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

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2014-10-30 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 Fed’s most recent Beige Book.

2014-10-30 Newsletter by Harold Evensky of Evensky & Katz

Harold Evensky presents his quarterly newsletter.

2014-10-30 How Exchange-Traded Futures Can Improve the Efficiency of Gold & Currency Linked ETFs by Ade Odunsi of AdvisorShares

With a number of gold and currency linked ETFs now using exchange traded futures to gain their gold and currency exposure versus the alternative of holding physical gold/hard foreign currency, we discuss below some of the key features of these futures markets which, in our view, mitigate most if not all of the concerns investor may have about these futures based ETPs.

2014-10-29 Americans Even More Pessimistic Ahead of Elections by Gary Halbert of Halbert Wealth Management

Republicans remain in a favorable position heading into the midterm elections. A new Wall Street Journal/NBC News poll released on Sunday showed that the GOP now holds an 11-point lead among “likely voters.” That’s up from only a 5-point lead a week earlier. Some 52% of likely voters want a Republican-led Congress, while 41% favor Democratic control.

2014-10-28 The Echo of Wirtschaftswunder by Bill O'Grady of Confluence Investment Management

Economic problems in the Eurozone continue to periodically emerge. Complicating matters significantly is German opposition to fiscal and monetary stimulus measures. We believe the experience after WWII and the Wirtschaftswunder (economic miracle) that lasted into the early 1960s has played a large role in shaping current German policy. This week we discuss German history with a focus on how German leaders shaped the economy and rebuilt the nation after the war, paying particular attention to the economic model and how the Merkel government is trying to impose that model on the entire Eurozone.

2014-10-27 Equities Recover Some Ground and Still May Have Room to Run by Robert Doll of Nuveen Asset Management

With global deflation and growth fears fading, U.S. equities snapped their four-week losing streak last week with the S&P 500 Index gaining 4.1%. This advance marked the largest weekly gain since January 2013. Following the correction from the mid-September to mid-October, the S&P 500 has now rallied 8%, leaving it only 3% from its all-time high.

2014-10-27 Fall Quarterly Commentary by John Prichard, Miles Yourman of Knightsbridge Asset Management

Born in the city of Lemberg in the Austrian-Hungarian empire (present-day Ukraine) (future-day Russia?), Ludwig von Mises would be a familiar figure to those interested in the intellectual underpinnings of economic libertarianism. He was an important contributor to the Austrian school of economic thought, which, while ultimately losing mainstream support to the Keynesians and their followers, has still remained influential in certain circles as an alternative.

2014-10-25 As the Eurozone Stalls, China Cuts the Red Tape by Frank Holmes of U.S. Global Investors

France and Germany’s industrial production has turned down recently. Their purchasing managers’ index (PMI) numbers are below the 50-mark line, indicating contraction. This trend is especially worrisome because Europe is a bigger trading partner with China than the U.S. is. So what’s the solution? The EU would do well to look east, specifically to China.

2014-10-25 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Inflation is falling, but it won't go through the floor; Income inequality is affecting consumption categories; Do new mortgage lending rules strike the right balance?

2014-10-24 Inflating the Big Mac One Calorie At A Time by James Cornehlsen of Dunn Warren Investment Advisors

Continuing our research into using the Big Mac as a gauge of inflation, we build on past posts but use our own research to draw conclusions. In previous articles, we have relied solely on The Economist’s calculation of the Big Mac price.

2014-10-24 Steady as She Goes by John Osterweis, Matt Berler of Osterweis Capital Management

For some time now we have been making the case for a long-term bull market in U.S. equities. This has rested on the prediction of a gradual economic recovery devoid of inflationary pressures, played out against a very accommodative monetary backdrop. So far, this is exactly what has occurred. But as we all know, trees don’t grow to heaven and nothing lasts forever. Therefore the relevant questions we ask ourselves every day are: (1) what could go wrong and (2) when should we start to worry? We shall devote this quarter’s Outlook to the things we worry about.

2014-10-23 When Will Rates Potentially Rise? by Team of Osterweis Capital Management

When 2014 started, some Wall Street strategists predicted a continuing rise in interest rates as U.S. economic growth accelerated and the Federal Reserve (the “Fed”) reduced its monthly stimulus. Instead, it has been a one-way street in government bond markets as they continued to deliver low yields at higher prices. In August, the yield on the benchmark U.S. 10-year Note fell to 2.3%, back down to June 2013 levels.

2014-10-23 China: Decelerating but Still Healthy by Andy Rothman of Matthews Asia

GDP growth will be just above 7% this year, and slightly slower next year. Despite the negative media headlines, there are no signs of impending doom and Andy Rothman, Matthews Asia Investment Strategist, expects the property market to stabilize in the coming quarters. Strong growth in income and retail sales means China remains the world’s best consumption story.

2014-10-22 Mr. Toad’s Wild Ride by Alan Hartley of Black Cypress Capital Management

Every time the stock market falls 3% or 4%, investors start to act like we’re staring at an oncoming locomotive. Though, each train has been the sort from Mr. Toad’s Wild Ride–not really a train at all, just bright lights and sounds meant to scare us.

2014-10-22 Retirement: How To Avoid Outliving Your Savings by Gary Halbert of Halbert Wealth Management

With over 10,000 Baby Boomers retiring every day, a pattern that will continue for the next 20 years, retirement savings continues to be one of the most important issues of our day. With 76 million Americans born between 1946 and 1964 – the “Baby Boom Generation” – saving enough for retirement is critically important.

2014-10-22 The US Mortgage Application Market Finally Wakes Up by Team of GaveKal Capital

All summer long we talked about how mortgage applications were down and couldn't get off the mat. That looks to finally be changing, at least from a refinancing point of view over the past couple of weeks. In the last two weeks the mortgage application index has increased from the 350 to 413 and has broke out of the range it has been in all year.

2014-10-22 Despite Volatility, This Bull Is Likely to Charge Higher by John Calamos, Gary Black of Calamos Investments

As the fourth quarter begins, the market has found itself engulfed in anxiety. Volatility has surged in the equity markets while the 10-year Treasury yield has dropped to 2%-leading some to question whether this bull market is breathing its last breath. We believe: * Global GDP growth will likely be in the 2.0%-3.0% range. * The U.S. is in the 5th or 6th inning of recovery, with slow but improving growth. * Despite the surge in volatility, this bull market has more room to run. * A balance of secular and cyclical growth companies presents the most attractive portfolio for this mid-cycle phase.

2014-10-21 Attractive Stocks in a Bifurcated Market by William Smead of Smead Capital Management

As value stock picking managers, we assume we will be operating in a bifurcated equity environment. We think the bifurcation will be between sectors of the stock market which appear over-capitalized due to “rear-view mirror” success and those which look undervalued when considering the present value of their future income stream. The combination of numerous forces, both positive and negative, will most likely create this bifurcation.

2014-10-20 Equity Losses Continue, but This Correction May Be Ending by Robert Doll of Nuveen Asset Management

Markets endured a sharp pullback and higher volatility, but technical factors suggest we may be nearing the end of the current correction. Long-term, we believe fundamentals remain sound, the U.S. economy should continue to grow and equities should be able to grind higher.

2014-10-19 What the Strong Dollar Does to Yellow and Black Gold and Why We're Seeing Green by Frank Holmes of U.S. Global Investors

The United States is doing better than it has in years. Jobs growth is up, unemployment is down, our manufacturing sector carries the rest of the world on its shoulders like a wounded soldier and the World Economic Forum named the U.S. the third-most competitive nation, our highest ranking since before the recession.

2014-10-19 Weighing the Week Ahead: Is the Correction Over? by Jeff Miller of New Arc Investments

Was that the bottom? Nearly everyone is trying to time the market, so the financial media will focus on remaining risk versus signals of a bottom.

2014-10-17 Special Report: Volatility Update by Richard Bernstein of Richard Bernstein Advisors

Volatility can destroy the best of financial plans. Simply doing nothing can be a fine strategy in the face of short-term volatility, but the tension associated with market downdrafts makes both institutional and individual investors’ feel that doing nothing is not an alternative. However, decisions made under duress are typically decisions that should not be made.

2014-10-16 Global Worries (And Some Benefits) by Scott Brown of Raymond James

In the latest update of its World Economic Outlook, the IMF revised lower its expectations of global growth in 2014 and 2015. None of that should have surprised anyone. At this point, the IMF expects that European GDP will be relatively weak in 2014 (+0.8% 4Q14/4Q13) and should improve in 2015 (+1.6% 4Q15/4Q14). However, risks are weighted predominately to the downside. Weaker European growth and a stronger dollar will have a significant impact on many U.S. firms, but may have some benefits for the economy as a whole.

2014-10-16 The Right Question by Jeffrey Saut of Raymond James

In this business it has been said, “Sometimes knowing the right question is more important than actually knowing the answer.” Over the years I have found that old Wall Street axiom to serve me well. One example would be reading the footnotes in a company’s annual report.

2014-10-14 Sea Change by John Mauldin of Mauldin Economics

The final chapter and conclusion pretty much end as you would expect: the demise of monetary policy’s ability to soothe the soul of the markets and the return of volatility. We hopefully get a full-fledged restructuring of the sovereign debt markets. The Fed and sister central banks will try the same tired tools they have been using. Except they have already been to the zero rate boundary and have wasted the opportunity they had to increase rates so that they could lower them later. Another round of quantitative easing?

2014-10-14 Finally, a Five Handle! by Brian Andrew of Cleary Gull

Last Friday’s jobs report was significant in that for the first time since July of 2008 the unemployment rate dipped below 6%. The September report indicated that the unemployment rate fell from 6.1% to 5.9%. While we have seen improvement in labor markets for some time now, the Fed still seems to want to take their time reducing stimulative policy.

2014-10-13 Is the UK Getting Back to Business as Usual?? by Mike Amey of PIMCO

In light of the generally buoyant economy, we may start to see more normal conditions returning to the UK labour market and, importantly, upward movement in wage growth over the cyclical horizon. In turn, these developments are critical for the conduct and timing of monetary policy and the behaviour of the Bank of England's (BOE) Monetary Policy Committee. We believe investors may want to treat the BOE's interest rate cycle with caution in shorter-maturity bonds, while valuations offer more protection in intermediate bonds given PIMCO's New Neutral thesis of secularly low real interest rates.

2014-10-12 Weighing the Week Ahead: Can Corporate Earnings Reports Reverse the Stock Market Decline? by Jeff Miller of New Arc Investments

Last week featured a low signal to noise ratio – speech after speech, but little fresh information. This week heralds the start of earnings season. While we have a normal measure of government data, market participants will carefully parse the announcements and conference calls. This week will be all about earnings.

2014-10-11 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, Europe’s slowdown can’t 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.

2014-10-11 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Hong Kong gets occupied; U.S. corporate taxes: Fact, fiction and framing; Has the U.S. Treasury blunted the Fed's QE program?

2014-10-11 Global Fears by Liz Ann Sonders, Brad Sorensen, Michelle Gibley & 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.

2014-10-10 That Was the Week That Was... by Jeffrey Saut of Raymond James

A week ago yesterday I arrived in New York City just in time to have dinner with some friends. Avra Estiatorio is arguably the best Greek seafood restaurant in the city and it is located 20 steps from my hotel of choice, the Hyatt 48 lex, which is aptly named since it sits on the corner of Lexington and 48th street.

2014-10-09 Tocqueville Gold Strategy Investor Letter by John Hathaway of Tocqueville Asset Management

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX), states in his latest quarterly letter on gold that "On a near term basis, this looks and feels like a bottom to us. On a longer term view, we are more bullish than ever." He goes on to write that "Expanding earnings and valuations, the underpinnings of the four year bull market in financial assets, may be approaching an inflection point. A reversal of this cycle would in our opinion restore interest in gold."

2014-10-08 Nervous Investors, Choppy Markets by Richard Michaud of New Frontier Advisors

It was a choppy third quarter for global asset classes. Domestically, Large Cap equities rose slightly but Small Cap US stocks fell.

2014-10-04 The Wayback Machine Birthday Tour by John Mauldin of Mauldin Economics

I’ve been writing this letter for some 15 birthdays now, well over 10,000 pages of collected work. Every word is still at my website – a history, if you will, of what I was thinking at the time. I asked my longtime (and long-suffering) editor, Charley Sweet, to go back over this past decade and a half and give us a review of what I was saying my birthday week.

2014-10-04 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

What is a good monthly U.S. payroll number?; The September U.S. job data were strong but may not move the Fed's needle; Falling inflation and inflation expectations will keep central banks from tightening

2014-10-04 One Thing Leads to Another: From Dividends/Buybacks to Capex by Liz Ann Sonders of Charles Schwab

The final revision to second quarter real GDP showed a healthy contribution by capex. Tide may be turning away from returning cash to shareholders toward capex; pushed by activist investors.Capex's leading indicators point to further improvement.

2014-10-03 China’s Inscrutable Contraction by Kenneth Rogoff of Project Syndicate

As China shifts to a more domestic-demand driven, services-oriented economy, a transition to slower trend growth is both inevitable and desirable. But the challenges are immense, and no one should take a soft landing for granted.

2014-10-03 Financial Repression (and How to Defend Yourself From It) by Mike Shedlock of Doug Short

I had the pleasure of being interviewed by Gordon Long last week. Gordon is publisher and editor of Gordon T Long Macro Analytics. The topic was "Financial Repression". What is financial repression? I defined it as "a set of fiscal and monetary policies for the expressed benefit of the ruling class: politicians, banks, and the already wealthy, at the expense of everyone else." In the video, I give numerous examples of repression, noting that central bank sponsored inflation is the epitome of financial repression. We also discuss what to do about financial repression.

2014-10-03 Banquo’s Grain and U.S. Interest Rates by Scott Minerd of Guggenheim Partners

Early in Shakespeare’s "beth," Lord Banquo asks the prophetic three witches, "If you can look into the seeds of time, and say which grain will grow, and which will not, speak then to me." Banquo’s turn of phrase reminds us that if a farmer planted the wrong grain he could yield a poor harvest, or worse, he might even starve. I thought about this recently when asked about the outlook for U.S. interest rates. Investors, like farmers, have a sense of the seasons that guides which grains, or investments, are more likely to yield favorable results. While I have

2014-10-03 5 Things To Ponder: Motley Cognizance by Lance Roberts of Streettalk Live

It has been an interesting week in the financial markets as the current correction process has continued. As shown in the chart below, the correction has primarily occurred in the mid, small and international equities as money has rotated into mega-large cap stocks for safety.

2014-10-02 Housing Hiatus? by John Canally of LPL Financial

We continue to expect housing may add to GDP growth in 2014 and for the next several years as the market normalizes following the severe housing bust of 2005-2010. Housing affordability and supply, and the supply and demand for home mortgages, will likely determine the pace at which housing increases GDP growth in the years ahead. The inventory of new and existing homes for sale as a percentage of total households has never been lower.

2014-10-02 Will Risk Parity Performance Persist? by Chris Maxey, Brian Payne of Fortigent

With risk parity portfolios on the whole having outperformed traditional 60/40 allocations since the trough of the financial crisis, one must be mindful of the risks that lie ahead when determining the efficacy of such an approach.

2014-10-02 Voya Fixed Income Perspectives – September 2014 by Christine Hurtsellers, Matt Toms of Voya Investment Management

Change is in the air, and it’s evident beyond the riot of color overwhelming our natural landscape. Market dynamics, too, are shifting, with the yield on the U.S. two-year Treasury inching higher and the U.S. dollar appreciating. Both not only suggest markets are pricing in a stronger U.S. economy, they are also potential harbingers that the end of zero interest rate policy is near.

2014-10-02 PIMCO Cyclical Outlook for the Americas: Recovery Remains Intact, Yet Uneven by Ed Devlin, Mike Cudzil, Lupin Rahman of PIMCO

U.S. growth can potentially exceed expectations over the cyclical horizon, in part bolstered by a healing consumer and a very accommodative Federal Reserve. While real growth in Canada has been modest in recent years, it increased to 3.1% in the second quarter and we expect that positive momentum to continue this year. In Latin America, we expect growth will pick up for the region as a whole with outperformance by smaller economies like Colombia and Panama.

2014-10-01 Making Sense of the Bond Market by Phelps McIlvaine of Saturna Capital

A persistent reduction in the US inflation rate and well-anchored inflation expectations continue to contradict the common understanding that interest rates have reached a cyclical floor.

2014-09-30 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 Economic Atonement by Peter Schiff of Euro Pacific Capital

This Friday is Yom Kippur, the day when Jews around the world ask forgiveness for their transgressions from the year past. Rabbis remind the penitent to dwell on their sins of omission, in which they did nothing when a more thoughtful and proactive action was needed, and sins of commission, in which they actively participated in an unjust action. And while not all economists are Jewish, Gene Epstein the economics editor at Barron's, offered his thoughts on how this applies to the group.

2014-09-29 Looking Past the Risks, Equities Still Appear Attractive by Robert Doll of Nuveen Asset Management

Last week featured some positive economic news, but equity markets sank nonetheless, with the S&P 500 Index falling 1.3%. On the bright side, we saw some strong data from the housing market and an upward revision to second-quarter gross domestic product growth (GDP).

2014-09-27 5 Reasons Why Short-Term Municipal Bonds Make Sense Now by Frank Holmes of U.S. Global Investors

Although short-term bonds might not be as sexy as common stocks in fashionable brands like Apple and Tesla, they play an important role in any serious investor's portfolio. Below are five reasons why investing in municipal bonds makes sense now more than ever.

2014-09-27 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

2014-09-27 Clear Sailing…or Choppy Seas? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley & Jeffrey Kleintop of Charles Schwab

We are at a tenuous point in the market seasonally speaking and a pullback is quite possible. We don’t recommend trying to time a potential correction, however, as that is virtually impossible and exposes investors to missed upside opportunities waiting on the sidelines. Elsewhere, the international picture looks a little shaky, but diversification is important and we do favor emerging markets within an international portfolio.

2014-09-23 Stocks Rally Following Janet Yellen’s Conference and Scotland’s Historic Referendum by Frank Holmes of U.S. Global Investors

Interest rates can’t stay zero forever, but for now it’s more of the same.

2014-09-22 A Lack of Surprises Helps Equity Markets Make Gains by Robert Doll of Nuveen Asset Management

Equity markets rose again last week, with the S&P 500 Index climbing 1.3% and reaching another record high. Bond yields and the U.S. dollar drifted higher, while emerging market equities and commodities struggled. Two major events that resulted in a continuation of the status quo helped market sentiment.

2014-09-22 Michael Aronstein on the Fed's Latest Mistake by Robert Huebscher (Article)

Since the Fed began its post-crisis monetary easing, a cult of second-guessers has emerged. The most extreme cry of "dollar debasement" or admonish that markets are doomed for hyperinflation. The more reasonable view, articulated by Michael Aronstein at a recent conference for financial advisors, is that near-zero interest rates and QE have distorted markets, but it is unclear when or how that will impact investors.

2014-09-21 Where’s the Growth? by John Mauldin of Mauldin Economics

Call me a heretic, but I take a different view than the economists in charge. To my mind, the sluggish recovery is a sign that central banks, governments, and, quite frankly, the “textbook” economists (despite their best intentions) are part of the problem. As Detlev Schlichter commented in his latest blog post (“Keynes was a failure in Japan – No need to embrace him in Europe”), “To the true Keynesian, no interest rate is ever low enough, no ‘quantitative easing’ program ever ambitious enough, and no fiscal deficit ever large enough.” It&r

2014-09-20 Stocks Rally Following Janet Yellen's Conference and Scotland's Historic Referendum by Frank Holmes of U.S. Global Investors

This news gives stocks reason to rally for a “considerable time,” or at least until the Fed gives us a more concrete timeframe for a rate hike.

2014-09-19 Banking on the Growing Strength of the Financial System by Dave Ellison of Hennessy Funds

Thiscommentary explores the U. S. financial system’s profound changes. In 2007, the financial system began to unravel due to excessive leverage, credit risk and overall business complexity. As we look forward, we see a potentially more stable profit picture developing for these firms. And, a rising interest rates environment has historically translated to increased revenue for banks and financial institutions. Dave Ellison believes the financial sector is ripe with opportunity.

2014-09-18 A New Fed Playbook for the New Normal by Peter Schiff of Euro Pacific Capital

While many economists and market watchers have failed to notice, we have entered a new chapter in the short and checkered history of central banking. This paradigm shift, as yet unaddressed in the textbooks, changes the basic policy tools that have traditionally defined the sphere of macroeconomic decision-making.

2014-09-18 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.

2014-09-18 What the Scottish Referendum & Fed News Could Mean for Investors by Russ Koesterich of BlackRock

Last week’s stock losses were partly a reflection of investors looking ahead to the Scottish independence vote this Thursday and the Federal Reserve (Fed)’s statement on Wednesday. Russ weighs in on the investing implications of these two big news events.

2014-09-16 Stocks Slip on Quiet Data Week by Chris Maxey, Ryan Davis of Fortigent

A modest number of economic indicators were released last week, with the majority suggesting that the domestic economy remains on solid footing. Consumer sentiment and retail sales were the bright spots, after concerns about what impact the weak labor report would have on the consumer.

2014-09-16 Economic Update by Team of Cambridge Advisors

After a rocky month in July, stocks resumed their march higher in August. The S&P 500 was up 4.0% for the month and is up 9.9% year-to-date. The small cap Russell 2000 index also performed well for the month, up 5.0%. Year-to-date, small cap stocks have lagged and are up only 1.75% as of the end of August. International stocks continued to struggle in August and year-to-date with performance of -0.4% and +2.93% respectively.

2014-09-14 What’s on Your Radar Screen? by John Mauldin of Mauldin Economics

So let’s look at what’s on my radar screen today. First up (but probably not the most important in the long term), I would have to say, is Scotland. What has not been widely discussed is that the voting age was changed in Scotland just a few years ago. For this election, anyone in Scotland over 16 years old is eligible. Think about that for a second. Have you ever asked 16-year-olds whether they would like to be more free and independent and gotten a “no” answer? They don’t think with their economic brains, or at least most of them don’t.

2014-09-13 Patiently Waiting for Mean Reversion by Frank Holmes of U.S. Global Investors

Because small caps tend to have higher beta than blue chips, you would expect them to outperform in a generally rising market—which we’re currently in. So it appears that a major rotation out of these riskier, more volatile stocks has inexplicably occurred, leading to the wide bifurcation between small and large companies. The good news is that, based on 20 years of historical data, stocks in the Russell 2000 tend to rally in the fourth quarter and continue steadily until around the end of the first quarter. Over this 20-year period ending in December 2013, the Russell has generat

2014-09-13 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The implications of Scottish independence; U.S. consumer spending outlook remains positive.

2014-09-12 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 Understanding China's Property Market by Andy Rothman of Matthews Asia

One of the biggest misconceptions about China’s property market is that most buyers are speculators. In fact, the residential market is driven by owner-occupiers, and even many poor Chinese are homeowners; China is a global leader in homeownership with urban ownership rates at 89%. The boom days may be over, but fundamental demand remains healthy. New home prices rose at an average annual pace of 9% over the last eight years, but nominal urban income rose 13% per year. Communist Party leaders do not appear too worried about property; they’ve taken only modest steps to support the m

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

Last Friday’s 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 Why Multifamily Housing is Booming (and Single-Family Isn't) by David Schawel (Article)

The rebound in single-family housing has been tepid. Investors must understand the underlying structural changes, especially why demand has shifted toward multifamily housing and why this shift will persist in the years ahead.

2014-09-09 Hiring Flounders in August and Extreme Seasonal Distortions by Chris Maxey, Ryan Davis of Fortigent

With expectations high, the August labor report landed with a reasonably loud thud. Economists expected recent improvements in labor markets to continue aplenty, but that proved not to be the case during the oftentimes-volatile month of August. It is never wise to read too much into a singular month, and the details of this report support that notion.

2014-09-09 Xi’s 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 China’s four stages of growth. We will conclude, as always, with market ramifications.

2014-09-06 The New Challenges of Price Discovery by Frank Holmes of U.S. Global Investors

In the past few years, price discovery—or the act of finding the “right” price for a security—has become much more challenging because of falling stock volume and widening bid-ask spreads. These challenges are directly attributable to the infiltration of high-frequency traders into the market, not to mention the expansion of dark pools and non-exchange trading.

2014-09-06 Back in the Saddle Again: Time to Pull in the Reins? by Liz Ann Sonders of Charles Schwab

Interest rates and seasonal tendencies are taking some attention away from the stronger economy and pose short-term risks for the stock market. Another pullback would be welcome from a sentiment perspective and would not dent our longer-term optimism that we are in a secular bull market that still has room to run. But just as fear has been the strongest emotion keeping many investors out of this bull market, greed is an emotion to rein in as well.

2014-09-05 Voya Global Perspectives – Market Update by Douglas Coté of Voya Investment Management

A hawk in dove’s clothing, Yellen will likely be ahead of the curve when it comes to hiking rates. Driven by strength in manufacturing and a revitalized consumer, corporate America is thriving. The euro zone is an economic basket case, forcing Draghi to reach for another “bazooka” solution, to the likely benefit of risk assets. Broad, globally diversified portfolios can help protect investors against the volatility that policy normalization may bring.

2014-09-04 Developed Europe: Regional Economic Review - Q2 2014 by Team of Thomas White International

Europe’s ability to sustain its economic recovery is back in the spotlight. The latest second quarter estimates of statistics agency Eurostat, which were released in mid-August, show that compared to the first quarter, GDP merely inched up 0.2 percent in the 28-country European Union (EU) but failed to grow at all in the 18-member Euro-zone.

2014-09-04 Midterms May Mean More Gains for Stocks by Burt White, Jeffrey Buchbinder of LPL Financial

With the midterm elections now just two months away and campaigning starting to heat up, we thought we would share our current views on the political landscape and what it may mean for U.S equities. In our two Outlook 2014 publications for this year, we posited that the U.S. economy and corporate profits may drive the stock market higher and investors could turn their attention away from policymakers in Washington, who were such a distraction in 2013 and earlier in the current economic expansion.

2014-09-04 What's Next for the Dollar and Gold? by Axel Merk of Merk Investments

One reason markets tend to get a little nervous in September is that it’s time for investors to ponder about their asset allocation for the remainder of the year and beyond. With the markets at or near record highs and the US dollar on a roll, what could possibly go wrong? Let’s look at what’s next for the dollar, gold, and currencies.

2014-09-04 Risk Revisited by Howard Marks of Oaktree Capital

In April I had good results with Dare to Be Great II, starting from the base established in an earlier memo (Dare to Be Great, September 2006) and adding new thoughts that had occurred to me in the intervening years. Also in 2006 I wrote Risk, my first memo devoted entirely to this key subject. My thinking continued to develop, causing me to dedicate three chapters to risk among the twenty in my book The Most Important Thing. This memo adds to what I’ve previously written on the topic.

2014-09-03 Consumer Confidence Hits a Seven-Year High... But by Gary Halbert of Halbert Wealth Management

Last week, the Conference Board reported that its Consumer Confidence Index rose to a near seven-year high in mid-August. It was the fourth consecutive monthly rise in the Index and handily beat the pre-report consensus.

2014-09-03 S&P Hits the 2,000 Mark by Ryan Davis of Fortigent

Equity markets moved modestly higher last week, with the S&P 500 closing above the 2,000 level for the first time. The S&P 500 added 80 bps on the week and now stands up 9.9% on the year following a 4% gain in August. Bonds also rallied last week, rising in tandem with European sovereigns. The rate on the 10-year Treasury fell to 2.33% by week’s end.

2014-09-02 Late, Not Lost: The Economic Drag From the Millennial Generation by Joshua Anderson, Emmanuel Sharef, Jason Mandinach of PIMCO

We believe concerns of a student debt "bubble" and perpetual financial weakness among Millennials are largely overstated. Understanding Millennials' financial trajectory is critical to our secular (3-5 year) outlook for home prices and the broader economy. We expect Millennials' financial position to improve, and pent-up demand could result in longer-term strength in housing and housing-related assets.

2014-08-30 Anticipate Before You Participate: Patterns in Trading by Frank Holmes of U.S. Global Investors

The primary unit of time measurement for high-frequency traders might be the microsecond, but for normal retail traders, it’s vital to know the best months, days and even half-hours of the day to make market transactions.

2014-08-30 Sound Familiar? by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

Stocks seem likely to continue their upward momentum although volatility could increase with Federal Reserve interest rate uncertainty combined with midterm elections and geopolitics. An improving economy, decent valuations and a still-accommodative Fed leave us confident that dips should be viewed as buying opportunities. Conversely, Europe is looking worse and we would be cautious in adding new cash at this time, concentrating additional international exposure instead on China and to a lesser degree Japan, always with a diversified portfolio in mind.

2014-08-29 Three Investing Lessons from the Napa Earthquake by Russ Koesterich of BlackRock

Last week’s Bay Area earthquake was a stark reminder that there are risks to living in California. It also was a violent, but good, metaphor for the dangers lurking in financial markets. Russ shares three investing lessons – and one busted movie myth – that he took away from the Napa earthquake.

2014-08-29 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Flexible labor markets are key to recovering from recession; Wage trends present a challenge for the Fed; Bank settlements are sizeable, but the benefit to housing has been limited

2014-08-27 Fed's Getting Anxious About Interest Rate "Liftoff" by Gary Halbert of Halbert Wealth Management

While I have been a Fed watcher for over 30 years, rarely have I seen as much media angst over the central bank’s next move as we are seeing today. We all know that the Fed is going to raise short-term interest rates at some point. We expect the Fed to “normalize” interest rates slowly in measured steps over the next few years. The main question is, when does this process begin?

2014-08-26 Event Driven Managers Encounter a Short-Term Hiccup by Chris Maxey, Brian Payne of Fortigent

After a period of very strong deal activity during the first half of 2014, traders and investors were hit with “arbageddon” in early August. “Arbageddon” struck after a series of large deals fell apart, sparking concern that the pickup in activity from earlier in the year was coming to an abrupt halt. Activity since that time would suggest otherwise, and it appears that the M&A train is back on course.

2014-08-25 Equities Climb as Investors Focus on Fundamentals by Robert Doll of Nuveen Asset Management

Equities have recovered all of the losses experienced in July through early August. The Fed appears to be slowly paving the way for interest rate increases, but we’re not expecting any immediate changes. The global economy is growing, but remains weak. In this environment, we believe investors should be more selective.

2014-08-25 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 Managing Expectations by Frank Holmes of U.S. Global Investors

The third part of this series on managing expectations is devoted to fundamental resource stock evaluation. I’ll discuss some of the statistical tools we use to pick quality stocks during a treacherous bear market, such as what we’ve seen in gold stocks the last three years

2014-08-23 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

2014-08-23 ECRI Recession Watch: Weekly Update by Doug Short of Advisor Perspectives (dshort.com)

The Weekly Leading Index (WLI) of the Economic Cycle Research Institute (ECRI) is at 134.3, unchanged from the previous week. The WLI annualized growth indicator (WLIg) dropped to 2.8 from the previous week's 3.5. On Monday of this week, ECRI broke its silence to the general public with a new commentary on its website focused on housing affordability and home price growth

2014-08-22 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.

2014-08-22 Assessing Corporate Credit Risk in Asia by Satya Patel of Matthews Asia

Investing in foreign markets requires a constant questioning of many long-held assumptions that underpin traditional security analysis. This issue of Asia Insight is the first in a series of commentaries to explore the fixed income themes of credit, currencies and interest rates. Given the complexities of Asia’s fixed income markets, we will examine the many considerations that investors need to take into account to fully appreciate the inherent risks of investing in this market.

2014-08-21 Lucid Dreaming! by Jeffrey Saut of Raymond James

Evidentially, the “lucid dreamers” on Wall Street practiced their skills two weeks ago as professional traders were sneaking large “buy orders” into the equity markets on the closing bell. Simultaneously, the Commitment of Traders’ Report showed those same traders were dramatically reducing their “short sale” bets.

2014-08-21 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 Fed’s 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.

2014-08-21 Skittishness by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

Stocks suffered some of their bigger daily and weekly declines of the year recently with geopolitical and Fed concerns the likely culprits. We don’t believe this was the start of a sustainable downtrend, although there could be further selling to come in the near-term. The U.S. economy appears to be strengthening, leaving us optimistic on the longer-term outlook for stocks. Likewise, worries over the Fed and the timing of the first rate hike have increased, but the initial stages of a tightening cycle tend to be positive for equities.

2014-08-20 Americas: Regional Economic Review - Q2 2014 by Team of Thomas White International

Economic trends from the region during the second quarter were in line with earlier periods, as the developed economies in North America are seeing healthier growth while most of the emerging economies in Latin America are facing a slowdown.

2014-08-20 A Peak at Yellen’s Labor Market Dashboard Highlights Fed Concerns by Rick Harper of WisdomTree

In this piece, we attempt to re-create the labor market dashboard and assess the progress the economy has made post-financial crisis. While many indicators suggest a full recovery (or at least substantial progress), a few indicators hint at little progress from crisis lows.

2014-08-19 Europe Taking a Negative Turn by Chris Maxey, Ryan Davis of Fortigent

Among the highlights of a busy calendar of economic data last week was the flash estimate of second quarter Eurozone GDP. The region has come under greater scrutiny in recent months amid a disinflationary trend and slowing economic data. As we discussed a few weeks ago, the high profile failure of Portuguese bank Banco Espirito Santo has also inflamed worries that Europe’s financial system remains vulnerable to a systemic shock.

2014-08-18 Don’t Be Passive About Rising Rates by Chris Marx of AllianceBernstein

Though they’ve defied expectations this year, higher interest rates appear to be all but inevitable. Investors need to take measure of the rate sensitivity in their portfolios—and stay agile—to negotiate the rough market crosscurrents a rate reversal may bring.

2014-08-18 Global Economic Perspective: August by Franklin Templeton Fixed Income Group® of Franklin Templeton Investments

The US economy seemed to move into a higher gear during the second quarter, when gross domestic product (GDP) growth reached an estimated annual rate of 4%, supported by personal consumption and inventory build-up. Its first-quarter downturn also was not quite as severe as previously thought, falling by an annual rate of 2.1% instead of the 2.9% initially reported by the Bureau of Economic Analysis.

2014-08-16 Bubbles, Bubbles Everywhere by John Mauldin of Mauldin Economics

You can almost feel it in the air. The froth and foam on markets of all shapes and sizes all over the world. It’s exhilarating, and the pundits who populate the media outlets are bubbling over. There’s nothing like a rising market to lift our moods. Unless of course, as Prof. Kindleberger famously cautioned (see below), we are not participating in that rising market. Then we feel like losers. But what if the rising market is … a bubble? Are we smart enough to ride it high and then bail out before it bursts? Research says we all think that we are, yet we rarely demonstrate th

2014-08-13 Municipal Market Perspectives by Portfolio Team of SMC Fixed Income Management

Heightened international unrest and the likelihood of accelerating economic weakness in Europe will provide further support for fixed income securities. It is unlikely central banks will move from their current accommodative monetary positions anytime soon. Since we do not anticipate a meaningful upward move in Treasury rates, municipal bond prices should also benefit. Yields are likely to remain close to current levels and even possibly move lower. Strong market technical factors will also provide support.

2014-08-12 Developed Asia Pacific: Regional Economic Review - Q2 2014 by Team of Thomas White International

During the first half of 2014, developed Asia Pacific economies faced challenges arising from lukewarm consumption and meek trade growth. Most countries in the region tried boosting their economies with a mix of infrastructure spending and loose monetary policies. Countries that had their trade skewed to China, Asia’s largest economy, faced prospects of slowing trade.

2014-08-11 Transformation or Bust, Part 2 by John Mauldin of Mauldin Economics

Envisioning a clear path through the issues from where we are today is not easy, though China certainly has more options than the world had with subprime by the middle of 2008, when there was so much toxic waste on the balance sheets of banks all over the world and there was no turning back. As we have emphasized in the past and will do today, China does have options. But each of the options has costs associated with it, and those costs are going up every day. Who pays and when is the simple question that most readers want to have answered, but therein lies the conundrum.

2014-08-11 Low and Expanding Risk Premiums are the Root of Abrupt Market Losses by John Hussman of Hussman Funds

Compressed risk premiums normalize in spikes. Day-to-day news stories are merely opportunities for depressed risk premiums to shift up toward more normal levels, but the normalization itself is inevitable, and the spike in risk premiums (decline in prices) need not be proportional or “justifiable” by the news at all.

2014-08-09 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Wage Growth May Not Be the Best Gauge of Labor Market Progress; The ECB's Summer Holiday May Not Be Very Relaxing; A Novel Proposal for Mortgage Lending

2014-08-09 Important Reform Progress by Andy Rothman of Matthews Asia

Last week's announcement that the Communist Party will reform the hukou, or household registration system, is an important first step toward reducing the contradictions and conflicts in Chinese society. Migrant workers were primarily responsible for China's rapid economic growth, and today account for the majority of the manufacturing and construction workforce.

2014-08-09 Summer Void by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

Although Wall Street and other corners of the business and political world may empty over the next few weeks, risks of a pullback in U.S. equities have gone up. Although we believe it would represent a buying opportunity and are optimistic longer term due to improving economic growth, nervous investors may want to consider a hedging strategy. China's stock market performance has improved and we remain positive, while European economic data has been more concerning, although the stocks still look attractively valued in our view.

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

Today we’ll 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 we’ll look at below paint a very different picture.

2014-08-05 Mixed Signals by Brian Andrew of Cleary Gull

Over the weekend I had the opportunity to take in baseball tryouts. I know you are thinking it is August so what tryouts would be taking place in the middle of the season? These tryouts were for U-8 boys. For the uninitiated, this is when boys aged 7 and younger try out for next season’s teams. My son spent two days at a baseball camp and then finished yesterday with team tryouts. During tryouts there were six stations covering the fundamentals of the game.

2014-08-05 Banco Espirito Santo: Opportunity for the ECB? by Ryan Davis, Brian Payne of Fortigent

Over the weekend, it was announced that Portugal’s Banco Espirito Santo (BES) would be split into a ‘good bank’ and ‘bad bank.’ This came after the Bank of Portugal assured that BES could raise enough money from private investors to recover from the bank’s first-half loss of €3.58 billion.

2014-08-05 Avoiding the Unintended Migration from Investor to Speculator by Bob Andres of Andres Capital Management.

The identification of value/price in the allocation of capital is essential to successful investing. Assets purchased at levels above intrinsic value reflect an approach based on hope and momentum not sound risk/reward analysis and normally portend negative results.

2014-08-05 So, What Did We Learn? by Scott Brown of Raymond James

The busy week of economic news left investors uneasy. The 4.0% GDP growth figure contributed to concerns that the Fed may be forced to raise short-term interest rates sooner rather than later. However, while the economic data reports, and even the Fed policy statement, had something for everybody, the outlook for monetary policy should be essentially unchanged.

2014-08-04 Dynamic and Durable Growth Part 2: The Enormous Implications of Shale Energy by Erik Voss of Invesco Blog

This is the second in a four-part series examining dynamic and durable growth themes that affect the US economy and may present opportunities for investors. The first post explored the biotech revolution, and the third and fourth posts will discuss the massive changes in mobility.

2014-08-04 US Stocks Make 31 Record Highs in 2014, But Investors Panic During 3% Selloff by David Edwards of Heron Financial

US stocks as defined by the S&P 500 made 31 record highs in 2014, most recently on July24th. Through Friday afternoon, stocks declined 3.3%, which is to say less than the decline of 4.2% we saw in April of this year, and decline of 5.6% in January.

2014-08-04 Inflation Trumps Growth by Jim Nelson of Euro Pacific Capital

With the first half of 2014 now in the books, many investors are happy with the performance thus far, especially given the economic headwinds that few saw coming. The 26% rally in U.S. stocks in 2013 gave way to a more modest 7% gain in the first half of 2014. Most see this as a positive development in a maturing market. But beneath the surface, important trends are emerging that should give investors reasons to re-evaluate their assumptions.

2014-08-04 Mounting Pressure Weighs on Equities by Robert Doll of Nuveen Asset Management

U.S. equities experienced a sharp pullback last week, with the S&P 500 Index falling 2.7%, its largest weekly decline in over two years. A number of factors contributed to the downturn, including rising geopolitical tensions, concerns over Federal Reserve policy, Argentina’s debt default, a slowdown in the housing recovery and a sense that the market rally has been getting tired. Not all of the news was negative, however, since we also saw some strong economic and earnings data and increasing merger and acquisition activity.

2014-07-31 The Chinese Wall of Worry: Uncertainty Rhymes with Opportunity by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, looks at the over-valued global market environment and points out that "While we wait for the day of reckoning…we should not be oblivious to potential opportunities, wherever they may exist. China may be a case in point." Digging deeper, Sicart looks at the negative media perception of China and believes "Many of the problems invoked in the headlines are real. But they are neither new nor, I believe on investigation, as catastrophic as implied."

2014-07-30 The Bank of England’s Balancing Act by Team of Manning & Napier

The United Kingdom (U.K.) has recently been a subject of increased attention in the media and investment circles. An improving economy—particularly relative to its Eurozone neighbors—has provided a reason for optimism among economists and investors alike. However, rapidly rising home prices and accommodative monetary policy have also raised potential red flags.

2014-07-29 Larry Summers' Sleepless Nights by Michael Edesess (Article)

Former Treasury Secretary Larry Summers has said that a new book, House of Debt, is "likely to be the most important economics book of 2014." It's authors argued that the causes of the Great Recession have been misdiagnosed and, therefore, the solutions - many of which were designed by Summers - were inadequate.

2014-07-29 20 Predictions for 2039 by Dan Richards (Article)

The shifts in the next 25 years will be just as substantial as those in the previous 25 years, and the most successful advisors will be those who are able to anticipate and adapt to these changes. Here are 20 predictions for what the financial-advising business will look like in 2039.

2014-07-29 Deconstructing the State of the Housing Recovery by Kristina Hooper of Allianz Global Investors

The rebound in the US housing market has slowed in the first half of 2014 for a number of reasons. But local economies and their respective job markets tell the real story. Kristina Hooper breaks it down.

2014-07-29 Corporate Earnings Season Update by Ryan Davis, Brian Payne of Fortigent

As the so-called punchbowl provided by the Federal Reserve is slowly withdrawn, $10 billion at a time, investors are increasingly looking to corporate fundamentals to see what might drive equity markets higher in the quarters ahead. Now three weeks into second quarter earnings season, market participants have a better idea of just how the most recent cycle is shaping up.

2014-07-29 Land Is the Riskiest of Asset Classes by Sean Fergus of John Burns Real Estate Consulting

Investing in land carries significantly more volatility than nearly all other real estate asset classes. As a general rule, a 1% change in home values results in a 3% change in finished lot values because almost all of the change is attributable to a change in the value of the land rather than the structure. Investing in raw land carries an even greater level of volatility and price swings.

2014-07-28 Second Quarter Economic & Capital Market Summary by Gregory Hahn of Winthrop Capital Management

It seems there is a growing disconnect between what the financial markets are discounting and the reality of what is transpiring in the domestic and global economies. While economic growth has the potential to increase during the second half of the year we are not expecting a dramatic acceleration since there are still structural problems in the economy. The result is slow private credit expansion, a lack of fixed investment and a slow rate of business formation.

2014-07-28 Yes, This Is An Equity Bubble by John Hussman of Hussman Funds

Make no mistake – this is an equity bubble, and a highly advanced one. On the most historically reliable measures, it is easily beyond 1972 and 1987, beyond 1929 and 2007, and is now within about 15% of the 2000 extreme.

2014-07-28 And That's The Week That Was by Ron Brounes of Brounes & Associates

More favorable earnings; more decent economic releases; more devastating global turmoil. Stocks were little changed during the week (though the S&P did move into record territory) as many investors went on much-deserved summer vacation. Hope they are well-rested because next week brings a new month, a vast array of key data, financial word from Big Oil and others, and hopefully progress on peaceful resolutions to the never-ending geopolitical conflicts.

2014-07-28 Indian Budget: Converting Promises into Policies by Jeremy Schwartz of WisdomTree

India has been a hot market in 2014, as investors anticipated the election of business-friendly prime minister Narendra Modi. If Election Day was the most important day of the year, perhaps the second most important day was the release of the annual budget on July 10.

2014-07-26 Second Quarter Earnings: Marching Toward a Strong Recovery by Frank Holmes of U.S. Global Investors

It’s earnings season once again, and though only a quarter of the Russell 1000 has reported so far, the news is just north of positive. All signs indicate that the market has dusted itself off and is back to its cheerful self after a ho-hum first quarter, which was negatively affected by harsh winter weather.

2014-07-25 Maintaining A Constant Standard Of Living Is Very Difficult by Team of Optimus Advisory Group

Ever wonder why rises in the Consumer Price Index ("CPI") seem low compared to your own personal experiences? Or why social security annual cost of living increases seem to get smaller and smaller? Or why inflation-adjusted pensions can't seem to keep up with general price increases? Or why the American worker gets such meager annual raises (if at all) that they seem to fall further behind year after year?

