fortigent

This is a review of last week?s market activity and economic data announcements, with a focus on the GDP announcements from the UK and the US.

2010-02-02 00:00:00 China's Strong GDP Up 10.7% in the Fourth Quarter, but is Inflation on the Horizon? by Team of American Century Investments

American Century looks at the sources of growth in the Chinese economy its future projected growth rate. Easy credit and stimulus measures are potentially leading to a real estate bubble and inflation. Exports from China grew in December, following 13 months of decline, and ??the world may have to continue to rely on China as the biggest engine of economic growth.?

2010-02-01 00:00:00 Fed Up? The Effects of a Rate Rise by Milton Ezrati of Lord Abbett

Milton Ezrati examines the history of Fed Funds rate hikes and the response of the bond markets. He concludes, based on the evidence of the 2004-2007 experience, that bond investors should not be fearful of rate increases.

2010-01-30 00:00:00 This Time is Different by John Mauldin of Millennium Wave Advisors

Mauldin begins with an analysis of the reported Q4 GDP numbers, saying that it is not indicative of underlying growth in the economy. He then comments on the Reinhart-Rogoff book "This Time is Different," focusing on the point that governments can survive debt-fueled growth until confidence in them evaporates. He is discusses Greece's fiscal problems.

2010-01-29 00:00:00 And That's the Week that Was... by Ron Brounes of Brounes & Associates

Ron Brounes? weekly market recap.

2010-01-28 00:00:00 Monthly Investment Commentary by Team of Litman Gregory

When the dust settled on one of the most eventful and upended years in memory, investors had generous gains in stocks and certain segments of the bond market to salve the wounds of a disastrous 2008 a

2010-01-26 00:00:00 Tell Me I'm Wrong by Howard Marks of Oaktree Capital

Howard Marks says ?the rally in financial markets worldwide has outpaced the fundamentals,? and he does not believe we are ?in the midst of a strong recovery.? He expects the economy to ?sputter alon

2010-01-26 00:00:00 2010 Outlook / Macro Overview by James F. Keegan of Ridgeworth

?In summary, global asset markets have transitioned from fear at the beginning of 2009 to an environment where government support and intervention have led to complacency and greed. While these powerf

2010-01-25 00:00:00 Invigorated Inventories: Catalyst for Growth? by Milton Ezrati of Lord Abbett

?Now with a turn to accumulation, especially if it occurs in a compressed period of time, inventories could add as much as two percentage points to overall growth. Under such an influence, an otherwis

2010-01-25 00:00:00 The Week in Review by Christopher Probyn of State Street Global Advisors

SSgA?s weekly G7 market review and commentary

2010-01-23 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

Politics and investors make strange bedfellows and, for the time being, the two do not seem to get along very well. Despite some reasonably favorable earnings reports, investors instead took their cu

2010-01-22 00:00:00 Economic Overheating With Chinese Characteristics by James Pressler of Northern Trust

In the two weeks leading to this morning's Q4 GDP announcement, a variety of signals have been emanating from Beijing's policy centers, all suggesting the economy was running a little warmer tha

2010-01-22 00:00:00 Give Bernanke a Break by Michael Nairne of Tacita Capital

In a recent speech, Bernanke pointed out that it was low real long-term rates (i.e. nominal rates less inflation) determined in the bond market that were a major contributor to the housing bubble, not

2010-01-22 00:00:00 Thoughts on the End Game by John Mauldin of Millennium Wave Advisors

"As for financial markets, we have come full circle to the concept of financial fragility in economies with massive indebtedness. All too often, periods of heavy borrowing can take place in a bubbl

2010-01-20 00:00:00 Financial Crisis Responsibility Fee - A Modified Proposal is Likely by Paul Kasriel of Northern Trust

?by 2013 the President should put forward a plan that 'recoups from the financial industry an amount equal to the shortfall in order to ensure that the TARP does not add to the deficit or national

2010-01-19 00:00:00 Inflation Myth and Reality by John P. Hussman of Hussman Funds

It is in this context that we should consider inflation risks over the coming decade. At present, inflation risks are hardly considered to be problematic by Wall Street. From the standpoint of the nex

2010-01-19 00:00:00 Steve Leuthold: The Market will Rally This Year by Robert Huebscher (Article)

Steve Leuthold is chairman of the $4.5 billion Leuthold Group and one of the most widely-followed market analysts. In his keynote presentation at last week's Fortigent conference, he offered an upbeat forecast for the first half of 2010.