2014-07-25 Market Valuations and the Theory of Relativity by Zachary Karabell of Envestnet

Depending on what metric you use to assess the stock market, equities could be cheap, expensive, or anywhere in between. Try not to be swayed by simplistic arguments based on selective analysis of historical valuations, patterns or averages. Advisors and investors should keep in mind that with so few opportunities today to find yield and appreciation, if long-term gains are to be had, stocks are where such gains are likely to be found.

2014-07-24 Mar Vista Investment Partners Second Quarter 2014 Review by Brian Massey of Mar Vista Investment Partners

Mar Vista Investment Partners second quarter commentary reviews the market and their large cap growth strategies during the most recent period and discusses the opportunities they see for their portfolios in the coming months.

2014-07-23 Economic Outlook Dimming, Yet Fed Plans Rate Hikes by Gary Halbert of Halbert Wealth Management

The mainstream media was largely successful in convincing the public that the dreadful 1Q GDP number (-2.9%) was the result of the bitter winter in January and February. The media spin was that the economy would snap back strongly in the 2Q with growth of 4%, 5% or even 6%. While there were some encouraging economic reports in April, May and early June, the economy now appears to be losing momentum again.

2014-07-23 Truth and Consequences by Gary Stroik of WBI Investments

After last year's robust stock market performance, returns this year seem a bit meager by comparison. This is especially true of the kind of big, blue chip companies that make up the DJIA, which is up only 1.51% for the first half of the year. This may be one of the reasons behind the topic of conversation that seems to be popping up more frequently lately. Many investors – including many conservative investors – appear to be asking themselves if they're being too cautious now that some of the major stock indices are hitting all-time highs.

2014-07-22 Weekly Market Update by Team of Castleton Partners

The intensifying geopolitical backdrop of Ukraine/ Russia, Israel/ Gaza, and Iraq/ ISIS continued to influence market activity and investment flows last week. As a result, intermediate and longer-dated Treasury rates were able to revisit their low yields of the year, last touched in May. However, the one thematic constant that continued unabated last week was the persistent flattening of the yield curve—the one trend that we are unwilling to fade.

2014-07-22 Cause and Effect: Bank of Japan Becomes Government’s Largest by Bradley Krom of WisdomTree

Although central banks often use their holdings of government debt to affect monetary policy, the meteoric rise in the expansion of the BOJ’s balance sheet is unprecedented. With the BOJ continuing to signal its willingness to aggressively stimulate the economy, we highlight here what we believe are the most significant implications of these policies.

2014-07-22 Anatomy of a Moat by Kenneth Lowe of Matthews Asia

At Matthews, we often talk about investing in “quality” companies with “economic moats.” We believe that these are the entities best placed to succeed over the long term in Asia. As Warren Buffett has noted, investors should seek businesses with “economic castles protected by unbreachable moats.” It is these moats that enable a company to survive and thrive as decades pass, creating economic value along the way by generating returns on capital ahead of their cost of capital. But what exactly is an economic moat?

2014-07-22 2014 Another Ho Hum Year from Hedge Funds by Ryan Davis, Brian Payne of Fortigent

Through the first six months of the year, hedge funds have generated a positive, albeit somewhat modest return. According to data compiled by Hedge Fund Research, the Fund Weighted Composite of hedge funds in their universe had generated a 3.2% return, compared to the S&P 500’s 7.1% gain. While not terrible on a standalone basis, many investors had greater hopes for the asset class following five straight calendar years of underperformance versus the broad equity markets.

2014-07-20 GDP: A Brief But Affectionate History by John Mauldin of Mauldin Economics

In this week’s letter we look at the construction of gross domestic product (GDP). As we will see, GDP is a relatively late-to-the-party statistic, thoroughly malleable in its construction and often quite contentious in its application. Yet the mainstream media regularly releases GDP numbers with the implicit assumption that they are in fact an accurate reflection of the general economy. We shall soon see that GDP is instead a fuzzy reflection of the economy, derived from a model that is continually readjusted in a well-intentioned effort to understand the scope of the economy.

2014-07-19 The Municipal Bond World, According to John Derrick by Frank Holmes of U.S. Global Investors

I sat down with Director of Research John Derrick, who also manages our Near-Term Tax Free Fund (NEARX), to get his thoughts on interest rates, the bond market and what investors should pay attention to as we move into the second quarter of 2014.

2014-07-19 Perspectives from the Franklin Templeton Fixed Income Group by Christopher Molumphy, Michael Materasso, Roger Bayston, Michael Hasenstab, and John Beck of Franklin Templeton Investments

In early July, there was a noticeable disconnect between the median forecast of Fed officials for interest rates by end-2015 and the markets’ forecast, as expressed in the federal funds futures rate. But if unemployment continues to decline and inflation to pick up in the coming months, the danger for bond market participants is that their predictions for interest rates may be too low and will have to be adjusted.

2014-07-19 Understanding Chinese Volatility by Andy Rothman of Matthews Asia

Sinology by Andy Rothman is a publication designed to provide investors with a framework for developing a deeper understanding of China and its economy. The focus will be on discussing the longer-term trends that are taking place in the country and their impact on the global economy. Rising volatility in China is a consequence of economic modernization and should not be feared by long-term investors.

2014-07-18 And That's The Week That Was by Ron Brounes of Brounes & Associates

Gaza, Iraq, Ukraine...ongoing turmoil and global tensions have been topping the headlines far too frequently these days. At times, markets are affected; at times, business is disrupted. Even more sadly, lives are lost. Hopefully calmer heads can prevail, but history is not often on the side of common sense.

2014-07-18 Fixed Income Outlook: Moving From Zero by Christopher Molumphy, Roger Bayston of Franklin Templeton Investments

Some prior market prognostications of rising rates have proven slow to play out as global central banks, namely the Bank of Japan and European Central Bank (ECB), have continued to ramp up easing measures and the US Federal Reserve (the Fed) has only slowly begun to lay off the gas pedal recently.

2014-07-18 Is it Time to Prepare for Inflation? by Russ Koesterich of BlackRock

Inflation has ticked up recently, leaving many investors fearing that it’s time to prepare portfolios for rising prices. According to Russ, while this fear isn’t irrational, it’s too early to restructure a portfolio around a big shift in the inflation outlook. Russ explains.

2014-07-18 Summer Essays by Jeremy Grantham of GMO

In a new quarterly letter to GMO's institutional clients, co-head of asset allocation Ben Inker uses the evolving Boston culinary landscape as a backdrop to examine the tendency of investors to pursue a "free lunch," when they should be looking for the "investing equivalent of an inexpensive and tasty food truck meal instead." In his section, chief investment strategist Jeremy Grantham looks back at investing mistakes made over his 47-year career, paying special attention to his formative investing years and the "painful lessons" learned therein.

2014-07-17 Equities Remain Resilient in Current Environment by Charlie Dreifus of The Royce Funds

While there was a brief shift towards higher quality from April through mid-May, low quality reasserted itself in June to mark a fairly muted—and mixed—second-quarter performance for small-caps. Forty-plus-year industry veteran Charlie Dreifus discusses the market's behavior during this period, as well as the U.S. economy and stock market.

2014-07-15 The Fed Announces Its Intentions by Chris Maxey, Ryan Davis of Fortigent

Minutes from the mid-June FOMC meeting were released last week, offering keen insight to the Federal Reserve’s current thinking on the economy. While the Fed suggests that the economic outlook is benign, the minutes offered guidance on the Fed’s exit path, which is expected to arrive by the end of the year.

2014-07-15 Booming Until It Hurts? by Robert Shiller of Project Syndicate

In recent months, concern has intensified among the world’s financial experts and news media that overheated asset markets – real estate, equities, and long-term bonds – could lead to a major correction and another economic crisis. The general public seems unbothered, but the experts' concern is healthy.

2014-07-14 Energy: Shale Generates Tectonic Changes by Stephen Toy of Invesco Blog

The shale revolution, only seven or eight years old, has been the catalyst for a tectonic change in US energy production and policy. It has also created a new paradigm in US manufacturing, launched a renaissance in the chemical industry, and is driving infrastructure spending. So how do we think about the shale revolution in terms of investing? It’s twofold.

2014-07-12 2014 Commodities Halftime Report by Frank Holmes of U.S. Global Investors

What a difference six months can make. After a disappointing 2013, the commodities market came roaring back full throttle, outperforming the S&P 500 Index by more than 4 percentage points and 10-year Treasury bonds by more than 6.

2014-07-11 Housing Starts, Personal Consumption Expenditure and Durable Good Orders Show the Truth by Dawn Bennett of Bennett Group Financial Services

The U.S. GDP number doesn’t lie. Housing starts, Personal Consumption Expenditure and Durable Goods Orders show the truth.

2014-07-11 Why The Fed Needs You To Sell Your Bonds by Gary Halbert of Halbert Wealth Management

Today I will attempt to explain why longer-term interest rates have fallen significantly this year when almost everyone expected rates to rise. This discussion focuses on the fact that there is a shortage of Treasury securities in the marketplace today, especially in maturities of 10 years or longer. The shortage is due to a combination of factors that I will discuss below

2014-07-10 Guarding Against Complacency by Scott Minerd of Guggenheim Partners

Investors should expect a quiet summer with markets rolling along, but with valuations becoming frothy now is a time to consider greater exposure to assets with higher credit quality.

2014-07-09 Tocqueville Gold Strategy Investor Letter: Second Quarter 2014 by John Hathaway of Tocqueville Asset Management

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX), remarks in his latest quarterly letter that it appears "the precious metals complex, both mining shares and bullion, appears to be in the process of completing a major bottom extending back to mid-2013." He goes on to add that he is "becoming more comfortable with the proposition that the downside potential has been fully exhausted after nearly three years of declining prices and that the stage has been set for a major advance in the years to come."

2014-07-09 And That's the Quarter That Was by Ron Brounes of Brounes & Associates

The dismal winter weather is finally in the rearview mirror and stocks continued their record-setting ways.

2014-07-08 Volatility Takes a Sabbatical by Mark Oelschlager of Oak Associates

The theme of the second quarter was low volatility, as stocks continued to grind higher. As June ended, the S&P 500 had gone 51 consecutive trading sessions without moving 1% or more in either direction. Not since April 16 has the index moved at least 1% in a given day. This is a remarkable streak and quite a contrast with the volatility of recent years. Naturally, when something like this happens, the inclination is to try to figure out what it means for the market going forward.

2014-07-08 Will Latest Jobs Report Force the Fed to Act? by Chris Maxey, Ryan Davis of Fortigent

After a reasonably bleak winter, labor markets are on the rebound, just in time for the Federal Reserve to decide when they should stop asset purchases. Recent figures suggest that labor markets are very near Fed targets, raising the possibility that interest rate hikes could begin sooner than expected.

2014-07-07 TIPS Outperform in the 2014 Second Quarter and First Half by Stephen Percoco of Lark Research, Inc.

TIPS have been on a tear so far in 2014. While returns on straight Treasury securities have been strong, TIPS returns have been stronger. After scampering away from Treasurys last year out of fears about the winding down of Federal Reserve stimulus, bond investors seemed reassured, after the weak first quarter GDP report and statements by the Fed, that interest rates are not about to rise anytime soon.

2014-07-03 Reality-Based Cost Of Living Index Tells The Real Reason Why So Many Americans Are Struggling by Steve Rumsey of Optimus Advisory Group

Ever wonder why rises in the Consumer Price Index ("CPI") seem low compared to your own personal experiences? Or why social security annual cost of living increases seem to get smaller and smaller? Or why inflation-adjusted pensions can't seem to keep up with general price increases? Or why the American worker gets such meager annual raises (if at all) that they seem to fall further behind year after year?

2014-07-02 1Q GDP Plunges Nearly 3% - What Will The Fed Do Now? by Gary Halbert of Halbert Wealth Management

Today we take a closer look at last week’s very ugly 1Q GDP report and see if we can discern why it was so much worse than anyone expected (hint: it was more than the severe winter weather). Fortunately, it continues to look like 2Q growth will come in at +3.0% or better. But even if GDP for the rest of the year comes in strong, the devastating 1Q will ensure yet another slow growth year.

2014-07-01 Fixed Income Markets Cruise - What's Next? by Chris Maxey, Brian Payne of Fortigent

For the better part of twelve months, fixed income markets have been in a rather benign state. After receiving a scare in early summer 2013 during the “taper tantrum,” volatility subsided, and normalcy returned to the world of fixed income. As money continues to pour into fixed income markets, there is growing concern that the investment opportunity is stretched and the time to rebalance is now.

2014-07-01 Housing Shows Fewer Cracks in Its Foundation by Kristina Hooper of Allianz Global Investors

Home sales are on the rise due to lower interest rates and increased demand following a difficult winter, but wage growth must follow in order to keep the housing recovery going, writes Kristina Hooper.

2014-07-01 Reality Check by Robert Rodriguez of FPA Funds

Bob Rodriguez, Managing Partner and Chief Executive Officer of FPA, delivered a speech titled "Reality Check" to shareholders of FPA funds on June 2, 2014, on Fed policy and federal fiscal excess.

2014-06-30 Taking a Balanced View of Equities by Lisa Myers of Franklin Templeton Investments

With the US S&P 500 Index and Dow Jones Industrial Average advancing into record territory this year and some European equity benchmarks likewise nearing new highs, some investors may be wondering whether it’s still wise to be jumping into the market at this stage. Lisa Myers, executive vice president, Templeton Global Equity Group, thinks that a long-term investment horizon, supported by bottom-up analysis, can reveal hidden value.

2014-06-30 The Delusion of Perpetual Motion by John Hussman of Hussman Funds

The Federal Reserve’s promise to hold safe interest rates at zero for a very long period of time has not created a perpetual motion machine for stocks. No – it has simply created an environment where investors have felt forced to speculate, to the point where stocks are now also priced to deliver zero total returns for a very long period of time. Put simply, we are already here. Investment decisions driven primarily by the question “What other choice do I have?” are likely to prove regrettable.

2014-06-28 Health Care Sector Spurred by Population Growth and M&As by Frank Holmes of U.S. Global Investors

Recently I spoke with John Derrick, director of research here at U.S. Global, to pick his brain about what he thought was the most interesting sector right now. You might expect him to have said energy, perhaps because of the intensifying violence in Kurdistan Iraq, a major oil producer. But instead, he said that he had his eyes on health care.

2014-06-25 Approaching a Tipping Point by Mike Boyle of Advisors Asset Management

On Thursday, June 19, the S&P 500 made it 66th new high of this bull market and unfortunately, based on almost any metric available, one could argue that the U.S. equity markets are due for at least a mild correction – or more.

2014-06-25 Mid-Year Muni Market Update by Rafael Costas of Franklin Templeton Investments

The municipal bond market faced a rather tough year in 2013, with news of troubles in Detroit, Puerto Rico and elsewhere scaring off some investors. This year hasn’t exactly been smooth sailing for the muni market either, but the waters seem a bit calmer and many investors have returned to the sector. Rafael Costas, Co-Director, Municipal Bond Department, Franklin Templeton Fixed Income Group, could be called cautiously optimistic about the muni market. He provides an update on some key market developments, including progress in the aforementioned trouble spots.

2014-06-24 Equities Rally on Surprise-Free Fed by Chris Maxey, Ryan Davis of Fortigent

The Federal Reserve held its regularly scheduled meeting last week, and equity markets raced to their strongest daily gain of the week after the announcement was released. There were few surprises, as the Fed chose to maintain its course, while painting a cautious economic picture.

2014-06-24 A Mosaic Approach to Raising the Fed Funds Rate by Kristina Hooper of Allianz Global Investors

The Federal Reserve is using a wide swath of economic data and anecdotal evidence to determine when to raise its benchmark interest rate. While prudent, it may stir up anxiety and volatility for equity investors, writes Kristina Hooper.

2014-06-21 Weekly Economic Commentary by Carl Tannenbaum, Asha Bangalore of Northern Trust

The Bank of England changes course; U.S. inflation is rising, but the Fed seems unconcerned; The situation in Iraq creates additional uncertainty around oil prices.

2014-06-21 Ah, the Power of Mean Reversion. by Frank of U.S. Global Investors

The chatter this week has been gold. The precious metal flew up $45 an ounce on Thursday, surprising investors, the media and markets alike.

2014-06-20 Global Economic Perspective: June by Franklin Templeton Fixed Income Group of Franklin Templeton Investments

With 10-year US Treasury yields dropping below 2.5% at one point during early June in spite of improving forward economic indicators, the US bond market has continued to send out confusing signals, in our view. Purchasing manager indexes have remained well over the 50 mark that separates expansion from contraction for many months, consumer demand has remained relatively buoyant, and nonfarm payrolls show job creation running at over 200,000 per month for 13 of the 21 months to May 2014.

2014-06-19 The Fed Continues Tapering; Tightening Still Seems Far Off by Team of Northern Trust

At its June meeting, the Federal Open Market Committee (FOMC) extended its predictable string of asset purchase reductions. Most of the attention was trained on an updated set of forecasts from the Fed that offers some clues to the future path of American monetary policy.

2014-06-19 American Allure by Scott Minerd of Guggenheim Partners

The American economy is looking stronger, and with Europe improving and China working through its problems, the outlook for U.S. stocks and bonds looks positive heading into summer.

2014-06-19 The Euro Goes Negative by Dickson Buchanan Jr. of Euro Pacific Precious Metals

The European Central Bank's (ECB) decision to charge a negative interest on overnight deposits is not going to lead to a higher targeted inflation rate, despite ECB President Mario Draghi's insistence that it will. Like all cases of central planning, this decision will have unintended and costly consequences - some of which are already starting to play out. In this particular case, instead of stimulating business lending or higher prices, the decision will only stimulate the increased buying of insolvent government debt - leading us all one step closer to the economy's eventual unravelling.

2014-06-18 Outlook on the US Dollar, Currencies & Markets: Look Out Below! by Axel Merk of Merk Investments

The FIFA World Cup and market predictions have in common that we are tempted to create a world of make-believe when it comes to predicting outcomes. While others ponder about the meaning of a round ball, we’ll focus on the implications of a make-believe world comprised of ever-higher asset prices. Our caution: look out below!

2014-06-18 Fed Outlook: Playing It Close to the Vest by Scott Brown of Raymond James

The Federal Open Market Committee will meet this week to set monetary policy. The FOMC is widely expected to further taper the monthly pace of asset purchases (not “on a preset path,” but continuing “in measured steps”). The bigger question is when the Fed will begin to raise short-term interest rates. The correct answer is “it depends.” Fed officials are currently debating the order of steps to be taken as they begin to normalize monetary policy.

2014-06-17 Housing Starts Stuck At 1 Million by Team of GaveKal Capital

US housing starts for May came in below consensus at 1,001K units vs expectations of 1,036K units. Housing starts are still about 9.5% higher than they were a year ago. Regionally, housing starts are strongest in the Midwest while in the Northeast, starts are actually 5% lower than they were a year ago. Building permits were also below expectations in May (991K vs 1,062K expected). Charts below.

2014-06-17 Gundlach: A Big Moment for the Economy and the Markets by Robert Huebscher (Article)

The benchmark 10-year Treasury bond is an attractive investment, according to Jeffrey Gundlach, although its yield is likely to stay between 2.2% and 2.8% for the remainder of the year. Despite that narrow range, Gundlach foresees pivots in other parts of the investment landscape.

2014-06-17 Oil Spikes on Iraqi Strife by Chris Maxey, Ryan Davis of Fortigent

Of the many global macroeconomic concerns of the past few years, oil has curiously fallen down the list in terms of major areas of investor focus. After recovering in the wake of the financial crisis, the commodity has generally been range bound between $100 and $120 a barrel. Newfound supply of natural gas in the United States has also eased concern about the domestic economy’s reliance on oil imports from the Middle East.

2014-06-16 Unconstrained Bond Investing in The New Neutral by Mohit Mittal, Saumil Parikh of PIMCO

At our recently concluded Secular Forum, PIMCO investment professionals from around the globe gathered in Newport Beach to discuss and debate the secular outlook for major world economies. With insight from guest speakers and new MBA/PhD hires, PIMCO coined the phrase The New Neutral to define its secular three- to five-year outlook for the world economies. In his most recent Investment Outlook, Bill Gross further elaborated on The New Neutral.

2014-06-16 Formula for Market Extremes by John Hussman of Hussman Funds

Market extremes generally share a common formula. One part reality is blended with one part misguided perception (typically extrapolating recent trends as if they are driven by some reliable and permanent mechanism), and often one part pure delusion (typically in the form of a colorful hallucination with elves, gnomes and dancing mushrooms all singing in harmony that reliable valuation measures no longer matter).

2014-06-14 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.

2014-06-14 Gold Investors: Let This Cycle Be Your Guide by Frank Holmes of U.S. Global Investors

U.S. Global Investors recently welcomed Doug Peta, an economist from BCA research, to our offices. He presented some interesting research regarding the Fed Funds Rate Cycle, and in turn, what that research could mean for gold. I wanted to share points from his presentation, as well as our own in-house research, to help you understand the positivity we see for the precious metal looking towards 2015.

2014-06-14 Who’s Afraid of Low, Low Rates? by James T. Tierney, Jr. of AllianceBernstein

Falling yields on Treasuries are often seen as a signal of a weakening economy that could undermine stocks. We think there are other explanations that don’t threaten the outlook for equities.

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

The U.S. economy contracted in the first quarter, but it appears very unlikely that we’ve 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.

2014-06-11 The US Economy – The Good, The Bad & The Ugly by Gary Halbert of Halbert Wealth Management

As is true more often than not, there are mixed signals in the economy. There are indeed some “green shoots” emerging that suggest the economy is finally gaining some momentum. Yet there are also continued troubling signs that, while not warning of an impending recession, suggest that we could be stuck in a structural period of continued below-trend growth.

2014-06-10 Far Above Cayuga’s Waters by David Wismer of Flexible Plan Investments

Graduation season is in a bit of a hiatus, with most colleges now having completed their commencement ceremonies and high school commencements are in full swing.

2014-06-10 The Crossroad by Kendall Anderson of Anderson Griggs

As summer peeks around the corner, a machine with two wheels is silently calling me, telling me that a new adventure awaits. This machine stirs up memories of past adventures, which builds in me a desire to head out to places unknown. I know that before summer ends I will answer its call, but for now I will just have to relive a few moments from trips past.

2014-06-07 China Leads the World in Green Energy, Gaming and Gambling Markets by Frank Holmes of U.S. Global Investors

Last month, Xian Liang, co-portfolio manager of our China Region Fund (USCOX), attended the 19th CLSA China Forum in Beijing. There he and hundreds of other global attendees were given the opportunity to meet with representatives from Chinese corporations, some of which U.S. Global owns. Xian also managed to get a sense of how the nation’s recent changes in consumer behavior and governmental policy reforms might affect its investment outlook. Although China remains an emerging market, it has lately taken a number of considerable strides to position itself as one of the world’s most

2014-06-05 Time (and Money) in a Cellphone by Bill Gross of PIMCO

Our modern age is becoming more virtual than physical, which I find increasingly depressing if only because I’ve failed to keep pace. I don’t even own a cellphone. Still, it doesn’t take a Boomer to observe that the reality outside as opposed to inside a computer or a cellphone should be the preferred experience. Scientists claim we are all just bits of information with billions of 1’s and 0’s, glued together to form a beating heart. Even so, I’m sticking with live chirping as opposed to Angry Birds for now. Virtual reality seems just a tad UNreal to me.

2014-06-03 Slow Ride: Housing’s Recovery Taking a Breather by Liz Ann Sonders of Charles Schwab

Key Points Housing's recovery has stalled courtesy of several headwinds. But it's less a driver of economic growth; and some trends could begin reversing. Long-term bears may be ignoring the (eventual) force of demographics.

2014-06-03 The US Housing Market's Darkening Data by Brian Pretti of PeakProsperity.com

Unlike past housing price cycles, the current environment is being driven not by natural household formation, but by a central bank-fueled investment cycle where institutional and foreign capital are the largest influence on the marginal price. This is unknown territory for homebuyers and certainly unsustainable at today's price levels. Brian Pretti shows how price mean reversion is inevitable; and urges homeowners (both residents and investors) to take steps not be as vulnerable as they were in 2008.

2014-06-02 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.

2014-06-02 Corporate Activity Flourishes by Chris Maxey, Brian Payne of Fortigent

With the backdrop of low interest rates, and sluggish revenue growth, 2014 has been the year that M&A activity finally blossomed. Companies are growing more aggressive in their acquisition tactics, leading to many high profile mergers and numerous opportunities to improve profitability.

2014-05-31 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.

2014-05-30 Four Simple Charts To Explain The Move In Bonds This Year by Team of GaveKal Capital

As an old friend used to say, "Price changes create their own news flow." This is a good way to think about all the "stories" that have surfaced lately explaining the unexpected plunge in bond yields this year.

2014-05-30 Global Economic Perspective: May by Franklin Templeton Fixed Income Group® of Franklin Templeton Investments

We believe a substantial improvement in US growth is underway, despite first-quarter 2014 gross domestic product (GDP) growth coming in at an annual rate of -1.0%, well below market expectations.

2014-05-30 Taking Advantage of Pessimism by Scott Minerd of Guggenheim Partners

The world is distracted with fears of the next great calamity, but heading into summer U.S. financial markets are enjoying a remarkably positive environment.

2014-05-30 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Reflections from a fortnight abroad;Last weekend's European elections will make cooperation more difficult

2014-05-29 Is There a UK Housing Bubble???? by Mike Amey of PIMCO

We see the UK experiencing a very traditional monetary cycle involving lower mortgage rates, higher house prices and then – hopefully – higher transactions. The Bank of England can address rising house prices either by raising financing costs via the banking system or by raising interest rates. Markets will watch BoE activity closely. Our expectation is for a gradual and modest interest rate cycle, with low rates in the UK economy for years to come. Housing may be an overvalued asset, but one that is secularly supported by low rates.

2014-05-29 Piketty's Envy Problem by Peter Schiff of Euro Pacific Capital

There can be little doubt that Thomas Piketty's new book Capital in the 21st Century has struck a nerve globally. In fact, the Piketty phenomenon (the economic equivalent to Beatlemania) has in some ways become a bigger story than the ideas themselves.

2014-05-29 Thailand’s Tensions, and Resilience by Mark Mobius of Franklin Templeton Investments

Thailand’s imposition of martial law on May 20 came after months of protests and threats of violence between two opposing sides—the anti-government group called the People’s Democratic Reform Committee (PDRC), known as the “yellow shirts,” and the pro-government group called the United Front for Democracy against Dictation (UDD), known as the “red shirts.” The PDRC demanded for the government to step down to pave the way for an appointed government.

2014-05-28 Home Sales Gain: Now Where? by Chris Maxey, Brian Payne of Fortigent

This week is full of economic data with the Case-Shiller Home Price index coming out. Also coming out is data on durable goods orders and consumer confidence. On tap for later in the week is the second estimate of Q1 GDP, pending home sales, and personal income growth.

2014-05-27 Economy Begins to Accelerate While Equities Push Higher by Robert Doll of Nuveen Asset Management

U.S. equities finished higher last week as the S&P 500 advanced 1.3%, snapping a two-week losing streak and ending at a new record high. Markets seemed to lack conviction, but the path of least resistance appeared skewed to the upside as momentum for the economic recovery was positive.

2014-05-25 A Bubble in Complacency by John Mauldin of Mauldin Economics

The simple fact is that we are in what I call a Muddle Through Economy. Things aren’t terrible, but they are not great, either. We’ve come through a devastating Great Recession caused by a crisis in the financial sector. It is quite typical for the effects of such a crisis to linger for a decade or more. So compared to where we were at the bottom of the Great Recession, the glass is half-full. But compared to the expectations we have for economic recovery and the resumption of vibrant growth, half-full seems like an exaggeration. And for many people, the glass is simply empty, whil

2014-05-25 Mounting Momentum? by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

Although the stock market remains sluggish, with the potential for a correction elevated, the U.S. economy appears to be improving. There is probably no great rush to get into the stock market at this point, but maintaining a steady investing discipline in the face of what we think is a continuing secular bull market is key. Investors frustrated with the low yield environment should be careful about adding too much risk to a portfolio in search of higher yields.

2014-05-24 In a Flash, China Looks Strong by Frank Holmes of U.S. Global Investors

If you want to know where the world economy is headed, there is one number that I believe investors should focus on: the HSBC China Manufacturing Purchasing Managers’ Index (PMI). On Thursday, the preliminary flash PMI for May came in at 49.7, beating Bloomberg’s consensus of 48.3.

2014-05-23 See No Evil by Peter Schiff of Euro Pacific Capital

In this week's release of the minutes from its April 29-30 meeting, Federal Reserve policymakers made clear that they see little chance of inflation moving past their 2% target for years to come. In order to make such a bold statement, Fed economists not only had to ignore the current data, but discount the likelihood that their current stimulus will put further upward pressure on prices that are already rising.

2014-05-23 Freddie, Fannie, finis? by Team of Northern Trust

The destruction wrought by the 2008 financial crisis necessitated a good deal of repair. In some areas, that repair is complete; in others, it is well along. But in one spot, it hasn’t really begun. Freddie Mac and Fannie Mae, the giant U.S. mortgage companies, remain in structural limbo more than five years after the American government rescued them. Just as plans to restructure these government-sponsored entities (GSEs) finally began making their way through the U.S. Congress, cross currents arose that greatly complicate the way forward. Some former shareholders are suing to recover so

2014-05-22 China’s Property Problems by Scott Minerd of Guggenheim Partners

Alarm bells are warning of a Chinese property bubble, but Beijing can avoid a crisis by allowing inflation to fix the problem.

2014-05-21 Pacific Powers: Australia and Japan by Don Huber of Franklin Templeton Investments

Separated by nearly 4,000 miles of sea, the economies of Australia and Japan are often lumped together under the Asia Pacific (APAC) label. Both of these countries can be considered global powers and powerful GDP generators, but their economies, the challenges they face and their responses to those challenges have been very different. Don Huber, vice president, research analyst and portfolio manager, Franklin Equity Group, looks at how these APAC powers are navigating their unique issues and shares his market outlook for each.

2014-05-21 And That's The Week That Was by Ron Brounes of Brounes & Associates

What goes up must come down (and then go up again). Such was the fickle week in the stock market. After soaring to new highs on the major indexes, investors went into selling mode (profit-taking for the most part?), before jumping back in for the end-of-week bargain shopping.

2014-05-20 Inflation Becomes the Latest Topic du Jour by Chris Maxey, Brian Payne of Fortigent

Long discussed pricing pressure is beginning to show up in various domestic indices, leading some to believe the Fed will pull its foot off the brakes sooner than anticipated. While inflation is stabilizing, there are few signs that it is accelerating materially, leaving plenty of room for the Fed to maneuver. It will be important to keep an eye on prices going forward, though, as any acceleration could alter the investment and economic landscape quickly.

2014-05-20 Bonds Rally, But Stocks Still More Attractive Long Term by Russ Koesterich of BlackRock

Stocks have floundered, while bonds continue to rally. Markets are showing a sharp reversal from 2013, when stocks were up strongly while bonds struggled. We maintain our long-term preference for equities and suggest investors exercise caution before adding to positions in bonds.

2014-05-17 Which Resource Areas Show Signs of Strength? by Frank Holmes of U.S. Global Investors

Global synchronized growth, as measured by the Global Purchasing Managers' Index (PMI), remained stable or positive for the past 12 months until Japan reversed the momentum in April with a precipitous drop in its PMI. China is contributing modest growth but, fortunately, the U.S. and Europe are rebounding. This lack of consistent global momentum has created a short-term, volatile, hot and cold, stop-and-go sentiment. Global real GDP growth peaked in 2010 at 5.2 percent then slowed for the next three years to 3 percent. Global growth in 2014 is likely to accelerate, for the first time in four y

2014-05-17 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

China: Two different stories, one conclusion. The jury is still out on long-term U.S. growth. Fond memories of Gary Becker.

2014-05-16 Concerned Optimism by Scott Brown of Raymond James

In her congressional testimony, Fed Chair Janet Yellen chose her words carefully. She indicated that if the economic outlook evolves as anticipated (growth picks up, the labor market tightens, and inflation moves toward the Fed’s 2% goal), then the Fed’s asset purchase program (QE3) will likely end in the fourth quarter. However, she refused to be pinned down on when the Fed would begin raising short-term interest rates. Global concerns and the housing sector “will bear close observation.”

2014-05-16 Breaking Good by Scott Minerd of Guggenheim Partners

After breaking out of their recent trading range, yields on U.S. Treasuries could now be heading significantly lower and the U.S. economy could enjoy fast economic growth in the coming months.

2014-05-16 Mixed Signals and the Road Less Traveled by Doug MacKay, Bill Hoover, Mike Czekaj of Broadleaf Partners

As the markets flirt with all-time highs and a potential shift in Fed policy, earnings season has not altered the fact that the level of investor uncertainty feels elevated. Throw in the case of a really bad winter, a geopolitical environment that rhymes with events just prior to World War I, and poor trading volumes, and it all suggests that heightened levels of unease remain.

2014-05-16 And That's The Week That Was by Ron Brounes of Brounes & Associates

Strike up the band! The Dow is now in positive territory for the year AND even set a record close. Who would have thunk that after the dismal January and the pessimism that reigned from the winter? The recovery continued as earnings season offered more surprises and the economic numbers show a country moving beyond the thaw of winter. Now if only China (Europe and Russia) could follow suit.

2014-05-15 Fed's Zero Interest Rate Cost Savers A Trillion Dollars by Gary Halbert of Halbert Wealth Management

Get a group of adults together in a social setting and the conversation almost invariably gets around to a discussion about the paltry returns savers have been earning on their money in recent years. Three-month certificates of deposits are averaging only 0.23% nationally; one-year CDs are at only 1% if you can get it; and five-year CDs get you only about 2%. And rates have been at or near these depressed levels for the last four years.

2014-05-14 Should We Worry More About The US Economy Or The International Economy? by Team of GaveKal Capital

The KBW Bank index is an index of 24 commercial banks in the US. It is considered a good proxy of the banking sector. Commercial banks tend to draw most of their profits from the local market, so the performance of the KBW Bank index is a decent proxy for profit expectations of the domestic sectors of the US.

2014-05-14 Great Rotation? No, The Reverse by Russ Koesterich of iShares Blog

According to many market watchers, 2014 was supposed to be the year of the so-called Great Rotation out of bonds and into stocks. However, as Russ writes, we’re actually seeing the reverse happen lately, though the case for stocks is still quite strong

2014-05-13 Dollar Bulls Drop Their Heads in Frustration by Chris Maxey, Ryan Davis of Fortigent

For some time, strategists have been bullishly positioned on the U.S. Dollar, anticipating a rally that failed to materialize. The arguments were straightforward – the Federal Reserve is exiting its easing cycle, Europe is facing deflationary pressure and likely to ease further, and the economy in the U.S. is on improving footing. Those expectations, while true to some extent, are not translating into gains for the Dollar, leaving many frustrated. The Dollar is suffering from a bad case of dejection and could struggle to see a sustained breakout for some time.

2014-05-13 Goldilocks and the Global Economy by Douglas Cote of Voya Investment Management

Macro conditions are lukewarm but positive and largely absent any systemic risk. Momentum stocks have fallen out of favor as the market rotates into names with more attractive valuations. Europe and especially the U.K. have been showing signs of strength despite geopolitical risk with its energy supplier, Russia. The “safety” of sidelined cash exposes investors to what we view as the greatest current risk in the market — upside risk.

2014-05-13 Market Perspective by The CCR Wealth Management Investment Committee of CCR Wealth Management

US equity markets have seen what we would describe as mild volatility over the last few weeks, mostly attributed to geopolitical tensions emanating from the Ukraine-Russia belligerence. For the first quarter, the S&P 500 rose 1.30%, while the Dow Jones Industrial Average and the NASDAQ composite were both down slightly.

2014-05-10 The Good, the Bad and the Opportunity by Frank Holmes of U.S. Global Investors

Twice a day, in the morning and at lunch, our investment team sits down together to discuss what’s important and what’s immaterial. This past week, in my opinion, the good outweighed the bad. Much of the economic news was a direct result of government policies, both fiscal and monetary. Here are my findings, which I hope will help you filter through the noise.

2014-05-09 The Job Market, GDP, and the Fed by Scott Brown of Raymond James

The U.S. economy added 1.15 million jobs in April – that’s prior to seasonal adjustment. We normally see large (unadjusted) job gains each spring. This year appears to be stronger than normal, partly reflecting a rebound from a bad winter. Strength in the seasonally adjusted payroll figure is certainly good news, but it may not necessarily be suggestive of a sharper underlying trend in job growth. There is still a very large amount of slack in the job market.

2014-05-09 Fighting History? by Liz Ann Sonders of Charles Schwab

A lot of movement to go nowhere can characterize the major indexes to this point in the year. History suggests we're entering a potentially tough period for stocks, due to both seasonal and midterm election year tendencies.

2014-05-08 Forward into Broad, Sunlit Uplands by Scott Minerd of Guggenheim Partners

It’s topsy turvy season as U.S. interest rates are falling when they should normally be rising and because 2014 might be the year to ignore the age-old advice to sell in May and go away.

2014-05-08 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Another stable week for stock prices as deal making, solid earnings and dividend growth offset the conflicting signals on the economy as well as the uncertainties stemming from various global hot spots.

2014-05-06 Labor Markets Bounce Back from Winter Hibernation by Chris Maxey, Brian Payne of Fortigent

In a less than surprising development, U.S. non-farm payrolls grew by 288,000 in April. While some are loathe admitting the positive nature of April’s report, there was plenty to be happy about in the latest release, suggesting the economy continues to move towards a more favorable footing. As always in the post-2008 world, caveats remain and the trend in the months ahead will provide a clearer picture into the pace of recovery.

2014-05-05 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.

2014-05-04 Albania's Fertile Grounds for Oil Opportunities by Frank Holmes of U.S. Global Investors

Texas is oil country. The state I now call home leads the nation in oil production and would be one of the top oil-producing nations if it were its own country. But that doesn?t stop us from exploring other promising oil opportunities further afield. Last week I traveled to Albania to check out a drill site of Petromanas Energy, a Calgary-based international oil and gas company focused on exploration and production throughout Europe and Australia. We own the junior stock in our Global Resources Fund (PSPFX) and Emerging Europe Fund (EUROX).

2014-05-03 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

2014-05-02 Looking for Bubbles Part One: A Statistical Approach by Jeremy Grantham of GMO

It is a sensible expectation that reasonable long-term value investors will endure pain in a bubble. It is almost a rule. The pain will be psychological and will come from looking like an old fuddy-duddy? looking as if you have lost your way in the new golden era where some important things, which you have obviously missed, are different this time. For professionals this psychological pain will also come from loss of client respect, which always hurts, and loss of peer group respect, which can be irritating.

2014-05-02 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Earnings have been supportive and merger activity has skyrocketed these past couple weeks. Stock markets have remained firm as a result despite money coming out of the previous hot sectors of social media (Amazon) & the biotech industry (despite great fundamentals).

2014-05-02 Emerging Markets Outlook - April 2014 by Team of Thomas White International

Emerging market equities as an asset class have been underperforming developed market equities for more than three years, though they continue to maintain the lead over 10-year returns. The divergence in returns between emerging and developed markets widened sharply in 2013, when the prospect of reduced capital inflows heightened investor concerns about slower economic growth in the emerging countries.

2014-05-02 Need for New Midstream Energy Infrastructure Remains Strong by David Chiaro of Eagle Global Advisors

Capital expenditures expected to surpass $640 billion by 2035, says David Chiaro, co-portfolio manager of the Eagle MLP Strategy Fund.

2014-05-02 Down Under: Commodities to Consumption by Tarik Jaleel of Matthews Asia

Ever since China's demand for commodities intensified around 1999, its increased reliance on imported energy and minerals has underpinned Australia's boom in the natural resources industry. Naturally, as China's import growth has recently slowed, materials and energy sector firms in both Australia and New Zealand have grown cautious about their business prospects.

2014-05-01 Attractiveness of Municipal Bonds Should Not Be Overlooked in 2014 by Municipal Insight Committee of Eaton Vance

After a challenging year for the municipal bond (muni) market in 2013, we believe the underlying strength of munis has improved, making the asset class an attractive proposition. In our view, challenges and headwinds will continue in 2014; however, more palatable yields and the relative attractiveness of munis versus other taxable alternatives may help investors limit the volatility and downside witnessed over the past year.

2014-04-30 The TCW Advantage: Analysis with Consumer Credit by Harrison Choi, Brian Rosenlund of TCW Asset Management

5 years removed from the depths of the crisis and behind the tailwinds of an incredibly accommodative Federal Reserve, asset prices and of course Non Agency RMBS prices have improved dramatically. When double-digit loss adjusted yields were available most participants in the market did very well if they were able to simply overcome the fear of buying an asset class that was seemingly in freefall. At current prices and significantly lower loss adjusted yields today, however, the margin for error is far lower and many managers without the expertise, infrastructure and experience will underperfor

2014-04-30 Dependence On Government Has Become Epidemic by Gary Halbert of Halbert Wealth Management

Did you know that the number of Americans getting benefits from the federal government each month greatly exceeds the number of full-time workers in the economy by a longshot? Sadly, it?s true. Based on the latest Census Bureau data available, there were over 148 million non-veteran Americans who were on some kind of monthly means-tested government benefit programs in 2012, by far the highest number ever. Today, that number is around 167 million by some more recent estimates.

2014-04-29 Americas: Regional Economic Review - Q1 2014 by Team of Thomas White International

The developed economies in North America continue to see relatively healthier growth prospects this year, while the outlook for the emerging economies in Latin America remains subdued. Trends from both the U.S. and Canada indicate that these economies are recovering from the slowdown at the beginning of the year, caused by adverse weather.

2014-04-29 What the Housing Doldrums Mean for Fed Policy by Kristina Hooper of Allianz Global Investors

Economic conditions are gradually improving, but the housing market has lagged. Kristina Hooper highlights what it will take to get housing back on track.

2014-04-29 Why Are Hedge Funds Struggling in 2014? by Chris Maxey, Ryan Davis of Fortigent

2014 has been a year marked by shaky equity markets and relatively higher volatility than observed in 2013. With falling equity market correlations and increased stock dispersion, it was presumably a more favorable environment for hedge funds. Unfortunately, that has not been the case as most alternative investment approaches are posting less than stellar results so far this year.

2014-04-28 Henny Pennies by Tony Crescenzi, Mike Amey, Tadashi Kakuchi, Ben Emons of PIMCO

While the Fed?s qualitative guidance may have increased uncertainties over monetary policy, volatility will likely remain contained by powerful short- and long-run forces related to the economic outlook. In the UK, we should at least respect the risk of a hike late in the first quarter of 2015, earlier than what is currently priced in. In Japan, we believe the BOJ will remain full throttle on its current monetary easing for some time.

2014-04-28 Fed?s Inflation Target Misguided? Good vs. Bad Disinflation by Ken Taubes of Pioneer Investment Management

For more than a year the Federal Reserve Board has cited inflation below its targeted 2% level as one justification for maintaining its extraordinarily accommodative monetary stance. As of February, the core inflation rate was 1.1%, based on the Personal Consumption Expenditure (PCE) inflation series, the Fed?s preferred measure of inflation. But there is good reason to question whether the 2% target justifies current policy.

2014-04-25 A Creative Approach to Revitalize South Korea?s Economy by Mark Mobius of Franklin Templeton Investments

South Korea has been an exciting country to follow since Templeton started investing in emerging markets in 1987. The country represents one of the great success stories of the modern age, rising from extreme poverty at the end of the Korean War to become an affluent, democratic and highly technologically advanced country. However, we believe recent years have seen signs that the methods and structures that gave rise to the years of dramatic economic progress have started to lose their effectiveness.

2014-04-25 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 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The link between money and inflation has clouded, but it hasn?t disappeared

2014-04-25 Developed Asia Pacific: Regional Economic Review ? Q1 2014 by Team of Thomas White International

Developed Asia Pacific economies showed increased resilience as loose monetary policies of the past two years helped create demand, boost employment, and increase output.

2014-04-24 Global Economic Outlook by Team of Northern Trust

Advanced economies should dominate the growth picture in 2014, but the jobless rate is likely to show only a small improvement

2014-04-24 Emerging Asia Pacific: Regional Economic Review - Q1 2014 by Team of Thomas White International

The byword for economic prospects in emerging Asia Pacific economies during the first quarter of 2014 was "optimism". The countries in the region, despite undergoing a torrent of political activity and struggle, pinned their hopes on a revival in global trade. With other avenues of growth such as investment and consumption showing little promise, the emphasis on global trade took on even greater importance.

2014-04-24 And That's The Week That Was by Ron Brounes of Brounes & Associates

After a week of panic, investors focused on the positives and went bargain hunting throughout. Thus far, earnings are not as bad as expected; China’s woes could mean new stimulus; labor and manufacturing seem to be in full fledge thaw. Hope the holiday season brings more good news.

2014-04-23 Positioning Your Portfolio for Rising Rates. by Team of Forward Management

Accelerating outflows from bond funds in 2013 highlight investor nervousness over the prospect of rising interest rates. Investors may want to carefully assess the role of fixed-income investments in their portfolios, particularly in light of other types of income-producing vehicles. Upon careful evaluation of their options, investors can make adjustments suitable to their objectives.

2014-04-23 Hasenstab: Separating the Wheat from the Chaff by Michael Hasenstab of Franklin Templeton Investments

Fixed income investors have dealt with a number of headwinds in early 2014, including unrest in Eastern Europe, the prospect of rising interest rates in the United States and fears about slowing growth in China. Michael Hasenstab, executive vice president and CIO, Global Bonds, Franklin Templeton Fixed Income Group®, has been on a global tour to assess conditions in select countries first-hand, looking beyond what the media headlines portray.

2014-04-22 Taxes are the Pits, But Not for Everyone It Seems by Chris Maxey, Ryan Davis of Fortigent

A number of Americans breathed a joyful sigh of relief last week after closing the books on their 2013 income taxes. The annual rite of passage rarely elicits excitement when addressed in conversation, and this year was unlikely to be any different. But, the latest tax data suggests the economy is gaining speed, news bound to make even the most hardened filers crack a smile.

2014-04-21 The Economic Cost of Brazil?s Spending Spree by Mark Mobius of Franklin Templeton Investments

Brazil has been on a spending spree during the past few years, which, unfortunately, has failed to generate meaningful growth and has led to negative economic consequences. In addition to the lavish spending in preparation for the FIFA World Cup? this summer and the Olympic Games in 2016, Brazil?s national oil company has been spending billions of dollars on expensive offshore oil exploration, production and energy development.

2014-04-21 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.

2014-04-18 Quarterly Review and Outlook by Van Hoisington, Lacy Hunt of Hoisington Investment Management

After examining much of the latest scholarly research, and conducting in house research on the link between household wealth and spending, we found the wealth effect to be much weaker than the FOMC presumes. In fact, it is difficult to document any consistent impact with most of the research pointing to a spending increase of only one cent per one dollar rise in wealth at best. Some studies even indicate that the wealth effect is only an interesting theory and cannot be observed in practice.

2014-04-17 Tick, Tock, Tax Time by Frank Holmes of U.S. Global Investors

In 2014, Americans will pay $3 trillion in federal taxes and $1.5 trillion in state taxes. Believe it or not, according to the Tax Foundation, that means more of your income is being spent on taxes than on food, clothing and housing combined!

2014-04-17 Equity Outlook by Team of Osterweis Capital Management

Short term, we would not be surprised if the market took a breather after its strong gains last year. Additionally we may see volatility related to news coming out of the Middle East and Russia. But longer term, we remain very optimistic on the outlook for U.S. equities. In addition to the reasons we discussed above we believe U.S. equities are very attractive relative to the alternatives. The great bull market in bonds appears to be over. The great decades of emerging market growth appear to be behind us.

2014-04-17 Why Energy is Catching the Market's Eye by Frank Holmes of U.S. Global Investors

Over the last month the energy sector has outperformed the market, and as you can see in the chart below, has done so by 6.5 percent. Year-to-date the sector is beating the S&P 500 Index by over 3 percent. In a spectacularly performing market during 2013, energy lacked some of the incredible performance seen throughout the other sectors, but recently it has turned up, catching the attention of the market yet again.

2014-04-17 Three Yards and a Cloud of Dust by Sam Stewart of Wasatch Funds

Former Ohio State football coach Woody Hayes was well-known for his conservative offense-often quoted as saying, "There are only three things that can happen when you pass, and two of them are bad." The two bad outcomes are either an incompletion or an interception. Instead, Hayes favored a methodical, grind-it-out approach, running the ball directly into the line: "three yards and a cloud of dust." What Hayes’ style of play may have lacked in pizazz, it more than made up for in results. The U.S. economy today is following a similar offensive playbook, but with less satisfying results.

2014-04-16 And That's The Week That Was by Ron Brounes of Brounes & Associates

And what a bad week it was. After flirting (and setting) new record highs on both the S&P and Dow, equity investors worried about the upcoming earnings reports and freaked out over the some disturbing news from China. Stocks plunged late in the week with the Nasdaq particularly hard hit, though the other indexes followed suit and gave up all of their prior gains for the year. For the most part, domestic developments remain strong but news on the global front have prompted investors to seek out the safe-haven of treasuries. Over-reaction or new trend?

2014-04-15 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 Complacency Makes Volatility Markets a Dangerous Place by Chris Maxey, Ryan Davis of Fortigent

With a dissipation of economic stress in Europe, and a general strengthening of economic conditions in the U.S., equity market volatility has plunged to new lows. Some would argue that market intervention by central banks is acting as an unnatural dampener to market volatility, raising the question as to whether a gradual removal of those policies will cause volatility to resurface. So far, the answer is up for debate, but current positioning suggests many investors are becoming complacent and will be caught off sides if such a scenario emerges.

2014-04-14 Uncovering Opportunities in Emerging Markets by Mark Kiesel of PIMCO

Emerging markets have underperformed expectations, but the longer-term secular outlook remains constructive for many regions. Highly negative investor sentiment and outflows have sharply reduced prices, significantly improving relative value in emerging markets. We see opportunities in emerging markets in interest rates, sovereign credit and select companies for investors with a longer-term investment horizon. ?

2014-04-12 Proper Perspective by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

Getting caught up in the weeds is easy in this 24-hour news cycle where everyone is looking to make a splash, but successful investing requires staying above the fray. The U.S. economy is growing and equities appear fairly valued, Europe has issues to deal with but has come a long way from the depths, Japan may be working against itself but improvement has been seen, and the threat of a Chinese debacle at this point seems minimal.

2014-04-12 Every Central Bank for Itself by John Mauldin of Millennium Wave Advisors

Whether the FOMC can actually turn the taper into a true exit strategy ultimately depends on how much longer households and businesses must deleverage and how sharply our old-age dependency ratio rises, but markets seem to believe this is the beginning of the end. For now, that’s what matters most. Under Fed Chair Janet Yellen’s leadership, the Fed continues to send a clear message to the rest of the world: Now it really is every central bank for itself.

2014-04-10 "I Will Gladly Pay You Tuesday for a Hamburger Today" by Robert Mark of Castle Investment Management

In October of 2013, Robert Shiller won the Nobel Prize in economics for his research on spotting market bubbles. Shiller, an economist and professor at Yale University who accurately predicted the housing bubble, is a pioneer of behavioral finance, or the understanding of how psychology causes us to act irrationally with our money.

2014-04-08 Moving Forward With the Normalization of Yields by Scott Mather, Michael Story of PIMCO

One response to yield normalization is to consider retaining core bonds and diversifying the specific risk factor of concern, in this case duration. In the past, global bonds have captured most of the upside but avoided a significant amount of the downside relative to domestic-only bonds. Generating capital gains from bonds in a rising yield environment requires defining concretely what yield normalization means ? where yields are going and when they will get there ? and setting these expectations against forward market pricing, country by country.

2014-04-07 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.

2014-04-07 The Doubt of Appearances by Dimitri Balatsos of Tesseract Partners

Households have made significant progress mending their balance sheet in the post-crisis period. Assets have been boosted on the back of higher home values and stock prices, while liabilities have been trimmed, mostly mortgages, thanks in large part to widespread home foreclosures.

2014-04-05 The Lions in the Grass, Revisited by John Mauldin of Millennium Wave Advisors

Today we explore a few things we can see and then try to foresee a few things that are not quite so obvious. The simple premise is that it is not the lions we can see lounging in plain view that are the most insidious threat, but rather that in trying to avoid those we may stumble upon lions hidden in the grass.

2014-04-04 Putin and the Naughty Chair by Robert Stimpson of Oak Associates

On the surface, the first quarter of 2014 appears to be decent. The S&P 500 eked out a gain of 1.8% in the first three months of the year, despite heightened geopolitical tensions, a changing of the guard at the Federal Reserve, and frigid weather hampering economic growth. Accounts managed by Oak Associates have topped the S&P 500 year-to-date. That being said, signs of internal weakness are present in US equities.

2014-04-04 Warning Signs in Leveraged Credit? by Elizabeth (Beth) MacLean of PIMCO

· Though leveraged credit markets are less levered than they were pre-crisis, signs of more lenient, issuer-friendly terms are prompting regulators (including the Fed) and investors to voice concerns. · Regulators have tightened lending guidelines, but strong demand versus supply means the market is able to find ways around such guidance. · Detailed bottom-up credit analysis with an emphasis on long-term fundamentals and loss avoidance remains crucial to investing in leveraged credit today.

2014-04-04 What's Abuzz About Gold? by Frank Holmes of U.S. Global Investors

If we continue to see these large movements of the physical metal, especially from the West to the East, it would appear to be only a matter of time until these supply-and-demand factors lift the gold price.

2014-04-03 Foolish Investment Ideas by Axel Merk of Merk Investments

With April Fools? Day behind us, it?s time to get serious about investing. Don?t be fooled by this week?s non-farm payroll report; nor by the assertion that the U.S. may have the cleanest of the dirty shirts. And certainly don?t be fooled into thinking the market has your interests in mind?

2014-04-03 Q2 fixed income outlook ? Hitting for the cycle by Gene Tannuzzo of Columbia Management

By the middle of this year, the economic expansion in the U.S. will officially turn five years old. By comparison, the average of all business cycle expansions tracked by the National Bureau of Economic Research dating back to the mid-1800s is about three and half years. But like many five year olds, this cycle hardly seems mature. In particular, we have taken notice of three key elements of the business cycle that have distinct implications for bond investing today.

2014-04-03 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Last week saw a correction in many of the high-flying groups, but overall another quiet week with investors unsure of the economic outlook.

2014-04-03 ProVise Bullets by Team of ProVise Management Group

During the Great Recession, America laid off two million factory workers and factory output fell 20 percent. Before the Great Recession, of course, manufacturing jobs were headed overseas. As we have slowly emerged from the Great Recession, it’s a little surprising to some that manufacturing has led the way, outpacing overall GDP growth. This year it looks like manufacturing could add 3.5 percent in growth. Is this just a replacement of jobs that were lost during the Great Recession?

2014-04-03 And That's The Quarter That Was by Ron Brounes of Brounes & Associates

After a nightmare than was January, the quarter actually turned out pretty well (except in the Ukraine).

2014-04-02 Consumer Confidence Up, But Concerns Remain by Gary Halbert of Halbert Wealth Management

The Conference Board reported last week that its Consumer Confidence Index jumped to 82.3 in March (up from 78.3), the highest reading since January 2008, just as the recession was beginning. But the two underlying components of the Index provided two different perspectives, as we will discuss today.

2014-04-02 Foolish Investment Ideas by Axel Merk of Merk Investments

With April Fools? Day behind us, it?s time to get serious about investing. Don?t be fooled by this week?s non-farm payroll report; nor by the assertion that the U.S. may have the cleanest of the dirty shirts. And certainly don?t be fooled into thinking the market has your interests in mind?

2014-04-02 A Fixer-Upper? by Team of GaveKal Capital

As noted yesterday, March was not an exceptionally positive month for European equities.

2014-04-01 U.S. Growth Offers a Tailwind for the Region by Mohit Mittal, Ed Devlin, Lupin Rahman of PIMCO

PIMCO expects growth in the U.S. to improve due to a reduction in fiscal drag, although the Federal Reserve?s tapering and slowing growth in China are risks. While higher U.S. growth should offer a boost to exporters, Canada will likely face headwinds from a housing correction and drop in consumption. Latin America has fared relatively well amid the recent volatility in emerging markets, but differentiation across credits and markets continues to increase.

2014-04-01 A Look at First Quarter Market Performance by Chris Maxey, Ryan Davis of Fortigent

As the first quarter draws to a close, equity markets appear poised to finish in positive territory despite a somewhat tumultuous news environment. As noted by Bloomberg, save for a sharply negative Monday period, the S&P 500 will close out a fifth consecutive quarter in positive territory for the first time since 2007.

2014-04-01 Signs of Life?? by Adam Bowe, Robert Mead of PIMCO

As mining investment in Australia tapers, improvements in other sectors of the economy recently have allayed some concerns of a collapse in domestic demand. We share the cautious optimism but stop well short of expecting higher policy rates this year. Australian bond yields remain highly correlated to global developed market bond yields, and without a near-term domestic catalyst to cause that correlation to break, Australia?s yields are more likely to gradually rise, particularly in the longer end of the yield curve, which isn?t supported by anchored policy rates. ?

2014-04-01 2016 (Part 1, The Economic Issue) by Bill O'Grady of Confluence Investment Management

In this report, we are tackling the geopolitical impact of the 2016 elections. Given the size of the topic, it will be discussed over a three-part series. As we survey the political landscape for 2016, the next presidential election could be historic. In our opinion, the last three presidents have been unable to create a consistent foreign policy that reflects America?s role as the unipolar superpower. We will begin by examining the economic challenges the next president will face, with a broad analysis of the issues of inequality and economic growth.

2014-04-01 Fundamental Tango by Scotty George of Alexander Capital

The economy and financial markets are forever sending out mixed, parallel, or confusing messages. Inflation or stagflation? Buy now, or take your profits? Proceed slowly, or go home? At this moment, the signals are hardly synchronized.

2014-03-29 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Using energy as a pawn may work to Russia’s disadvantage in the long run. China’s 2014 economic outlook is hazy. Lessons from the 2014 stress test.

2014-03-28 Americas: Regional Economic Review 4Q 2013 by Team of Thomas White International

The outlook for the developed economies in North America remains healthy while the emerging economies of Latin America continue to face headwinds. Though recent data from the U.S. and Canada have indicated moderation in economic activity, most of the slowdown was likely caused by adverse weather conditions in the region.

2014-03-28 Lacking Conviction by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Investors seem to lack conviction, what will potentially push them to one side or the other.

2014-03-28 Four Areas Revved Up for a Resources Boom by Frank Holmes of U.S. Global Investors

Commodity returns vary wildly, as experienced resource investors can attest and our popular periodic table illustrates. This inherent volatility can spell opportunity for the nimble investor who can look past the mainstream headlines to identify hot spots. Our global resources expert, Brian Hicks, CFA, identified four we believe are revved up for a resources boom.

2014-03-27 A Sustainable Recovery?? by Mike Amey of PIMCO

Early signs indicate that the long awaited increase in business investment is underway. In turn, that bodes well for real income growth and the sustainability of the economic recovery. Given the improved economic prospects and the change in rhetoric at the Bank of England, the central bank could well be an early adopter of tighter monetary policy. We expect the BoE to hike rates ahead of the US Federal Reserve. While we beli?eve the British pound has already reflected the BoE?s guidance for official rates to rise by mid-2015, the bond market has yet to fully reflect the new environment. ?

2014-03-27 US Economic Round-Up - Pending Home Sales Decline Again by Team of GaveKal Capital

Quite a bit of US data was released this morning. The major releases were GDP 3rd revision, Corporate Profits, Initial Jobless Claims, & Pending Home Sales. Let's take a quick look at each.

2014-03-26 And That's The Week That Was by Ron Brounes of Brounes & Associates

Well, apparently Janet Yellen has her own style, her own personality, her own mixed message. Just as Fed watchers had to get used to Bernanke in the aftermath of maestro Greenspan (does that name still apply after the financial crisis?), investors will need a few meeting to figure out the new Fed Chair. An early rebound was followed by a selloff which was followed by a rebound which was followed by a late-week selloff. Nicely done, Ms. Yellen (though Russia played a role as well).

2014-03-26 Looming Retirement Crisis ? Boomers In Big Trouble! by Gary Halbert of Halbert Wealth Management

Let?s face it, we all know this country is facing a retirement crisis. The first of the Baby Boomers turned 65 and started retiring in 2011. The number of Boomers retiring each year will rise rapidly over the next decade or more. Before the end of this decade, Boomers will be turning age 65 at the rate of 8,000 per day.

2014-03-26 Housing Booming, Busting and Muddling Along by John Burns of John Burns Real Estate Consulting

Housing is local again! Our consultants and clients see vastly different housing markets all across the country. I categorize them into three groups (booming, busting, and muddling) in this article and provide anecdotes from our team members---- but it is really more complicated than that.

2014-03-25 Janet Yellen Enters the Picture by Chris Maxey, Ryan Davis of Fortigent

After bursting onto the scene earlier this year, Janet Yellen held her first official FOMC meeting last week. Rather than upset the apple cart, she held a largely status quo stance, but several comments raised more than a few questions.

2014-03-25 US Housing Round-Up by Team of GaveKal Capital

We had three US housing related economic releases today: FHFA House Price Index, S&P Case-Shiller, and new home sales. The two price series both slightly beat consensus while new home sales came in exactly at consensus.

2014-03-25 Five Things You Should Know About Housing Reform Legislation by Michael Canter, Matthew Bass of AllianceBernstein

A recent US Senate bill calls for a restructuring of the government?s role in housing finance, including winding down Fannie Mae and Freddie Mac. Here are five takeaways from the current proposal.

2014-03-24 March Flash Update by Clyde Kendzierski of Financial Solutions Group

At the end of February, the market as measured by the S&P 500 moved slightly above the year-end levels. Subsequently, a brief calming of the tensions surrounding the events in the Ukraine (time will tell) generated a relief rally that extended a bit further resulting in new record highs exactly 5 years after the financial crisis lows of March 2009.

2014-03-24 Stocks Rise as Economic Backdrop Slowly Improves by Bob Doll of Nuveen Asset Management

U.S. equities finished higher last week, with the S&P 500 increasing 1.4%. Ukraine seemed to be receding in investors? minds. Despite the volatility and sharp increase in bond yields on Wednesday, the hawkish takeaways from the FOMC meeting were not a lingering overhang.

2014-03-24 Fed-Induced Speculation Does Not Create Wealth by John Hussman of Hussman Funds

Fed-induced speculation does not create wealth. It only changes the profile of returns over time. It redistributes wealth away from investors who are enticed to buy at rich valuations and hold the bag, and redistributes wealth toward the handful of investors both fortunate and wise enough to sell at rich valuations and wait for better opportunities.

2014-03-24 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 China's Minsky Moment? by John Mauldin of Millennium Wave Advisors

In speeches and presentations since the end of last year, I have been saying that I think the biggest macro problem in the world today is China. China has run up a huge debt, and the payments are coming due. They seem to be proactive, but will it be enough? How much risk do they pose for the global system?

2014-03-22 What Makes a Slam-Dunk Portfolio? by Frank Holmes of U.S. Global Investors

As a native Canadian, hockey is in my blood, but after moving to Texas, the icy arenas changed to basketball courts, as the sole major league sports team in the city is the San Antonio Spurs.

2014-03-20 Assessing the Liquidity of Futures Backed Gold ETFs by Ade Odunsi of AdvisorShares

Most gold ETFs that use futures to gain gold exposure will use the COMEX 100 ounce gold futures contract which is generally regarded as the most liquid gold futures contract in the world. The Commodity Exchange (COMEX) is a commodity exchange owned by the Chicago Mercantile Exchange (CME). As part of its gold exchange the COMEX offers warehousing for its members.

2014-03-19 A Kid?s Market? by Jeffrey Saut of Raymond James

The Great Winfield goes on to say, in Adam Smith?s classic book from 1967, ?The strength of my kids is that they?re too young to remember anything bad, and they are making so much money they feel invincible.? He rented kids with the idea that one day the music will stop (it partially did in 1969-1970 and completely did in 1973-1974) and all of them will be broke but one.

2014-03-19 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.

2014-03-19 If They Will Lend, Someone Will Spend (on Something) by Paul Kasriel of Econtrarian, LLC

Upon awakening from my winter hibernation way up here in beautiful northeastern Wisconsin, I have noticed that bank asset managers have been anything but hibernating. Rather, they have been quite busy expanding their loans and securities.

2014-03-19 Pockets of Opportunity in Europe, Emerging Markets by Lisa Myers of Franklin Templeton

Maintaining the right mix or balance of assets in a portfolio to achieve a desired goal can be a challenge, particularly when the markets are constantly shifting. As portfolio manager for Templeton Global Balanced Fund, Lisa Myers, executive vice president, Templeton Global Equity Group, regularly faces that task.

2014-03-18 Currency Markets Heat Back Up, and Will Likely Remain that Way by Chris Maxey, Ryan Davis of Fortigent

Long dormant after the financial crisis, foreign exchange markets are beginning to heat up, offering ample trading opportunity for asset managers. The U.S. dollar was widely viewed as being the best long trading opportunity for 2014, but so far, that has not played out, with activity in the Euro, Chinese Yuan, and other currencies impeding dollar strength.

2014-03-17 Restoring the "Virtuous Cycle" of Economic Growth by John Hussman of Hussman Funds

The so-called ?dual mandate? of the Federal Reserve does not ask the Fed to manage short-run or even cyclical fluctuations in the economy. Instead ? whether one believes that the goals of that mandate are achievable or not ? it asks the Fed to ?maintain long run growth of the monetary and credit aggregates commensurate with the economy's long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices and moderate long-term interest rates.?

2014-03-17 And That's The Week That Was by Ron Brounes of Brounes & Associates

Remember when tiny Greece was a market mover? Well, now it’s tiny Crimea. With the growing global tensions and concerns about Crimea’s secession from the Ukraine to Russia, investors chose to take a week off (for the most part) and take some equity profits, while moving back into the safe haven of treasuries. With little news on the domestic economic calendar, investors looked abroad and didn’t care much for what they saw in China. (Still, the yuan must be better than the ruble these days.)

2014-03-16 Inequality and Opportunity by John Mauldin of Millennium Wave Advisors

Today we will continue our thinking about income inequality, and I will respond to some of your letters, as they make good launching points for further discussion of the topic.

2014-03-12 Housing: An Oft Forgotten Pivot Point by Matt Lloyd of Advisors Asset Management

Today we got the newly released data on the state of the economy in the form of the Fed Flow of Funds. We have often cited it as a way of corroborating certain trends and potential reversal of trends when warranted.

2014-03-12 U.S. Household Net Worth Hits New Record High by Gary Halbert of Halbert Wealth Management

The Federal Reserve announced last Thursday that US household net worth reached a new record high by the end of last year ? at $80.7 trillion. The Fed said the new record was made possible largely due to vaulting stock prices, increased home values and Americans paying off more of their debts.

2014-03-10 It Is Informed Optimism To Wait For The Rain by John Hussman of Hussman Funds

Regardless of very short-term market direction, it is urgent for investors to understand where the equity markets are positioned in the context of the full market cycle.

2014-03-07 Weather or Not? by Peter Schiff of Euro Pacific Capital

Everyone agrees that the winter just now winding down (hopefully) has been brutal for most Americans. And while it's easy to conclude that the Polar Vortex has been responsible for an excess of school shutdowns and ice related traffic snarls, it's much harder to conclude that the it's responsible for the economic vortex that appears to have swallowed the American economy over the past three months.

2014-03-07 Making Green from Gold, Palladium and Pollution by Frank Holmes of U.S. Global Investors

Gold is coming back with a vengeance, experiencing a clear recovery and grabbing the attention of market cynics. Analysts from Noruma Securities even upgraded its outlook for gold, expecting bullion to climb over the next three years, according to Barron's.

2014-03-05 The US Economy - Back To The Slow Lane Again by Gary Halbert of Halbert Wealth Management

Late last year, President Obama predicted that 2014 would see ?breakout growth? in the US economy. His optimism was not completely unwarranted since the economy grew by a healthy 4.1% (annual rate) in the 3Q of last year, driven largely by an unexpected surge in inventory rebuilding. Then in late January, the Commerce Department reported that the economy grew by a better than expected 3.2% in the 4Q.

2014-03-04 A Consumer Releveraging Renaissance? by Chris Maxey, Ryan Davis of Fortigent

After a long period of deleveraging, there are appearances that consumers are entering a stage of releveraging. The devil is always in the details, though, and this releveraging cycle is likely to play out vastly different than those of previous expansions.

2014-03-03 Blame it on the Weather? Not so Fast by Russ Koesterich of iShares Blog

How much is the weather to blame for recent soft U.S. economic data? While the weather is certainly responsible for some, or perhaps even most, of the recent slowdown, it?s not the whole story, writes Russ.

2014-03-03 Market Outlook by Scotty George of Alexander Capital

Whereas the "micro" details of ascribing corporate valuations are litigated every day through securities' trading on global bourses, there is very little "macro" disagreement that we are at a critical global inflection where recovery and purchasing power either expand or remain less than satisfactory. If it doesn't happen now, after all the intervention, debate, austerity and fiscal changes, it is not likely to take root at all.

2014-02-28 Hide and Seek by Herbert Abramson, Randall Abramson of Trapeze Asset Management

Hide and seek. A game investors played as children but should not forget these days. Currently, investors need to hide safely to protect from some unfavourable developments in an environment that could hurt them.

2014-02-28 What Areas of the Market Will Remain in the Limelight? by Frank Holmes of U.S. Global Investors

The current bull market has been five years in the making. Since the bottom on March 9, 2009, the S&P 500 Index has grown an incredible 174 percent. With this spectacular performance, investors are asking if U.S. companies will stay in the limelight or if it is time to draw the curtain on equities.

2014-02-28 Bounce Back by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

US stocks have bounced and the market’s still attractive and in the midst of a secular bull market. But there are likely to be bumps along the way; notably given that this is a midterm election year; which are known for first-half pullbacks. A diversified portfolio is important and both European and Chinese stocks appear to have upside, while Japan continues to frustrate with a two-steps forward, two-steps back sort of approach. And a final reminder not to replace fixed income assets with equities in search of higher income without recognizing the risk profile of a portfolio has changed.

2014-02-27 Big Wheel Keep on Turning by Scott Minerd of Guggenheim Partners

Economic uncertainty from this winter soft patch will linger for months, but strong housing fundamentals should underpin a strengthening U.S. economy while low inflation augers well for stock prices.

2014-02-26 Supply and Demand in the Balance by John Burns of John Burns Real Estate

We look at the housing demand/supply balance two ways.

2014-02-26 U.S. Housing: Investors Reach for Higher-Hanging Fruit by Joshua Anderson, Emmanuel Sharef, Grover Burthey of PIMCO

PIMCO expects house prices to transition to steady secular growth, with nominal price increases of 5%?10% cumulatively over two years. An environment of reduced volatility and steady gradual growth may result in tightening risk premia and spreads as the market begins to price in this new dynamic. Over the coming years, we will focus on whether the underbuilding of single-family homes is ultimately resolved through housing starts, rental growth or continued price appreciation.

2014-02-26 Weather-Beaten by Scott Brown of Raymond James

Harsh winter weather often shows through in the economic data. Large seasonal adjustment can magnify that impact. Snowstorms happen every year, of course ? the key is whether they are worse than usual. This year, bad weather has been relatively widespread, affecting many areas of the country and much of the economic data for December, January, and February. None of the bad weather has had a significant impact on the longer-term outlook and investors have begun to take the economic news with an appropriate grain of salt.

2014-02-25 Time to Worry About Europe Again? by Chris Maxey, Ryan Davis of Fortigent

The European sovereign debt crisis has all but faded from investors? minds since ECB President Mario Draghi?s famous pronouncement on July 26, 2012 that he would do ?whatever it takes? to save the monetary union. Since that time, equity markets in Europe rallied sharply as accumulated risk aversion fell away.

2014-02-25 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.

2014-02-25 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

A quiet four days for stocks last week. Between the holiday, school vacations and winter weather; there just were not many catalysts for the stock marker.

2014-02-24 Another Disappointing US Housing Data Release by of GaveKal Capital

Existing home sales fell by -5.1% month-over-month in January. Existing home sales have now declined five of the past six months are now down on a year-over-year basis (5.13%).

2014-02-24 Wallflower Value Stocks Are Ready to Dance by Chris Marx of AllianceBernstein

Global equities are notching new highs, valuations are elevated and talk of market bubbles is increasingly common. Yet, by our measure, the potential for outperformance in value stocks has rarely been better. How can that be?

2014-02-22 Going for the Gold by Frank Holmes of U.S. Global Investors

Everyone wants the gold. Around the world, athletes train for years to compete for a gold medal. In Hong Kong and China, the Love Trade seeks gold coins, bars and jewelry.

2014-02-21 Is the U.S. Economy Under the Weather? by Carl Tannenbaum of Northern Trust

Is the U.S. economy under the weather?; Japan is faltering a bit as year two of Abenomics begins; Bitcoin has generated a lot of attention, some of it unwanted

2014-02-20 And That's The Week That Was by Ron Brounes of Brounes & Associates

We’re back, baby. (Well, at least, for a week.) Janet Yellen made her case to become the most revered Fed Chair (anyone even remember Maestro Greenspan?) by merely reiterating Dr. B’s prior remarks about the economy and the bond buying program. Investors felt the love this Valentine’s week as they shook off the past negativity and took the Dow to its best daily showing and back above the 16k level. Can Cupid (and Yellen) continue to work his (her) magic after Prez day and beyond?

2014-02-20 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks soared last week as economic reports showed the global economy was weaker than originally estimated in the last quarter of 2013 and has lost further momentum in 2014. This has acted to support bond prices and lower interest rates. Thus, stocks as an asset class continue to do well.

2014-02-20 Thanks Washington, But the Recovery Remains Soft by Russ Koesterich of iShares Blog

While two events in Washington last week supported stocks and other risky assets, they overshadowed the release of some relatively disappointing economic numbers providing more evidence of still soft U.S. economic growth.

2014-02-20 Nothing Burns Like the Cold by Scott Minerd of Guggenheim Partners

The U.S. economy has stalled amid a winter freeze but the Federal Reserve is unlikely to act because warmer weather should bring a rebound, leading to higher U.S. stock prices and tighter credit spreads.

2014-02-20 The Next Phase of Housing's Recovery: Which Five Investments Should You Own Today? by Mark Kiesel of PIMCO

PIMCO has significant top-down and bottom-up expertise dedicated to understanding the U.S. housing market cycle. In 2006, we warned U.S. housing prices were significantly overvalued, which led to our defensive positioning heading into the recession. In 2011, we turned bullish on real estate and added investments such as non-agency mortgage-backed securities, banks and homebuilders that we felt would benefit from an eventual recovery in housing prices.

2014-02-20 Bond Investors Need Not Feel Powerless by Jeff Hussey of Russell Investments

Jeff Hussey, global CIO, explains the strategies investors should be pursuing when considering fixed income investments in their portfolios and how additional yield cushion while opening a door to additional security selection returns from active management.

2014-02-19 Checking in on Earnings by Chris Maxey, Ryan Davis of Fortigent

Earnings season is nearing its finale, and the latest results show plenty of reason to be bullish, but the longer-term trend remains an outstanding question for markets.

2014-02-18 Why Emerging Market Fears are Overblown by Robert Huebscher (Article)

Conditions in the emerging markets bear little resemblance to those in 1997 leading up to the Asian crisis, according to Simon Derrick, a leading market strategist with BNY Mellon. In this interview, he also explains why the euro is overvalued and picks the winners and losers in today’s currency wars.

2014-02-18 Are US Housing Prices About To Drop? by Team of GaveKal Capital

This morning the NAHB Housing Market Index showed a large 10-point drop in January. This is, in fact, the largest decline on record for the Housing Market Index.

2014-02-18 Equity Markets: How Much Energy Does the Bull Have Left? by Kurt Feuerman of AllianceBernstein

After another big year for stocks in 2013, many investors are questioning how much longer the bull market can run before it collapses from exhaustion. This doubt has intensified with the early 2014 selloff. However, based on what we see, it’s not time to worry about the market’s stamina yet.

2014-02-18 Topping Patterns and the Proper Cause for Optimism by John Hussman of Hussman Funds

We would dismiss classic topping patterns we observe here if the recent market peak did not feature the "full catastrophe" of textbook speculative features, particularly the same syndrome of extreme overvalued, overbought, overbullish, rising yield conditions observed (prior to the past year) only at major market peaks in 2007, 2000, 1987, 1972, and 1929. Meanwhile, we remain encouraged. Those who follow a historically informed, value-conscious, and risk-managed investment discipline should be among the most optimistic investors in the financial markets.

2014-02-15 The Economic Singularity by John Mauldin of Millennium Wave Advisors

Today, let’s think about central banks and liquidity traps and see if we agree that central bankers are driving the car from the back seat based upon a fundamentally flawed theory of how the world works. That theory helped produce the wreck that was the Great Recession and will have its fingerprints all over the next one.

2014-02-14 Weather Related? by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

The recent slowdown in economic data appears to be largely weather related and we believe decent growth will reassert itself. Stocks have bounced after a weak start to the year, but the threat of a further pullback remains, although our longer-term optimism has not been dented. Likewise, we believe Europe offers some attractive investment opportunities but we’re in a wait-and-see mode with Japan. Finally, we don’t see EM turmoil becoming overly contagious, but we are watching that situation closely.

2014-02-13 A Centennial to Celebrate - The Federal Reserve Looks Forward to Its Next 100 Years by Carl Tannenbaum of Northern Trust

The Fed’s centennial arrives at an interesting juncture. Never in its history has the American central bank been so deeply involved in economic management, and rarely has it attracted such controversy. The recent transition in Fed leadership marks the end of a significant era. In some ways, this makes it a perfect time to contemplate what the Fed was, what it has become and what it should be during its second century. The results of this review will be valuable to central banks the world over.

2014-02-13 Equity Markets: How Much Energy Does the Bull Have Left? by Kurt Feuerman of Alliance Bernstein

After another big year for stocks in 2013, many investors are questioning how much longer the bull market can run before it collapses from exhaustion. This doubt has intensified with the early 2014 selloff. However, based on what we see, it’s not time to worry about the market’s stamina yet.

2014-02-12 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.

2014-02-12 Why Quantitative Easing Didn?t Work by Gary D. Halbert of Halbert Wealth Management

IN THIS ISSUE: 1. Why Fed?s Quantitative Easing (QE) Didn?t Work 2. Velocity of Money Plunged During Financial Crisis 3. Should Bernanke & Company Have Done More? 4. QE Was a Huge, Dangerous Experiment That Failed 5. Fed Begins to ?Taper? QE Purchases in January 6. Conclusions ? What Happens Next?

2014-02-07 2013 Year-End Investment Commentary by Team of Litman Gregory

We find ourselves with a more sanguine big-picture view, at least over the nearer term, than we have had in some time. U.S. and global economic fundamentals gradually improved over the past year across a number of dimensions, and seem poised for continued improvement or at least stability in 2014. However, as we look ahead, the longer-term risks related to excessive global debt, subpar growth, and unprecedented government policy that we have worried about since the aftermath of the 2008 financial crisis still remain largely unresolved.

2014-02-07 What's the Game Changer for Gold? by Frank Holmes of U.S. Global Investors

What will break gold of its losing streak? Will inflation, which is a lagging indicator, be stronger than expected? In one of my most popular posts last year, I said that based on the jobs market, the limited housing recovery and regulations slowing down the flow of money, the Fed would have no choice but to start tapering and raising rates very gradually to keep stimulating the economy.

2014-02-06 Emerging Market Woes abd Fed Tapering Equals Stocks Plunge by Gary Halbert of Halbert Wealth Management

January saw US stocks record their first losing month since last August. After reaching new record highs at the end of December, the Dow Jones shed almost 1,000 points in the last half of the month and the decline continues. Analysts attributed the sell-off in large part due to troubling news from several emerging nations, in particular to the so-called "Fragile Five" - Turkey, India, Brazil, Indonesia and South Africa.

2014-02-06 EM Misery and US Large-Cap Euphoria by William Smead of Smead Capital Management

Many investors are wondering why emerging stock market misery currently equates to weakness in the US stock market as represented by the Dow Jones Industrial Average and the S&P 500 indexes (large-cap). Long time followers of our writing at Smead Capital Management are aware that we have been making the argument this would happen since 2010 and we are happy to review our thesis.

2014-02-06 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 Chicago Housing Outlook an A Plus after Falling 91% by John Burns of John Burns Real Estate Consulting

Watch out for a housing renaissance in the Chicago metro area. The region massively overcorrected in this last downturn and just recently joined the recovery. New home revenue fell 91% from 2005 to 2010, and most private builders went out of business.

2014-02-05 This Just In: The Secular Bear Market May Be About to Resume. by Martin Pring of Pring Turner Capital Group

In our 2012 book, Investing in the Second Lost Decade we laid out the case for the secular bear market in equities lasting at least through the end of the decade. Since then prices of most averages have moved to all-time highs. It’s time to throw in the towel on the secular bear market for stocks...right?

2014-02-05 Emerald Economic Commentary by Team of Emerald Allocation Strategies

As Yogi Berra once said, "You got to be careful if you don’t know where you’re going, because you might not get there." As we look back on 2013 and look ahead to 2014,we want to share our thoughts on the road traveled and more importantly, the possible road ahead.

2014-02-04 Bear Markets: Different Ingredients, Same Market Behaviors by Roger Nusbaum of AdvisorShares

While it is logical that markets are complex, the reality is that the level of complexity changes over time. The level of complexity started to increase last year when now former Fed Chairman Ben Bernanke first introduced the idea of what has come to be called tapering.

2014-02-04 Challenging the Consensus by Niels Jensen of Absolute Return Partners

Investors are overwhelmingly bearish on bonds going into 2014. In this month’s Absolute Return Letter we challenge that view and look at various reasons why the bond market may surprise most people and deliver a positive return this year.

2014-01-30 Quarterly Review and Outlook - Fourth Quarter 2013 by Van Hoisington, Lacy Hunt of Hoisington Investment Management

In The Theory of Interest, Irving Fisher, who Nobel Laureate Milton Friedman called America’s greatest economist, created the Fisher equation, which states the nominal bond yield is equal to the real yield plus expected inflation. It serves as the pillar of macroeconomics and as the foundational relationship of the bond market. It has been reconfirmed many times by scholarly examination and by the sheer force of historical experience. Examining periods of both low and high inflation offers insight into how each variable in the Fisher equation affects the outcome.

2014-01-30 A Healthy Correction in Emerging Markets by Scott Minerd of Guggenheim Partners

It has been a hard start to the year, especially for emerging markets, but the latest dislocation is a healthy part of the cycle and the risk-on trade remains intact.

2014-01-30 Breakthrough by Colleen Denzler of Janus Capital Group

The funny thing about crises is that we tend to feel as if they occur suddenly, on one day. For me, that day was when Lehman Brothers filed for bankruptcy protection on September 15, 2008. I remember looking at my Bloomberg screen and thinking I was witnessing the end of the financial markets.

2014-01-29 All Things in Moderation, Including Housing by Ed Devlin of PIMCO

In our view, the cooling housing market and other domestic factors will keep Canadian growth at a modest 1.75%-2.25% in 2014, despite a boost from higher U.S. growth. While we expect a correction in Canada’s housing market to begin this year, the macroeconomic environment and the availability of mortgage credit suggest a housing crash is unlikely. In this environment, we think the Canadian dollar should remain attractive, 10-year bonds should offer the potential for gains, and provincial bonds will likely outperform federal government and corporate bonds.

2014-01-29 Fed Responsible for EM Crisis? by Axel Merk of Merk Investments

From the bully pulpits in Sao Paulo to the blogosphere in cyberspace, the Fed is blamed for the turmoil in Emerging Markets (EM). That’s a bit like blaming McDonald’s for obesity. Blaming others won’t fix the problems in EM economies, it won’t fix investors’ portfolios and it is an unlikely way to lose weight. Investors and policy makers need to wake up and realize that they are in charge of their own destiny. Let us explain.

2014-01-29 A Few Concerns by Scott Brown of Raymond James

We’ve 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 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. What’s 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.

2014-01-28 Emerging Market Issues Weigh on U.S. Equities by Bob Doll of Nuveen Asset Management

U.S. equities finished lower last week as the S&P 500 declined 2.6% and suffered the largest weekly pullback since June of 2012. U.S. stocks are down approximately 3.0% both year to date and from all-time highs. In 2014, lack of direction in the market has been a focus, and the waning influence of macroeconomic news caused a notable shift late last week.

2014-01-28 Surviving Austerity by Andrew Schiff of Euro Pacific Capital

With the Standard & Poor’s 500 Index having posted a 30% gain, it’s easy to assume that U.S. stocks easily led the world in 2013. (There is more on what is behind this rally in the latest version of the Euro Pacific Capital Newsletter). But as it turns out, the stimulus-loving U.S. markets had plenty of company. Surprisingly, this includes countries supposedly saddled by the scourge of austerity.

2014-01-28 An Active Management Turning Point? by Chris Maxey, Ryan Davis of Fortigent

Active managers faced a difficult road in recent years, leading to many questions about the efficacy of active versus passive investment management. There are signs that the tide is once again changing in favor of active managers and the road ahead could offer happier times.

2014-01-25 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

So while the Fed was the first to implement nontraditional monetary strategies, the BoE may be the first to unwind them. And it may be the first to test the power of macroprudential policy. The results might make for an interesting export back across the Atlantic.

2014-01-23 Economic Growth is Likely to Improve in 2014 by Derek Hamilton of Ivy Investment Management Company

We believe a global economic upturn is likely in 2014, although the overall growth rate will remain sluggish. We think developed countries will show the largest improvement, which in turn will help support growth rates in emerging markets.

2014-01-23 Can Equities Continue Their Rise? Equity Investment Outlook: January 2014 by Matt Berler, John Osterweis of Osterweis Capital Management

2013 marked the fifth year of recovery following the near-death experience of the 2008 global financial system meltdown. From a low of 677 in 2009, the S&P 500 Index (S&P 500) finished 2013 at 1,848, delivering a stunning 203% total return from the low. Over the same period, the total return for the Dow Jones Industrial Average was 188%. The tech-heavy and arguably more speculative NASDAQ logged a 249% total return. These very large equity returns reflect both a strong recovery in corporate profits and a dramatic clean-up of our financial system.

2014-01-21 Superstition Ain't the Way by John Hussman of Hussman Funds

When you believe in things that you don’t understand, then you suffer.

2014-01-21 Weighing the Week Ahead: More "Experts" Predicting a Market Top by Jeff Miller of New Arc Investments

Most potential stock investors have been bruised by events over the last decade. They are receptive to a message of fear, and many pundits are happy to satisfy their urges. Calling for a major market turn can be very profitable for the pundit. This is true even if the prediction is very early and the pundit never signals when to shift back.

2014-01-21 And That's The Week That Was by Ron Brounes of Brounes & Associates

With a few more days to digest the labor data, investors began the week on another sour note, but a sense of normalcy returned on some other better-than-expected releases. Still, the Fed’s stimulus remains atop the headlines as speculation runs amuck about how the tapering will play out. Earnings season pushes ahead and, thus far, the results are lackluster at best. Don’t forget, as January goes...

2014-01-18 Dialing Down the Drama by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We remain optimistic on stocks for 2014, but there will likely be bumps in the road. Investor sentiment is elevated, complacency seems to be building, and the valuation story is less compelling. But waiting for a correction can be quite detrimental to portfolio performance, evidenced by last year. QE tapering will likely continue at a very modest pace and U.S. interest rates will likely drift higher throughout the year. We remain positive on Europe and our outlook toward China is improving, while we are in at wait-and-see sort of mode with Japan.

2014-01-17 What Does It Take to Be in the Top 1 Percent? Not As Much As You Think by Frank Holmes of U.S. Global Investors

You might be surprised to learn that the top 20 percent of income earners bring in a household income of just over $100,000. The top 10 percent of earners have a household income of more than $148,687. To be considered in the top 1 percent, household income is at least $521,411.

2014-01-16 2014: Once more for '84 by Team of Smead Capital Management

Since our thinking is always dominated by owning businesses which meet our eight investment criteria in a long-duration time frame, we continue to remain vigilant of the circumstances around us. To that end, we thought it would be helpful to review a similar historical situation and glean a feel for what was wise behavior back then and what might be wise behavior as we look forward to the year 2014.

2014-01-15 U.S. Inflation Outlook 2014: Signs of Life by Nicholas Johnson, Mihir Worah of PIMCO

We expect headline CPI to rise to around 2.0% year-over-year in 2014, with our base case oil forecast in the $105-$110 per-barrel range and expectations for food prices to be stable. PCE, in our view, will likely remain below the Fed’s 2% target, around 1.5%. Individuals will get some relief at the supermarket, but they will feel a pinch from landlords, who will likely raise rents.