2010-01-16 00:00:00 And That's the Week that Was... by Ron Brounes of Brounes & Associates

2010-01-16 00:00:00 Poland's Economy is No Joke by Peter Schiff of Euro Pacific Capital

2010-01-14 00:00:00 Weekly Market Review by Christopher Probyn of State Street Global Advisors

The minutes of the December 15-16 FOMC meeting suggest that members are becoming slightly more optimistic about the economy?s prospects. However, they remain cautious, particularly over the near term:

2010-01-11 00:00:00 Economic Freebasaing by Cliff W. Draughn of Excelsia Investment Advisors

"Although the US stock markets received a tremendous boost in 2009 after a debilitating 2008, the performance of the Dow, S&P 500 and NASDAQ Composite indices was not enough to overcome a decade of

2010-01-11 00:00:00 Green Shoots, Weak Roots by John P. Hussman of Hussman Funds

2010-01-09 00:00:00 And That's the Week That Was... by Ron Brounes of Brounes & Associates

2010-01-09 00:00:00 Forecasts by Team of State Street Global Advisors

2010-01-06 00:00:00 And That's the Week that Was by Ron Brounes of Brounes & Associates

2010-01-05 00:00:00 The New Normal by David A. Rosenberg of Gluskin Sheff

2010-01-05 00:00:00 Paul Krugman on Deficits, Taxes, Inflation, and Recovery by Dan Richards (Article)

Dan Richards' interview with Paul Krugman, the 2008 Nobel prize winner in Economics, covers his views on the size of the next stimulus package, how high marginal tax rates should go, and lessons from the Japanese experience. Whether or not you agree with him, Krugman is highly influential and his views may presage future policy decisions.

2010-01-04 00:00:00 Timothy Geithner Meets Vladimir Lenin by John P. Hussman of Hussman Funds

2009-12-29 00:00:00 Special Report - Year Ahead: Can You Handle the Truth? by David A. Rosenberg of Gluskin Sheff

2009-12-23 00:00:00 And That's the Week that Was by Ron Brounes of Brounes & Associates

2009-12-22 00:00:00 ECRI: Recovery and Jobs Growth are Underway by Robert Huebscher (Article)

Lakshman Achuthan, the managing director of the Economic Cycle Research Institute (ECRI), provides an upbeat forecast in our interview. He says the economic recovery has been underway since the summer and he expects to see jobs growth in the coming quarters. ECRI is a global research firm serving buy- and sell-side institutions and Fortune 500 companies.

2009-12-22 00:00:00 Staggered Return to Global Growth by Paul Kasriel of Northern Trust

2009-12-22 00:00:00 All Carolinas Are Not Created Equally by John Burns of John Burns Real Estate Consulting

2009-12-21 00:00:00 Predictions of 2010: The Best is Yet to Come by Christopher Whalen of Institutional Risk Analyst

2009-12-19 00:00:00 The Age of Deleveraging by John Mauldin of Millennium Wave Advisors

2009-12-15 00:00:00 Barton Biggs on Undervaluation in the S&P 100 by Robert Huebscher (Article)

Barton Biggs, the former Chief Global Strategist for Morgan Stanley who now runs the hedge fund Traxis Partners, says the high-quality, large-capitalization stocks in the S&P 100 are now undervalued by one standard deviation. In our interview, Biggs also discusses his fears and how investors should protect themselves from the worst-case scenarios.

2009-12-15 00:00:00 Investing in Range-bound Markets by Vitaliy Katsenelson (Article)

Vitaliy Katsenelson, a frequent contributor to these pages, reviews his thesis for secular market cycles, why the US markets remain locked in a range-bound state, and what it will take for them to exit from that state.

2009-11-24 00:00:00 Interview: Brian McMahon of Thornburg Investments by Robert Huebscher (Article)

We speak with Brian McMahon, CEO and CIO of Thornburg Investment Management about the Thornburg Income Builder Fund (TIBAX) and the challenges of finding income-producing securities in today's markets.

2009-11-17 00:00:00 Our Steroidally Challenged Economy by Vitaliy Katsenelson (Article)

Vitaliy Katsenelson writes that the US economy is like a marathon runner who, after suffering an injury, takes steroids in order to return to racing. His performance is fine, but what don't see are the risks, just as our economy is now "steroidally challenged."