2014-01-15 Fed Tapering -- Shades of 1937? by Paul Kasriel of Econtrarian, LLC

In the press conference immediately following the December 17-18, 2013 FOMC meeting, Fed Chairman Bernanke indicated that it was the FOMC’s current plan to have terminated Federal Reserve outright securities purchases by the end of 2014, commencing with a $10 billion reduction in securities purchases immediately after the December 2013 FOMC meeting and then continuing to taper its purchases by about $10 billion after each 2014 FOMC meeting. Of course, this tapering plan is subject to modification in either direction depending on forthcoming economic and financial market developments.

2014-01-15 The January Barometer by Jeffrey Saut of Raymond James

It’s that time of year again when the media is abuzz with that old stock market saying, "so goes the first week of the new year, so goes the month and so goes the year." Admittedly the January Barometer has a pretty good track record.

2014-01-14 The Diversification Obituary by Chris Maxey, Ryan Davis of Fortigent

According to some major media outlets, 2013 was the year diversification died. With the S&P 500 racing to a more than 30% gain (the largest since the late ’90s), it seemed as though no other asset class truly mattered last year. While it is true domestic equities had a banner year, one-asset class portfolios will never be robust, and there is reason to believe 2013 is a prime example of why diversification is incredibly important.

2014-01-14 The Financial Fire Next Time by Robert Shiller of Project Syndicate

Just as most people are more interested in stories about fires than they are in the chemistry of fire retardants, they are more interested in stories about financial crashes than they are in the measures needed to prevent them. That is not exactly a recipe for a happy ending.

2014-01-13 Weighing the Week Ahead: Can Earnings Growth Propel Stocks Higher? by Jeff Miller of New Arc Investments

If you could know one thing about stocks in the coming year, it would be what to expect from corporate earnings. The Q4 2013 reports will provide a preview, with attention starting this week.

2014-01-13 "New Bubble" Talk, Premature by Brian Wesbury, Bob Stein of First Trust Advisors

That was fast. A little over two years ago, we declared that housing had not only bottomed, but was about to start its first real growth spurt since the bubble (Housing At An Inflection Point 11/2/2011). While some agreed, others expressed polite disagreement or, in some cases, incredulity.

2014-01-10 2014 Economic and Investment Outlook by Team of Ivy Investment Management Company

Although the December 2013 U.S. budget pact between House and Senate negotiators was a welcome development, partisan battles over government spending still are possible in 2014. The agreement ends a three-year budget fight and sets government spending through fall 2015, but it does not eliminate the need to raise the nation’s borrowing limit - the "debt ceiling."

2014-01-10 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.

2014-01-10 Continuing a Winning Formula for 2014 by Frank Holmes of U.S. Global Investors

We believe there’s a way that increases the odds of winning. It’s by combining a bottom-up approach with a top-down strategy: Find great, fast-growing and shareholder-focused companies and focus on the best stocks in the sectors experiencing positive momentum.

2014-01-09 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 doesn’t 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 Consumer Confidence Jumped in December, But Why? by Gary Halbert of Halbert Wealth Management

Today we’ll look at several economic reports, including a big jump in consumer confidence last month. That seems a little odd given that over 63% of Americans still believe the country is headed in the wrong direction as I reported last week.

2014-01-08 AdvisorShares Weekly Market Review by AdvisorShares Research of AdvisorShares

In this new year, the magnitude of 2013 comes full circle. The S&P 500 and the Dow finished the year with 29.6% and 26.5% gains, respectively. For the Dow, that was the biggest annual gain since 1995, and the fifth consecutive positive year. Most impressive in the developed markets was Japan’s Nikkei Stock Average, which surged 57%.

2014-01-08 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 Where are Margins Headed? by Mark Oelschlager of Oak Associates

The fourth quarter was another good one for stocks, with the S&P 500 returning 10.5%, and 32.4% for the year. This was the best calendar-year performance by the index since 1997. All four quarters of 2013 produced positive returns, with the first and fourth quarters, typically the strongest seasonally, both hitting double-digits. For the year Consumer Discretionary and Healthcare were the standout sectors, while Utilities and Telecom lagged. The laggards are not surprising, as they are income-oriented - an area of the market that was hurt by the backup in bond yields.

2014-01-07 Is 2014 the Year That Alternatives Matter Again? by Chris Maxey, Ryan Davis of Fortigent

In the wake of the financial crisis of 2008, investors piled into alternative investments en masse to help insulate their portfolios from another dramatic market decline. For those who had not yet bought into the idea of improving portfolio risk-adjusted returns, the 50% drawdown in the S&P 500 provided all the convincing needed.

2014-01-07 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 2014 Housing Predictions by Logan Mohtasham of AMC Lending Group

A tale of 2 halves with lingering questions characterizes what we can say was the story for housing for 2013. In the first half of the year, rates were low as the 10 year note was well under 2%. People were still refinancing, as home prices rocketed. Multiple bids were common, and pundits like Ivy Zelman cheered the improving market with praise like "Housing is in Nirvana".

2014-01-06 Reflections on 2013: What's Important, What's Not, and What's Ahead by Mike Shedlock of Sitka Pacific Capital Management

A tale of 2 halves with lingering questions characterizes what we can say was the story for housing for 2013. In the first half of the year, rates were low as the 10 year note was well under 2%. People were still refinancing, as home prices rocketed. Multiple bids were common, and pundits like Ivy Zelman cheered the improving market with praise like "Housing is in Nirvana".

2014-01-06 Too Big to Pop by Peter Schiff of Euro Pacific Capital

Most economic observers are predicting that 2014 will be the year in which the United States finally shrugs off the persistent malaise of the Great Recession. As we embark on this sunny new chapter, we may ask what wisdom the five-year trauma has delivered.

2014-01-06 And That's The Week That Was by Ron Brounes of Brounes & Associates

To say that 2013 was an interesting year would be a bit of an understatement. We learned a long time ago not to make predictions about the stock market because no matter what is predicted, it is likely to be wrong. Even if we get lucky one year, we are not likely to even get close the following year. We do try to give guidance, however. Last year we suggested that, given the late run in the market in 2012 and its 15% return, investors should be happy with a return of 8 to 10% in 2013. Obviously, investors enjoyed much better returns.

2014-01-03 A More Market-Friendly China by Henry Zhang of Matthews Asia

My last visit to Beijing happened to coincide with the Communist Party’s Third Plenum Meeting. General business sentiment was just as upbeat as it had been earlier last autumn. But through my discussions with different businesspeople, I came away with a distinct new optimism over the leadership’s more market-oriented stance on policies.

2014-01-03 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.

2014-01-02 2013 - Good Year Or Good Riddance? by Gary Halbert of Halbert Wealth Management

It’s New Year’s Eve, so I thought it might be interesting to look at some recent polls to get a sense of how Americans feel about how things went in 2013 and what they considered to be the most important news stories of the year.

2014-01-02 2013 in Review: Best of the "Silver Bullet" Awards by Jeff Miller of New Arc Investments

Regular readers of my "Weighing the Week Ahead" series know that I occasionally give the Silver Bullet Award. This recognizes writers who take it upon themselves to debunk dangerously misleading financial analysis. Their often thankless work reminds me of the Lone Ranger, whose adventures often upheld the notion that "...that all things change but truth, and that truth alone, lives on forever."

2014-01-02 The Long and The Short of Gold Investing by Peter Schiff of Euro Pacific Precious Metals

There are two types of gold investors: those trying to make money on short-term market timing and those looking for long-term asset preservation. It was the fear-driven trading of the former that helped gold break $1900 in 2011, and for good reason - stormy markets steer investors to safe havens.

2013-12-31 2014? by Jeffrey Saut of Raymond James

Year-end letters are difficult to write because there is always a tendency to discuss the year gone by or, worse, attempt to forecast the coming year. Typically, when the media asks where the S&P 500 (SPX/1841.40) will be at the end of the new year, I tell them you might as well flip a lucky penny.

2013-12-30 Weighing the Week Ahead: How Should Investors Judge the Prospects for 2014? by Jeff Miller of New Arc Investments

Sometimes the calendar of news and events makes it easy to predict what will grab our attention in the week ahead. In the last few weeks leading up to the Fed tapering announcement, I highlighted the following.

2013-12-30 Plow Horse, Trotting by Brian Wesbury, Bob Stein of First Trust Advisors

What a year 2013 has been. Remember how it started, with the media hyperventilating over the "fiscal cliff" deal and spending sequester? The vast majority of economists, pundits and politicians believe in Keynesian economics. So, it’s not surprising that higher tax rates and spending cuts sent them into an intellectual and theoretical funk.

2013-12-27 Gary Shilling: Review and Forecast by John Mauldin of Millennium Wave Advisors

It’s that time of year again, when we begin to think of what the next one will bring. I will be doing my annual forecast issue next week, but my friend Gary Shilling has already done his and has graciously allowed me to use a shortened version of his letter as this week’s Thoughts from the Frontline. So without any further ado, let’s jump right to Gary’s look at where we are and where we’re going.

2013-12-26 Economy Surprises On The Upside, But Is It Real? by Gary Halbert of Halbert Wealth Management

In today’s abbreviated holiday E-Letter, we’ll look at last Friday’s surprising report on 3Q GDP. In its third estimate of 3Q GDP, the Commerce Department reported that the economy surged by more than anyone expected. Given the surprisingly strong numbers, more than a few are questioning the report’s accuracy and wondering if it will be revised lower in January.

2013-12-26 Newsletter by Harold Evensky of Evensky & Katz

I admit it, I do occasionally pick on Money Magazine and other consumer financial publications, but as I’ve written in the past, for the most part, Money does a great job of educating consumers. Its story on Lessons from the Crash "Lehman Brothers’ collapse in September 2008 sent stocks on a terrifying ride. A year-by-year look back reveals five key takeaways you need to heed today" is an excellent example. Here are Money’s "Lessons."

2013-12-24 And That's The Week That Was by Ron Brounes of Brounes & Associates

vestors thanked Bernanke this week for what they perceived as an early holiday present. While no one knew how they would react once the Fed began to taper its bond purchases, many surprised analysts by lifting stocks to one of the best showings of the year (and a new record on the Dow). And now that that uncertainty is out of the way, let the vacations begin.

2013-12-24 Will Santa Claus Come to Town in 2013? by Kevin Mahn of Hennion & Walsh

The technical anomaly popularly called the "Santa Claus Rally" describes the abnormal positive returns the market experiences in the last month of the calendar year. Logic would suggest that the optimistic behavior of market participants due to the holidays, combined with higher sales during the busiest shopping season of the year, justify the movement in stock prices, but shouldn’t this seasonality be priced into the market already?

2013-12-20 PIMCO Cyclical Outlook for the Americas: Riding the Cross-Currents of Higher U.S. Growth and the Fed by Mohit Mittal, Lupin Rahman, Ed Devlin of PIMCO

In the U.S., lower fiscal drag and the possibility of higher consumer and corporate spending should drive growth higher in 2014. Supported by higher U.S. growth and stabilization in Europe and China, Latin America is set to grow 3%-4% on average, but with a large dispersion across countries. Canada should benefit from the U.S. recovery but will likely lag U.S. growth due to lower consumption and residential investment.

2013-12-20 A Surprising Way to Participate in Today's Tech Boom by Frank Holmes of U.S. Global Investors

China has become one of the best consumption stories out there, and looking over the next few years, local technology companies are almost certain to benefit. So while many U.S. investors are getting excited about the growing number of initial public offerings in the tech sector, they would be remiss if they didn’t look beyond Silicon Valley.

2013-12-20 Looking Beyond the Initial Fed Taper by Sam Wardwell of Pioneer Investments

Can the Fed be believed or trusted? Pioneer’s Sam Wardwell analyzes the tension between data dependency and forward guidance in Fed policy.

2013-12-20 A Picture: More Misleading than a Thousand Words by John Burns of John Burns Real Estate Consulting

If you believe mortgage rates will return to 8.3%, backend debt to income ratios will fall to 38%, and that significant down payments and savings will be required going forward, then you should be concluding that housing appears overvalued today. I am not ready to make those assumptions.

2013-12-18 Australia Inc. by Adam Bowe, Robert Mead of PIMCO

In 2013, real growth in business investment in Australia outside the mining sector slowed to almost zero, in part due to the high exchange rate. While some sectors of the economy such as housing appear to be improving, we continue to expect sub-trend growth in 2014 due to the subdued outlook for business investment. The RBA will most likely have to keep interest rates low for an extended period to ease the transition away from mining-assisted growth and encourage a weaker exchange rate.

2013-12-18 PIMCO's Cyclical Outlook for Asia: Growth Is Stabilizing but Not Stellar by Ramin Toloui, Tomoya Masanao, Robert Mead of PIMCO

In China, near-term economic performance will be dominated by the dialing back and forth of credit conditions by policymakers, while long-term reform progresses incrementally. Japan’s GDP growth will slow in 2014 due to a consumption tax hike but will still be above the country’s potential growth as it is assisted by reflationary policies. The pace of Australia’s growth will slow due to weakness in manufacturing and mining, reflecting tempered growth in China.

2013-12-18 The Milken Rule and Wide/Sustainable Moats by Bill Smead of Smead Capital Management

This is my 34th year in the investment business. You might not be aware that I trained and worked at Drexel Burnham my first nine years in the business. Michael Milken was the driving force behind the success and profitability of my original firm. What happened to Drexel and Mike Milken in the late 1980s is a study in how to have a brilliant vision and how to handle a business with a very wide moat. Its demise has created what I call the Michael Milken rule and we believe it should be used in present day analysis, in particular when it comes to evaluating moats.

2013-12-17 Gundlach - Don’t Plan on Tapering by Robert Huebscher (Article)

Investors face many concerns as the new year approaches, but a recurrence of May’s "taper tantrum" should not be high on their lists, according to DoubleLine’s Jeffrey Gundlach. With the majority of Fed governors staking a dovish position, "quantitative stimulus is likely to remain with us longer than people think," Gundlach said.

2013-12-17 Will 2014 Bring an End to Central Bank Intervention? by Chris Maxey, Ryan Davis of Fortigent

Nearing the final two weeks of the year, it is customary to look forward to the trends and events that will shape the coming year. A theme that may come to the fore in 2014 revolves around central bankers, specifically the diverging fates in various economies of the world.

2013-12-17 The Monster That Is Europe by John Mauldin of Millennium Wave Advisors

This week, Geert Wilders and his Party for Freedom in the Netherlands and Marine Le Pen of the Front National (FN) of France held a press conference in The Hague to announce that they will be cooperating in the elections for the European Parliament next spring and hope to form a new eurosceptic bloc.

2013-12-17 2013 A Pretty Good Year by Mike Temple of Pioneer Investments

This time last year we were bullish about equities and positive on the slow but steady strengthening of the economy. The market did not disappoint. The economy was almost heroic, you might say, with its performance enduring government sequestrations and higher taxes almost a 2% drag on GDP but comporting with our expectations of 2 - 2.5% growth. 2013 is ending with GDP and the markets coming fairly close to what we thought they’d achieve. Now the year is almost out, so let’s take stock of 2013 but look ahead to 2014.

2013-12-17 The One Percent by Jeffrey Saut of Raymond James

I read the Pope’s words about inequality following a meeting of our newly formed Consumer Analysts Panel. The panel consists of our consumer analysts, our lodging/housing analysts, our economist, senior management of our institutional sales team, and me. Interestingly, the recurring theme over the course of said meeting was that the top 20% of wage earners are doing fine, but the bottom 20% are not.

2013-12-17 Taper Time? by Scott Brown of Raymond James

There are many arguments for and against an initial reduction in the Fed’s monthly rate of asset purchases, but the balance has shifted toward a December taper. It appears to be a very close call, but even if the Fed decides to delay again, we all know (or should know) that QE3 is going to wind down in 2014.

2013-12-17 Housing Market Index Is Up, Should Help Buoy CPI by Team of GaveKal Capital

The NAHB Housing Market Index increased to 58 to post the highest number since August, which is also the highest level of the recovery. The HMI correlates pretty well with house prices.

2013-12-16 A Much Better Dilemma by Mike Amey of PIMCO

While the UK economy is likely to avoid reverting to growth levels of recent years, it must transition into a more durable recovery involving business investment, higher productivity and stronger real wages. However, headwinds for domestic demand look significant and the banking system appears to favour secured lending to consumers over businesses. We believe that much of the rise in bond yields is already behind us. With clearer value in shorter bonds, our preference lies in short and intermediate gilts.

2013-12-16 Debt Crisis Recovery: Bell Curves and Balance Sheets by John Greenwood of Invesco Blog

This three-part series examines the life cycle of a debt crisis and looks at where the US, UK and eurozone are in the recovery process. This second post looks at where the US stands in the deleveraging process. Part 1 explained the phases of a debt crisis, while Part 3 will focus on why the UK and eurozone lag the US in balance-sheet repair.

2013-12-16 Absolute Return Letter: Squeaky Bum Time by Niels Jensen, Nick Rees, Tricia Ward of Absolute Return Partners

QE has led to asset price inflation. That much we established in the November Absolute Return Letter. In this month’s letter we go one step further and look at whether we are now in bubble territory. Considering the strong bull-run we have experienced in 2012-13 it is perhaps surprising to learn that, in a historical context, it is not an outsized rally, nor are equity markets - with the possible exception of the United States - particularly expensive.

2013-12-16 A Budget Deal Wimpy Would Like, Saturday Night Debate & A Word on Pensions by Gregg Bienstock of Lumesis

Saturday evening, I was asked by a reader (I was surprised to learn she was a regular reader) why I am always pointing out the potential pitfalls associated with data we capture and why so harsh on the good folks in our nation’s capital. "Things are actually pretty (darn) good - a deficit reducing budget is about to be passed, unemployment is the lowest it has been in years and the housing market is abuzz. Not to mention, the stock market has been pretty good to those that have invested." I responded that I respected her view but was truly bothered by the data, as evidenced by this weekl

2013-12-16 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.

2013-12-16 Settling In by Mark Kiesel of PIMCO

An improving outlook for U.S. housing will be constructive for consumer spending, confidence and jobs. There are many ways to invest directly and indirectly in companies that should benefit from higher housing prices, a pickup in home repairs and remodeling, and residential investment spending. We continue to favor select investments in homebuilders, building materials, appliance manufacturers, lumber, home improvement, banks, title insurance, mortgage origination and servicing, and non-Agency mortgage-backed securities.

2013-12-13 The Impact of the Great Recession and Federal Reserve Accommodation on Households by Matt Lloyd of Advisors Asset Management

The latest release of macro data came out today from the Fed Flow of Funds report generated by the Federal Reserve. We monitor this with great anticipation so as to measure possible direction changes or momentum of a current direction. There are a myriad of data points, however, a few select charts should continue to raise confidence in the direction of the economy and, at worst, a liquidity-driven backstop to maintain consumption at minimum agreeable levels.

2013-12-13 The Year of the Horse: 3 Reasons Chinese Stocks Could Gallop Ahead in 2014 by Russ Koesterich of iShares Blog

While Chinese stocks have massively underperformed their U.S. and developed market counterparts year to date, Russ explains the three reasons why he’s still bullish on China.

2013-12-13 And That's The Week That Was by Ron Brounes of Brounes & Associates

No one deserved a break more than investment guys/gals (except maybe politicos). Unfortunately, Thanksgiving holiday was too "short and sweet" for many and the economic week that followed was crazy. Number after number depicted an economy on solid ground with strong confirmation from the late-week labor releases. Investors took profits throughout much of the week as the final month of the year began, but the Bulls were back in force to conclude the week.

2013-12-13 Viewpoints from AAM - Navigating the New High Landscape by Mike Boyle of Advisors Asset Management

December, historically the best month to own equities, has begun with a whimper with the S&P 500 closing at a loss each of the first four days of the month. If you include the last trading day of November, that makes five days in a row of red-filled screens for a total loss of 1.23% for the S&P 500. In the grand scheme of things that is a pretty small loss but it already has pundits dismissing the chances of a "Santa Claus Rally" and others saying the recent new market high of 1807.23 for the S&P 500 reached on November 27 might be its last.

2013-12-13 One of the Most Notable Stories of the Year: Energy Renaissance in the U.S.A. by Frank Holmes of U.S. Global Investors

Only a few years ago, we were contemplating the supply constraints facing the petroleum industry, as many major oil fields around the world were facing a decline in production. Now, with the disruptive technology in shale oil and gas, we may be looking forward to decades of drilling.

2013-12-12 The Fed, Inflation, and the Perfect Storm in Gold Miners by Clyde Kendzierski of Financial Solutions Group

Neither hopes of job creation nor fears of inflation (based on the massive expansion of the monetary base since late 2008) have thus far materialized. Total credit creation (i.e. money supply) during most of the last five years either shrank or barely grew despite massive growth in the monetary base. Nominal GDP (growth plus inflation) grows in response to total expansion of credit (both from the Fed and the banking system), not just the monetary base.

2013-12-12 The Wisdom of Looking Like An Idiot Today by Adam Taggart of PeakProsperity.com

Here’s a recently-released report on the stark choice that bubble markets force investors to make: to look like an idiot now, or look like one later. Those that have sought to position themselves prudently and defensively since 2008 currently look foolish as liquidity-inflated stocks and real estate prices have passed them by over the past 2 years-- while ’safe havens’ like precious metals have suffered mightily. But it’s critical to remember that the nefarious nature of a bubble is to suck in as many participants as possible before bursting and causing maximum damage.

2013-12-12 PIMCO Cyclical Outlook: Synchronized Optimism by Saumil Parikh of PIMCO

In the U.S., the abatement of fiscal policy tightening combined with steady improvements in labor market demand and higher asset valuations is likely to drive an increase in real growth. The eurozone should finally emerge from recession in 2014, and Japan is likely to continue to grow with the continued assistance of extraordinarily expansive policies. In China, external demand will likely improve, but domestic demand will likely slow somewhat.

2013-12-11 The Fed is Playing Hamlet to the Markets by Sam Wardwell of Pioneer Investments

To taper or not to taper-that is the question the Fed is asking itself. What’s moving the market is (it appears) the odds of Fed action. For the first half of last week, "good news was bad news" as stock and bond markets apparently interpreted better economic data as suggesting an earlier QE (Quantitative Easing) Taper. On Friday, the market apparently decided the jobs report was good enough to further reduce downside risks to the economy but not strong enough to spur the Fed to action.

2013-12-11 Q3:2013 Flow-of-Funds Report - 'Tis the Season to Be Jolly by Paul Kasriel of Econtrarian, LLC

I know that being a Debbie Downer gets more face time on cable news, but after looking at the Fed’s latest Financial Accounts of the U.S. report, formerly known as the Flow-of-Funds report, I cannot contain my optimism about the economy’s prospects in the New Year.

2013-12-10 Fiscal Policy and Monetary Policy - Update by Scott Brown of Raymond James

Market participants expected the November Employment Report to be the deciding factor on whether the Federal Reserve would begin to slow its rate of asset purchases this month. However, officials aren’t going to react to any one piece of data. The best argument for tapering is that it has to start sometime. However, the key factors that delayed the tapering in September and October are still with us to some extent.

2013-12-10 Best Consumed Below Zero? by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

In this report, we will turn our attention to Denmark to study its decision to undertake the below-zero rate, the specifics of the situation that prompted it and the effects of the negative rate on financial conditions and the broader economy. We will then briefly look at the possibility of a below-zero rate policy for the ECB and, most importantly, the geopolitical ramifications of the decision by the world’s second largest currency block to ease into unknown consequences of negative rates to stimulate the economy.

2013-12-10 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 everyone’s thinking about their ultimate goal for investing in the stock market and the behaviors which lead to wealth creation.

2013-12-09 Gauging Tapering Post November Jobs Report by Chris Maxey, Ryan Davis of Fortigent

With another month down in 2013, last week came time to dissect the latest report on employment. If the market reaction was indicative, the highly anticipated November labor report did not disappoint, sending stocks up more than 1% on Friday.

2013-12-07 Interview with Steve Forbes by John Mauldin of Millennium Wave Advisors

For whatever reason, Steve Forbes seems to bring out the passion in me. When I think about what central bank policies are doing to savers and investors, how we are screwing around with the pension system, circumventing rational market expectations because of an untested economic theory held by a relatively small number of academics, I get a little exercised. And Steve gives me the freedom to do it.

2013-12-06 Did the Government Shutdown Help the Economy? by Frank Holmes of U.S. Global Investors

Take the government shutdown in October, when the House and Senate fought over the debt ceiling. Economic data wasn’t released, services were halted, national parks were closed, and "non-essential government workers were told to stay home. As a result, GDP was expected to collapse. Yet, data released this week reveal a different, stronger image of the U.S. economy. I think Shakespeare would deem the media’s fear mongering tactics as Much Ado About Nothing.

2013-12-04 And That's The Week That Was by Ron Brounes of Brounes & Associates

And stocks just keep rolling along. November ended with another bang as the Blue Chips climbed 3.5% for the month and The Dow Jones extended its weekly winning streak to eight. But did anyone even notice? Happy Thanksgivukkah.

2013-12-04 Dramatically Dropping Deficits? Keep Dreaming by Milton Ezrati of Lord Abbett

A smaller U.S. budget shortfall for fiscal 2013 will be largely due to transitory factors.

2013-12-03 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 Looking Out on the Horizon for Equities by Bob Doll of Nuveen Asset Management

U.S. equities finished higher for an eighth consecutive week as the S&P 500 increased 0.1%, representing the longest positive streak since 2004. Inertia may have carried markets forward in a relatively quiet trading week without major headlines. Retail news appeared fairly positive in anticipation of a strong start to the Thanksgiving shopping weekend. Economic data was mixed.

2013-12-03 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?

2013-12-03 Turning Over Rocks by Herbert Abramson, Randall Abramson of Trapeze Asset Management

The S&P 500 is at a record high and we believe the markets generally are fully valued. Corporate revenue growth is anemic, profit margins are stretched, and the prospect of earnings rising meaningfully is not high. And, the outlook for the U.S. and global economy is still uncertain. Market psychology is at a level suggesting the market is overbought. Margin debt is at record levels and the current popularity of stocks by retail investors at market highs is in itself a red flag.

2013-12-03 Fixed Income Markets Slog Forward by Chris Maxey, Ryan Davis of Fortigent

The past five years have seen a dramatic influx of investor capital into corporate credit markets. As investors jumped into the market, there is growing concern that credit markets are nearing stretched valuations. Those concerns are likely premature, particularly with central bank intervention in place.

2013-12-03 Secular Bull or Secular Bear? by Leo Cesna of Relevant Investments

Applying statistical control limits to Dr. Shiller’s CAPE Index reveals where the S&P 500 is likely headed.

2013-12-03 U.S. Economy Slowly Gaining Traction - What's Ahead for Year-End? by Sam Wardwell of Pioneer Investments

As we enter the final month of 2013, my themes of the last several weeks continue - the capital markets, in general, remain quiet and U.S. economic data, while mixed, shows signs of steady improvement. This week, I’ll start by looking forward to some news we’ll be watching as the year closes out...

2013-12-02 The Elephant in the Room by John Hussman of Hussman Funds

Investors will do themselves terrible harm if they ignore the objective warnings of history based on our subjective experience in this unfinished half-cycle. That subjective experience is far more closely related to my 2009 stress-testing decision than many investors recognize.

2013-12-02 Consumers Doing Fine by Brian Wesbury, Bob Stein of First Trust Advisors

According to the National Retail Federation, Thursday to Sunday holiday sales dropped 3% versus last year. No doubt, this will wake up some dozing bears. And, we are sure that when we say it’s not as bad as you think, many will argue we are perma-bulls, naive, or downright stubborn. You can think what you want, but we don’t believe sales are falling.

2013-11-30 Arsonists Running the Fire Brigade by John Mauldin of Millennium Wave Advisors

In the old days, central banks raised or lowered interest rates if they wanted to tighten or loosen monetary policy. In a Code Red world everything is more difficult. Policies like ZIRP, QE, LSAPs, and currency wars are immensely more complicated. Knowing how much money to print and when to undo Code Red policies will require wisdom and foresight. Putting such policies into practice is easy, almost like squeezing toothpaste. But unwinding them will be like putting the toothpaste back in the tube.

2013-11-29 Back to Housing Bubbles by Nouriel Roubini of Project Syndicate

What we are witnessing in many countries looks like a slow-motion replay of the last housing-market train wreck. And, like last time, the bigger the bubbles become, the nastier the collision with reality will be.

2013-11-29 ING Fixed Income Perspectives - November 2013 by Christine Hurtsellers and Matt Toms of ING Investement Management

Given rich valuations globally, we remain broadly neutral on interest rate risk with the exception of Japan.

2013-11-28 U.S. Housing Sector - Losing Ground? by Carl Tannenbaum of Northern Trust

The powerful momentum that drove the American housing sector forward in the past three years may be dissipating. And it is clear that higher mortgage rates have a pronounced impact on demand. The Federal Reserve will therefore have to proceed with caution as it considers when and how to reduce its asset purchases.

2013-11-27 Housing Outlook 2014: Holding Our Breath by John Burns of John Burns Real Estate Consulting

As a kid, I remember the Apollo lunar module losing all communication for about one hour as it orbited around the back of the moon. We all held our breath for that hour, waiting to hear that all was okay.

2013-11-27 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

This has been another quiet week for stocks which closed at their highs for the year. The Dow Jones Industrial Average even closed above 16,000 for the 1st time.

2013-11-26 QE: Not That Big of a Deal by Brian Wesbury, Bob Stein of First Trust Advisors

The most frequent question we get lately is "what happens to long-term interest rates when quantitative easing ends?" Many analysts argue that the Federal Reserve is buying and holding a huge share of Treasury debt and once QE ends other buyers will suddenly have to absorb more. This will cause interest rates to soar, bust the housing market, undermine stocks, and possibly cause a recession.

2013-11-26 Elections in Chile by Bill O'Grady of Confluence Investment Management

On November 17, Chileans went to the polls to vote on a new president and parliament. In this report, we offer short biographies of the two Chilean presidential candidates, focusing mostly on Michelle Bachelet. From there, we will provide a short history of Chile, primarily to highlight the tensions between the forces of liberalization and reaction. An examination of the Allende-Pinochet period will detail the factors that have affected Chile’s political structure over the past five decades. As always, we will conclude with market ramifications.

2013-11-26 While You Were Sleeping: Asian Developments Loom for Financial Markets by Chris Maxey, Ryan Davis of Fortigent

Amid all the Fed talk dominating airwaves and headlines, a few key developments occurred overseas last week that could shape financial markets significantly in the quarters ahead.

2013-11-26 Dig Deep - Then Dig Some More - to Uncover Risks in EM Corporate Debt by Shamaila Khan of AllianceBernstein

Emerging-market (EM) corporate debt returned big numbers for investors in recent years, as the sector rode a general wave of optimism about the future. But those days are gone. In 2013, successful investors have had to take a more painstaking path.

2013-11-25 Solving the Income Puzzle by Christopher Remington, Michael Cirami, Kathleen Gaffney, Scott Page of Eaton Vance

Income needs may be as high as they’ve ever been, while the yield potential from many traditional investment classes has dwindled to generational lows. Investors who remain in high-priced, low-yielding core bond strategies could experience loss of principal (and mounting retirement shortfalls) if interest rates revert toward their mean. We advocate creating an integrated, multi-pronged income plan that may offer yield potential that meets investor needs, while managing key risks found in the typical core fixed-income allocation.

2013-11-25 An Open Letter to the FOMC: Recognizing the Valuation Bubble in Equities by John Hussman of Hussman Funds

The Fed has done enough, and perhaps dangerously more than enough. The prospect of dismal investment returns in equities is an outcome that is largely baked-in-the-cake. The only question is how much worse the outcomes will be as a result of Fed policy that has few economic mechanisms other than to encourage speculative behavior.

2013-11-25 Ben's Rocket to Nowhere by Peter Schiff of Euro Pacific Capital

Herd mentality can be as frustrating as it is inexplicable. Once a crowd starts moving, momentum can be all that matters and clear signs and warnings are often totally ignored. Financial markets are currently following this pattern with respect to the unshakable belief that the Federal Reserve is ready, willing, and most importantly, able, to immediately execute a wind down of its quantitative easing program. How this notion became so deeply entrenched is a mystery, but the stampede it has sparked is getting more violent, and irrational, by the day.

2013-11-25 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 it’s 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.

2013-11-25 Sir Isaac Newton by Jeffrey Saut of Raymond James

In 1711 the Earl of Oxford formed the South Sea Company, which was approved as a joint-stock company via an act by the British government. The company was designed to improve the British government’s finances. The earl granted the merchants associated with the company the sole rights to trade in the South Seas (the east coast of Latin America). From the start the new company was expected to achieve huge profits given the believed inexhaustible gold and silver mines of the region.

2013-11-22 Understanding the Rise of China by Frank Holmes of U.S. Global Investors

If the sweeping economic reforms planned by Chinese leaders during the Third Plenum can be our guide, it looks to be a promising decade for global investors. Details released this week confirmed President Xi Jinping’s concerted efforts to move China toward a market-based economy that mirrors the West.

2013-11-21 Looking Beyond Inventories by Team of Northern Trust

Inventories have the habit of offering surprises in reports of real gross domestic product (GDP). The third quarter GDP report was one such occurrence, with inventories making an unexpectedly hefty contribution. A reversal of this event is most likely to influence the headline GDP number in the final three months of the year.

2013-11-21 The Fed and the Economy: “Don't Shoot Until You See the Whites of Their Eyes” by Scott Minerd of Guggenheim Partners

The Federal Reserve has started to highlight “forward guidance” as a way to keep interest rates lower for longer and get the exhausted hamster off the treadmill of quantitative easing. We still think tapering remains farther off than most investors expect.

2013-11-21 Developed Asia Pacific: Regional Economic Review Q3 2013 by Team of Thomas White International

Developed Asia Pacific economies were back on their feet during the second quarter of 2013 as economic growth gained momentum, inflation fell mildly and exports climbed strongly. Most developed countries in the region such as Japan, Australia, and New Zealand reported a sharp positive swing in consumer and business confidence. Predominantly expansionary monetary and fiscal policies also helped keep the pace of economic recovery.

2013-11-21 US Stocks for a Baby Boom by Bill Smead of Smead Capital Management

As contrarians, we at Smead Capital Management frequently get questions about stocks like Gannett (GCI), Bank of America (BAC) and eBay (EBAY). To understand how excited we are to own these common stocks you need to understand how a long-duration common stock portfolio would benefit from the coming baby boom in the developed world. Thanks to wonderful research from The Bank Credit Analyst (BCA), we can understand the demographics of developed nations like the US. BCA concluded that a "baby boom" is coming in the US and in other developed nations.

2013-11-20 Yellen: “Farther To Go” by Scott Brown of Raymond James

Janet Yellen gave a balanced assessment of how monetary policy will be conducted during her tenure as Fed chair. However, the financial markets perceived a “dovish” tilt. She stressed that conditions in the labor market are still far from normal and noted that inflation has been running below the Fed’s goal of 2% “and is expected to do so for some time.” However, Yellen noted that there were risks of removing support too late as well as too soon. QE3 can’t go on forever.

2013-11-20 Who is Right on the Stock Market? by Jeffrey Saut of Raymond James

Efficient, or inefficient, that is the key question. I would argue that at major inflection points the stock market is ANYTHING but efficient. That’s because, as my dear, departed father used to say, “The stock market is fear, hope, and greed only loosely connected to the business cycle!” Plainly, I agree and would note that when on March 2, 2009 I stated the stock market was going to bottom that week, I was greeted with cat-calls of disbelief. The same was true with the Dow Theory “sell signal” calls of September 1999 and November 2007.

2013-11-19 Howard Marks: Equities are Under-owned and Un-loved by Robert Huebscher (Article)

According to Oaktree’s Howard Marks, U.S. equities are ’under-owned and un-loved, and I like to buy assets like that.’

2013-11-19 A Glimpse of a Yellen-Led Fed by Kristina Hooper of Allianz Global Investors

Kristina Hooper highlights some key takeaways from incoming Federal Reserve chair Janet Yellen’s testimony before the Senate last week, including when the Fed is likely to taper its bond-buying program.

2013-11-19 Ignoble Prizes and Appointments by Jeremy Grantham of GMO

Chief investment strategist Jeremy Grantham comments on this year’s Nobel Prize in economics and "the most laughable of all assumption-based theories, the Efficient Market Hypothesis"; candidates to succeed Chairman Bernanke at the Fed; the impact of commodity price rises and the housing bubble in the crash of 2008; and prospects for the U.S. equity market.

2013-11-19 October 2013 Market Commentary by Andrew Clinton of Clinton Investment Management

The Fed’s decision in September to maintain it’s policy of asset purchases, better known as Quantitative Easing (QE), caught the broader market by surprise. Fed “tapering” of QE was broadly expected to begin in September. The Fed’s decision to delay the reduction of QE pushed back the date upon which anticipated tapering would begin. This resulted in a meaningful rally in Treasury bond prices in September. To the surprise of many media pundits calling for ever higher interest rates, US Treasury yields ended October at 2.55%, virtually unc

2013-11-18 Willing a Fiscal Win by Christine Hurtsellers, Matt Toms of ING Investment Management

Why can’t we just will our desired political outcomes the way the most fervent seemingly can impact ballgames? After watching Fenway Park packed to the rafters with Red Sox faithful exercising their sovereign and ethereal right to psychically encourage baseballs out of the yard and knowing that millions of others in Red Sox nation were doing the same in front of their televisions we’re left wondering if the fans of Team U.S.A. can apply a little of that classic Carlton Fisk mojo a few hundred miles down I-95.

2013-11-18 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.

2013-11-15 Taper or Not, Stocks and Bonds Could Gain by Scott Minerd of Guggenheim Partners

Both bond and equity markets are well-positioned, regardless of whether the U.S. Federal Reserve tapers its asset purchase program.

2013-11-15 Dressed to the Nines with Gold by Frank Holmes of U.S. Global Investors

While paper gold is getting the cold shoulder in the West, the Love Trade buyers in the East are wrapping their arms around all the physical gold they can get their hands on.

2013-11-13 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.

2013-11-12 Reflections on a Week in Cuba by Robert Huebscher (Article)

My recent one-week visit to Cuba revealed why our relationship with this island country ? less than 100 miles off the coast of Florida ? has been problematic for the U.S. for the last half-century. Once the Castro brothers are gone, the government of Cuba may change in dramatic ways. But such a transition would have to be accompanied by a change in U.S. policy to Cuba. Pictures from my trip are also provided.

2013-11-12 Dream to Outperform the Market by Bill Smead of Smead Capital Management

If you dream about investment market outcomes which are already popular in the marketplace, your dreams can turn into nightmares. The Everly Brothers 1958 hit song, “All I have to do is Dream” tells us a great deal about the long-term posture of investors in late 2013 and how dreams can turn to nightmares. On the other hand, if you dream about an outcome which most experts aren’t expecting, the rewards can be explosive.

2013-11-11 Confounding Friday Report, Pesky Housing Details, Stamps and Election Results by Gregg Bienstock of Lumesis

The markets rallied on Friday ostensibly because of the First Friday employment data was it good news (job creation) or bad news (rate is up and the Fed will keep juicing the market). Read on. Next, it is on to a look at housing data that seems to have been under the radar screen of the media. I conclude this week with a look at my election predictions. While I hit a touch over 50% (worthy of baseball hall of fame induction) the folks at the major networks won’t be inviting me to work the election map anytime soon.

2013-11-11 A Textbook Pre-Crash Bubble by John Hussman of Hussman Funds

Despite the unusually extended period of speculation as a result of faith in quantitative easing, I continue to believe that normal historical regularities will exert themselves with a vengeance over the completion of this market cycle. Importantly, the market has now re-established the most hostile overvalued, overbought, overbullish syndrome we identify.

2013-11-10 What Would Yellen Do? by John Mauldin of Millennium Wave Advisors

In advance of this week’s confirmation hearings for Federal Reserve Board Chairperson-nominee Janet Yellen, let’s pretend we are prepping our favorite Banking Committee senator for his or her few questions. What would you like to know? In this week’s letter I offer a few questions of my own.

2013-11-08 Government Shutdown Doesn't Shut Down Markets in October by Karen Cavanaugh of ING Investment Management

The stage was set for an October selloff, but markets treated investors to another round of across-the-board gains. Headlines comparing today’s equity market with 1999 are way off; the current rally has been driven by solid corporate fundamentals, and the market remains compellingly valued. Global economic growth remains sluggish, and eventual Fed tapering is likely to introduce volatility into markets worldwide.

2013-11-08 Big Ideas in the Big Easy by Frank Holmes of U.S. Global Investors

This is likely a contrarian view to the folks in the White House, but I think investors benefit from being contrarian and thinking differently. In preparation for my presentations in New Orleans as well as for the Metals & Minerals Investment Conference in San Francisco and the Mines and Money in London in a few weeks, I’ve been pulling together this kind of research that we can all put to use now.

2013-11-07 Putting Macro Trends in Context: What do They Mean to a Bottom-Up Investor? by Will Nasgovitz of Heartland Advisors

For some time now, we’ve had a generally positive economic outlook. The occasional setback is assured, but on the whole we believe that the U.S. economy is still in the early stages of a multi-year recovery.

2013-11-06 Thank The Fed For Big Stock Market Gains by Gary Halbert of Halbert Wealth Management

My guess is that just about everyone reading my E-Letters would agree that the Fed’s massive “quantitative easing” (QE) program has had a bullish effect on the stock markets over the last few years. Several new reports conclude that the Fed’s unprecedented QE bond buying program is responsible for ALL of the stock market advance since the bottom in early 2009.

2013-11-06 Tighter Fiscal Policy Not Helping by Scott Brown of Raymond James

We are now more than five years into the economic expansion, but to many Americans, it still feels like a recession. Many of the headwinds that restrained the recovery early on, such as housing and state and local government, have turned to modest tailwinds, and monetary policy remains highly accommodative. The biggest restraint on growth this year has been fiscal policy. There is a near-term focus on a long-term budget deal, but an agreement seems rather unlikely. Sequester spending cuts set for mid-January should be a more important consideration for lawmakers.

2013-11-06 The Top 10 Investor Worries Right Now by Robert Isbitts of Sungarden Investment Research

In the first of a regular series in my Informed Investing blog, let’s count down the top 10 things that give investors the willies in today’s investment environment. These are situations known to even casual investors, but may or may not be communicated to them effectively by their financial advisors.

2013-11-05 Geo Scores and Election Predictions by Gregg Bienstock of Lumesis

“It’s the economy, stupid.” I’m sure many of us remember that statement from a few years back. With a couple of gubernatorial and many mayoral elections at hand, I thought it might be fun to provide our call on these races by looking at how the economies of those States and cities have fared over the past year. If it is indeed “the economy, stupid,” the below may provide some insight into where incumbents are safe and where change may come. This report will print longer due to the inclusion of more tables than usual.

2013-11-05 Ex-US Property Bubble Peaking? by Chris Maxey, Ryan Davis of Fortigent

For several years now, a common storyline on China was the immense overcapacity in the country’s housing market. A mixture of easy credit policies and officials’ explicit economic growth plans based on capital investment yielded construction on a massive scale across the countryside. So-called ghost towns emerged as the pace of building and the migration of rural citizens into these cities fell out of sync.

2013-11-04 Mortgage REITs: Last Chance to Exit? by Keith Jurow of Advisor Perspectives (dshort.com)

An online advertisement raises the following question often asked by your clients: Can you find me more income? In a nutshell, that is the dilemma facing high net worth investors.

2013-11-04 More #PlowHorse in Q3 by Brian Wesbury, Bob Stein of First Trust Advisors

Despite the shutdown, the sequester, talk of tapering, and meteors in the night sky, the US economy just keeps plowing along. Reported later this week, we expect Q3 real GDP grew right on trend at a 1.9% rate another, #PlowHorse report.

2013-11-02 Bubbles, Bubbles Everywhere by John Mauldin of Mauldin Economics

The froth and foam on markets of all shapes and sizes all over the world. It is an exhilarating feeling, and the pundits who populate the media outlets are bubbling over with it. There is nothing like a rising market to help lift our mood. Unless of course, as Prof. Kindleberger famously cautioned, we are not participating in that rising market. Then we feel like losers. But what if the rising market is a bubble? Are we smart enough to ride and then step aside before it bursts? Research says we all think that we are, yet we rarely demonstrate the actual ability.

2013-11-01 Weekly Economic Commentary by Team of Northern Trust

The public needs to move beyond its bad feelings toward financial institutions. Should we modify the price stability mandate of central banks? The Fed offers no surprises.

2013-10-31 What's Your Plan for Getting Punched in the Mouth? by Miguel Perez-Santalla of BullionVault

Planning to win is where you should start. But what if your opponent hits back...?

2013-10-31 Scrooge McDucks by William Gross of PIMCO

With the budget and debt ceiling crises temporarily averted, perhaps a future economic priority will be to promote economic growth; one way to do that may be via tax reform. How to proceed depends as always on the view of the observer and whether the glasses are worn by capital, labor or government interests.

2013-10-31 A Bit More Hawkish, All Things Considered by Brian Wesbury, Bob Stein of First Trust Advisors

Today’s statement from the Federal Reserve was almost a carbon copy of the last one in September. No changes to the pace of quantitative easing or interest rates, which is exactly as the consensus expected. The Fed made only minor changes to the text of the statement, making it slightly more hawkish in one spot and slightly more dovish in another.

2013-10-31 International Equity Commentary by Team of Thomas White International

International equity prices saw robust gains in September as the U.S. Federal Reserve unexpectedly refrained from reducing its bond purchase programs. In addition, the lowering of the U.S. growth forecast by the Fed lifted investor optimism that the quantitative easing is likely to be wound down at a very gradual pace.

2013-10-30 Fed Tapering Could Be Off The Table Until 2014 by Michael Materasso of Franklin Templeton

Sometimes, hindsight is insight. The mystery of why the Federal Reserve didn’t start pulling back or “tapering” its prolonged quantitative easing program at its September policy meeting seems more clear now that we’ve experienced the fallout from the fraying of US fiscal policy soon thereafter, including a 16-day government shutdown in October. Given that the Congressional agreement reached in October only funds the government through January 15 and extends the debt ceiling through February 7, more political grandstandingand economic consequencescould lie ahead.

2013-10-29 Can Financial Engineering Cure Cancer? by Robert Huebscher (Article)

Securitization and the collateralized obligations it produced led to the financial crisis and the near-collapse of the financial markets. But financial engineering’s bad reputation could turn around. Andrew Lo, a professor at the MIT Sloan School of Management and director of its Laboratory for Financial Engineering, thinks financial engineering can cure cancer.

2013-10-29 Is This the New Normal'? by Sam Wardwell of Pioneer Investments

Markets Settle into a New “Normal” All sorts of economic data were released last week, but volatility has dropped: rightly or wrongly, market forecasts about the pace of quantitative easing (QE) and earnings growth in the U.S. appear to have coalesced around an outlook for “slow growth with ongoing QE”.

2013-10-28 How Real Estate Impacts the US Economy by Russ Koesterich of iShares Blog

Despite appreciating more than 10% over the past year, home prices still look reasonable and housing affordable. However, while there is little risk of another housing bubble, a significant pickup in interest rates could dampen housing activity and by extension, the recovery.

2013-10-28 The Grand Superstition by John Hussman of Hussman Funds

One thing that separates humans from animals is the ability to evaluate whether there is really any actual mechanistic link between cause and effect. When we stop looking for those links, and believe that one thing causes another because “it just does” we give up the benefits of human intelligence and exchange them for the reflexive impulses of lemmings, sheep, and pigeons.

2013-10-28 Beyond the Noise, More of the Same? by Scott Brown of Raymond James

Delayed economic data reports have begun to arrive. The figures point to a disappointing 3Q13 (relative to expectations) and the partial government shutdown is unlikely to help in 4Q13. The recovery had been poised for improvement this year, but fiscal policy has been a major headwind. Economic figures will be distorted in October (due to the government shutdown) and in November (due to the rebound from the shutdown). Yet, beyond the noise, the underlying pace of growth is likely to remain disappointing in the near term. Is there hope for 2014?

2013-10-28 Jobs, Jobs, Jobs by Chris Maxey, Ryan Davis of Fortigent

Following an extended delay, investors were disappointed (sort of) to learn that the September payroll report was another dud. The headline figure was below expectations, but investors were largely comforted by knowing this likely extended QE3 further into the future.

2013-10-28 Why Growth is Deep in the Heart of Texas by Frank Holmes of U.S. Global Investors

A recent TIME Magazine cover 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.

2013-10-26 Housing Bargains Harder to Find by John Burns of John Burns Real Estate Consulting

While mortgage rates remain near historical lows, home prices have come back strong.Thanks to strong price appreciation, the ratio of Median Home Price / Median Household Income now exceeds historical averages (since 1981) in 20 of the top 21 housing markets.

2013-10-26 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 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.

2013-10-24 Risk-On Returns by Scott Minerd of Guggenheim Partners

Ultra loose U.S. monetary policy continues pushing asset values higher at home and abroad. Seasonal factors should also provide a tailwind and lift asset prices across nearly every investment class.

2013-10-23 Investment Bulletin: Global Equity Strategy by Team of Bedlam Asset Management

The portfolio enjoyed another index-beating month with a gain of 0.9% versus 0.6%, so improving further the long term numbers. As noted in previous Bulletins, correlations between growth and equity market returns are low. Investors remain fixated otherwise, but some confusion is reasonable given that growth in earnings per share is also slowing. Yet strong equity markets can be justified by the Free Lunch Theory.

2013-10-23 Can Kicked Down the Road Once Again... by Blaine Rollins of 361 Capital

Donkeys 1, Elephants 0, Congress -535. The can was kicked down the road once again. We would all like to think that Congress will avoid another last minute battle in early 2014, but unfortunately we can’t put it past the current list of non-negotiators. The only thing that is certain in the future is that it will be many election cycles before a member of Congress makes it into the World Series of U.S. Presidential ballots.

2013-10-23 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.

2013-10-23 Singaporean Consumer Consumption and Confidence is Weak - Should Investors Worry? by Team of Manning & Napier

Singapore is the world’s 35th largest economy by nominal GDP, yet ranks 6th in the world by GDP per capita, signifying its position as an advanced and highly-productive economy. With an efficient regulatory framework, low tax rates, and a flexible labor market, Singapore has a reputation for being one of the most business-friendly countries in the world.

2013-10-22 Inching Closer by Sponsored Content from Janus Capital Group (Article)

How is the recent flooding in Colorado related to global economies and the financial crisis of 2008? Get a unique perspective from Colleen Denzler, CFA, Janus’ Global Head of Fixed Income Strategy, on how global economies are grappling to wean themselves off government support and grow their economies from within.

2013-10-22 After the Minimalist Debt Ceiling Deal: The Good & Bad News by Russ Koesterich of iShares Blog

Last week, investors cheered that Washington finally reached a last-minute debt ceiling deal. But despite their big sigh of relief, the debt ceiling deal wasn’t all good news. Russ provides a quick look at the good, the bad and the investing implications of the compromise.

2013-10-22 The Boys Are Back in Town by Jeffrey Saut of Raymond James

The boys are indeed back in town as Washington D.C. opened its doors for business as usual last week following a contentious debt ceiling debate and a 16-day shutdown of the government. This outcome had been anticipated in these letters for often-stated reasons, and just like when the ”fiscal cliff” was averted, I now expect the media to turn its focus to the next Armageddon.

2013-10-22 And That's The Week That Was by Ron Brounes of Brounes & Associates

The gov is back in biz (so get back to work). Investors were pleased (for now).

2013-10-22 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 region’s vulnerability has increased over the last two years due to mounting structural challenges. What’s 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.

2013-10-21 Winners and Losers - Pensions and Food Stamps by Gregg Bienstock of Lumesis

To the brink they went and a “deal” was had. I don’t know if I call it much of a deal I kind of feel like I’ve seen this B movie before. I could go on but that would put me in the same stature as the talking heads on the left and right news channels that prophesize to their viewers without regard for the rest of us. That said, one quick digression.

2013-10-21 Did Monetary Policy Cause the Recovery? by John Hussman of Hussman Funds

Much of the present faith in monetary policy derives from the belief that it was the central factor in ending the banking crisis during what is often called the Great Recession. On careful analysis, however, the clearest and most immediate event that ended the banking crisis was not monetary policy, but the abandonment of mark-to-market accounting by the Financial Accounting Standards Board on March 16, 2009, in response to Congressional pressure by the House Committee on Financial Services on March 12, 2009.

2013-10-21 Fourth Quarter Investment Outlook by Bob Doll of Nuveen Asset Management

The macro theme of the fourth quarter and early 2014 is monetary reflation and global growth resynchronization. The Fed’s surprising decision to postpone tapering its QE program will likely encourage further risk-taking. In the meantime, we observe increasing signs of a synchronized improvement among the four important economies - the United States, Europe, Japan and China.

2013-10-18 Despite Uncertainty, the Market Still Looks Strong by Charlie Dreifus of The Royce Funds

Although it was an ugly battle, on Thursday morning October 17 President Obama signed a bill that reopened the government into January 2014 and raised the debt ceiling until early February of next year.

2013-10-18 Consumer Confidence Plunging Recession Ahead? by Gary Halbert of Halbert Wealth Management

The stalemate in Washington continues, the government remains in partial shutdown and the debt ceiling looms on Thursday. A bipartisan deal to fund the government until January 15 and raise the debt limit until early February is working its way through the Senate and could be voted on later today or tomorrow. It is unlikely that the Senate bill will pass in the House, which is reportedly working on yet another bill (see link below) that is unlikely to pass in the Senate.

2013-10-18 Fall is in the Air by Christopher Singleton of Kanawha Capital Management

Autumn has arrived, and many creatures have been making dutiful preparations to survive the winter months. But not all are so inclined, particularly our political leaders. Indeed, along with crisper air temperatures and more vibrant colors, it would just not feel like fall without the annual Washington squabbles to fund the federal government and increase its borrowing authority.

2013-10-18 High Yield Bond Outlook: A Time for Unconstrained Management by Vilis Pasts, Matthew Pasts, Isaac Braley of BTS Asset Management

Using our unconstrained approach, BTS indicators signaled a move back into High Yield bonds near the end of September.BTS Asset Management views the High Yield bond sector as exhibiting solid fundamentals. Based on historical comparisons, High Yields have strong cash flow coverage for interest payments, due to conservative use of leverage. Post 2008, companies hired less people and have kept other fixed costs down.

2013-10-18 Trying to Stop a Bull Market Has Risks by Frank Holmes of U.S. Global Investors

U.S. stocks have been on a tear. The S&P 500 Index has climbed a surprising 20 percent so far this year, as a global synchronized recovery takes shape and funds flow back to equities. As I often say, investors take risks when they try to stop a bull run, and plenty of data suggest you might regret taking that action this year.

2013-10-17 Yellen to the Rescue? by Axel Merk of Merk Investments

While Democrats and Republicans fight with water pistols, the President may be readying a bazooka by nominating Janet Yellen to succeed Ben Bernanke as Fed Chair. You may want to hold on to your wallet; let me explain.

2013-10-17 The Short & Long-Term Implications of A Minimalist Debt Ceiling Deal by Russ Koesterich of iShares Blog

A deal to extend the debt ceiling and reopen the government is emerging. If it passes by tomorrow or shortly thereafter, the economy and markets will be spared the worst case scenario of a technical default. However, Washington’s inability to strike a more substantial bargain will have negative repercussions, over both the short and long term.

2013-10-17 Politics Secondary to US Equity Fundamentals by Grant Bowers of Franklin Templeton

It’s easy to get caught up in the tense drama surrounding the government shutdown and the debt ceiling squabble between Congressional Republicans and Democrats, but Grant Bowers, portfolio manager of Franklin Growth Opportunities Fund, maintains that looking beyond the political posturing and focusing instead on US corporate fundamentals is his preferred approach. Read on for more from Bowers on how he views the issues at hand, and why, even in the face of another political showdown in the Capitol, he thinks the US still presents a strong investment case.

2013-10-17 And That's The Week That Was by Ron Brounes of Brounes & Associates

The gov is closed for business. Nuff said. (But help may be on the wayor not?)

2013-10-16 Economic Assessment Without Government Reports by Team of Northern Trust

The very near-term economic outlook is unclear and will remain so until the political impasse in Washington over the government shutdown and debt ceiling is settled. If differences are resolved in a day or two, the damage could be about 0.2 percentage points to fourth quarter real gross domestic product (GDP). A failure to raise the debt ceiling would more of a calamity, which we hope not to encounter.

2013-10-16 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.

2013-10-15 A Degree in Debt: Student Loans and the Economy by Team of Manning & Napier

Recent times have drawn concerns about student loan debt and rising delinquencies. Anecdotes of unfortunate individuals struggling financially to cope with massive student loans raise fears of broader risks to the US economy and financial markets.

2013-10-14 A Look at “Stale Data” (Not Due to Gov't Shutdown) and Housing by Gregg Bienstock of Lumesis

I am confident that some type of deal will be reached to avert a default. And, let’s keep in mind that, according to the CBO, the 10/17 deadline is really just a deadline to start making decisions about what to pay with the remaining $30 or so billion as they project another one or two weeks before the “day of reckoning” when there is only enough money to pay about 70% of the government’s bills which bills to pay.

2013-10-14 Me and My Horse by Jim Goff of Janus Capital Group

This is not a story about getting back on the horse that throws you. It is about just staying on the horse. It is also a market story.

2013-10-14 Move Along, Market: It's Only a Gaper's Delay by Rick Golod of Invesco Blog

After several days of stalemate between the White House and Congress, House Republicans have offered a six-week debt ceiling extension conditional on negotiating a package of fiscal concessions. The debt ceiling offer is straightforward, but the shutdown would continue until the fiscal concessions are agreed on. While this may dampen the economy and equity market, at least in the short run, I believe long-term investors should stay put and be patient.

2013-10-11 The Fed's Surprise and Yellen's Challenge by Mohamed A. El-Erian of Project Syndicate

To ask what Janet L. Yellen, the nominee to succeed Ben Bernanke as Chair of the Federal Reserve, has in store for US monetary policy is to pose the wrong question. The real issue is the decline of the Fed’s policy effectiveness.

2013-10-10 The Fire Fueling Gold by Frank Holmes of U.S. Global Investors

Gold took quite a beating in September, bucking its seasonal average monthly return of 2.3 percent. The political battle between President Barack Obama and Congress, China’s Golden Week, and India’s gold import restrictions likely weighed on the metal.

2013-10-10 Economic and Market Overview: Third Quarter 2013 by Team of Envestnet

The economic environment in the third quarter was one of growth, albeit at a slower pace than most economists, and the Federal Reserve (“Fed”), believe can be self-?sustaining. The slow but steady gains the economy made were enough to buoy the stock market, but likely only because the Fed has seen it necessary to maintain its aggressive monetary policy. While employment gains were anemic during the quarter, the unemployment rate actually declined to 7.3%, largely due to a contraction in the labor force.

2013-10-08 And That's The Qaurter That Was by Ron Brounes of Brounes & Associates

An obsession with Fed policy; troubles in Syria; new concerns in DCand yet the market kept rolling (for a while).

2013-10-07 Ted Williams, Ford F-150's, and Market Valuations by Robert Mark of Castle Investment Management

In late 2008 Lehman Brothers had just collapsed, AIG needed help from the US government and markets around the world were in a tailspin. Today, five short years later, we find it strange how the strength of the stock market defies a climate of declining earnings. With another quarter of corporate results behind us, equities continue to rally despite corporate earnings offering no material support, with many companies actually talking down their future growth prospects.

2013-10-07 Charles Wheelan’s Tips for Separating Economic Truth from Fiction by Jeff Briskin (Article)

The world of numerical obfuscation is a topic covered in an informative and surprisingly entertaining ?statistics primer’ by economist Charles Wheelan. In a recent conversation with Wheelan, we discussed his book and the lessons it offers to financial advisors, whose decision-making processes are influenced by the seemingly endless stream of economic and market data posted every day.

2013-10-04 The New Normalization of Fed Policy by Tony Crescenzi of PIMCO

The Fed is sending a message that the unwinding of its extraordinary accommodation will be done with great care and patience, and will take time - a long time. In delaying a taper, not only did the Fed show markets it has little tolerance for any tightening of financial conditions, it also strengthened its forward guidance considerably. The Fed’s decision to delay a taper will likely relieve some of the upward pressure on longer-term interest rates.

2013-10-04 Is the Pump Primed for Emerging Markets Investors? by Mark Mobius of Franklin Templeton

The vulnerabilitiesor rather, perceived vulnerabilitiesof emerging markets have been the focus of heightened discussions over the past few months. Concerns about the health of emerging markets came on the heels of political upheavals in Egypt, economic deceleration in China and protest demonstrations in Brazil and Turkey this summer.

2013-10-04 The Fed and Its Big Thumb by Ron Muhlenkamp of Muhlenkamp & Co.

We’ve seen what happens when prices get ahead of the economy reality. The bubbles in the dot-com’s in 2000 and the housing market in 2007 were such effects. We fear that the apparent Fed desire to continue to manipulate interest rates may engender more bubbles.

2013-10-04 Introducing the Tortoise Economy by Sam Stewart of Wasatch Funds

All things considered, large U.S. companies that operate globally appear to be particularly attractive right now. Because many of these companies are generating significant portions of their sales outside the U.S., investors are effectively getting some international exposure with what I consider to be more-quantifiable risks.

2013-10-04 The Fire Fueling Gold by Frank Holmes of U.S. Global Investors

For patient, long-term investors looking for a great portfolio diversifier, a moderate weighting in gold and gold stocks may be just the answer. And, today, when looking across the gold mining industry, you’ll find plenty of companies that have paid attractive dividends, many higher than the 5-year government yield.

2013-10-03 Third Quarter Market Commentary: Let's Reminisce by Robert Stimpson of Oak Associates

US stocks have risen each quarter of 2013, outperforming most other asset classes and emerging markets along the way. In the third quarter, the S&P 500 Index rose 5.24% and pushed the year-to-date gain to 19.79%. All sectors within the S&P 500 have produced positive returns this year, although the pro-cyclical groups have outperformed the defensive ones.

2013-10-03 Survival of the Fittest? by William Gross of PIMCO

I hate crows and my wife Sue hates bugs, but like most married couples we have learned to live with our differences. Crows eat bugs though, and bugs eat bugs, and that scientific observation sets the context for the next few paragraphs of this month’s Investment Outlook.

2013-10-03 PIMCO Cyclical Outlook for the Americas: A Slow-Moving Fed Benefits Economies on Both Continents by Mohit Mittal, Lupin Rahman, Ed Devlin of PIMCO

PIMCO expects the U.S. economy to grow 2.0%2.5% over the next year. However, a continued government shutdown would be a drag on growth. In Latin America, we see growth picking up to 3.0%3.5%, but the outlook varies by country. Mexico should fare well, but Brazil’s story is more mixed. In Canada, we believe the housing correction will be less severe than many are predicting, and we expect GDP to grow 1.5%2.0% over the cyclical horizon.

2013-10-02 Countdown to a Government Shutdown (Sept. 30) by Liz Ann Sonders of Charles Schwab

Unless an 11th hour deal is struck, the government will shut down at midnight tonight. Memories are fresh from similar "fiscal follies" in the summer of 2011 and we’ll compare and contrast. The last shutdown was 17 years ago and a look at that history may also be instructive.

2013-10-02 The Death Knell of Global Synchronized Trade by Bill Smead of Smead Capital Management

At Smead Capital Management, we believe the interest on September 18th in emerging markets, oil and gold are the last gasps of a dying trend. Our discipline demands that you must avoid popular investments and completely avoid investments attached to a perceived “new era.” We argue that the international investment markets reaction to Bernanke’s reprieve on September 18th is proof of a vision we have of the future.

2013-10-02 What's easy about Quantitative Easing? by Gene Goldman of Cetera Financial Group

Recently you may have read or heard in the news about the possibility of the Federal Reserve (Fed) “tapering” its Quantitative Easing (QE) program. The topic can be so ingrained in the news cycle that few newscasters take the time to cover the details. So we thought we’d spend a few minutes discussing the background and recent developments on the QE program, and why it matters to investors.

2013-10-02 And That's The Week That Was by Rob Brounes of Brounes & Associates

Move over Ben BernankeTed Cruz has the floor. (Somehow investors seem more interested when Dr. B speaks.) With politicos facing debates on debt ceilings and budget funding, few have confidence that they can act reasonably and with compromise (and the Cruz debacle did not help matters). Stocks fell over five consecutive days as portfolio managers set up positions for the next quarter. Labor and manufacturing releases highlight a hectic week on the economic calendar, but shenanigans from DC may steal the headlines.

2013-10-01 Money Can Buy Happiness by Justin Kermond (Article)

Extensive research has shown that the act of buying life experiences and giving money away can make people happier than buying material items does.

2013-10-01 Europe Pokes Its Head Out From the Shadows by Chris Maxey, Ryan Davis of Fortigent

With all the focus on affairs in the US, China and developing nations, Europe has largely been given a free pass in recent months. The lack of attention gave Europe the opportunity to fix some of its troubles, but challenges remain and are likely to surface in the weeks ahead.

2013-09-30 Teenage Melodrama and the Market's Infatuation with QE by Michael Temple of Pioneer Investments

Like a teenager caught between the decision of going to college and leaving friends behind or living in the comfort of home and going nowhere, debt markets have been reeling between taper angst and infinite quantitative easing euphoria.

2013-09-30 The House at Main and Wall by Justin Speer of Invesco Blog

This four-part series tracks the recent US housing recovery and explains why investors should be both encouraged and cautious. Part 4 looks at pockets of investment opportunity on Main Street. Part 1 traced the recovery’s trajectory against the backdrop of the overall US economy. Part 2 examined affordability and interest rates, while Part 3 discussed why homebuilders’ stocks may potentially be overvalued.

2013-09-27 Read My Lips... by Dimitri Balatsos of Tesseract Partners

Chairman Ben Bernanke’s press conference this week, commenting on the decision by the Federal Open Market Committee (FOMC) not to “taper,” reminded us of the famous slogan of Presidential hopeful George H.W. Bush at the 1988 Republican National Convention “Read my lips: no new taxes.” Yet, after he won the election, he raised taxes in an effort to reduce the public deficit.

2013-09-27 You Never Know by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Surprises come at any moment in the investing world, reinforcing the need to have both a long-term view and a balanced/diversified portfolio. We believe signs are pointing to better US and European growth, a near-term rebound in China, and some possible positive momentum building in Japan. But near-term fiscal policy risks abound. Investors that need to add to equity positions should use pullbacks to do so.

2013-09-25 Active ETF Market Share Update & Weekly Market Review by AdvisorShares Research of AdvisorShares

Last week, total AUM in all active ETFs increased by almost $80.2 million. Assets in the two largest categories “Short Term Bond” and “Global Bond” fell by $20.65 million and $38.585 respectively. As the dollar weakened on the Federal Reserve’s decision to delay tapering, the “Foreign Bond” category increased by $65.725 million and “Currency” active ETFs added $7.43 in value. Just like the previous week, the second largest increase in AUM came in the “High Yield” ETF category, which this time rose by over $44.35 million, main

2013-09-25 Surprise... by Blaine Rollins of 361 Capital

Clearly, the numbers didn’t meet the Fed’s preconditions for tapering. And while the jobless rate has fallen to 7.3% (from 8.1% when QE3, the current round of quantitative easing began), Bernanke had to acknowledge what’s been obvious to all. The decline in the jobless rate hasn’t occurred just because more folks are getting jobs; it’s because many are dropping out of the workforce, which means they’re not counted as unemployed by the government.

2013-09-24 Michael Aronstein’s 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 And That's the Week That Was by Ron Brounes of Brounes & Associates

Hail the Almighty Fed. Despite a rather hectic week on the economic calendar, investors instead focused primarily on news from the Federal Reserve. They rejoiced the end of Summer’s campaign for Chair and further rejoiced another Fed meeting with far more words than action. The week ended with profit-taking and plenty of uncertainty heading into the homestretch of the year.

2013-09-24 Has the Fed Lost Its Credibility? by Chris Maxey, Ryan Davis of Fortigent

Any economics student will tell you central banks must achieve three things to effectively implement monetary policy: (1) independence; (2) credibility; and (3) transparency.For most of the Fed’s history, the first two characteristics were arguably well attained.However, the group was never well known for clarity into its thinking.

2013-09-24 The U.S. Economy: Poised for Growth? by Jeremy Boynton of Laureate Wealth Management

The Federal Reserve decided to delay the beginning of the end of quantitative easing (QE). The markets were very surprised by this as nearly all Fed watchers were expecting at least a small reduction in QE. In explaining its course of action, the Fed cited economic conditions that are currently too weak and/or fragile to begin removing QE. Ironically, the bond and stock markets rallied on this news.

2013-09-23 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. It’s 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 Shake & Bake and Pension Woes, One Man's “Thoughts From the Frontline” by Gregg Bienstock of Lumesis

This week I take a departure from form. After a few brief words around the Fed’s Shake and Bake maneuver and a very quick look at Food Stamp data, I return you to the capable hands of John Mauldin to dive into the Pension woes. We are honored that Mr. Mauldin based his work on DIVER’s data and some of our tools. If you decide to follow John’s advice around your city, let us know if we can help. Be sure to check out the “Data Released this Week” as our data team was hard at work.

2013-09-23 Happy Anniversary? Perspectives on the Financial Crisis Five Years Later by Nanette Abuhoff Jacobson of Hartford Funds

Since 2008, there’s been slow but steady improvement in the global economypolicy makers’ unconventional tools have helped stabilize ?nancial markets and bought time for economies to rebalance. Expectations are too low for developed-market growth and in?ation, in our view. As such, we think this environment will be positive for developed-equity marketsparticularly in Europe and Japan.

2013-09-23 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.̶

2013-09-23 Post Fed, Expect More Surprises by Kristina Hooper of Allianz Global Investors

Kristina Hooper says investors should brace for more big market swingsand some fiscal curveballsin the wake of the FOMC’s decision not to taper in September. But the economy is throwing some good surprises our way too.

2013-09-21 Stock Buyback Announcements Slow to $2.3 Billion Daily in Third Quarter by Minyi Chen of AdvisorShares

Due to the acceleration in buyback volume in previous quarters, we are not reducing our $2.0 billion daily estimate of actual stock buybacks. Actual stock buybacks tend to track new stock buybacks closely with a lag. If the volume keeps falling in Q4 2013, however, we will likely reduce our estimate.

2013-09-21 Fifty Shades of Gold by Frank Holmes of U.S. Global Investors

Unlike many commodities, there are many shades to gold, such as the Love Trade’s buying gold for loved ones and the Fear Trade’s purchasing gold as a store of value. An additional “shade” investors need to be aware of is how the Fed interprets the recovery of the U.S. economy.

2013-09-20 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.

2013-09-20 U.S. Commercial Real Estate: Will the Good Times Last? by Devin Chen of PIMCO

The CRE market has experienced a gradual recovery in asset pricing since the 2008 financial crisis. Despite the duration of the recovery, there continues to be dislocation in the CRE market that astute investors can capitalize on. We believe certain properties in non-major markets look attractive for acquisition, and have been acquiring residential land on an opportunistic basis.

2013-09-20 The Fed's About-Face by Scott Minerd of Guggenheim Partners

The Federal Reserve’s decision not to taper quantitative easing telegraphed a mixed signal to markets about policy guidance while tempering forward economic growth expectations. Dramatically lower interest rates can be expected.

2013-09-20 Q&A: Emerging Markets Powerhouses China and India by Mark Mobius of Franklin Templeton Investments

Given their heft in the emerging markets world, China and India are among the countries I get asked most often about, particularly when they show market distress signals like economic slowing.This past week, the Templeton emerging markets team and I have been in China as part of a large research trip, doing further analysis on the market and key company prospects. I thought it would present a good opportunity to share a few of my answers to recent questions on both China and India.

2013-09-20 Growth and Rising Stars by Mark Kiesel of PIMCO

While developed market growth in several regions is picking up cyclically from low levels, overall global economic growth should remain subdued over the next several years. We believe credit spread tightening and rating upgrades are most likely for specific companies in industries and areas with strong growth. We see these "rising star" companies in the U.S. and European auto sector, the gaming, energy and chemical industries and in sectors tied to the U.S. housing market.

2013-09-19 A Fine Balance in the Global Profits Cycle by Saumil Parikh of PIMCO

In the U.S., we expect growth to accelerate over the cyclical horizon, but to disappoint elevated consensus expectations. In Europe, we also expect growth to accelerate, but just barely, and also below consensus. In Japan, we expect growth to remain heavily reliant on aggressive fiscal and monetary policies. And in emerging markets, we expect a stabilization in growth assisted by central banks regaining control of currency and financial market conditions. The outlook for global corporate profits is a key measure of success in determining the handoff to self-sustaining growth going forward.

2013-09-18 White Noise by Jeffrey Saut of Raymond James

Most recently, I have been in a cautious mode, believing we were involved in a short-term pullback that would carry the S&P 500 (SPX/1687.99) down about 10%. That strategy was working until the Syrian compromise wrecked the rhythm of the decline. Bear in mind, however, the anticipated decline was always couched within the context of a longer-term secular bull market.

2013-09-18 Stock Funds' 5-Year Track Records Set to Double by Gary Halbert of Halbert Wealth Management

Many investors focus on the previous five years annualized return when analyzing which mutual funds to buy. We also pay a good deal of attention to the 5-year performance number when analyzing mutual fund and ETF returns at Halbert Wealth Management. And currently the 5-year average returns for most equity mutual funds are not all that attractive.

2013-09-17 Gundlach ? Where to Expect the Next Crisis by Robert Huebscher (Article)

Unless there is a crisis, don’t expect a major decline in interest rates, according to Jeffrey Gundlach. And if such a crisis occurs, Gundlach warned, it will most likely take place in this emerging market.

2013-09-17 Tidbits Foreclosure, BK Signs and John Mauldin's “Unrealistic Expectations” by Gregg Bienstock of Lumesis

Some tidbits to start and then on to an outstanding guest commentary from the renowned John Mauldin. Our tidbits focus on Foreclosures and some insights around our review of some bankruptcy warning signs published by S&P Capital IQ. Our guest commentary, “Unrealistic Expectations” (I might have called it “Unrealistic Assumptions”), focuses on the daunting reality of underfunded pension plans.

2013-09-17 High Yield Market Overview August 2013 by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index, was down 0.62% for the month of August. Political uncertainties continue to weigh on investor sentiment, including a potential military response to Syria and the U.S. approaching the debt ceiling limit in mid-October. Uncertainty about Fed policy and who will be the next Chairman are also in the background.

2013-09-17 Consumers Face An Economy at a Crossroads by Chris Maxey, Ryan Davis of Fortigent

As the Federal Reserve prepares to debate the merits of tapering its asset purchase program this week, a key area of the economy that will be closely analyzed by Bernanke and Co. is the health of the American consumer. There are tenuous signs that consumers are spending more, but attitudes towards the economic recovery are hardly encouraging. Consumers will find it difficult to stay the key cog of economic growth in the U.S., but at the very least, their participation in the recovery is imperative, and leaves much to be desired.

2013-09-16 Russia is Tough to Love, Easier to Hate, Hard for Investors to Ignore. Here's Why by Frank Holmes of U.S. Global Investors

Russian President Vladimir Putin created a stir recently when he shared his thoughts with Americans in an op-ed printed in The New York Times. According to The Times, very few pieces written by heads of state have been published by the paper and very few received the attention Putin attracted.

2013-09-16 Baby Steps by John Hussman of Hussman Funds

Our view is that the Federal Reserve will taper its program of quantitative easing this week, in the range of a $10-15 billion reduction in the pace of monthly debt purchases. The Fed really has no “communication problem” about this the economic impact of further quantitative easing has had diminishing returns, and the economic drag from fiscal reductions has thus far been smaller than the Fed feared when it justified QEternity on the basis of those concerns last year.

2013-09-13 Waiting for Clarity From the Fed and Congress by Team of Northern Trust

U.S. economic growth averaged roughly 2.0% in the first half of the year and the average gain of real gross domestic product (GDP) during the entire 16-quarter economic recovery is 2.2%. Real GDP is projected to grow close to this trend in the second half of the year.

2013-09-12 Approaching a Turning Point by Scott Minerd of Guggenheim Partners

Higher interest rates continue to negatively affect the real economy, increasing the susceptibility of risk assets to downside risk.

2013-09-12 Brave New World by Christine Hurtsellers, Matt Toms of ING Investment Management

If the monotony of high school lulled you into a catatonic state the semester you were supposed to read Brave New World, here’s the CliffsNotes summary of what you missed. Aldous Huxley imagined a futuristic utopia in which the government promotes economic and emotional stability through the plentiful use of a soporific opiate called “soma”. Soma allows the mind to take a holiday from worldly problems via a gram, or two or three. Imagine the chaos into which this fictional world would descend were the government to abandon its role as pharmacist to the masses.

2013-09-11 Demand and Supply Fundamentals Point to Continued Price Growth by Adam Artunian of John Burns Real Estate Consulting

Will home price appreciation remain strong in the face of modest job growth and the recent uptick in mortgage rates?

2013-09-10 Some Scary Bumps in the Road Just Ahead by Gary Halbert of Halbert Wealth Management

The major stock indexes moved lower after setting new record highs in early August, although prices have recovered somewhat in the last few days. So was the weakness in August just an overdue correction before moving even higher? Maybe, but there are a number of things coming up in the next month or so that could rattle the markets even more, including whether or not we go to war with Syria. We’ll talk about those today.

2013-09-09 Get Ready for “Taper Lite”: 3 Signs the Labor Market Isn't Picking Up by Russ Koesterich of iShares Blog

While the overall US economy is healing, the labor market’s recovery continues to be frustratingly slow. Friday’s payroll report suggests investors should prepare for a less aggressive Fed, a more muted backup in interest rates and a bond market that can go up as well as down.

2013-09-09 Moving On - Five Years After Lehman by John Petrides (Article)

This month marks the fifth anniversary of the Lehman Brothers failure and the start of worst financial crisis in American history since the Great Depression, and yet to some investors, it seems like only yesterday. Investors still hold onto that period of volatility as if it will happen again tomorrow, paralyzing and confusing their investment decisions. Consequently, many investors have watched from the sidelines as the stock market has recovered solidly year after year.

2013-09-09 The Shape of Things to Come by Kristina Hooper of Allianz Global Investors

With a week to go before the September FOMC meeting, there’s little that stands in the way of Fed tapering. Friday’s jobs report didn’t impress but it probably wasn’t bad enough to stop central bankers from pulling some punch, writes Kristina Hooper.

2013-09-09 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.

2013-09-09 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks finished higher last week, but August was a down month as worries about monetary policy including who will lead the Federal Reserve next year, along with the confusion surrounding the Obama administration’s Syria decisions have put a damper on things for now.

2013-09-06 Weekly Market Review by AdvisorShares Research of AdvisorShares

The major US stock indexes fell once again last week, capping off the worst monthly performance of the S&P 500 in over a year. However, the index is only 4.69% below its all-time intraday high reached on August 2nd. While fear that the Fed would vote to start ending extraordinary stimulus measures at the next meeting late in September was the main reason cited for the decline, thin trading volume in August and especially the week before Labor day may have made led to increased volatility and price declines.

2013-09-06 The Growth Mirage by Scott Minerd of Guggenheim Partners

Despite disappointing economic data, there continues to be widespread expectations of a period of stronger economic growth just ahead. This growth mirage draws thirsty investors and increases the likelihood that interest rates will continue rising over the near-term.

2013-09-06 GSE Reform Lumbers Up to the Starting Gate by Michael Canter of AllianceBernstein

Momentum is finally building to do something with Fannie Mae and Freddie Mac. The bipartisan Corker-Warner proposal, now making the rounds on Capitol Hill, aims to dissolve the GSEs and start fresh. Meanwhile, Fannie and Freddie are testing innovative mortgage-security structures that transfer the risk of borrower defaults to the private sector.

2013-09-06 The Good, The Bad and The Ugly by Douglas Cote of ING Investment Management

“Good” economic news in developed markets has been overshadowed lately by the “bad” (burgeoning Asian currency crisis) and the “ugly” (Syria). Unwinding central bank support from the markets will be arduous; it is already contributing to destabilization of certain emerging market currencies. News out of Washington this autumn tapering, Fed leadership and the debt ceiling has the potential to add volatility and uncertainty. The U.S. equity market has been the place to be this year, but diversification remains key.

2013-09-06 Will Gold Follow Its Seasonal Pattern This Year? by Frank Holmes of U.S. Global Investors

There are factors beyond Syria this week driving gold. That’s the Love Trade. This group gives gold as gifts for loved ones during important holidays and festivals. This is the time of the year that we are in the midst of right now. Historically, September has been gold’s best month of the year. Looking at more than four decades of monthly returns, the precious metal has seen its biggest increase this month, averaging 2.3 percent.

2013-09-04 Fixed Income - Where to Now? by Chris Maxey, Ryan Davis of Fortigent

Since the end of the Global Financial Crisis (GFC), investors moved aggressively into fixed income asset classes. They were quickly rewarded in the years following the crisis with a combination of falling interest rates and tighter credit spreads, which led to positive absolute returns. The easy money in fixed income is gone, however, and now is the time for careful asset class selection.

2013-09-04 Off to the Races by Peter Schiff of Euro Pacific Precious Metals

Summer is traditionally a slow season for precious metals, but this summer started with a rout. In the last week of June, gold and silver hit 2-year lows of $1,192 and $18.61 respectively. Fortunately, after staggering along the lows, the precious metals are off to the races once more - with gold rallying more than 18% and silver 31%. This remarkable performance continues even in the face of the Fed’s sustained tapering threats.

2013-09-04 4 Signposts To Watch for an Emerging Markets Turnaround by Russ Koesterich of iShares Blog

When will we see a significant and prolonged reversal in emerging markets (EM) stock performance? Russ says to watch for four signposts that could signify the EM underperformance tide is turning.

2013-09-03 Our Views as We Head into Autumn by Charles Lieberman (Article)

Economic growth prospects for the U.S. are slowly improving, implying that the unemployment rate will continue to work its way lower and corporate profits will keep rising. We expect the Fed to start tapering of its bond buying program in September. Interest rates should revert to more normal, higher levels, but stocks should also work their way higher. Nonetheless, investors will be focused on events surrounding Syria, at least over the near term.

2013-09-03 So Step Right Up, Pick Your Favorites... by Blaine Rollins of 361 Capital

So with the backing of The White House, the State Department, the Senate & The Economist, the United States is going to launch Tomahawks on Syrian targets. The President did say that he will let Congress vote on a strike, but both he, Secretary Kerry and Senator Reid let it be known that they will be lighting fuses soon. So as a refresher as to who is supporting whom in Syria, the chart below will both assist and thoroughly confuse you...

2013-08-30 An American Energy Revolution by Frank Holmes of U.S. Global Investors

In Texas these days, there’s a feeling of absolute and unwavering confidence in the concept of an American energy revolution. From the depths of reserves to the richness of the energy, an incredible transformation is taking place.

2013-08-29 Active ETF Market Share Update & Weekly Market Review by AdvisorShares Research of AdvisorShares

Last week, total AUM in all active ETFs increased by over $69 million. As in previous weeks, assets in “Short Term Bond” active ETFs increased, this time by almost $64.6 million. AUM in the “Foreign Bond” category fell by nearly $58 million both because of falling values for ETFs in the category and because redemption units in certain ETFs. The “Global Bond” category had another bad week, ending over $18.3 million below where it began.

2013-08-29 High Yield Bond Market Mid-Year Check In by Matthew Pasts of BTS Asset Management

After a prosperous 30-year bull market, the prospect for the future direction of High Yield bonds would seem to hinge on not whether, but when their decline starts.Dan Fuss has been managing bonds for 55 years. His multi-sector bond fund, Loomis Sayles Bond Fund, ranks in the top 10% of its peer group over the last 15- and 10- year periods as of December 31, 2012. Fuss believes that bonds are currently “the most overbought market I have ever seen in my life in the business.”

2013-08-29 Monthly Investment Commentary by Litman Gregory Research Team of Litman Gregory

U.S. stocks resumed their positive streak in July (after a slightly negative June). Large-cap stocks rose in three out of the four weeks and were up 5% for the month. Smaller companies generally outperformed their larger-cap counterparts. After Federal Reserve comments regarding the timing of its stimulus withdrawal upset markets in May and June (particularly the bond market), investors seemed to take comfort in the Fed’s more recent comments. Among other points, Chairman Bernanke reiterated that a decision to taper bond purchases is different from raising the federal funds rate

2013-08-29 More Evidence of Pressure on Housing by Scott Minerd of Guggenheim Partners

The slowdown in housing due to higher mortgage rates is becoming more evident in the data for that market. This comes during a time when the Fed is making a crucial decision about tapering quantitative easing, which is causing market uncertainty to rise further.

2013-08-28 Forrest Gump Stock Market by Bill Smead of Smead Capital Management

After watching "Forrest Gump" for about the thirtieth time recently, I realized that the US economy and US stock market share a great deal in common with Forrest. In this missive, we will be reminded of the journey of a true American folk hero and of the journey back from the abyss the US economy and stock market have made since early in 2009.

2013-08-27 Why Bad Decisions Happen to Good People: An Introduction to Behavioral Finance by Scott Clemons (Article)

Cognitive biases frequently cause even skilled investors to make irrational decisions. Thankfully, irrationality is fairly predictable. Here are four behavioral biases that investors face and techniques for recognizing and overcoming them.

2013-08-27 Will Rate Rise Derail Housing Recovery? by Chris Maxey, Ryan Davis of Fortigent

As the Federal Reserve grapples with when and how to unwind quantitative easing, interest rates climbed more than a point since the end of 2012. This caused mortgage rates to increase to their highest levels in two years last week, with the average conforming 30-year loan jumping to 4.58% from 4.40% the week prior. Rising financing costs is presenting a headwind for one of the biggest bright spots in the US economy over the past 12 months.

2013-08-27 How Real is the Recovery in Commercial Real Estate? by Joel Beam, Ian Goltra of Forward Management

How Real Is the Recovery in Commercial Real Estate? A conversation with Joel Beam and Ian Goltra of Forward’s Real Estate Portfolio Management Team.

2013-08-27 Surviving a Road Trip by Jerry Wagner of Flexible Plan Investments

The earnings and economic news never seem to quit. And every position, and each action be it buy, sell or hold has commentators and gurus voicing an opinion on every side of the subject. For many investors, it is impossible to sort out the right direction to be heading in, let alone whether you should be on the entrance or the exit ramp for the investments making up your portfolio.

2013-08-27 Emerging Markets Feel the Ripples of Fed Tapering by Sam Wardwell of Pioneer Investments

Many Emerging Market currencies (notably those of India, Brazil and Indonesia) have been weak since the beginning of May. The declines accelerated sharply in recent weeks, leading to something approaching panic in several markets last week.

2013-08-27 Choose Your Door Wisely.. by Blaine Rollins of 361 Capital

If I was being forced to choose a side for year end 2013 performance, I would have to agree with Mr. Plant. While September is historically a difficult month for the markets, we also know that the Q4 tends to reward the equity markets.

2013-08-26 The Case for More Mortgage QE by Kristina Hooper of Allianz Global Investors

Disappointing new home sales don’t mean that tapering is less likely to occur in September. Rather, it may only mean that when tapering begins, the Fed’s likely to start small and only trim Treasuries.

2013-08-26 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 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 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.

2013-08-23 Economic Update: August 2013 by Lori Liffring, Michael Bridgeman, Gaylan Abood, Justin Anderson, Karen Benefiel of Cambridge Advisors

Stocks had another strong month in July with the large-cap S&P 500 index up 5.0% and the small-cap Russell 2000 up 7.0%. International stocks in developed markets were also 5.2% higher as measured by the MSCI EAFE index while emerging market stocks were up less than 1%. Bond prices stabilized during the month resulting in only a slight 0.1% gain.

2013-08-23 What Does an Improving Economy Mean for Stocks and Bonds? by Charlie Dreifus of The Royce Funds

With the economy improving, inflation tame, and a Federal Reserve meeting approaching in September, Portfolio Manager and Principal Charlie Dreifus believes that small-caps remain an attractive option within the equities market.

2013-08-23 Utilities - Today's Best Bond Alternative by Chuck Carnevale of F.A.S.T. Graphs

To refer to any stock or equity as an alternative to bonds or fixed income is sure to stir up the ire and consternation of many professional and individual investors alike who deem themselves prudent. Frankly, under normal circumstances I would tend to agree.

2013-08-23 5 China Charts That Look Bullish for Commodities by Frank Holmes of U.S. Global Investors

Over the past few months, investors have seen better economic data coming out of Europe. Consumer confidence in the continent has been rising, manufacturing data is improving and the fiscal situation is on the mend. Now, China appears to be strengthening as well, which could signal better times ahead. Below are five charts that look bullish for China and commodities. While not meant to be comprehensive, they do point to areas where investors might want to pay close attention.

2013-08-23 Embrace Bottom Up by Herbert and Randall Abramson of Trapeze Asset Management

With all the conflicting macro news, some good, some not, and with the S&P 500 and the Dow at new highs while many sectors languish, it is preferable to focus on the little picture not the big one. The big one may currently be more unpredictable than the small one, being bottom up investment in undervalued securities. Those may currently be less popular, but we value investors are naturally driven to buy investments low, that are neglected and unpopular, with the view of selling them high when their popularity is enhanced. Buy low and sell high. Not buy high and sell higher as is now in vogue.

2013-08-23 Buckle Up by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Caution is warranted near-term. For investors that have a solid strategy of dollar-cost averaging into the market, we don’t recommend deviating from that path. However, for investors who are more tactical, better entry points are likely yet to come. Longer-term, we remain bullish on US equities and prefer developed international markets over emerging markets.