2009-10-27 00:00:00 The ?V? Points Downward by Robert Huebscher (Article)

Long-term equity investors face a critical juncture. They can believe a V-shaped economic recovery is imminent, if not underway, and valuations for broad-based equity indexes properly reflect an end to the "decrepit decade" of return-less risk in US markets. Or they can believe true economic recovery - growth, not just stability - is still a long way off and US equity valuations are in bubble territory, not reflective of the rough terrain ahead. We provide our thoughts.

2009-09-29 00:00:00 The Case Against Inflation by Robert Huebscher (Article)

Investors should expect extremely low inflation - just slightly above zero - for the indefinite future, according to Connie Everson, the Managing Director and co-founder of the Capital Markets Outlook Group, a Boston-based economic consulting firm that serves institutional investors throughout the world. Everson delivered her remarks to an audience of financial analysts in Boston last Thursday.

2009-09-29 00:00:00 Taste Testing Investment Style Sausages by Ron Surz (Article)

Equity indexes, like those offered by Russell and S&P are the investment-world equivalent of sausages - chopped up pieces of meat in tightly wrapped packages. Most shoppers buy sausages based on brand name, as do investors when they choose their benchmarks. In this guest contribution, Ron Surz dissects these index sausages and explains the real differences in their ingredients.

2009-08-25 00:00:00 The Case for Optimism by Dan Richards (Article)

Only a few months ago, economist's doomsday scenarios caused widespread concerns that we were about to revisit the Great Depression. That consensus view on the economy has shifted remarkably quickly, with a much more positive outlook for the immediate period ahead. Dan Richards cites two recent articles making a persuasive case for optimism.

2009-08-04 00:00:00 Paul Krugman on the Prospects for Recovery by Eric Uhlfelder (Article)

Nobel laureate economist Paul Krugman tells Eric Uhlfelder that massive government spending is essential for generating growth, but fears the first stimulus package will not be enough to keep the economy from slipping back into recession nor reducing unemployment.

2009-07-28 00:00:00 Moving Average: Holy Grail or Fairy Tale - Part 3 by Theodore Wang (Article)

Buy-and-hold remains deeply entrenched in the financial planning community, despite many of the flaws Ted Wong's previous articles have illustrated. Although many financial advisors suffer dearly from their buy-and-hold practices, they are reluctant to change their approach. Who dares to challenge investment sages like Bogle, Siegel, and Malkiel who emphatically support this long-standing investment principle? Academic research studies overwhelmingly endorse buy-and-hold. How can they all be wrong?

2009-07-21 00:00:00 SIFMA?s Proposed by Ron Rhoades (Article)

On July 17, 2009, the Securities Industry and Financial Markets Association ("SIFMA") announced that its Private Client Group Steering Committee unanimously supports a new federal fiduciary standard for broker-dealers and investment advisors, embracing a proposal advanced by the Obama administration a week earlier in a draft of the "Investor Protection Act of 2009." Ron Rhoades looks at whether this shift in direction by SIFMA poses a radical change in business models, or whether the "new federal fiduciary standard" is something else in disguise.

2009-07-14 00:00:00 Some Signs of Life and Hope for a New Recovery by John P. Calamos and Nick P. Calamos (Article)

Calamos Investments' co-CIOs John P. Calamos, Sr. and Nick P. Calamos discuss the current market climate, implications of Fed and government actions, and investment opportunities in the shorter- and longer-term. Global governmental policies have restored a degree of confidence in the financial markets and many key financial metrics are back to pre-Lehman levels. Many investment opportunities will be available in the future. We thank them for their sponsorship.

2009-06-23 00:00:00 The Road to Zimbabwe by Robert Huebscher (Article)

John Williams of Shadow Government Statistics is best known for exposing inaccuracies and biases in government reporting of data - most notably the understatement of the CPI index. Williams says the US economy is on the brink of hyperinflation which will render the dollar worthless, as happened recently to Zimbabwe's local currency.

2009-06-09 00:00:00 Simon Johnson on Obama?s Achilles Heel by Eric Uhlfelder (Article)

While he agrees with much of what the US administration is doing to confront the economic crisis, Simon Johnson, the former chief economist of the International Monetary Fund, fears that present policy is not addressing a key issue: the overwhelming influence of the finance industry in US economic affairs. He likens this imbalance to what we see at the core of many emerging markets crises.

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