2013-08-23 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

India: Broken promise or temporary hiccup? Bond markets appear unmoved by central bank guidance. Rising mortgage rates are taking some of the steam out of housing.

2013-08-23 The Next Big Challenge to Investors: Duration by Mike Temple of Pioneer Investments

Many investors have been conditioned to accept that the economy will be in the rehabilitation ward for the foreseeable future, rates will remain low, and monetary stimulus unending. We believe this is an increasingly dangerous mindset and the next great risk for bond investors is coming into view: the return of higher interest rates. We look at the “refuge” subsectors those areas of the fixed income market that investors may believe provide “safe haven” from the gathering storm.

2013-08-22 Active ETF Market Share Update & Weekly Market Review by AdvisorShares Research of AdvisorShares

Last week, total AUM in all active ETFs fell by over $60.5 million. AUM in the “Global Bond” category fell by nearly $89 million both because of falling values for ETFs in the category and redemptions in certain ETFs. The “Foreign Bond” category had another bad week, ending almost $36 million below where it began. As in previous weeks, assets in “Short Term Bond” active ETFs increased, this time by almost $36.5 million.

2013-08-22 Determined to Taper by Scott Minerd of Guggenheim Partners

The release of the July Federal Open Market Committee meeting minutes today and the Jackson Hole Economic Policy Symposium starting tomorrow are likely to dominate near-term activity in financial markets. Despite mixed economic data, it appears increasingly likely that some form of tapering will be announced at the FOMC’s September meeting.

2013-08-21 Trickle-Up Economics by Bill Smead of Smead Capital Management

Major magazines have a history of putting a topic on their cover at the end of a long-term trend. For example, “The Death of Equities” was a Business Week cover in late 1979, near the end of a miserable stretch in the US stock market. Time’s recent cover story, “The Childfree Life”, got us wondering about the economics of childbearing in the US? Does Time’s cover mark the end of a trend? Can the US economy succeed without homegrown population increases? Will economic success driven by the current demographics in the US trickle down to unemployed blue collar

2013-08-20 Change is Coming by Chris Maxey, Ryan Davis of Fortigent

The summer months brought a period of calm to global markets and economies. Nearing the move to autumn, it is time to look ahead and see what resides on the horizon. Investors could be due for a renewed bout of volatility based on any number of events set to happen before year-end.

2013-08-20 A Lot Of Action In What Was Expected To Be A Quiet Week by Sam Wardwell of Pioneer Investments

Most of the U.S. economic data released last week was rather ho-hum, consistent with continuing slow growth, but markets weren’t boring. Maybe markets are thin because it’s August, but the U.S. Treasury market had one of its worst weeks in a long time, and the selling spilled over into the U.S. stock market.

2013-08-20 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.

2013-08-20 Epic Climb Up and to the Right... by Blaine Rollins of 361 Capital

Interest rates continue to make an epic climb up and to the right...

2013-08-19 Chicago and Detroit A Guest Commentary by Joshua Laurito of Lumesis

A few weeks back, we brought you a guest commentary by Josh Laurito regarding the City of Detroit. His perspectives were well-received by our readers. This week, Josh is back by popular demand with some thoughts on his home town of Chicago. We believe there is great value in considering fresh perspectives from intelligent people that is precisely what Josh brings to the table.

2013-08-19 A Bear Market Is Here: In Bonds! by Brian Wesbury, Bob Stein of First Trust Advisors

While it certainly hasn’t made the headlines that it should have, the bond market has been kicked in the teeth. After bottoming at 1.61% on May 1, the yield on the 10-year Treasury Note hit 2.84% on Friday, its highest level in two years the worst bear market move in bonds since the end of the 2008-09 financial panic.

2013-08-19 A Warning Regarding Broken Speculative Peaks by John Hussman of Hussman Funds

We presently observe what might best be called a “broken speculative peak” a strenuously overvalued, overbought, overbullish, rising yield syndrome followed by a breakdown in market internals.

2013-08-17 Signs of the Top by John Mauldin of Millennium Wave Advisors

The investment media seems obsessed with the question of whether the Fed will taper. The real question should be not about "tapering" but about credibility. What happens when fundamentals become the narrative as opposed to what the central bank is doing? What happens if the Federal Reserve throws a liquidity party and nobody comes? Today we look at some of the fundamentals. The market is in fact overvalued, but that doesn’t mean it can’t become more overvalued. Is this August 1987 or August 1999?

2013-08-16 Attention Investors: Don't Fear Rising Rates; Fear Perpetually Low Rates by J.J. Abodeely of Sitka Pacific Capital Management

This month’s Insight will take a look at the performance of bonds during two previous inflationary periods, the 1940s and the 1970s, and illustrate two very different total return experiences. Through these examples, we will show that bond investors-- and by extension, any investor with a traditional balanced portfolio, should not fear rising rates as much as they should fear perpetually low rates.

2013-08-15 High Yield Market Overview July 2013 by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch High Yield Master II Constrained Index, was up 1.88% for the month of July. High yield recovered some of the sell-off experienced in May and June as Treasury yields stabilized and mutual fund and ETF (exchange traded fund) flows turned positive. The market’s rally occurred as rate fears subsided, which resulted in retail flows returning to the asset class.

2013-08-15 China and the Outlook for Financial Crises by Scott Minerd of Guggenheim Partners

China’s elevated and rising debt levels appear to be one of the largest risks to the global economy today. Although it is difficult to gauge when the risks in that country could manifest as a crisis, investors should act with the knowledge that the margin of safety in the global investment environment continues to decrease.

2013-08-14 What Role for Emerging Markets After the Sell-Off? by Ramin Toloui of PIMCO

While history suggests that the sell-off in emerging market bonds could ultimately offer attractive buying opportunities, it is important to anchor investment decisions firmly within a forward-looking economic and market outlook. Continuing vulnerabilities in global growth suggest there is fundamental value in EM bond yields at present valuations, as interest rate hikes priced into EM yield curves are unlikely to materialize in an environment of tentative growth.

2013-08-13 China Struggles to Fight the Trend by Chris Maxey, Ryan Davis of Fortigent

Prior to the global financial crisis, decoupling’ was the word du jour. In the years since the crisis began, however, decoupling has vanished from the everyday lexicon. In recent weeks, the financial media noticed a new form of decoupling, one that shows improving growth prospects in the developed world but slower growth in developing economies. Rightly or otherwise, much of that slowdown is pinned on China and recent data continues to suggest a slower pace of growth than investors became accustomed to in prior decades.

2013-08-13 Tapering, Munis and an Uneven Recovery by Gregg Bienstock of Lumesis

This week’s Tidbits are a bit longer text wise than usual. I focus on the end of QE (or the beginning of tapering) and then take a quick look at counties in Michigan feeling the impact of Detroit’s filing. I then move on to a review of a very uneven housing market and offer a quick observation on exports before concluding with some State Geo Scores to consider.

2013-08-13 Emerging Asia Pacific: Regional Economic Review - Q2 2013 by Team of Thomas White International

Asia’s emerging nations, the darling of the world economy since the 2000s, uncharacteristically slowed in the first quarter of 2013. After a decade of robust growth, many of Asia’s fast-growing economies are coming to terms with structural changes. Asian currencies, which had appreciated quite a bit over the past few years thanks to ultra-loose monetary policy in the developed world, came tumbling down at the first talk of a slowdown in the supply of cheap money.

2013-08-13 Developed Asia Pacific: Regional Economic Review Q2 2013 by Team of Thomas White International

Many developed economies in the Asia Pacific region rebounded during the second quarter of 2013 to post a healthy set of growth and inflation numbers. Turning on the monetary spigots during the past one year provided a major fillip to many developed Asian economies. Countries that fumbled in the wake of natural disasters in the recent past, showed marked improvement. Even those countries that were said to be suffering from structural deficiencies, too, responded well to the monetary medicine administered by their various central banks.

2013-08-13 And That's the Week That Was by Ron Brounes of Brounes & Associates

When the Fed talks, people listen (and it doesn’t even have to be Bernanke). This week, a few key policymakers (not named Bernanke) expressed their views that the bond buying program may begin to be tapered this year, perhaps as early as the September meeting. Some investors used the opportunity to sell stocks and book some profits, though news from China eased certain concerns that the global economy was on shaky ground.

2013-08-13 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

Despite the market’s jittery, almost daily, responses to the Federal Reserve’s inferences about “taking their foot off the pedal”, the reality is that secular changes, like the kind considered, occur very slowly and give us enough time to prepare for, and analyze, the consequences real and imagined.Most importantly, we need to see significant changes in data, and perception of that data, over the long term in order to corroborate the Fed’s decision.

2013-08-13 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stock prices declined modestly last week. A shrinking trade deficit caused 2nd quarter GDP estimates to increase (over 2% now annualized), thus renewing fears that the Federal Reserve would commence “tapering” at their September meeting.

2013-08-13 Dog Days of Summer Are Upon Us by Blaine Rollins of 361 Capital

Hopefully you are reading this from the beach, because there is so little news happening in the markets that those of us in the office are about to start making news up to justify stock price movements. But while news and volumes are at August lows, here are some thoughts that might ring a bell to help you to either make some money or to set down your smartphone and get back to the water.

2013-08-12 Extreme Brevity of the Financial Memory by John Hussman of Hussman Funds

The period of generally rich valuations since the late-1990’s (associated with overall market returns hardly better than Treasury bill returns since then) has created a tolerance for valuations that, in fact, have led to awful declines, and have required fresh recoveries to elevated valuations simply to provide meager peak-to-peak returns.

2013-08-09 The Half Full Economy by Peter Schiff of Euro Pacific Capital

The marginal economic strength that was described in the most recent GDP release from Washington has caused many to double down on their belief that the Fed will begin tapering QE sometime later this year. While I believe that is a fantasy given our economy’s extreme dependence on QE, market observers should have learned long ago that the Bureau of Economic Analysis (BEA) initial GDP estimates can’t be trusted. A perusal of their subsequent GDP revisions in the last five years reveals a clear trend: They are almost twice as likely to revise initial estimates down rather than up.

2013-08-09 A Surprising Way to Play a Europe Rally by Frank Holmes of U.S. Global Investors

After a lengthy period of stagnant growth and lackluster results, the gradual crescendo of improving economic data that’s been coming out of Europe lately certainly commands attention.

2013-08-09 The Calm Before the Storm? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Record highs in US equities have resulted thus far in only modestly elevated investor sentiment and it appears retail investors are returning to the market, which could fuel further gains. However, volatility is likely to increase with political and Fed issues on the horizon. Europe remains attractive, along with Japan, but we are watching the potential consumption tax increase closely, while China’s valuations are improved but concerns remain.

2013-08-08 Market Melt-Up Catches Defensive Investors by Surprise by Douglas Cote of ING Investment Management

Extraordinary returns in the fourth year of a bull market remind us that long-term defensiveness can’t be rationalized. July saw remarkable returns across global equity and fixed income markets, with the exception of U.S. Treasuries. Investors would be well served to ignore media drama and fear mongering and simply follow the fundamentals. Five years spent worrying about Armageddon is too long, but there’s still time to get back to a normal allocation.

2013-08-08 Not an Entry Point for U.S. Stocks by Scott Minerd of Guggenheim Partners

My long-term view of U.S. equities remains bullish, but a number of indicators, as well as near-term macro challenges, point to a pause in the run-up of that asset class.

2013-08-08 Looking Farther Down the Road by Doug MacKay, Bill Hoover, Mike Czekaj of Broadleaf Partners

The stock market has continued to do very well over the summer months, reaching new, all-time highs and proving to even the most stubborn of skeptics that Great Recessions can become Great Recoveries for those with the appropriate time horizon. While our industry spends a great deal of time and effort focused on relative performance results compared to appropriate benchmarks, the greatest value any financial advisor or money manager can provide is usually addressed far less often; simply keeping you in the game.

2013-08-08 Is The Financial Crisis Over For Financial Stocks? by Chuck Carnevale of F.A.S.T. Graphs

The cause of the financial crisis of 2007 -2008, also known as the Great Recession of 2008, is attributed to many different theories. However, one of the most common theories is an easy money regulatory environment that led to an abundance of subprime loans, which in turn inflated real estate prices to bubble levels. Additionally, many blame the Financial sector, predominantly the money center banks, for exploiting the lax lending requirements with reckless and greedy behavior.

2013-08-08 The Role of Confidence by Howard Marks of Oaktree Capital

The so-called wealth effect plays an important and well recognized part in the functioning of an economy. When assets appreciate in value, the owners translate their increased wealth into increased spending. While at first glance this is unsurprising, it should be noted that this is true even if the appreciation is unrealized, and thus the increased wealth exists solely on paper. The relationship can be stated as follows: the richer people feel, the more they spend. Changes in confidence have an impact on behavior similar to the wealth effect. That’s what this memo is about.

2013-08-07 Adapt or Die... by Blaine Rollins of 361 Capital

Bond king Bill Grosss $261.7 billion Total Return Fund at Pacific Investment Management Co. suffered a $7.5 billion net outflow last month, according to data from fund tracker Morningstar Inc. on Friday. It is the third straight monthly outflow for the Fund, on the heels of nearly $10 billion in redemptions in June. Clients have yanked $15.6 billion from Gross’s Fund in 2013 through July. Jeffrey Gundlach’s $37.9 billion DoubleLine Total Return Bond Fund suffered $580 million net outflow in July, according to Morningstar.

2013-08-06 And That's the Week That Was by Ron Brounes of Brounes & Associates

After a week like this, everyone needs a vacation. Big Oil led the earnings trail and the results were not pretty. Europe and China both expressed nice signs for their previously weaker manufacturing sectors. At home, the labor results were mixed, manufacturing looked solid, the consumer remained active, and Michael delayed the vote yet again.

2013-08-06 The “Employment Situation” and A Look at Housing by Gregg Bienstock of Lumesis

This week, we start with a return to our “tidbits” and then insight and thoughts around the Employment Situation as reported on Friday and our take on that and related data. We also take a look at Homeownership data and wonder if the glass is half full or empty.

2013-08-06 Equities Grind Higher as the Economy Continues to Muddle Through by Bob Doll of Nuveen Asset Management

U.S. equities advanced last week, with the S&P 500 increasing 1.10%.1 For the month of July, the S&P gained 5.09%, and equities have increased 21.33% year to date. Second quarter earnings season is nearly complete, and there has not been a material change in estimated earnings for the balance of the year or 2014. Revenues were slightly ahead of expectations, and earnings per share were approximately 3% higher than expected, annualizing at about $110 per S&P 500 share.

2013-08-06 The ABCs of ABS: Identifying Opportunities in Asset-Backed Securities by Scott Minerd of Guggenheim Partners

In the search for yield, ABS offers an opportunity to generate higher returns through rigorous analysis, unaccompanied by additional credit or interest-rate risk.

2013-08-05 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 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 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.

2013-08-02 Second Half Challenges by Michael Kayes of Willingdon Wealth Management

One of the most challenging aspects of managing portfolios is to process the endless information flow and determine what impact it will have, if any, on the markets. Some information, while interesting to read about, has virtually no impact on the future direction of stock and bond prices. Other information may not have an immediate impact, but it may be impactful in the future. This, delayed-impact information encompasses the vast majority of information that surfaces on a daily basis.

2013-08-02 Building Market Intelligence by John Burns of John Burns Real Estate Consulting

The US housing market can no longer be painted with one brush, as the housing recovery is playing out very differently across the country. Here are some anecdotes gleaned from our consulting team.

2013-08-01 Alternatives for Today's and Tomorrow's Market Challenges by Jennifer Bridwell, Sabrina Callin of PIMCO

Investors should consider alternative investment strategies, which could enhance diversification and the potential for alpha, or risk-adjusted returns, because returns from traditional asset classes in coming years may be lower and more volatile than those realized historically.

2013-08-01 Active ETF Market Share Update & Weekly Market Review by AdvisorShares Research of AdvisorShares

Last week total AUM in all Active ETFs fell by almost $20 million. This was almost entirely due to redemptions in “Foreign Bond” Active ETFs. The “Short Term Bond” category continues to gain assets and increased by $38 million just last week. Total AUM in this category could possibly surpass the “Global Bond” category in the coming months in trends continue.

2013-07-31 An Important Week on the Economic Front by Scott Brown of Raymond James

The markets have placed too much emphasis on the Fed tapering. Whether policymakers decide to slow the rate of asset purchases in September or December shouldn’t matter all that much. The Fed’s decision will be data-dependent. Note that it’s not the figures themselves that matter. Rather, it’s what the data imply for the overall economic outlook.

2013-07-31 Still High Time for High Yield? by Team of Rainier Funds

Given recent strong performance and yields hovering at historic lows, a current topic of debate has been whether the high yield bond market has become an asset bubble and how much of a risk is the potential end to the Federal Reserve’s accommodative monetary policy to high yield investors. While we at Rainier acknowledge there are current risks in the fixed income market, we believe these concerns are not unique to high yield bonds.

2013-07-30 Detroit A Guest Commentary and Noise from DC by Gregg Bienstock of Lumesis

This week I bring you a guest commentary from a friend and colleague, Josh Laurito. His blog post, “Why Detroit’s Bankruptcy is a Bigger Deal Than You Think” may rankle a few of you and cause others to challenge Josh’s points. That is what he does so well he thinks outside of the box and offers context not necessarily shared by folks who are all munis, all the time. It is precisely these reasons that I encourage you to read on. In my years of knowing Josh, I have always found his thinking and approach to be insightful and, at times, a bit different.

2013-07-30 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 week’s release of the July employment report. Global macro headlines generated more uncertainty than direction for the markets.

2013-07-30 Earnings Take a Back Seat to Policy by Chris Maxey, Ryan Davis of Fortigent

Although it was a quiet week on the economic front, there were a few notable indicators to digest.

2013-07-30 Economic & Capital Market Summary by Gregory Hahn of Winthrop Capital Management

We are approaching the five year anniversary of the beginning of the Financial Crisis. By this time in 2008 we had already experienced the complete seizure of the Auction Rate Preferred securities market and the takeover of Bear Stearns by JP Morgan Chase. In August of 2008, we would see the collapse of Lehman Brothers and the government takeover of AIG. We stand here today, shoulders slumped, and heads bowed mourning the lack of real progress in addressing the structural problems that are impeding sustained economic growth and private credit expansion.

2013-07-30 FPA Crescent: Steve Romick's Quarterly Commentary by Steven Romick of FPA Funds

FPA Crescent Fund has released its quarterly commentary examining the state of the fund and its investments as well as an outlook on the greater economy. Portfolio manager Steve Romick feels that the economic “recovery has been disappointing and largely engineered by central bank policy” and worries “that low interest rates and novel and theoretical Fed policy could lead to unintended consequences.”

2013-07-30 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stock averages were nearly unchanged last week as earnings reports are being reported mostly in line albeit with the usual concerns about the pace of economic activity. This is reflected once again by a lack of revenue growth for many industries.

2013-07-30 Royal Babies and Economic Growth by Bill Smead of Smead Capital Management

On a recent business trip to Europe, we noticedanecdotallya lack of hope in the economic future of Europe. There is a good reason for the lack of hope. Hope, we believe, comes in the form of new life. When all of the austerity being practiced in developed nations around the world is pretty much done, something else needs to happen for economic growth to take hold. At Smead Capital Management, we believe developed economies need rebirth and the birth last week of a son to the Royal family is a watershed event.

2013-07-30 Leuthold's Chun Wang on 10-year Rates by Chun Wang of Leuthold Weeden Capital Management

So now the question is how high can it go? Just like every other market, bond yields tend to overshoot, and we think 3% is the upper bound in the short-term. However, we believe it will settle back closer to 250 bps by the end of the year.

2013-07-30 ING Fixed Income Perspectives July 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

We are constructive on interest rate risks in many developed and emerging economies as global central banks reinforce accommodative monetary policy. We favor the U.S. dollar versus the Japanese yen, the Euro and other developed market currencies. Credit spreads should narrow from current levels as the markets gain confidence and the Treasury market stabilizes. preads offer more than adequate compensation for likely credit losses and a further rise in interest rates. Spreads have been pressured to pre-QE3 levels and mortgages look attractive at these higher levels as prepayment speeds slow.

2013-07-29 And That's the Week That Was by Ron Brounes of Brounes & Associates

So now Prez Obama is sharing his two cents about the economy. After weeks of endless babble from the Fed Chief and his partners in crime about the economy and the longevity of the bond buying program, O is now making job creation his number one priority. Is anyone listening to his urgent messages (certainly no one in DC)? Investors (at least those not on vacation) were less than impressed with the less than impressive earnings of the week, though markets held their own.

2013-07-29 Driftingbut for How Long? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

Equities have drifted higher during a decent earnings season with few surprises, while yields have calmed and volatility has plunged. Typical lackluster summer action may prevail for the next month, but action is likely to heat up as the weather begins to cool.

2013-07-29 Global Economic Outlook by Team of Northern Trust

Growth is expected to improve in the United States and the United Kingdom while disappointing in Europe.

2013-07-26 The View From Here by Carl Tannenbaum of Northern Trust

Despite the advance of college savings accounts, many families are ill-prepared to pay for school.

2013-07-26 Investors Now a Concern by John Burns of John Burns Real Estate Consulting

During the downturn and early stages of recovery, we were huge proponents of investors taking advantage of overcorrected home prices to make great investments while also helping the housing market recover. Mission accomplished.

2013-07-26 Emerging Markets Equity Commentary June 2013 by Team of Thomas White International

Emerging market equity prices declined appreciably on heightened investor concerns over an early withdrawal of the monetary stimulus measures in the developed world. The most recent policy statement issued by the U.S. Federal Reserve, which was more optimistic about the growth prospects for the U.S. economy, and comments by Fed officials seemed to suggest that the central bank is preparing to wind down its bond purchase program.

2013-07-26 China Property: A Tough "Bubble" to Pop by Henry Zhang of Matthews Asia

Irecently came across an old newspaper article from February 1989 that described Beijing’s residential property "bubble," with average selling prices then of about US$430 to US$510 per square meter. The article went on to say that, given that the average college-educated worker typically saved less than approximately US$13 per month, at those prices, it would take a century or so to be able to buy a two-bedroom apartment. The writer concluded that a housing bubble was underway.

2013-07-26 Is Europe Ready to Take Off? by Frank Holmes of U.S. Global Investors

After the U.S.’s huge run, is it possible the country will be handing off the baton across the Atlantic for the next leg of the relay race? Here are a few areas of strength that could send European stocks higher.

2013-07-25 Summer Quarterly Commentary by John Prichard of Knightsbridge Asset Management

Recently the Fed indicated it may begin returning control over market pricing and interest rates to Adam Smith’s invisible hand... and borderline chaos erupted. The episode began mid-day May 22nd as Congress questioned Fed Chairman Bernanke and suddenly the cat was out of the bag and a paradigm shift ensued. Bond funds suffered some of their largest weekly redemptions on record. Rates spiked and markets swooned around the world through late June as investors assumed the worst.

2013-07-25 A One-Pillar Economy by Scott Minerd of Guggenheim Partners

Despite blockbuster new home sales, higher interest rates have put downward pressure on housing activity. This is highly worrisome given the importance of housing to the health of the U.S. economy.

2013-07-25 Perspective by Jim McDonald of Northern Trust

Investors have faced a torrent of central bank actions and communications during the last month, and markets continue to differentiate among economies and companies a welcome maturation from the markets’ prior regime of “risk on/risk off.” We believe the Federal Reserve has moved from an easing bias to one of tightening but at an elongated pace that will remain data dependent. Joining in this parsimony are some key emerging-market central banks, including the People’s Bank of China, which is working to control credit risk in the Chinese economy.

2013-07-25 No Bargains in the Consumer Discretionary Aisle by Russ Koesterich of iShares Blog

Russ has long advocated that investors remain cautious on consumer discretionary stocks. After last week’s weak economic data, he updates the case for this call.

2013-07-24 Average Gas Price Could Hit $4 by Labor Day... Or Not by Gary Halbert of Halbert Wealth Management

With the recent jump in gasoline prices, several energy analysts are forecasting that prices at the pump will top $4 a gallon (national average) later this summer. On the other hand, some analysts feel that gas prices will only go up another 5-10 cents a gallon just ahead, and then move lower in the fall. Of course, no one knows for sure. Today, we’ll take a look at what’s driving gas prices higher.

2013-07-24 Stocks and Bonds Both Again Rally as Bernanke Soothes by Sam Wardwell of Pioneer Investments

Fed Chairman Ben Bernanke’s congressional testimony got more headlines, but Detroit’s long-anticipated formal filing for Chapter 9 bankruptcy was by far the more important development. Billions of dollars of losses will be imposed on general obligation bondholders and/or retired employees.

2013-07-24 Bursting of the Bond Bubble by Clyde Kendzierski of Financial Solutions Group

Our April newsletter focused on the extreme overvaluation in the bond market. I argued that money market funds (or cash) were likely to outperform bonds and bond funds over the next decade. In May I applied the same logic to US stock prices and the inherent fallacy in the prevailing TINA (“there is no alternative” to stocks) hypothesis. Although stocks are likely to outperform bonds over the next decade, both asset classes remain seriously overvalued. In a world of overvalued assets, zero return looks much better than large potential losses even when that means foregoing transitory

2013-07-24 Earnings Acceleration Likely Needed for Next Upturn in Stocks by Bob Doll of Nuveen Asset Management

U.S. equities finished mostly higher last week. For a fourth straight week, the S&P 500 and Dow Jones Industrials were up (returning 0.73% and 0.57% respectively for the week), while the NASDAQ underperformed at -0.34%. It was a busy start for second quarter earnings. More than 70% of the 100 S&P 500 companies that have reported earnings have beaten consensus earnings per share expectations by approximately 3% in aggregate.

2013-07-24 Active ETF Market Share Update & Weekly Market Review by AdvisorShares Research of AdvisorShares

This past week, total assets in the active ETF space increased by over $60 million. The top 3 categories (“Global Bond”, “Short Term Bond” and “Foreign Bond”) all saw increases in AUM. The “Alternative Income” category fell in AUM, after weeks of only going up.

2013-07-24 Blather, Rinse, Repeat by Scott Brown of Raymond James

As expected, Federal Reserve Chairman Ben Bernanke repeated recent themes in his monetary policy testimony to Congress. However, he appeared to make a clearer distinction between the Fed’s two current policies, emphasizing that short-term interest rates will remain low for a long time. Even though there wasn’t anything new in Bernanke’s testimony, the markets took it as “dovish.” Importantly, the Fed isn’t the only central bank placing an emphasis on forward guidance.

2013-07-23 Taper Protection: Where to Go when Rates Rise by Casey Frazier, CFA (Article)

I have fielded a number of questions from advisors about the effects of rising interest rates on real estate values. The negative effect of rising rates is predictable for fixed incomes, but real estate returns vary and are dependent on a number of factors. I will start with a historical analysis that demonstrates the strength of real estate returns during periods of rising rates. Then I’ll outline the factors that drive changes in real estate values in a rising-interest-rate environment.

2013-07-23 And That's the Week That Was by Ron Brounes of Brounes & Associates

Well, at least, the Tigers are leading the AL Central. The city of Detroit filed for Chapter 9 bankruptcy protection this week and pension owners and creditors are lining up to ask for pennies on the dollars on unpaid moneys owed. Detroit officially becomes the largest city in US history to file for such protection as it continues to suffer from a falling tax base after losing 250k residents between 2000 and 2010.

2013-07-23 Emerging Markets: Undervalued or Value Trap? by Chris Maxey, Ryan Davis of Fortigent

In the first quarter, we explored the divergence of emerging market equities from the US. We noted that a combination of factors likely drove the 12% performance differential, including investor risk appetites, inflationary pressures in developing markets, and reduced commodity price expectations.

2013-07-23 Time to Kick the “Ick” Factor for Energy and Materials by Scott Colyer of Advisors Asset Management

Basic materials have been the “biggest loser” of an asset class for 2012 as well as thus far in 2013. Everything tangible, from gold and copper to coal and steel, has acquired an “ick” factor that makes the asset class nearly uninvestable. Shares of companies in these categories are trading at values not seen since 2009 market lows. We are beginning to see some very important developments that might make the group more palatable. In fact, we believe that metals, mining and energy could again become Wall Street darlings.

2013-07-22 A Tale from A Land Afar Comes Home, How Strong is This Recovery? by Gregg Bienstock of Lumesis

A break from our recent practice of tidbits. There’s a story you should read the similarities just might make you take notice. From there, I delve into the “recovery” and provide a bit more around our recently introduced Geo Score.

2013-07-22 More Plow Horse in Q2 by Brian Wesbury, Bob Stein of First Trust Advisors

Forecasting economic growth for the second quarter of the year is always precarious. The reason is that the initial report on the second quarter is when the government goes back and makes revisions to GDP for the past several years. This time around, it’s particularly iffy because the government for the very first time is going to start accounting in GDP for the value of R&D spending by companies.

2013-07-20 Any Bonds Today? by John Mauldin of Millennium Wave Advisors

Given the acknowledged limitations of the CPI, we nevertheless use it in myriad ways. It governs cost-of-living adjustments for Social Security beneficiaries, government employees, and many labor union members. CPI is baked into the general cake, even though we know it is an imperfect fit in almost every situation.

2013-07-19 Print the Legend by Peter Schiff of Euro Pacific Capital

The Trayvon Martin/George Zimmerman tragedy has become one of those transcendent events that dominates the national discourse and throws light on dimly lit aspects of our society. Obviously, the case touches most closely on issues of race relations, media culture, and the politicization of the justice system. It also reveals how preconceived emotional commitments to a narrative can consistently trump demonstrable facts. These tendencies are also present in the polarized discussion about the persistent weakness of the U.S. economy.

2013-07-19 China's Slowing Growth Who's In the Driver's Seat? by Anastasia Amoroso of J.P. Morgan Funds

After three decades of double-digit GDP growth, China has recently been expanding at a rate much closer to its five-year plan’s established target of 7%. As the pace of growth has changed, so has its composition and trajectory. The focus is shifting away from growth at all costs to a preference for quality over quantity that increases the wellbeing of an average Chinese consumer. The government is intent on rebalancing the economy away from commodity intensive infrastructure spending and towards supporting the middle class by increasing urbanization, private consumption and affordable ho

2013-07-19 Weekly Economic Commentary by Team of Northern Trust

The year’s first half included some big surprises. U.S. wage and salary growth sets the stage for stronger consumption. Don’t be discouraged by the most recent housing report.

2013-07-19 Challenging a Long-Held Assumption about Commodities by Frank Holmes of U.S. Global Investors

It is widely accepted that China spurred higher commodity prices in the past decade. And if the country was the force behind the boom, then the assumption is that China’s lower, but still healthy growth will be a drag on commodity prices. But recent research challenges this assumption.

2013-07-19 Opportunity in Europe by Team of Neuberger Berman

A striking feature of this year’s global stock market rally is that international markets have significantly trailed U.S. stocks. Nevertheless, Neuberger Berman’s Asset Allocation Committee (AAC) recently made the contrarian call of upgrading its view for international developed markets, particularly Europe. In this Strategic Spotlight, we provide an update on the European economy and lay out some reasons for optimism despite the dour growth outlook.

2013-07-18 A U.S. Stock Market Rally to Sell by Scott Minerd of Guggenheim Partners

The longer-term outlook for the U.S. stock market remains favorable, but moves in the NYSE advance/decline line suggest caution in the weeks and months ahead.

2013-07-18 Second Quarter 2013 Financial Market Commentary by Andrew Zimmerman of DT Investment Partners

To taper, or not to taper, that is the question that investors are currently grappling with.

2013-07-17 The Bernanke Guessing Game by David Wismer of Flexible Plan Investments

There can be little doubt that US equity markets have become more dependent than ever, at least in the short-term, on the every utterance of Fed Chairman Ben Bernanke and his fellow FOMC members.

2013-07-17 Second Quarter 2013 Newsletter by Steve Wenstrup, Jim Tillar of Tillar-Wenstrup

We wrote after the strong first quarter to expect volatility to increase with stocks remaining the preferred asset class and that is largely what happened in the second quarter. Almost all risk assets wobbled after the Federal Reserve (Fed) hinted at a possible tapering of quantitative easing later this year. Regardless, most domestic stocks did well in the quarter.

2013-07-17 Hopelessly Devoted To You by Bill Smead of Smead Capital Management

A journalist from Fortune magazine once asked Andy Grove, the former CEO of Intel, for the best business advice he’d ever been given. Grove provided a simple quote from a former professor at City College of New York: “When everybody knows that something is so, it means that nobody knows nothin’.”

2013-07-17 Canadian Secular View: Into Darkness? by Ed Devlin of PIMCO

Many investors are buying Canadian federal government bonds, shorting Canadian bank stocks and selling Canadian dollars in anticipation of a prolonged downturn. While significant risks are clearly facing the Canadian economy, our baseline forecast does not justify positioning our portfolios for a prolonged Canadian downturn.

2013-07-17 Bubbles Forever by Robert Shiller of Project Syndicate

In 2006, the largest global real-estate bubble in history imploded, and the collapse of a major worldwide stock-market bubble a year later triggered the global financial crisis. Although one might think that we have been living in a "post-bubble" world since then, talk of new bubbles keeps reappearing.

2013-07-16 Hedge Funds Can Advertise...But Should They? by Chris Maxey, Ryan Davis of Fortigent

In April 2012, the Jumpstart Our Business Startups (JOBS) Act was signed into law. The legislation eased a number of regulatory burdens on small businesses and private industry in a bid to boost job growth. The bill made additional headlines for lifting an 80-year ban on solicitation for private placements, the restriction that prevented hedge funds from advertising their wares to the general public.

2013-07-16 High Yield Market Overview June 2013 by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch High Yield Master II Constrained Index (the “Index”), was down 2.64% for the month of June. Yields moved sharply higher during the month as the high yield market experienced record retail outflows, quickly adjusting expectations around the Treasury market, and increased equity price volatility. Volatility spiked after a more hawkish message emanated from the Fed after the Federal Open Market Committee (FOMC) meeting on June 19th.

2013-07-16 Don't Be Deceived by the Deficit Dip by Milton Ezrati of Lord Abbett

Recent budget reports have been encouraging. Revenues are rising faster than originally expected, and deficits are running lower. Some of this improvement is real, but, sadly, not all of it.

2013-07-16 Investment Bulletin: Global Equity Strategy July by Team of Bedlam Asset Management

For the first half of the year, the 17.7% gain by the portfolio was 390 basis points better than the index; during June, market panic over potential changes in Fed policy resulted in a 3.0% fall in the index, with the portfolio down by a similar amount. US bond funds suffered a record $58 billion outflow during the month, 2%of their assets.

2013-07-16 Bernanke Still Trying To Get The Message Across by Scott Brown of Raymond James

Economists view the Federal Reserve’s communications with the public as being consistent over the last several weeks. There has been no change in the monetary policy outlook. The Fed had been expected to reduce the pace of asset purchases later this year. The financial markets, however, seem to be hearing different things at different times.

2013-07-15 Beneath the Noise, a Resilient Demand Trend and Clear Fed Plan by Alan Levenson of T. Rowe Price

Available data point to real GDP growth of less than 1% in the second quarter, yet we are looking through the dip: core demand data have been firmer (watch June retail sales on Monday), and a Q2 inventory correction will likely be followed by current quarter re-stocking. The sharp upward adjustment in mortgage rates will not derail the housing recovery. The FOMC has provided substantial clarity, in our view, regarding the monetary policy path that it intends to follow if the economy evolves in line with its expectations.

2013-07-15 Don't Forget About Earnings by John Petrides (Article)

Earnings season is upon us! Investors can finally focus on what really matters in driving stock prices...earnings growth.

2013-07-15 Mid-Year Outlook: Waiting to Move Beyond a Muddle-Through Economy by Bob Doll of Nuveen Asset Management

By focusing on current economic conditions while giving due importance to the uncertainty created by Fed actions we offer thoughts for consideration in evaluating “risk-on” investments.

2013-07-15 Rock-A-Bye Baby by John Hussman of Hussman Funds

I’ve always thought that singing “Rock-a-bye baby” offers a bizarre lesson to our young, encouraging them to be lulled gently to sleep by describing a scene that should have them wide-eyed with terror.

2013-07-15 And That's the Week That Was by Ron Brounes of Brounes & Associates

After weeks of naysaying and fear-mongering about the Fed, investors finally embraced news from Bernanke and friends and equities moved back into record-setting territory. While most accept the fact that the Fed has entered the “beginning-of-the-end” of its bond-buying stimuli, the minutes from the latest policy meeting and a few “comforting” comments from Dr. B. himself helped calm the masses that the program would not end “yesterday.”

2013-07-12 China's Very Relative Malaise by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, looks at “China’s Very Relative Malaise”, an observation which he describes as “a vaguely uneasy feeling that seemed to be shared by most (Chinese) but not always for the same reasons.”

2013-07-12 Opportunity Knocks for Mortgage Investors by Matthew Bass of AllianceBernstein

We don’t usually think of rising rates as being good for homeowners. That may be because we’re accustomed to thinking of financing (and refinancing) as the key to reviving sagging housing markets. And it’s true that financing availability remains tight, at least by historical standards, and isn’t going to get looser with rising rates.

2013-07-12 Commodities 2013 Halftime Report: A Time to Mine for Opportunity? by Frank Holmes of U.S. Global Investors

It was a challenging first half of the year for most commodities, with only two resources we track on our Periodic Table of Commodities Returns rising in value. Natural gas and oil rose 6.5 percent and 5 percent, respectively, while silver lost a third of its value and gold lost a quarter of its price from the beginning of the year.

2013-07-12 Calming Downand Changing Focus by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Markets are calming and investors seem to be focusing on fundamentals againa nice change from recent history. The bar is relatively low for earnings season but focus will be on the commentary surrounding releases. We believe more sideways movement in both US equities and Treasury yields could prevail over the next couple of months, with summer months muting action; but remain optimistic about stocks longer-term. Likewise, Japan could tread water until new elections are held, but we believe the eurozone provides opportunities that should be looked into at the expense of investments in China.

2013-07-11 The Capital Flight from Safety: It is Not About Tapering it is About Growth by Scott Colyer of Advisors Asset Management

Since Ben Bernanke’s comments seemed to unleash the bond vigilantes on June 19, we have seen a reversal in money flows that have used the U.S. Treasury market and the gold market as a “flight to safety trade.”

2013-07-11 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company

While the economic trends of the past couple of years continue, we’ve just seen an important change in interest rates and the bond markets.

2013-07-10 3 Risks that Could Derail the Market Rally by Russ Koesterich of iShares Blog

Stocks can withstand moderate rate increases, as we saw last Friday when they rallied despite a sell-off in bonds. But Russ K warns that they may not withstand these three other scenarios.

2013-07-09 A Mid-Year Letter to Clients: A Positive Outlook on America by Dan Richards (Article)

Each quarter I’ve posted templates to serve as a starting point for advisors looking to send clients an overview of the three months that just ended and the outlook for the period ahead. This quarter’s letter focuses on why the U.S. is expected to be the leader among global economies.

2013-07-09 The Fed's Bind: Tapering, Timetables and Turmoil by Scott Minerd of Guggenheim Partners

There are striking parallels between the dramatic recent sell-off in U.S. Treasuries and the Great Bond Crash of 1994. But the summer of volatility now facing financial markets is no doomsday scenario. Instead, it puts the U.S. Federal Reserve in a bind. Higher interest rates will reduce housing affordability, which is especially troublesome since housing is the primary locomotive of U.S. economic growth.

2013-07-09 Record Selling of Bond Funds: $79.8 Billion Pulled from Bond Mutual Funds and Exchange-Traded Funds by TrimTabs Asset Management of AdvisorShares

The biggest liquidity story is unfolding in the bond market, not the stock market. Investors are pulling record sums out of bond funds. Read this investor insight by TrimTabs Asset Management to learn more about the central bank’s influence on the markets as well as supply and demand activity with the stock market.

2013-07-09 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.

2013-07-05 Record Selling of Bond Funds: $79.8 Billion Pulled from Bond Mutual Funds and Exchange-Traded Funds by Minyi Chen of AdvisorShares

The biggest liquidity story is unfolding in the bond market, not the stock market. Investors are pulling record sums out of bond funds. Read this investor insight by TrimTabs Asset Management to learn more about the central bank’s influence on the markets as well as supply and demand activity with the stock market.

2013-07-05 The Asian Giant Stampeding into Gold by Frank Holmes of U.S. Global Investors

In this environment, gold should remain attractive. However, as the West flees the precious metal, another set of gold buyers has come forward with the aim to preserve wealth. Take a look at the chart below which shows total gold production compared to the gold deliveries on the COMEX and the Shanghai Gold Exchange.

2013-07-03 Getting Back to “Normal” by Douglas Cote of ING Investment Management

Though markets were whipsawed by the announcement, the Fed’s plan to step aside and allow normalization is a good thing. The primary risk to hedge is now 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. It’s not too late for investors to move away from defensive positioning and back toward a standard allocation.

2013-07-03 Long Train Running: Why Stocks Are Rebounding by Liz Ann Sonders of Charles Schwab

Why the June swoon occurred and why it might already be over. Fed’s move toward policy normalization may have a lot to do with pricking perceived asset bubbles; not a more hawkish economic stance. Sentiment has improved notably; but technical conditions may need a bit more repair.

2013-07-03 A Roadmap for Rates by Scott Minerd of Guggenheim Partners

Uncertainty over the Federal Reserve’s timeline for tapering quantitative easing has resulted in increased volatility in fixed income markets. While the coming months could see the 10-year Treasury yield climb as high as 3.5 percent, the resulting economic slowdown will keep rates subdued in the medium-term.

2013-07-03 AdvisorShares Weekly Market Review by AdvisorShares Research of AdvisorShares

Markets went higher last week after central bankers around the world reassured investors that they would not kill the economic recovery with higher interest rates. More volatile small and mid-cap stock indices performed even better than the S&P 500.

2013-07-03 Does China's Central Bank Matter More than The Fed? by Sam Wardwell of Pioneer Investments

I’m pleased to share with you the economic and market brief that I prepare for Pioneer’s investment professionals each week. It’s intended to be short but informative, and I hope you find it useful.

2013-07-03 Failure to Communicate, Part 2 by Scott Brown of Raymond James

The financial markets have begun to reassess Fed Chairman Bernanke’s monetary policy comments. Several Fed officials spoke last week, each echoing Bernanke’s key messages: 1) policy will remain data-dependent, 2) tapering is not tightening, and 3) a rise in the federal funds target rate is a long time off. With an emphasis on data-dependence, the economic figures should get more scrutiny from the markets. Still, there’s a sense that hope plays a major role the Fed’s economic outlook.

2013-07-03 Will the Recent Rise in Interest Rates Shut Down Household Spending? by Paul Kasriel of Econtrarian, LLC

Not likely. Today, June 27, the yield on the Treasury 10-year security closed at 2.47% according to the Bloomberg public (i.e., free) website. According to the Fed, this security closed at 1.66% on May 1. All else the same, household borrowing and spending would be stronger had this interest rate not risen by 81 basis points in the space of about two months. But it is doubtful that the recent rise in bond yields of many stripes will shut down consumer borrowing and spending.

2013-07-02 Gundlach’s One-Word Explanation for June’s Decline by Robert Huebscher (Article)

According to Doubleline’s Jeffrey Gundlach, a single word explains the declines global capital markets experienced in June.

2013-07-02 The 2013 Mid-Year Geopolitical Update by Bill O'Grady of Confluence Investment Management

At mid-year, we customarily publish our geopolitical outlook for the second half of the year. This list is not designed to be exhaustive. As is often the case, a myriad of potential problems in the world could become issues in the second half of the year. The lineup listed below details, in our opinion, the issues most likely to have the greatest impact on the world. However, we do recognize the potential for surprises which we will discuss throughout the year in upcoming weekly reports.

2013-07-02 Second Quarter Market Commentary by Mark Oelschlager of Oak Associates

The market posted another positive quarter, with the S&P 500 returning almost 3%. In recent years, Q2 has witnessed a “growth problem,” in which softening economic data prompted investors to sell stocks. But this year that did not happen, as the data actually improved. While new job creation is less than some would like to see, there has been a clear acceleration over the past six months.

2013-07-02 Investors Gear Up for Earnings Post-Taper by Chris Maxey, Ryan Davis of Fortigent

Following a few weeks of FOMC-induced turmoil, investors are looking forward to getting back to the fundamentals.Second quarter earnings season are set to kick off July 8 with Alcoa, in what will mark an important reporting period for financial markets.Given the now much telegraphed intentions of the Fed, investors are scrutinizing whether the US economy and corporate sector is ready to stand on its own feet.

2013-07-02 Let's Barbecue It... by Blaine Rollins of 361 Capital

Equity investors finished June with the first down month in 8 for the S&P500. Bond investors took a Tommy Boy two by four across the face. And yes, it did leave a mark. Two months ago the "Great Rotation" from bonds to equities was nowhere to be seen. Today the panic out of fixed income funds is happening at the highest levels seen since 2008. As we noted last week, inflection points in major rotations are volatile, scary, and unpleasant. This helps to explain the seven 100 basis point moves in the S&P500 in the month of June, which marks the most volatility in 12 months.

2013-06-28 The New, Old Normal by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We believe the recent volatility will be relatively short lived and provides an opportunity for investors who need to adjust their portfolios to do sowith long-term goals in mind. The risks associated with fixed income have been illustrated over the past couple of weeks and rising yields have caused equity volatility and a pullback. But we remain optimistic about US equities as well as developed international markets; particularly relative to emerging markets.

2013-06-28 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 How Bonds Will Suffer Before the Fed Raises Rates by Mike Temple of Pioneer Investments

The Federal Reserve’s years-long zero-interest rate policy has flattened Treasury yields to where rising interest rates and inflation are almost assured manifestations. Investors may have to face the threat of rising bond yields. Damage to high quality, long-duration debt instruments would likely happen far in advance of a rise in interest rates with periods of significant volatility. What are the risks to portfolios? The first in a series of three papers that examines this questions is now available.

2013-06-27 Policy-Induced Volatility Continues by Scott Minerd of Guggenheim Partners

The recent bond market collapse is reminiscent of the Great Crash of 1994. Further pressure on the economy due to rising interest rates could cause the Fed to revisit its timetable for QE.

2013-06-27 The Tipping Point by Bill Gross of PIMCO

I’ve spun a few yarns in recent years about my days as a naval officer; not, thank goodness, tales told by dead men, but certainly echoes from the depths of Davy Jones’ Locker. A few years ago I wrote about the time that our ship (on my watch) was almost cut in half by an auto-piloted tanker at midnight, but never have I divulged the day that the USS Diachenko came within one degree of heeling over during a typhoon in the South China Sea. “Engage emergency ballast,” the Captain roared at yours truly the one and only chief engineer.

2013-06-27 What We've Got Here is (a) Failure to Communicate by Scott Brown of Raymond James

In his press briefing following the June 19 FOMC meeting, Fed Chairman Bernanke outlined how the evolution of the economic outlook will drive policy decisions in the months ahead. The key messages are that monetary policy will remain data-dependent, that tapering is not tightening, and that higher short-term interest rates are still a long way off.

2013-06-27 ING Fixed Income Perspectives June 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Fears of Fed tapering are overblown; we expect global funding conditions to remain easy. We continue to favor the U.S. dollar and are bearish on the euro and the yen; we are cautious on EM local currencies, as volatility is likely to persist.Spreads are appealing at current levels, with higher-quality industrials offering the most attractive risk/reward.

2013-06-26 The QE Lemon Has Been Squeezed Dry by Tad Rivelle of TCW Asset Management

We’ve just witnessed the dress rehearsal for the end of the Fed’s Quantitative Easing (QE). Markets that had learned to stop worrying and love the financial repression have been given reasons to fear the interest rate cycle. For five years we have lived with a central bank that has used, or abused, a zero rate policy and QE to effectuate the Great Risk-On trade to cure the ills of the Great Recession.

2013-06-26 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 Bernanke’s comments regarding the U.S.economy’s 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.

2013-06-25 The Great Debate on Inequality: Stiglitz versus Krugman by Michael Edesess (Article)

Economics Nobel laureate Joseph Stiglitz is the chief alarmist warning that income and wealth inequality in the U.S. is a very serious threat to the economy. So it comes as a surprise that his fellow Nobelist Paul Krugman ? Stiglitz’s intellectual comrade-in-arms ? disagrees with him. Their disagreement goes to the heart of today’s economic problem.

2013-06-25 Back to Normal by Brian Wesbury, Bob Stein of First Trust Advisors

Market behavior especially since Fed Chair Ben Bernanke mentioned QE tapering has been relatively dramatic. Not unprecedented, but dramatic. By contrast, the reaction of the punditry has been way over the top.

2013-06-25 Is Fixed Income the New Equity? by Chris Maxey, Ryan Davis of Fortigent

After several decades of positive returns, fixed income investors are being treated to a rude awakening in the last six weeks. Recent comments from Federal Reserve officials suggest a sooner than anticipated exit from quantitative easing, raising the prospect of higher interest rates. Throughout the universe of fixed income assets, investors are questioning the future return potential, leading many to wonder, what now?

2013-06-24 And That's the Week That Was by Ron Brounes of Brounes & Associates

What is the Fed actually saying? The economy is recovering; the labor market is improving; short-term interest rates should remain low until at least 2015; the bond buying program will continue in its current form; any “winding down” (tapering) of purchases will be contingent on steady growth; the policymakers would be prepared to ramp up buying if conditions warrant. What have many investors been hearing/thinking?

2013-06-24 Quick Takes by Charles Lieberman (Article)

One of the issues being hyped these days is over the uncertainty surrounding Fed policy, which quite candidly, I don’t get. Short of laying out precise dates and amounts, the Fed has provided exceptionally detailed guidance that it will ease off the accelerator over the coming months, as long as the unemployment continues trending down. Downside risks have receded, the economy is improving, and extraordinary measures for policy are no longer needed. On the economy’s current trajectory, the Fed suggests it will no longer be engaged in QE by next summer.

2013-06-24 A Timetable for Ending QE by David Kelly of J.P. Morgan Funds

In a press conference following this week’s FOMC meeting, Fed Chairman Ben Bernanke provided markets with a clearer understanding on how the Fed expects to phase out its current quantitative easing (QE) program. This timetable is justified both by economic progress and by the significant future costs which a too-large Fed balance sheet is likely to entail. Moreover, the timetable, while never previously explicitly outlined, should not have been a surprise to most market observers. Nevertheless, Mr. Bernanke’s words have been met by a sharp selloff across a wide range of financial a

2013-06-21 Outlook for the Global Bond Market by Nic Pifer of Columbia Management

The global economy continues to expand, but seems stuck on a moderate, below-trend trajectory. Lately, the story seems to be more about a growth rotation across regions than a clear-cut acceleration or deceleration at the global level. Looking to 2014, however, we still expect the global economy to accelerate to a more trend-like pace.

2013-06-21 The Fear Factor in US Equities by Grant Bowers of Franklin Templeton Investments

Fear is a powerful motivator. Whether it’s a saber-toothed tiger or investment risks, it’s hard to stay calm when confronted with a perceived threat. Fear of a 2008 2009 downturn repeat, even in spite of strong performance in the US equity market in the first half of the year, has kept many investors sidelined. Grant Bowers believes fear itself could be the biggest issue holding back many investors right now, noting that in his view, short-term volatility aside, the recent US market rally is based on supportive fundamentals which he thinks should have staying power.

2013-06-21 Tapering the Taper Talk by Peter Schiff of Euro Pacific Capital

As usual the Federal Reserve media reaction machine has fallen for a poorly executed head fake. It has been fooled by this move many times in the past and for its efforts it has tackled nothing but air. Yet right on cue, it took the bait once more. Somehow the takeaway from Wednesday’s release of the June Fed statement and the Bernanke press conference is that the Central bank is likely to begin scaling back, or "tapering," it’s $85 billion per month quantitative easing program sometime later this year, and that the program may be completely wound down by the middle of next year.

2013-06-21 What's an Investor to do in Markets like These? by Frank Holmes of U.S. Global Investors

What should an investor do after a day like yesterday? Stay calm and invest on, as I believe there is opportunity in picking up what the bears left behind. Here are a few ideas to ponder.

2013-06-19 Will The Fed Tank The Markets Tomorrow? by Gary Halbert of Halbert Wealth Management

The Fed Open Market Committee is meeting today and tomorrow to set monetary policy going forward. The big question is whether or not the Fed will decide to “taper” its monthly purchases of $85 billion in Treasury bonds and mortgage securities, which have driven stocks and bonds higher over the last few years. The decision depends largely on the Fed’s view of the economy, so they tell us.

2013-06-19 The Trouble with Tapering by Scott Minerd of Guggenheim Partners

Rising interest rates are beginning to put pressure on the recovery in the housing market, which will affect economic output. This reduces the likelihood that the Fed will taper QE in 2013, and could even lead it to signal a possible expansion or extension of the current policies.

2013-06-18 Retirement Income Designations ? Which Should You Choose? by Wade Pfau (Article)

With more than 50 certification programs based on the withdrawal phase of the planning lifecycle, advisors are faced with a paralyzing choice about which designation provides the most valuable curriculum. Here’s some guidance on choosing the right program for advisors.

2013-06-18 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.

2013-06-18 Promise to Be Irresponsible by Jeremie Banet, Mihir Worah of PIMCO

We believe the recent rise in real rates and fall in inflation expectations could jeopardize the U.S. economic recovery. We also believe these are a direct result of uncertainty about the Federal Reserve’s ultimate goal. Low real yields accompanied by sufficient nominal growth are the necessary prescription for a still ailing economy.

2013-06-18 Unconstrained Bond Funds Fail to Deliver by Chris Maxey, Ryan Davis of Fortigent

There have been an incessant number of articles in the past year addressing a “Great Rotation” by investors the seismic shift in asset allocation predicted to result from a transition to a rising rate environment. Individual investors “spoiled” by a 30-year secular decline in interest rates, it is thought, will run to new alternatives in the face of this structural headwind for a significant chunk of their portfolios.

2013-06-17 And That's the Week That Was by Ron Brounes of Brounes & Associates

When Ben Bernanke talksactually he doesn’t even have to talk to move the markets. For the past few weeks, investors have speculated about the next Fed moves and the possibility of a “tapering” of the $85 billion a month bond purchase program, perhaps as early as next week. Markets have been jittery (to put it mildly) as global stocks have fallen (thanks Japan) and international bond rates have been on the rise. Investors began over-analyzing each economic release, each comment by a Fed official, each forecast by a regulatory body or related agency.

2013-06-17 The Price of Distortion by John Hussman of Hussman Funds

Corporate profits have benefited in recent years from enormous fiscal distortions that have bloated margins 70% above their historical norms. Stock prices have benefited in recent years from enormous monetary distortions that have suppressed interest rates and encouraged investors to “reach for yield.” Combining those effects, investors have been encouraged to chase stocks, placing elevated price/earnings multiples on already elevated earnings. Investors who value stocks on the basis of these distortions are likely to discover in hindsight that they have paid a very dear price.

2013-06-17 2013 Midyear Economic Update -- Another False Dawn? by Paul Kasriel of Econtrarian, LLC

We’ve seen this movie before since midyear 2009, haven’t we? The pace of economic activity begins to quicken and it looks as though a full-throated cyclical expansion might finally be at hand, only to have the economy slip back into the doldrums. Nominal private domestic spending on currently-produced goods and services grew in the first quarter at an annualized rate of 5.5% compared to 3.4% in the previous quarter. Consumer spending accelerated, housing sales picked up and business spending on equipment and software continued to grow at a healthy pace.

2013-06-17 Anecdotal Insights into the Housing Market by Charles Lieberman (Article)

The current obsession is over when the Fed will begin to withdraw some of its quantitative easing policy and how this will affect markets. This is adding some volatility back into the markets, even though this change in policy has been expected for a long time. Since Fed policy is likely to change only gradually and will do little to tip the valuation balance between stocks and bonds for quite some time, we see little reason to temper our fundamentally bullish stance towards stocks and bearish view of bonds.

2013-06-17 Tidbits, Stabilization Funds, Rearview Mirrors and Magic 8-Balls by Gregg Bienstock of Lumesis

This week I decided to try something new think of it as the appetizer, dinner and dessert. The appetizer is our section of Tidbits, a look at some headlines and a thought or two around the same. The meal is where we take a deeper dive into a subject or two and dessert is where we round things out what’s new, what’s coming up and the like. If you don’t like the new format, let me know.

2013-06-17 Sloppy Markets Continue by Bob Doll of Nuveen Asset Management

Last week the S&P 500 declined 0.97%,1 while many global equity averages fell for the fourth week in a row. Early in the week, discussion of tapering by the Federal Reserve was a big headwind, as discomfort over a slower pace of policy accommodation rippled through global markets. Thursday’s rally was driven by thoughts that tapering fears may be overdone. Markets were also helped by better employment and consumption data.

2013-06-15 Economists Are (Still) Clueless by John Mauldin of Millennium Wave Advisors

The economic forecasts of mainstream economists are quite positive, if not enirely optimistic, reflecting the current data. Should we not take heart from that? Alas, no. This week we look at some of our recent musings on that topic, triggered by a letter from a very serious economist who took umbrage when I wrote disparagingly about economists and forecasting a couple months ago.

2013-06-14 The Sustainability of Managed Futures Returns by Robert Keck of 6800 Capital

Many investors have begun to question the efficacy of an investment in managed futures given the most recent two years of negative performance for the industry as a whole at a time when U.S. equity prices have been achieving multi?year highs. The concern is not so much the magnitude of the losses incurred by the managed futures industry during this period; in many cases they are relatively small in comparison to the size of the drawdowns experienced by many other asset classes such as equities, real estate, fixed income, etc., during peak periods of market stress.

2013-06-14 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.

2013-06-14 Changing Picture by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We could be in the beginning stages of an adjustment toward a more "normal" monetary policy environment, with attendant volatility. This once again illustrates the importance of diversification and focusing on long-term goals when investing. We continue to believe the US equity markets are an attractive place for assets and recommend buying on pullbacks to the extent that you need to add to equity exposure. Additionally, continue to exercise caution around fixed income allocations and focus more on the developed markets vs. EM.

2013-06-11 May Flowers Bring Best Equity Market Since 1997 as Bonds Wilt by Douglas Cote of ING Investment Management

The S&P 500 has opened 2013 with its best year-through-May return since 1997. U.S. Treasury prices, in contrast, plunged last month on talks of Fed “tapering”. Don’t expect the reflation in bond yields to continue in the near term, as the Fed continues to struggle in its current war against deflation. Fundamental business activity not quantitative easing is the wellspring of sustained economic growth, creating lasting sales and profits. For investors, the two biggest self-defeating fears continue to be 1) the fear of buying equities and 2) the fear of buying bonds.

2013-06-10 What's Capping Capital Spending? by Milton Ezrati of Lord Abbett

Now that housing has at last begun to make a contribution to the economic recovery, the pace of capital spending seems to have ebbed. To some extent, the slowed pace of such spending reasonably reflects the economy’s still-more-than-ample production capacity. Reasonable as this seems, the slowdown does come as a disappointing change from the unusually strong growth earlier in the recovery. Now, looking forward, the prospect is for this slowed growth to continue, for a while at least.

2013-06-08 Banzai! Banzai! Banzai! by John Mauldin of Millennium Wave Advisors

In practice it may be harder for Japan to grow and generate inflation than it might be for other major nations. Today we’ll focus on Japanese demographics. While the letter is full of graphs and charts, it does not paint a pretty picture. The forces of deflation will not go gently into that good night.

2013-06-07 Filling in the 2Q13 Picture and Looking Ahead by Scott Brown of Raymond James

We’re now two-thirds of the way through 2Q13. However, the second quarter economic picture is still sketchy. We have some data for April, which is subject to revision. Figures for May will begin arriving this week. Despite the cloudy near-term economic picture, the financial markets are looking ahead to better growth in the second half of the year.

2013-06-07 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The change at the top of the Bank of England comes at a delicate time. The May U.S. employment report will not sway the Fed either way. Eurozone and China PMI reports - interpret with caution.

2013-06-07 As Economy Heats Up, Will Commodities? by Frank Holmes of U.S. Global Investors

Don’t wait for the Fed to officially raise rates, as research shows that investors get the most benefit from materials and energy stocks by getting in now

2013-06-06 But We Want Goldilocks-Like Growth by Blaine Rollins of 361 Capital

While the equity markets would enjoy a bit of the great rotation out of the 20+ year outperformance in bonds and into equities, the move in May has been too much, too quick for even equity investors to stomach. So while the Long Treasury ETF (TLT) fell -6.8% in May, the size of the move even scared investors in REITs (IYR), Junk Bonds (JNK/HYG), and Utilities (XLU).

2013-06-06 The Fed's Dilemma by Scott Minerd of Guggenheim Partners

Market volatility is rising as the Fed continues with its asset purchase program. The economy also appears increasingly vulnerable to a rise in interest rates, which would have an adverse effect on housing in particular.

2013-06-06 The Risk of Government Policies and the Rationing of Retirement by Jason Hsu of Research Affiliates

In late April, a group of leading economists and investment practitioners assembled in La Jolla, California, for Research Affiliates’ 2013 Advisory Panel. Our theme this year touched on two topics that have been front-and-center in recent public debates: the risk of government intervention and the potential rationing of retirement.

2013-06-06 The Wisdom of Crowds by Niels Jensen, Nick Rees,Tricia Ward of Absolute Return Partners

Are markets efficient? This is a debate that has been on-going for decades. In one corner you have the proponents of the Efficient Markets Hypothesis. In their world alpha does not exist, or at the very least it is not sustainable. In the other corner you have the supporters of behavioural finance who see investors as being mostly irrational and suffering from all sorts of behavioural biases which create alpha opportunities galore. Out of this long lasting stand-off a new paradigm is emerging called the Adaptive Markets Hypothesis which aims to reconcile the two.

2013-06-06 Inflation Is Still the Lesser Evil by Kenneth Rogoff of Project Syndicate

The world’s major central banks continue to express concern about inflationary spillover from their recession-fighting efforts. That is a mistake: given the political, social, and economic risks of continued slow growth, policymakers should encourage a sustained burst of moderate inflation.

2013-06-06 Omissions of the Omen: "Hindenburg Omen" and the Selloff Last Week by Liz Ann Sonders of Charles Schwab

Rising US Treasury bond yields and Fed "taper talk" not to mention a "Hindenburg Omen" sighting hit stocks last week. A look inside the Omen should calm fears of impending doom. The market is likely not out of the woods, but we don’t expect an overly sinister correction.

2013-06-05 Certainty, Rates and the Year Ahead by Peritus Asset Management of AdvisorShares

The government tells us not to worry, as the Federal Reserve comes to rescue with QE-Forever. Certainty with fiscal policy doesn’t seem to change the demand equation and cheapened money doesn’t do anything if demand isn’t present. Treasury rates remain at 0% for the foreseeable future making yield hard to find. Read this position paper by Peritus Asset Management scrutinizing how all this has come to pass and what indicators are foretelling the near future effects on the high yield asset class.

2013-06-05 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.

2013-06-05 Fed Advisory Council Drops A Bombshell by Gary Halbert of Halbert Wealth Management

Last Friday afternoon, the Fed released the minutes from a May 17 meeting of the Federal Advisory Council (FAC). The Council is a group of 12 influential bankers from across the country who meet periodically and give the Fed Board of Governors input regarding the economy, moneyary policy, etc. The minutes from the latest FAC meeting clearly indicate that the bankers are becoming increasingly uncomfortable with the Fed’s unprecedented “quantitative easing” policy. To my knowledge, no one in the mainstream media has reported on what you will read here today.

2013-06-05 Will Green Shoots Flourish in U.S. and Latin America? by Josh Thimons, Lupin Rahman of PIMCO

The US economy is much further along the road to repair relative to its developed market peers, but it is still dealing with an unsustainable fiscal situation. Latin America is closely coupled to the rest of the world. What happens in the U.S., China and Europe over the secular horizon is especially critical. Our secular investment outlook calls for a more defensive posture toward risk. In U.S. fixed income, this suggests positioning for alpha rather than capital appreciation.

2013-06-04 Woody Brock’s 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 America’s 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 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 The Gold Bull vs The Paper Tiger by Peter Schiff of Euro Pacific Precious Metals

That’s all, folks. One look at the headlines will tell you the gold bull market is officially over: the stock market is booming, a modest recovery of the US economy is underway, and the dollar is dominating the forex. Time to sell your bullion and get back into US stocks!

2013-06-04 Employment Data, “State of the States” and Interesting Quotes Worth Exploring by Gregg Bienstock of Lumesis

I simply can’t seem to shake the notion that some basic issues continue to exist despite some of the favorable headlines and discussions with some pretty smart people who think the worst is behind us (I do subscribe to the view that it is critical to seek out views contrary to my own to keep me in check). During these discussions or when revisiting their basis, I can’t help but revert back to the data. After all, facts are facts.

2013-06-03 A Taste of What Tapering Might Mean by Christian Thwaites of Sentinel Investments

A week on from the sparks of the FOMC minutes and we can see how the market handles the subtler parts of Fed communication. Not well. Most of the dove camp talked about adjusting purchases up or down depending on economic conditions (all very reasonable and consistent) but stressed there was really nothing in the data for change. The hawk that counts, Bullard of the St. Louis Fed, even called for continued QE given low inflation. So the “employment is too low, continue” and "inflation is too low, continue” camps agree.

2013-06-03 And That's the Week That Was by Ron Brounes of Brounes & Associates

And the streak continues. (The monthly winning streak that is.) While stocks have drifted lower each of the past two weeks, the Dow has surged for six straight months and the S&P 500 now stands at seven and counting. In fact, much of the week’s losses came in the final hour(s) of trading as investors took profits for the month and positioned their portfolios for the summer. No news from the Fed yet, but the bond debates continue. Housing remains strong on the economic front, but next week’s data will go a long way toward setting the tone for the future.

2013-06-03 Defense and Selective Offense by Mark Kiesel of PIMCO

Given the market’s newfound risk appetite for credit and less attractive valuations, we are taking advantage of global credit market liquidity in an effort to reduce our overall risk posture. In our selective offense approach, we continue to favor U.S. housing and housing-related areas, in addition to select investments in the energy, pipeline, specialty finance, gaming, hospitals, and airline and auto industries, given the more positive fundamental outlook for these sectors.

2013-06-03 US Balance Sheet Repair: More Difficult This Time by John Greenwood of Invesco

In most developed economies, the post-war years since 1945 saw sustained business cycle expansions alternating with shorter recessions. At the end of each expansion, authorities dealt with inflation by raising interest rates and slowing credit growth. When inflation subsided, interest rates were lowered again.

2013-05-31 The Great Reflation by Peter Schiff of Euro Pacific Capital

This week economists, investors and politicians were treated to some of the "best" home price data since the frothy days of 2006 when home loans were given out like cotton candy and condo flipping was a national pastime. The Case-Shiller 20 City Composite Home price index was up a startling 10.9% for the 12 month period ending in March. Prices in all 20 cities were up, with some (Las Vegas, Phoenix, and San Francisco) notching gains of more than 20%. Meanwhile the National Association of Realtors announced that April pending home sales volume reached the highest level in nearly three years.

2013-05-31 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Is central bank communication clarifying or confusing? The European Central Bank should focus its efforts on small business lending. A look beneath the surface of housing proves revealing.

2013-05-30 And That's the Week That Was by Ron Brounes of Brounes & Associates

All good things must come to an end (hopefully just temporarily). After a nice month-long weekly winning streak, stocks gave back some ground as investors over-analyzed Fed comments and worried about future monetary policy. (The stimulus will end at some pointthat’s not necessarily a bad thing.) Japan took the over-analysis the hardest as its market suffered a serious setback, though the rally for the year had been significant and some watchers expected a pullback at some point (just not all in one day).

2013-05-30 Has the Fat Lady Started to Sing on the Housing Market? by Martin Pring of Pring Turner Capital Group

As decision makers we are continually looking for clues from economic activity in order to adjust portfolios. The beauty of following business cycle sequences is the value from anticipating financial market leadership changes. A major beneficiary of this four year old business recovery has been housing and housing related stocks.

2013-05-30 Morning in a New Europe by Scott Minerd of Guggenheim Partners

The pace of policy reforms is accelerating and economic recovery appears to be on the horizon for the European Union.

2013-05-29 Investors Shun Stocks But Cling To Bonds - Why? by Gary Halbert of Halbert Wealth Management

he Halberts are out of town celebrating our son’s graduation from college on the sunny beaches of southern Florida. In place of my usual writing, I have chosen to reprint an excellent article from The Wall Street Journal’s Jason Zweig on investor behavior. The WSJ writer keys in on a new investor survey from Blackwater, Inc., one of the largest money management firms in the world (almost $4 trillion in customer assets). Blackwater surveyed investors that have at least $50,000 in investable assets. The findings are almost sure to surprise you.

2013-05-29 Filling the Hole We Have Dug by Adam Bowe, Robert Mead of PIMCO

Mining investment contributed more than 60% of the growth in Australia’s GDP in 2012. The expected decline in mining investment will likely leave a significant economic hole in the short term that needs to be filled. PIMCO expects easier monetary policy will be needed to support other sources of domestic growth, such as non-mining business investment, household consumption and housing construction.

2013-05-29 Is the Fed in the Home Stretch? by Chris Maxey, Ryan Davis of Fortigent

Global equity markets stammered through a choppy environment last week following increased fears that certain central banks were considering the possibility of pulling stimulus sooner than anticipated. Markets have long been dependent on central banks, but the notion that policymakers could head for the exits leaves investors unsure how to react.

2013-05-28 Economic Climate Change & the Long-Term View on Yields by Sponsored Content from Loomis Sayles (Article)

Will rates rise? It’s a logical question. US Treasury yields have been in a secular downward trend since the 1980s and almost frozen at historic lows for the last several months. While recent cyclical improvements suggest the US economy is heating up, we do not expect interest rates to start soaring to record highs. The interest rate environment will eventually undergo climate change, but the process will be gradual. There are secular headwinds cooling rates, and we expect them to persist for years to come.

2013-05-28 The Puzzle Is Complex: Education Funding, Assessed Values and Housing Prices by Gregg Bienstock of Lumesis

While many look to Memorial Day as the official beginning of summer, we hope all took time to reflect on the true meaning of Memorial Day as a time to thank, recognize and remember those that have, are and stand ready to defend our country and all we stand for. I, for one, am incredibly grateful to the men and women that serve our country and put their lives on the line to defend our freedom, democracy and way of life.

2013-05-28 Rock, Paper, Scissors by John Hussman of Hussman Funds

There’s a sort of rock-paper-scissors relationship to financial indicators. Trend following factors typically trump valuations alone, while overvalued, overbought, overbullish syndromes trump trend-following and monetary considerations. Monetary factors tend to be most effective as confirmation of other measures, particularly of trend-following factors, but only in the absence of overvalued, overbought, overbullish syndromes.

2013-05-28 Taking Stock by Bob Doll of Nuveen Asset Management

U.S. and global equities were under pressure last week, with all major U.S. indices lower for only the fourth time this year. With discussion of the Fed tapering its stimulus, market uncertainty gained momentum. The S&P 500 was down 1.0% for the week.1 We consider the market pullback technical in nature since the mention of a Fed quantitative easing exit likely created a natural point to take profits after the recent rally.

2013-05-24 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The two Asian giants have a challenging year ahead. The Fed will be challenged to keep the bond market under control.

2013-05-24 The Love Trade for Gold is Still On! by Frank Holmes of U.S. Global Investors

The more important demand for gold, in my opinion, comes from the enduring Love Trade, as countries like China and India buy the precious metal out of love and tradition.

2013-05-24 Bifurcation Blues by Herbert and Randall Abramson of Trapeze Asset Management

Bifurcation. A very technical sounding word. It merely means “a division into two parts”, which is what we are witnessing in many areas related to investment, both macro and micro. And it is exhibiting to value investors those areas to avoid and the most attractive to embrace. And giving rise to a wide range of disparate opinions among economic and investment professionals as to what outcomes are likely. Needless to say, we have our own strong views.

2013-05-24 Remarkable Resilience by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We saw how the prospect of a sooner pullback in purchases in bonds by the Fed rattled the market both in the US and globally, but the picture, to us, has not changed to any great degree. A very gradual pullback, not even going to zero, in quantitative easing due to an improved economic situation doesn’t spell disaster to us. We continue to urge investors to pay attention to both sides of the risk equation when making decisions and to keep the longer-term perspective in mind. Short-term swings are inevitable, but should not be the basis for sound decision making.

2013-05-23 QE from 35,000 Feet by Scott Minerd of Guggenheim Partners

Quantitative easing has benefited from global macro events and appears likely to continue for the rest of the year. Markets, though, will continue to anticipate how the current policies will eventually be unwound.

2013-05-23 ING Fixed Income Perspectives May 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

How do you like them apples? By pointing out some Excel blunders in the data of Harvard economists Reinhart and Rogoff, a UMass-Amherst grad student appears to have gotten their number and in the process discredited their seminal work touting the merits of austerity. Though Good Will Hunting fans may be amused to see a couple of Harvardians get their comeuppance, you don’t need the titular character’s wicked smarts to deduce that harsh government spending cuts may not be the best way to pick up your economy.

2013-05-22 If You Didn't Buy That Powerball Ticket... by Blaine Rollins of 361 Capital

So onward and upward. What signals should Bulls be on the lookout for? Change in breadth (Up v. Down Volumes, Advancers v. Decliners), Signs of distribution (Sharp down days accompanied by large % increases in trading volumes), Change in leadership away from RISKON sectors (don’t want SmallCaps, Financials, Industrials, Transports or Housing to lag)...

2013-05-22 Is There Value in Today's Stock Market by Bill Smead of Smead Capital Management

Due to the recent strength in the US stock market, we thought it would be helpful to followers of Smead Capital Management to understand the history of our core investment beliefs and where our portfolio is in relation to those core beliefs. A review of the ongoing tension between valuation mattering dearly and the enormous benefits of long-term business ownership is especially interesting after a significant upward move in the stock market. How do you keep turnover and trading expense low, while maintaining a meaningful margin of safety?

2013-05-22 A Whiff of Confidence by David Kelly of J.P. Morgan Funds

The single biggest on-going survey of consumer confidence in the United States is conducted by Rasmussen, who survey 500 consumers every night on their views of the U.S. economy and their personal finances. Since October 2007, there has not been a single month in which the index produced by this survey has exceeded 100. However, since the start of May it has averaged well above this level.

2013-05-22 And That's the Week That Was by Ron Brounes of Brounes & Associates

Four times a charm. Despite lackluster earnings and economic data that raises some concerns, investors continue to play the game of “how high can we go” and stocks climbed for the fourth straight week With 15k (Dow) and 1600 (S&P) well in the rearview mirror, investors seem to have their targets set on bigger and better things. Some bullish comments by a hedge manager; a solid consumer sentiment reading; a reason for the Fed to hold off on tapering its bond buying stimulusand it’s off to the races for equities (again).

2013-05-22 China's IPO Drought: Will it Lift? by Eddie Chow of Franklin Templeton Investments

Following a flood of initial public offerings (IPOs) that lasted several years, China’s local A-share market has been in an IPO drought since late last year. There is some speculation China’s regulatory body, the China Securities Regulatory Commission (CSRC), may allow some IPOs to trickle back into the market this year, but we don’t yet know exactly when or at what volume. I’ve invited my colleague Eddie Chow to share his perspective on why IPO issuance has been halted in China’s local market, and where we see potential opportunities in the current environment.

2013-05-21 Developed Europe: Regional Economic Review 1Q 2013 by Team of Thomas White International

After withdrawing into the background in late 2012, the Euro-zone sovereign debt crisis resurfaced in the first quarter with the Italian elections and Cyprus’ banking crisis. In late February, Italy’s national elections resulted in a fractured mandate, and Italians voted out the incumbent, the main architect of the country’s austerity and reforms agenda.

2013-05-21 Why the Lack of Inflation Is a Problem by Chris Maxey, Ryan Davis of Fortigent

Given the outsized role central banks are playing in today’s financial markets, inflation watching has taken on increased significance.It is widely assumed that continued easy money policies are only possible as long as price increases remain under control.At the same time, for a global economy trying to escape an extended period of weak growth and burdensome debt loads, low inflation is a double-edged sword.

2013-05-21 Capitalism and Democracy by Bill O'Grady of Confluence Investment Management

In the Italian elections, the party that showed the strongest results was the Five Star Movement, led by the comedian Beppe Grillo. Despite this strong showing, the party failed to form a government and refused to participate in any coalitions. This decision not to participate in the political process has been exhibited by other protest groups, such as Occupy Wall Street, the Israeli Tent Movement, and the Spanish “Indignant” movement.

2013-05-21 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.

2013-05-20 Still Bullish by Brian Wesbury, Bob Stein of First Trust Advisors

Like Rip Van Winkle, imagine you went to sleep on October 9, 2007 and didn’t wake up until yesterday. On 10/9/2007, equities were at record highs: 14,165 for the Dow Jones Industrial Average and 1,565 for the S&P 500.

2013-05-18 All Japan, All the Time by John Mauldin of Millennium Wave Advisors

This week we again focus on Japan. Their stock market has been on a tear, and their economy grew 3.5% last quarter. Is Abenomics really the answer to all their problems? Is it just a matter of turning the monetary dial a little higher and voila, there is growth? Why doesn’t everyone try that? And what would happen if they did?

2013-05-17 Weekly Market Highlights by Matthew Rubin of Neuberger Berman

Bank of England leaves monetary policy unchanged. S&P 500 and DJIA post gains of 1.3% and 1.1%, respectively. U.S. inflation and housing data and euro area GDP headline this week’s economic releases.

2013-05-17 Finding Opportunity Far and Near by Frank Holmes of U.S. Global Investors

Would it surprise you to learn that a vast majority of equity valuation models state that stocks should head much higher over the next five years?

2013-05-16 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 And That's the Week That Was by Ron Brounes of Brounes & Associates

Fiscal Cliff. Sequester. Different names for similar budgetary issues that both basically resulted in games of Congressional “kick the can.” Now in a stroke of luck for non-compromising politicos, the budget deficit is shrinking as higher payroll taxes and paybacks from previously bailed out entities (thanks Fan) have enhanced government revenues since the beginning of the year.

2013-05-15 Speaking of a Great Week... by Blaine Rollins of 361 Capital

I left the office each day thinking that I just saw another walk off game winning home run by the S&P500. The bears were given their chance in April with the weak economic data and slightly less than exciting earnings, but they just couldn’t break it. In return, the employment data was a bit better, the global central banks came out swinging (ECB, Australia, and South Korea), then the markets broke the Yen, Bonds, and Gold, and the Bulls absolutely skinned the Bears.

2013-05-14 Nouriel Roubini: Four Reasons Investors Should be Worried by Robert Huebscher (Article)

Despite a modest recovery from the nadir of the financial crisis, the global economy still faces tail risks, according to Nouriel Roubini. Roubini’s forecast is not as gloomy as the one that earned the moniker “Doctor Doom,” when he correctly predicted the housing market collapse and the ensuing global recession. But, in a talk May 1, he identified today’s biggest danger points in Europe, the U.S., China and geopolitics which he said threaten to destabilize the global economy.

2013-05-14 Mohamed El-Erian: The Three-Speed Global Economy by Robert Huebscher (Article)

The global economy is operating at three distinct speeds, according to Mohamed El-Erian, and investors need to understand the implications of the divergent paths that key countries are following. Japan and most European countries are going backward, he said, and could continue in that direction for decades. The U.S. is “healing,” but not quickly enough to get to “escape velocity.” Certain emerging markets, meanwhile, are adapting technology and innovation and are growing rapidly.

2013-05-14 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 Fed’s 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 Fed’s quantitative easing (QE) or could there be a much more fundamental reason?

2013-05-14 Housing Finally Breaks Free by Chris Maxey, Ryan Davis of Fortigent

Housing, which for so many years represented everything bad about the credit crisis, is finally beginning to have its day back in the sun. Trends in housing markets around the country are improving, to the benefit of the overall economy. It appears that trend is set to continue.

2013-05-14 Cyclical and Emerging Market Strength May Be Pointing to Better Growth by Bob Doll of Nuveen Asset Management

Last week U.S. equities advanced as the S&P 500 increased by 1.3%. We have been amazed bythe market’s ability to continue to rally in an environment in which sales growth has been anemic and earnings gains have been largely based on companies’ abilities to manage margins and utilize financial engineering.

2013-05-14 Who is Henry Singleton? by Jeffrey Saut of Raymond James

The year was 1974 and Teledyne (TDY/$77.56/Outperform), on a split-adjusted basis, was trading at about $0.05 per share. By 1986 it was changing hands around $75 per share. Unfortunately, back in 1974 I didn’t have enough money to buy more than 10 shares, having lived through the devastating bear market of 1973 1974 where the D-J Industrial Average (INDU/15118.49) lost 47% of its value.

2013-05-14 Inflation Update by Team of North Peak Asset Management

Basing investment decisions on inaccurate measurements of the inflation rate can result in investors unknowingly positioning their portfolios to lose purchasing power over time. This mis-measurement could be especially dangerous when yields are low. For example, evaluating a nominal 3% investment opportunity using an inaccurate 2% inflation rate indicates a marginally attractive 1% real return opportunity. However, if inflation is actually running at 5%, this becomes a deeply unattractive negative 2% real return investment.

2013-05-13 Tenuous Times? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

US stocks continue to make new highs, yet commodities have struggled and Treasury yields remain low, albeit up from recent near-record lows. Although not the standard playbook, we remain optimistic but acknowledge an equity pullback can occur at any time. Manufacturing data has been soft, the employment picture is mixed, and housing continues to improve. The European Central Bank (ECB) has joined the easing arty, illustrating the continued disappointments coming out of the eurozone.

2013-05-13 Americas: Regional Economic Review 1Q 2013 by Team of Thomas White International

Weaker global demand and prices for energy and commodities, as well as softer than expected domestic consumption have restricted the growth outlook for most economies in the Americas region during the first three months of the year. Fewer monthly job additions in the U.S. have dented consumer confidence, and growth for the current year is now forecast to be moderately lower than earlier expectations.

2013-05-10 A Tale of Two Markets: Equity Bulls and Bond Bears by Douglas Cote of ING Investment Management

Surging equity markets absent an accompanying rate rally is a red flag, as Treasury yields remain well below “normal”. While investors’ renewed enthusiasm for equities is warranted, they must be careful to avoid the “folly of gaming diversification”. Corporate earnings have impressed, though revenue has struggled due in part to a moribund Europe. Divergent markets mean investors should stay broadly diversified in equities and real bonds not near-cash and ever alert to the fundamentals.

2013-05-10 2013 US Financial Markets: Part 2 - The TINA Hypothesis by Clyde Kendzierski of Financial Solutions Group

Contrary to the “Bernanke Illusion” (money market funds are a zero return investment), history indicates that money market funds are likely to provide investors with returns approximating inflation over the next decade. As I pointed out in our last letter, the markets are pricing in inflation levels significantly higher than the prospective total returns of 10 year TBonds. The small additional return achieved by corporate bonds or US stocks (at current prices) is unlikely to compensate a buy and hold investor with sufficient gains to justify the interim risks.

2013-05-10 Weekly Research Briefing by Blaine Rollins of 361 Capital

This week’s focus was squarely on central bank policy decisions and the U.S. April payrolls data. Mid-week the FOMC reinforced the "Bernanke put" by stating explicitly that quantitative easing can be increased if conditions worsen.

2013-05-10 Countries Should Be Careful Not to Overstimulate Their Housing Markets by Team of Northern Trust

Countries should be careful not to overstimulate their housing markets. Credit extension is improving, but remains modest.

2013-05-09 China's Building, but Will They Come? Ghost Cities by Mark Mobius of Franklin Templeton Investments

Some of you may have heard or read about the current state of the real estate market in China, often covered in a sensationalistic way, with talk of “ghost cities” and “bubbles” ready to burst and so forth. These types of reports can cause quite a jolt in the market, which is what we saw happen, probably not coincidentally, after a popular US television newsmagazine aired a somewhat negative report in March. But as I’ve said many times before, there’s often more to a story; important parts can end up on the cutting room floor.

2013-05-08 Are Recent Market Highs Merely Rhymes, or Something More? by Joe Kringdon of Pioneer Investments

As someone smarter than me once observed, history never repeats itself, but it does rhyme. Oftentimes those rhymes, like my family’s dinner bills, are simply head fakes’ curious coincidences with no residual meaning. Other times, however, they do carry meaningful implications. Consider, for example, what’s going on in the markets right now.

2013-05-08 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 Onoda’s 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.

2013-05-07 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 Meredith Whitney ? State-issued GO Muni Bonds are Safe by Ben Huebscher (Article)

Meredith Whitney has softened her tone regarding muni bonds. The analyst who famously predicted disaster for the entire market on national TV now she says that new governors have been elected and states have begun reforming. There will be problems in four key states, but she is not predicting a disaster. In fact, she said investors will be safe in general obligation bonds.

2013-05-07 And That's the Week That Was by Ron Brounes of Brounes & Associates

The trend is your friend (and the current trend is a “friend with benefits” for investors). After a record-setting first quarter for stocks, analysts were skeptical that the “party” would continue. And yet, the Dow Jones enjoyed a fifth straight month of gains in April, while the S&P 500 and Nasdaq one-upped the Blue Chips with six month winning streaks.

2013-05-06 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 week’s 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 All's Well That Ends Well by Scott Brown of Raymond James

The economic data reports were decidedly mixed last week. However, the April Employment Report exceeded expectations, which provided a good excuse for share prices to move higher. Bonds were whipsawed, encouraged by the view that the Fed was less likely to taper its asset purchases, but then hit hard by the better-than-expected payroll figures.

2013-05-06 Beyond the Headlines: Job Growth, Exports and Housing by Gregg Bienstock of Lumesis

Congress has done something for the American public. FAA, sequester, flight delays we can fix that! While I would usually take a cynical swipe at Congress (something like, “did they act because they, too, were impacted by their own stubbornness”), I’ll let well enough alone and simply pass on a heartfelt thanks. Perhaps this is the start of something. I hear they are working closely on immigration reform and an exemption for Congress and their staff from the Affordable Care Act (aka Obamacare). Ok, so two of three initiatives garnering bi-partisan support are purely self-ser

2013-05-06 Sell in May But Stick Around by Christian Thwaites of Sentinel Investments

A bit odd, perhaps, to worry about deflation as the S&P hits all time highs. But the whiff of deflation is in the air. The YOY PCE core (the one the Fed likes) came in at 1.1% which is the lowest it has ever been.

2013-05-04 The QE Sandpile by John Mauldin of Millennium Wave Advisors

Sell in May and go away? What about "risk off?" And ever more QE? Today’s letter is a quick note and a reprise of a popular letter from yesteryear (with a bit of new slant), as I am at my conference in Carlsbad.

2013-05-03 Pring Turner Approach to Business Cycle Investing by Team of AdvisorShares

Like the seasons of the year, the environment for bonds, stocks, and commodities progress in a repeatable and sequential fashion. A gardener understands it is difficult to plant in the winter because nothing grows. The same is true for the financial seasons in the business cycle, where investors can use knowledge of the sequence to create a financial market roadmap. This paper from Pring Turner Capital Group, one of our valued sub-advisors, takes you through the six-stages of the business cycle.

2013-05-03 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 “Twin Peaks” Target Achieved, What's Left? by Doug Ramsey of Leuthold Weeden Capital Management

Pithy sound bites aren’t our forte. So when we came up with the “Twin Peaks” idea (last decade’s S&P 500 highs of 1527 and 1565) a few months back, we hoped we’d 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.

2013-05-02 Gold Recovers Amidst Uncertainty by John Browne of Euro Pacific Capital

The selloff in gold that captured the world’s attention in mid-April has revealed some truths about how the market trades and the sentiments of many of the investors who have piled into the trade over the past few years. While the correction does highlight a higher degree of uncertainty than many of the most ardent gold advocates had anticipated, it does not represent the historic "end of an era" reversal that the many in the media have so gleefully suggested. In many ways, the market has shown a resiliency that its detractors do not understand.

2013-05-01 While the Bears Fight... by Blaine Rollins of 361 Capital

While corporate earnings outlooks and released economic data remained soft, the world moved to declare Austerity a failure and quickly assumed that the ECB could ease further at this week’s meetings. The recent collapse in commodity prices and slowdown in China does put a high card in their hand. With these new thoughts, European equities and bonds both surged on the week...

2013-05-01 Emerging Asia Pacific: Regional Economic Review by Team of Thomas White International

Major emerging Asia Pacific economies, which picked up growth momentum during the latter half of 2012, struggled to carry forward the economic pace during the initial months of 2013. China, India, and Indonesia, some of the most populous countries in the region and in the world, faced significant headwinds to growth as key engines of the economy investment, consumption, and exports came under strain.

2013-05-01 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.

2013-05-01 There Will Be Haircuts by Bill Gross of PIMCO

It has been the objective of the Fed over the past few years to make even more innovative forms of money by supporting stock and bond prices at cost on an ever ascending scale, thereby assuring holders via a “Bernanke put” that they might just as well own stocks as the cash in their purses. Gosh, a decade or so ago a house almost became a money substitute. MEW or mortgage equity withdrawal could be liquefied instantaneously based on a “never go down” housing market. You could equitize your home and go sailing off into the sunset on a new 28-foot skiff on any day but S

2013-04-30 Letters to the Editor by Various (Article)

A number of readers responded to Robert Huebscher’s article, The New Challenges to Reinhart and Rogoff, which appeared last week.

2013-04-30 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.

2013-04-30 Is May Really the Time to Go Away? by Chris Maxey, Ryan Davis of Fortigent

As investors near the witching hour of May, the oft-asked question once again comes to the foreground is it best to sell in May and walk away? This year could prove the exception to recent history, but a number of trends are beginning to take shape inside the market’s inner workings.

2013-04-30 Is the U.S. Housing Recovery Built to Last? by Milton Ezrati of Lord Abbett

The sector’s comeback will continue, but the pace will likely moderate. Here’s why.

2013-04-30 The U.S. Economy A Gain in GDP? by Marie Schofield of Columbia Management

The advance estimate of gross domestic product (GDP) released by the Bureau of Economic Analysis last Friday showed that the U.S. economy grew at an annualized rate of 2.5% in the first quarter, below expectations of an increase of 3.0%. Despite the decent first quarter advance, year-over-year gains in nominal and real GDP are largely unchanged from the prior quarter at 3.4% and 1.8%, respectively. While growth rates at this slow pace in these measures have typically heralded recessions, they appear stable but also underscore a critical problemthe failure to generate escape velocity.

2013-04-30 ProVise Bullets by Ray Ferrara of ProVise Management Group

With the passage of the American Taxpayer Relief Act of 2012, a lot of people felt that things were set as it related to estate taxes. Apparently everyone believed that except the President, who has proposed several changes to estate tax law in his fiscal 2014 budget.

2013-04-29 New Highs Bring New Worries by Richard Golod of Invesco

The sustainability of the rallies in US and Japanese equities this year so far is looking uncertain amid slowing year-over-year earnings growth and mixed global economic signals. European and emerging market shares have traded lower year to date and seem likely to continue lagging in the near term. However, on balance, I remain optimistic about global equities, seeking yield opportunities and investments with an actively managed, more selective approach.

2013-04-29 Developed Asia Pacific: Regional Economic Review by Team of Thomas White International

After facing subdued economic conditions for the most part of 2012, developed Asia Pacific economies started 2013 on a cautious note. While most countries opined that downside risk to GDP growth declined substantially, challenges to growth arose from a recessionary scenario in key developed economies, especially from the European Union.

2013-04-29 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.

2013-04-29 Cruel Top Line Growth by Christian Thwaites of Sentinel Investments

The current earnings season is a very mixed bag. Start with the economic background where nominal growth decelerated in 2012 from around 4.4% to 3.6%. The first quarter may be marginally higher but some of that is from a low base effect. It’s very difficult for companies to raise prices, increase share or volumes when demand is simply deficient. Sure, balance sheets are in much better shape, as evidenced by robust bond issuance, but many companies are in excess savings mode. Here are undistributed corporate profits as a percent of GDP.

2013-04-27 The Cashless Society by John Mauldin of Millennium Wave Advisors

A cashless future might be farther off than we either fear or hope. Not only is it farther away than some think, we are actually seeing an increase in the use of cash all over the world (and this is not just a US phenomenon). We will look at some interesting factoids that make for thought-provoking discussions, but when we couple them with research on the rise of the unreported economy (aka the underground economy) and the number of people who get some form of government assistance, we may find problematic consequences resulting from hidden incentives that work in unintended ways.

2013-04-26 The Return of the Asian Tigers: Guinness Atkinson Asset Management Asia Brief by Edmund Harriss, James Weir of Guinness Atkinson Asset Management

Often overlooked by international investors, South East Asia encompasses some of the world’s best performing equity markets in recent years, putting the more established emerging markets in the shade. This performance is backed by good economic results and the favourable demographics of some of these countries, with youthful populations ready to improve productivity and increase consumption. One catalyst for future growth is the Association of Southeast Asian Nations (ASEAN) free trade area, which will bring down trade barriers between the South East Asian nations.

2013-04-26 An Update on the Global Business Cycle by Investment Strategy Group of Neuberger Berman

Understanding where we are in the an important aspect of investing, as the behavior of asset classes may vary throughout that cycle. Recent data indicate that the U.S. remains in its fourth year of expansion, but payroll and retail numbers have disappointed. Outside the U.S., Europe continues to be mired in recession while China’s growth rebound recently has appeared to sputter. In this edition of Strategic Spotlight, we review what these developments mean for the global business cycle and how to position portfolios accordingly.

2013-04-26 A Funny Thing Happened on the Way to Equilibrium by Ben Inker of GMO

The bedrock of GMO’s investment philosophy is reversion to the mean. We believe that capitalism should cause the return on capital to be in line with the cost of capital, and that assets that embody similar risks should offer similar long-term returns. These beliefs, in turn, guide our assumptions that equities should trade at replacement cost, that the long-term return to equities should be approximately the same as their normalized earnings yield, and that assets without long return histories should have similar valuations and equilibrium returns as related assets with longer histories

2013-04-26 No Escape by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Global economic growth has weakened, while the US economy hasn’t reached "escape velocity." US stocks have held up relatively well. With few other attractive alternatives, domestic equities appear to be the best house in a rough neighborhood. With the Fed committed to easing, housing improving, and valuations reasonable, the trend should continue. Risks remain and diversification and some hedging strategies are recommended.

2013-04-26 Like Baseball in the Snow by Doug MacKay, Bill Hoover, Mike Czekaj of Broadleaf Partners

As has occurred in each of the last three years, the economy should continue to plug along, not as we might like it to be, but as we can reasonably expect. Growth scare or not, we suspect that the end of 2013 will show that continued progress lies ahead, but perhaps not exactly in the same pattern as it has thus far.

2013-04-25 Questioning Quantitative Easing by Scott Minerd of Guggenheim Partners

Speculation over the reduction or expansion of quantitative easing largely amounts to market noise.

2013-04-25 The End of “Expansionary Austerity?” by Scott Brown of Raymond James

A few years ago, an economic paper by Harvard professors Carmen Reinhart and Kenneth Rogoff helped fuel the push for austerity. It was met with some criticism from economists, but was widely embraced by the press and by politicians on both sides of the Atlantic. The study has now been demonstrated to have had serious flaws, but will those in power fold? Or will they double down on bad economic policy?

2013-04-25 Surf's Up! by Jeffrey Saut of Raymond James

Last month I was reminded of “Surf’s Up!” while rereading said report from my departed friend Stan Salvigsen of Comstock Partners fame. While that is the organization Stan, Michael Aronstein, and Charles Minter formed in the late 1980s, Stan’s investment career actually began in 1964 as an analyst with the Value Line Investment Survey. Subsequently, he was an equity strategist at a succession of firms, including Dreyfus, Oppenheimer, C. J. Lawrence, and Merrill Lynch.

2013-04-25 Like Air Out of An Untied Balloon... by Blaine Rollins of 361 Capital

Earnings hit the market like a ton of bricks this week. It wasn’t that the reported numbers were a disaster, but that the new data points did not change the trajectory of the current buying and selling patterns. Investors rewarded the defensive earners (bought more Coca-Cola, Johnson & Johnson, and Microsoft) and sold their shares in more cyclical stocks (Industrials, Semis, and Oil Services). Financial stocks survived the week, but few owners went home Friday feeling better about their bank names than at the start of the week.

2013-04-25 Q1 2013 Market Commentary by John Prichard of Knightsbridge Asset Management

The country now in the news is tiny Cyprus, which received a bailout for its banks from the European Union (EU), but only after agreeing to steep losses for those banks’ large depositors. Hitting up bank deposits represents a new dimension to the European debt crisis and illustrates how in a crisis, leaders can and often will resort to whatever means are necessary. When the Cypriots first requested a bailout from the EU and were told their depositors had to suffer, they balked and said that was unacceptable...

2013-04-23 Middle East/Africa: Regional Economic Review by Team of Thomas White International

According to a World Bank (WB) report, global growth in 2013 will remain sluggish as economic recovery in the developed nations is likely to be slow. Lower business and consumer confidence, government spending cuts, as well as high rates of unemployment may delay the recovery, the report says. The report has also noted that developing nations may experience slower growth due to structural and monetary policy challenges.

2013-04-23 Q1 Earnings Leave Much To Be Desired by Chris Maxey, Ryan Davis of Fortigent

Following the strongest first quarter in 15 years, it is not surprising to see equity markets faltering in April. Last week’s decline of 2.1%, however, may reflect deeper concerns about corporate fundamentals amid a mixed earnings season.

2013-04-22 Strategy for a Second Gear Economy by David Kelly of J.P. Morgan Funds

American investors could be forgiven for feeling just a little confused. One week after the stock market posted its strongest first-quarter gains since 1998, the Bureau of Labor Statistics announced the weakest monthly job growth in nine months. Real GDP growth was just 0.4% in the fourth quarter but appears to have been much stronger in the first. So is the economy getting stronger or weaker, how is the Federal Reserve likely to react to it and what, if anything, should investors do about it?

2013-04-22 And That's the Week That Was by Ron Brounes of Brounes & Associates

The end to another tax season; a hectic week on the earnings calendar; a number of key domestic economic releases; and ongoing developments on the global economic frontand yet, much of the country (and world for that matter) was focused on the events in Boston and the aftermath of the bombing that led to a massive manhunt and a shootout with police. Early in the week, the celebrated Boston Marathon came to an abrupt halt as terror again reigned throughout the country and nearby residents were sent into lockdown mode.

2013-04-22 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

The deadly bombings in Boston last week, along with a spate of senseless killings in Newtown and Aurora, should highlight for those consumed by economics and financial market statistics the fragility of life and a sense of perspective about helping those in need at their darkest hour. How noble that on the day of the U.S. equity market’s most damaging point collapse in years, our focus was on Boston and not on our wallets or portfolios.

2013-04-22 Housing Prices Are About to Surge by Charles Lieberman (Article)

Housing activity has improved dramatically over the past year, but the recovery is too weak to prevent home prices from surging. We anticipate that home prices will increase at a healthy double digit rate quite soon and this price rise is likely to be sustained until new single family home construction exceeds 1 million at an annual rate for at least a six month period of time, more than 60% above the current rate of new single family construction. Read More

2013-04-22 Guess What? Growth is Back! by Brian Wesbury, Bob Stein of First Trust Advisors

The first quarter has come and gone and lots of data have been released. Still, there are pieces of data missing and these missing data points make forecasting GDP treacherous.

2013-04-22 Commodity Declines and Weak Data Startle Investors by Bob Doll of Nuveen Asset Management

U.S. equities declined last week as the S&P 500 fell by more than 2.0%, which came on the heels of a new all-time high the prior week. Led by gold, commodities experienced volatility and declined over the past two weeks. Other detractors included disappointing first quarter Chinese economic numbers and somewhat softer U.S. releases.

2013-04-20 Austerity is a Consequence, not a Punishment by John Mauldin of Millennium Wave Advisors

Austerity is a consequence, not a punishment. A country loses access to cheap borrowed money as a consequence of running up too much debt and losing the confidence of lenders that the debt can be repaid. Lenders don’t sit around in clubs and discuss how to “punish” a country by requiring austerity; they simply decide not to lend. Austerity is a result of a country’s trying to entice lenders into believing that the country will change and make an effort to restore confidence.

2013-04-19 Equity Investment Outlook by Team of Osterweis Capital Management

Every so often we write an Investment Outlook with conclusions that prove to be both accurate and worth repeating. Such is the case with our prior outlook issued in January 2013. In it we stated that “At the risk of sounding complacent, we believe that the fundamental trends that produced such favorable results in 2012 are still in place and should support another good year in 2013. We are not blind to the challenges and uncertainties that still face us, nor do we believe that the year ahead will be devoid of volatility.

2013-04-19 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks moved up nicely last week despite poor economic data and a huge decline in precious metals and other commodities.

2013-04-19 F.I.R.S.T.: Bond Market Outlook by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Amid heightened political uncertainty in Europe and subdued global growth expectations, global investors owe Hiroki Kuroda a big domo arigato for his pledge to inject about $1.4 trillion into the moribund Japanese economy by the end of 2014. The newly appointed BOJ governor’s unprecedented plan to buy Japanese government bonds,

2013-04-19 First Quarter Investment Commentary by Team of Litman Gregory

Looking ahead, significant uncertainty surrounds fiscal and monetary policy in terms of what policies will be adopted and their ultimate economic and financial market impacts. More broadly, still-high global debt levels pose an economic headwind. Against this backdrop, our outlook for stocks has not improved. If anything, given the sharp run-up in stock prices, we are getting closer to reducing our U.S. equity exposure further than we are to increasing it.

2013-04-19 Gold Buyers Get Physical As Coin and Jewelry Sales Surge by Frank Holmes of U.S. Global Investors

Even with the gold price dropping, why are gold coins selling at a premium? It’s Economics 101: The coin supply is limited and the demand is high. This buying trend isn’t only occurring in the U.S. In Bangkok, Thailand, for example, crowds of buyers were filling stores, eagerly waiting in multiple lines to purchase gold jewelry and coins.

2013-04-18 Fannie and Freddie Face the Future by Milton Ezrati of Lord Abbett

The mortgage finance giants are the subject of a new policy initiativewith significant implications for the U.S. housing market.

2013-04-17 U.S. GDP: After Some First-Quarter Flurry, a Slowdown? by Ken Taubes of Pioneer Investments

We had a little flush of activity in the first quarter, which we believe will lead to much better GDP potentially well over 3% than people anticipated in the beginning of the year. We look at this activity as a little bit of a catch-up, for a couple of reasons.

2013-04-17 Signs of a Correction by Scott Minerd of Guggenheim Partners

Although the long-term economic picture remains sanguine, a number of global risks and economic results point to a temporary period of consolidation in equity markets.

2013-04-17 What's Driving Emerging Markets? by James McDonald, Daniel Phillips, Phillip Grant of Northern Trust

Emerging market (EM) equities have historically outperformed as the global economy gained momentum, as shown in Exhibit 1. After a great catch-up rally in the second half of 2012, the stocks finished the year as global outperformers only to lose that momentum in the first quarter of 2013. What is behind the recent underperformance, and what does it say about the outlook? Our research points to a number of contributors to the recent weakness.

2013-04-16 Gold in the Crosshairs by Peter Schiff of Euro Pacific Capital

In the opening years of the last decade, most mainstream investors sat on the sidelines while "tin hat" goldbugs rode the bull market from below $300 to just over $1,000 per ounce. But following the 2008 financial crisis, when gold held up better than stocks during the decline and made new record highs long before the Dow Jones fully recovered, Wall Street finally sat up and took notice.

2013-04-16 High Yield Market Overview by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index, was up 1.03% for the month of March, as the high yield market continued to benefit from stable U.S. economic growth and steady asset reflation driven by the Fed and global central banks.

2013-04-16 Tax Day as Polarizing as Ever by Chris Maxey, Ryan Davis of Fortigent

Tax season is once again upon the American population, and this year, just as in years past, people are less than enthusiastic. It is estimated that the average taxpayer contributed slightly more than $11,000 dollars to federal taxes in 2012 and those figures are on the rise. As might be expected in the current backdrop, however, not everyone shares the same opinion on taxes.

2013-04-16 2013 US Financial Markets by Clyde Kendzierski of Financial Solutions Group

In the fall of 2012 the S&P 500 came close to our forecast high (S&P- 1500) Last year we suggested that not only was the S&P likely to reach 1500, but also speculated that renewed bullish sentiment could take us back to the old highs of 1565. When the S&P touched 1563 a couple weeks ago, I started getting client calls complimenting my prescient forecast.

2013-04-15 And That's the Week That Was by Ron Brounes of Brounes & Associates

Another dayAnother record. With last week’s poor unemployment releases suddenly a distant memory, investors looked forward (and not backward) and took the Dow Jones and S&P 500 back into record-setting territory with a four-day winning streak. By week’s end, however, some key earnings reports disappointed and analysts became more concerned about the state of the consumer (though there is clearly no consensus on that front either).

2013-04-15 Housing Is it Getting Better, A Second Look by Gregg Bienstock of Lumesis

This week we take a quick look at some of what is in the President’s budget and then focus on the housing market (the title harkens back to something we wrote a few months back). You may sense, as you read on, I’m a bit cranky this week. As you read through the housing section you’ll understand why.

2013-04-12 Housing Bubble II? by Russ Koesterich of iShares Blog

It might seem like the housing bubble just burst, but as the housing market stages a comeback, investors are asking if we’re already facing another bubble. Russ explains why home prices aren’t in a bubble but home builder stock valuations may be.

2013-04-12 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.

2013-04-11 Telling (Taper) Time by Tony Crescenzi of PIMCO

Investors need be alert for signs of progress in the many employment indicators the Fed is watching, and listen closely to what the Fed is saying to know when bond buying will be tapered. The failure to achieve “escape velocity” is why the Fed is using its printing press to purchase $85 billion of securities monthly. These purchases will continue, the Fed says “until the outlook for the labor market has improved substantially.” The Fed has made progress toward achieving escape velocity but the progress must be sustained for the Fed to throttle back on its stimulus.

2013-04-11 Stockton is Bankrupt: Now What? by James Dearborn of Columbia Management

Although we have no exposure to Stockton, California debt, we thought it would be useful to comment on the city’s financial plight in the wake of the recent bankruptcy court ruling allowing the city to file a “plan of adjustment” or the equivalent of Chapter 11 reorganization. We, and other municipal bond participants, will be watching this process closely to see how the court treats various creditors.

2013-04-10 Economic Slowdown Halts Equity Rally by Bob Doll of Nuveen Asset Management

The latest softness in economic indicators probably means that more consolidation in the equity markets is required before we can advance beyond the recent all-time highs. During March, nearly all of the activity for the S&P 500 was within 1% of 1550. Equities may move lower due to deteriorating technical conditions and the possibility of weak first quarter earnings reports.

2013-04-10 Surprising Surge!! by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

Momentum from 2012’s surprisingly strong performance continued into the first quarter of 2013 with stocks rising sharply. Our portfolios did well but lagged behind our benchmarks in the quarter. Taking a little longer view, over the trailing 12 and 36 months we mostly matched the double-digit gains of our benchmarks, which we are very pleased with since we usually underperform during strong market advances. So far this year small- & mid-capitalization, value, and domestic stocks were the market leaders, while international, growth, commodity stocks and Apple were laggards.

2013-04-10 Don't Pay Too Much for That Bordeaux - Or That Bond by Jeff Helsing of PIMCO

The financial market’s reliance on ratings agencies and benchmarks, along with regulations, can cause distortions in the value of some securities. These price distortions can create potential opportunities for some investors. Investors should consider aligning capital allocation with outcome-oriented objectives that aren’t influenced by credit ratings or benchmarks.

2013-04-09 PIMCO Cyclical Outlook for Asia: How Leadership Changes Are Shaping Asia's Outlook by Q&A with Ramin Toloui, Tomoya Masanao and Robert Mead of PIMCO

For Asia, “slow but not slowing” global growth will likely keep external demand neutral, and policy developments will therefore help shape the economic outlook. In Japan, we see a significant boost to aggregate demand coming from the concerted monetary and fiscal expansion of the new Abe government. In China, concerns about inflation, housing market excesses, and long-term financial stability are prompting policy restraint that should keep growth below 8% this year.

2013-04-08 The Theology of Inflation by John Mauldin of Millennium Wave Advisors

We begin this week with a simple pop quiz. Is inflation good or bad? Answer quickly. I’m sorry your answer is wrong. Or rather, we can’t know if your answer is right or wrong because we are not sure what is meant by the question. We may think we know and we may be right but we can’t be sure, because the word inflation has different meanings for different people in different places and different times. In fact, even the same people in the same place and time can’t agree on a precise definition.

2013-04-08 Taking Distortion at Face Value by John Hussman of Hussman Funds

The U.S. stock market presently reflects two unstable features. One is that extraordinary monetary policy specifically quantitative easing has created an ocean of zero-interest money that someone has to hold at each point in time, and that provokes a speculative reach for yield. The other is that extraordinary fiscal policy, coupled with household savings near record lows, have joined to elevate profit margins more than 70% above their historical norm, as the deficit of one sector has to emerge as the surplus of another.

2013-04-05 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company, Inc.

For two years or more, we’ve been discussing Europe, China, and U.S. politics as drivers for the financial markets. These drivers continue.

2013-04-05 PIMCO Cyclical Outlook for the U.S.: Back From the Brink by Josh Thimons of PIMCO

We expect the largest contributors to U.S. growth this year will be housing and related industries, increases in capital expenditures (albeit from very depressed levels), certain manufacturing sectors, such as the auto industry, and the energy sector. We see roughly 1.7 percentage points of drag on GDP coming out of Washington far less than the four to five percentage points of potential drag had there been no fiscal cliff resolution. We believe the Fed will continue with hyperactive monetary policy, which we now call “QE Infinity,” that does not have an explicit end date or progr

2013-04-05 What's Next for U.S. and European Markets? by Mike Temple of Pioneer Investments

I was asked recently to provide some color around the state of global fixed income markets as we close out the first quarter of 2013. Of course, one of the more watched situations in the global markets has been Cyprus’s banking crisis. I won’t go into too much depth on the subject here, as my colleague, Cosimo Marasciulo, has recently provided a comprehensive analysis.

2013-04-05 This Week's Central Bank Meetings Revealed a Range of Behavior by Team of Northern Trust

This week’s central bank meeting revealed a range of behavior. The U.S. employment report fell well short of expectations. Does China have a property bubble?

2013-04-05 Every Gold Coin Has Two Sides by Frank Holmes of U.S. Global Investors

Just as every coin has two sides, every data point that doesn’t meet expectations usually has an upside somewhere. For instance, although the gold price has fallen with the strengthening U.S. dollar, the yellow metal is appreciating in Japanese yen. So when negative news about the economy came out this week, along with the U.S. Labor Department reporting that the country added only 88,000 jobs in March, investors found reasons to be encouraged.

2013-04-04 Sound Fundamentals but Fatigue in the Markets by Scott Minerd of Guggenheim Partners

Although economic fundamentals continue to strengthen, the run-up in asset prices that has unfolded over the past half-year appears to be at risk of a temporary set-back.

2013-04-04 Teachings from Recovered Markets by Richard Michaud of New Frontier Advisors

Domestic indices’ all-time record highs indicate that U.S. domestic equity markets have largely recovered from the 2008 Great Recession. It may have taken four years but it still seems a remarkable achievement given the Dow’s low of 6620 in March 2009. It is worth noting that prior highs were attained in an era with a poor savings rate and wide use of levered strategies. The last four years were widely characterized by a “low return” market mantra and fear of equities stoked by many doomsayers, pundits, and strategists who greeted every upturn with pessimism.

2013-04-03 First Quarter Recap by Bob Doll of Nuveen Asset Management

This past month marked the fourth anniversary of the global equity market bottom on March 9, 2009. U.S. stocks have clawed back all of the losses from the Great Recession and are near historical highs. Most other major markets are still well below their 2007 peaks, but have rebounded sharply since last June and look increasingly resilient. However, there is tremendous anxiety about the economic outlook, and many investors fear equities and other risk assets are floating on a sea of liquidity rather than solid fundamentals. We are more constructive and maintain a pro-growth investment stance.

2013-04-03 When Does The Great Recession Become the Great Rotation? by Gene Tannuzzo of Columbia Management

Given the strong flows into the bond market over the past few years, many pundits have pondered the beginning of the “Great Rotation” when bond investors begin to move money into the equity market. Investors fear that this shift could cause losses in bond funds as investors flee. Indeed since the start of the Great Recession in 2008, investors have plowed into bond funds as an alternative to equity volatility.

2013-04-03 Minor Crisis...Not Too Many Hurt by Christian Thwaites of Sentinel Investments

Cyprus proved, over the last two weeks, that markets often overlook the small stuff. Very few commentators we follow saw any of it coming and the theories that sprang up in the interim (Cyprus as vassal state to Russia, return to the Cypriot pound, imminent EU break up, twin euros in circulation, utter disaster for the economy, German intransigence and Schrecklichkeit) were absurd.

2013-04-03 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.

2013-04-03 F.I.R.S.T.: Made in the U.S.A. by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Not just the preamble for the “machine-wash-in-cold-water-and-eat-celery-only” instructions on the inside of your skinny jeans, “Made in the U.S.A.” is a brand in vogue these days as the Stars and Stripes looks to dawn a manufacturing renaissance to go with that snazzy new housing recovery everyone’s been talking about.

2013-04-02 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.

2013-04-02 Is the Vix Still an Adequate Measure of Risk? by Chris Maxey, Ryan Davis of Fortigent

The 30-day implied volatility index for the S&P 500 calculated by the Chicago Board of Options Exchange (CBOE), known as VIX, has long been used as an indicator of market sentiment. Commonly referred to as the “fear index,” the VIX often portends periods of stress in equity markets, as options traders price in higher volatility in the future. The shape of the VIX futures curve, in particular, has historically been used as an indicator of future volatility levels.

2013-04-02 Flying High on Borrowed Wings by Peter Schiff of Euro Pacific Capital

After selling off an astounding 56% between October of 2007 and March 2009, the S&P 500 has staged a rally for the ages, surging 120% and recovering all of its lost ground too. This stunning turnaround certainly qualifies as one of the more memorable, and unusual, stock market rallies in history. The problem is that the rally has been underwritten by the Federal Reserve’s unconventional monetary policies But for some reason, this belief has not weakened the celebration.

2013-04-01 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.

2013-04-01 A Fresh Milestone by Jeffrey Saut of Raymond James

Last Thursday the S&P 500 (SPX/1569.19) notched a new all-time causing Ms. Scaggs to pen the aforementioned story in Friday’s Wall Street Journal. I was particularly interested in a sentence further down in the article that read, “The rally in stocks comes as investors warm up to stocks for the first time in years.” That prose sparked memories of an era gone by.

2013-04-01 The Arithmetic on Consumer Spending by Scott Brown of Raymond James

The 3rd estimate of 4Q12 GDP growth showed a downward revision to consumer spending growth. Less momentum heading into 1Q13, right? Guess again. Revisions to the monthly data actually showed better growth heading into the new year. Moreover, figures for January and February suggest a much stronger rate of growth in spending (and hence GDP) than was anticipated just a short time ago.

2013-03-29 Learnings From the Cyprus Saga by Carl Tannenbaum of Northern Trust

There are important differences between the situation in Cyprus and the challenges other southern European nations face that should limit the transfer of financial trauma. The hope remains that the ECB’s promise to do whatever it takes to solve the sovereign debt crisis will ultimately settle markets. But access to certain types of ECB support requires reaching agreement on restructuring with the same European officials who have handled the situation in Cyprus so maladroitly.

2013-03-29 Market Resilience by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

After a stellar first quarter performance from US stock markets, which showed impressive resilience to continued headwinds, a pullback is certainly possible but we don’t suggest investors who need to add to allocations wait. In a relative world, the US stock market continues to look like an attractive place to invest, although there may also be opportunities in Japan and Europe as well. The upcoming earnings season could tell the story for the market over the next couple of months, but we continue to advocate a long-term point of view and maintaining a diversified portfolio.

2013-03-28 On the Fed, the Keystone Pipeline & the War On Jobs by Gary Halbert of Halbert Wealth Management

The Fed Open Market Committee (FOMC) met as scheduled last Tuesday and Wednesday to review monetary policy and its massive “quantitative easing” effort. The official policy statement released at the end of the meeting on Wednesday was little changed from those in previous months.

2013-03-28 Today's Good News Isn't Bad for US Stocks by Daniel Loewy of AllianceBernstein

Believe it or not, recent US housing market gains, the slight reduction in jobless rates and other signs of a revival in US economic growth are making some investors bearish about US stocks. We think their fears are misplaced.

2013-03-28 What Will Drive the Market? by Charlie Dreifus of The Royce Funds

The sequester adds to the economic headwinds caused by ending the payroll tax holiday and the boost in tax rates. However, even with the sequester, total federal government outlays will rise this fiscal year. Finally, after more than a month of daily increases for a gallon of unleaded gasoline, prices are now declining. This has been of concern as rising oil and gasoline prices were yet another headwind facing the U.S. economy. (Oil prices have also declined.)

2013-03-28 What Maslow and Rand Would Tell Investors Today by Frank Holmes of U.S. Global Investors

While gold’s performance in the short term has been counterintuitive, I plan to stick to my own advice. I simply feel safer with a small weighting in gold as insurance.

2013-03-27 Mark Hulbert: Our Kindred Spirit by Bill Smead of Smead Capital Management

Mark Hulbert and I started in the investment business in 1980. He chose to create a business out of analyzing the results and psychological implications of investment newsletter writers. At Smead Capital Management, we formed a business to analyze publicly-traded US common stocks through the prism of our eight proprietary criteria. We enjoy his unbiased third-party opinions on current circumstances and his consistently good historical perspective.

2013-03-26 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks were flat last week as investors were mesmerized by the goings on in Cypress and the European Union.

2013-03-26 Currencies in a Race to Debase by Chris Maxey, Ryan Davis of Fortigent

Since the start of the year, investors have seen rapid shifts of sentiment in currency markets. The debasement that for so long was assumed to be a purely Western phenomenon is beginning to impact countries globally, driving changes in expected returns and growth prospects.

2013-03-26 Smart People's Opinions, The Data Says and Some Looming Deadlines by Gregg Bienstock of Lumesis

Being on the road gives me a lot of time to read the views and opinions of many very smart people (Faber, Mauldin, Hussman, Hunt and Zhao this week citations below as they all are worth a read). An interesting thread runs through much of what I absorbed this week: they don’t believe the hype.

2013-03-26 The Stimulus Trap by Peter Schiff of Euro Pacific Capital

For years we have been warned by Keynesian economists to fear the so-called "liquidity trap," an economic cul-de-sac that can suck down an economy like a tar pit swallowing a mastodon. They argue that economies grow because banks lend and consumers spend. But a "liquidity trap," they argue, convinces consumers not to consume and businesses not to borrow. The resulting combination of slack demand and falling prices creates a pernicious cycle that cannot be overcome by the ordinary forces that create growth, like savings or investment.

2013-03-25 The Hook by John Hussman of Hussman Funds

At the 2000 peak, Richard Russell observed "Every bull and bear market needs a hook.’ The hook in a bear market is whatever the bear serves to keep investors and traders thinking that everything is going to be all right. There is always a hook."

2013-03-25 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.

2013-03-25 Housing Recovery Still Young by Brian Wesbury, Bob Stein of First Trust Advisors

Into early 2012, conventional wisdom argued that the odds of a robust housing recovery were lower than the odds of New Mexico and Georgetown losing to Harvard and Florida GC.

2013-03-25 Still Bullish by Richard Golod of Invesco

Global equities (as measured by the MSCI All Country World Index) fell modestly in February amid reignited fears about the euro’s future, signs of distress in China’s economy and the looming sequester deadline in the US. Nevertheless, I believe the US, Japan and emerging markets may offer compelling opportunities, while Europe requires a more selective approach.

2013-03-22 ING Fixed Income Perspectives March 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Developed sovereigns are still broadly unattractive, but global central banks appear poised to ease. We prefer EM currencies that will continue to benefit from positive global growth and tolerate further upward pressure on the U.S.

2013-03-22 Happy Clients; Terrified Prospects by David Edwards of Heron Financial Group

Four years ago, on March 9th, 2009, US stocks collapsed to a 12 year low. A financial crisis rooted in overleveraged purchases of junk (or even fraudulent) securities claimed, in quick succession, Bear Stearns, Lehman Brother, Merrill Lynch (forced into a shotgun marriage with Bank of America) and AIG. Investors panicked, selling good securities at deep discounts to fair value.

2013-03-22 Power of Positive Screening: Pursuing Strength of Social and Financial Returns by Chat Reynders, Patrick McVeigh of Reynders, McVeigh Capital Management

Market volatility and sweeping changes to mainstream views of investing are catalyzing acceptance of tactics that combine fundamentals with a progressive outlook on social issues. Positive screening brings balanced companies to the fore of the investment landscape: this practice isolates sound equities that demonstrate strength of balance sheet, dependability of management, and a commitment to act as part of a global community focused on positive change.

2013-03-22 US Stocks: Third Time’s the Charm by Seth Masters of AllianceBernstein

At 1550, the S&P 500 has regained the peak it reached in March of 2000 (when the tech bubble burst) and again in October of 2007 (before the credit crunch hit). But we think the third time’s the charm: We think the stock market still has room to rise because equities are now more attractively valued and of higher quality than they were at previous peaks.

2013-03-22 The Success of Central Bank Policy Is Not Measured By The Revenue It Generates by Team of Northern Trust

The success of central bank policy is not measured by the revenue it generates. Cyprus is a small country that could cast a long shadow. The U.S. dollar’s fortune is changing

2013-03-22 In Gold We Trust by Frank Holmes of U.S. Global Investors

Poorly thought out government policies hurt the formation of capital and destroy people’s trust in paper money. Leaders may have good intentions, but some of their actions show disrespect for private property and individualism. This only reemphasizes gold as an important asset class.

2013-03-21 The Constancy of Dividends by Bill Smead of Smead Capital Management

The payout ratio on the S&P 500 Index currently hovers around 30% of the after-tax profits of companies in the indexat the low end of the last 100 years. In comparison, the capital appreciation portfolio here at Smead Capital Management has a payout ratio of 27%. This is important because most studies show that over 40% of the returns provided by common stocks come from dividends over long stretches of time. With those figures in mind, we reasoned that this is a good juncture to remind everyone about our vision of the next ten years as it pertains to dividends.

2013-03-21 Cyprus as a Pandora’s Box by Scott Minerd of Guggenheim Partners

The attempt to levy a deposit tax on Cypriot accounts has the potential to further destabilize the European Union, with contagion risk elevating for other peripheral member states.

2013-03-21 Fed Still Inching Toward Optimism by Brian Wesbury, Bob Stein of First Trust Advisors

The Federal Reserve made no changes to monetary policy today and only some small changes to the language of its statement. Once again, the Fed’s comments were slightly more optimistic about the economy than they were after the prior meeting.

2013-03-21 Global Markets’ Time Factor by Mohamed El-Erian of Project Syndicate

In recent months, the dichotomy between booming financial markets and sluggish economies (and dysfunctional politics) has loomed large. The critical element of time and who controls it could well mean the difference between an orderly global resolution of today’s ongoing financial problems and a return to serious trouble.

2013-03-19 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks had a very quiet week with volumes reaching levels that one associates with holiday trading.

2013-03-19 Mila Kunis, Euphoria, and the Stock Market by John Rothe of Riverbend Investment Management

Are we in the “euphoria” stage of the market right now? This past week, as the S&P 500 nears a record level, financial news pundits were fascinated with the following headlines.

2013-03-19 Why Are Emerging Markets Struggling in 2013? by Ryan Davis of Fortigent

Despite one of the sharpest rallies in US equities in recent memory, emerging market equities have been left curiously behind in 2013. Through last Friday, the market segment was down 1.0%, compared to an S&P 500 index that was up 10.0%. This seems to violate the regime that investors have gotten used to over the past 10 years, whereby the emerging markets equity index served as a high beta proxy for the US equity market.

2013-03-18 And That’s the Week That Was by Ron Brounes of Brounes & Associates

Move over Dow Jones, here comes the S&P. What few thought possible a year ago is coming to fruition as the major indexes continue to push toward record territory. The S&P 500 is close (but no cigar) to besting its personal high set in late 2007, before this whole banking mess emerged and sent equities into a tailspin. Confident investors seemed to be overlooking the numerous concerns (budget/sequester, payroll taxes, Europe, China) so they can participate in the record run.

2013-03-18 M&A and Dividends Likely Drivers of the Market by Charlie Dreifus of The Royce Funds

The sequester adds to the economic headwinds caused by ending the payroll tax holiday and the boost in tax rates. However, even with the sequester, total federal government outlays will rise this fiscal year. Finally, after more than a month of daily increases for a gallon of unleaded gasoline, prices are now declining. This has been of concern as rising oil and gasoline prices were yet another headwind facing the U.S. economy. (Oil prices have also declined.)

2013-03-18 Finding the Sweet Spot by Mark Kiesel of PIMCO

Where is the investment “sweet spot” in today’s global financial markets? The uneven global growth outlook means there are opportunities and risks for both credit and equity investors.

2013-03-18 Don’t Forget About Emerging Market Equities by Russ Koesterich of iShares Blog

While emerging market stocks are underperforming US stocks, Russ explains why longer-term investors may want to give EM markets another look.

2013-03-15 Waiting on Weakness? by Mike Boyle of Advisors Asset Management

On Tuesday, March 5, The Dow Jones Industrial Average (DJIA) set a new record close at a level of 14,253.8 (old record of 14,164.5 was set on 10/09/07). Since then it has gone on to set four more consecutive record-closing highs. The S&P 500, at a closing level of 1556.2 on 3/11/13, is still about nine points shy of its record high of 1565.2 (also set on 10/09/07), but it is up seven days in a row and the odds of that occurring are about 1.17%.

2013-03-15 Washington May Be Ready to Take a Break From the Brink by Josh Thimons, Libby Cantrill of PIMCO

With Washington’s dysfunction not in the forefront, the economy could be more unencumbered to grow, with markets trending in a similar direction. The Fed’s proactive policies should continue to favor overweight positions in the five-year through 10-year part of the Treasury yield curve and support interest-rate-sensitive sectors of the economy most notably housing. In the longer term, however, we would advise investors to be cautious: Without meaningful long-term structural deficit reform, real growth will inevitably lag in the U.S.

2013-03-15 High Yield Market Overview by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index, posted a positive total return of 0.46% in February, as the high yield market finished on a positive note, after experiencing heightened volatility throughout the month.

2013-03-15 Global Economic Overview by Team of Thomas White International

Global economic trends largely remained positive during February, though the stalemate after the Italian elections and the failure by policymakers to reach a deal to avoid the U.S. sequester heightened the political and policy risks. The U.S. GDP figure for the last quarter of 2012 was revised higher, showing the world’s largest economy managed to avoid a decline.

2013-03-15 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Despite exceptionally easy monetary policy, inflation risk remains low. Record stock market levels are boosting consumer spending. U.S. capital spending is poised to be a bright spot this year.

2013-03-15 Finally!! Now What? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Surprise! We don’t know what’s going to happen in stocks over the next few weeks. But we are seeing an environment that we believe can foster further gains in the US as economic data remains generally positive, the Fed maintains its accommodative stance, and small progress is being made in the fiscal realm. Investors concerned about a pullback may want to hedge their portfolios, but maintain adequate exposure to equities.

2013-03-14 Excess Liquidity Finds a Home by Scott Minerd of Guggenheim Partners

U.S. home prices appear likely to continue to rise as the Federal Reserve injects more liquidity into the system. Given housing’s unique characteristics, this will have positive effects for consumption and growth.

2013-03-14 Newsletter by Harold Evensky of Evensky & Katz

In the latest edition of his client newsletter, Harold Evensky highlights a number of interesting bits of news, including a must-see destination for your friends, your kids and your grandkids, some advice from Warren Buffett, a tip from Albert Einstein and the latest data on hedge fund performance.

2013-03-14 Tightening the Noose: Can the SEC and Its New Chairman Be Tougher on Wall Street? by Team of Knowledge @ Wharton

Although the SEC has always been the federal government’s chief guardian of integrity in the financial markets, critics have a long list of grievances, including claims that the agency is too unsophisticated and too soft on wrongdoers. Assuming she is confirmed as the new SEC chairman, Mary Jo White will need almost superhuman skills to make the SEC more effective. Can she -- or anyone, for that matter -- accomplish this?

2013-03-13 Taking Stock in the U.S. by Team of Franklin Templeton Investments

Is it time to take stock in the U.S. market? Equities started the year strong as the U.S. economy sidestepped the worst-case fiscal cliff scenario and continued showing signs of improvement despite global economic uncertainty. In fact, the Dow Jones Industrial Average reached a record high in early March. While there are still a number of possible issues that threaten to derail the market, Grant Bowers, portfolio manager of Franklin Growth Opportunities Fund, believes economic resilience in the United States is encouraging news for stocks, and investors have taken notice.

2013-03-12 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 Finally, a Jobs Report Worth Reading by Chris Maxey, Ryan Davis of Fortigent

Surprisingly, the February employment report showed a labor market growing at a reasonably healthy rate. Concerns that the sequester would spill into the broader economy have yet to materialize and if recent trends hold, the economy may finally be approaching a point of robust and sustainable job growth.

2013-03-12 The Plow Horse is Trotting by Brian Wesbury, Bob Stein of First Trust Advisors

In October 2012, we raised our recession odds from 10% to 25%. We saw an increase in uncertainty and fear over the election and the fiscal cliff as having the potential to cause a drop in velocity. Panics (falling velocity) are rare. As a result, our base case (75% odds) was for a 2.5% to 3% increase in real GDP for 2013. Real GDP increased just 0.1% in Q4, but now it appears the Plow Horse is starting to trot a little.

2013-03-12 We Made It. Now What? by Christian Thwaites of Sentinel Investments

What looks like a fairly settled policy in Europe is fast becoming a very dangerous situation, according to Christian Thwaites in his latest "Thought of the Week" -- "We Made It. Now What?" -- adding that the outlook for the world's second largest economic bloc is pretty week.

2013-03-12 U.S. Dominates World Markets for the Trifecta by Douglas Cote of ING Investment Management

While large-cap indices get all the headlines, mid and small caps have continued to excel. Frontier markets have picked up the slack as major emerging markets stumble. Global risks persist, though U.S. fundamentals appear solid. The move toward U.S. energy independence should soon result in a trade surplus, boosting GDP.

2013-03-08 Spasmodic Stupidity: The Wile E. Coyote Congress by Cliff Draughn of Excelsia Investment Advisors

I predict the Ides of March will find us in a continued sequestration, and Congress will use the time between now and the debt ceiling deadline on March 27th to debate the merits of true tax reform as opposed to governing by crisis. In the end, though, the reform conversation will revert to governance by crisis, with another stop-gap measure to avoid government shutdown during Holy Week and Easter, which will tide us over to the elections of 2014. Do you expect any different?

2013-03-08 How to Keep Calm and Invest On by Frank Holmes of U.S. Global Investors

The market noise of today will not be going away. However, investors can gain confidence in the following wisdom of the crowd. As famous investor Benjamin Graham said, "The individual investor should act consistently as an investor and not as a speculator. Keep calm and invest on.

2013-03-07 Animal Spirits: F.I.R.S.T. by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Call it what you will a dog-eat-dog world in which you're wearing Milk-Bone underwear or an example of capitalism at its finest an M&A cycle is heating up. This activity may be signaling the rebirth of what British economist John Maynard Keynes originally referred to as "animal spirits", much to the delight of fictional corporate barbarian Gordon Gekko and his real-life analogues, who require little prompting to act on Keynes "spontaneous urge to action".

2013-03-07 Freewheeling? by Dimitri Balatsos of Tesseract Partners

Ignoring threatening clouds in the distant horizon, the financial markets are wrapped in a blanket of complacency. Consider the following. The Dow Jones Index has been flirting with the 2007 record peak. Implied stock market volatility, as measured by the VIX Index, is in the basement. Junk bond yields are at record lows, compressing spreads to within shouting distance of risk-free Treasuries. Securitization is back from the dead, while the drought in M&A activity is now getting plenty of rainfall.

2013-03-07 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.

2013-03-07 Florida is on Fire by Lesley Deutch of John Burns Real Estate Consulting

The Florida housing market is booming. Home buyer traffic and sales are climbing rapidly throughout the state, leading to increasing home and land prices.

2013-03-06 U.S. Sequester: How Significant is it for the Global Economy? by Team of Thomas White International

Since the U.S. has been one of the brightest spots in the current global economic environment, any negative development that restricts activity in the U.S. could have a magnified impact on the economic prospects for the rest of the world.

2013-03-06 Welcome Back, Visible Risk by Rob Stein of Astor Asset Management

Risk and more accurately "visible risk" has re-entered the market, and that's a very good thing. Visible risk is what you can measure, evaluate, mitigate, manage, and hedge (at least to some degree).

2013-03-06 Why Our Best Ideas Come In The Shower and Why They Are So Hard To Remember by Gary Halbert of Halbert Wealth Management

I don't know about you, but I have had some of my best and most creative ideas while in the shower. But the shower is not the only place or activity where we tend to be more creative. Our creative juices can frequently be stimulated when doing other things as well such as driving home from work, during or after exercise, cooking, meditating, etc.

2013-03-05 Weave a Circle Round Us Thrice by Christian Thwaites of Sentinel Investments

There was plenty of news to threaten the recent market rallies but, as of writing, we're within a whisper of all time highs in US stocks and managing to have a very orderly consolidation in bonds. This is surprising because the political process has once again taken careful aim and shot itself in the foot. The sequester has become the dumb answer to difficult questions and will initiate, mostly indiscriminate, across-the-board cuts.

2013-03-05 Is Now the Time to Diversify? by Chris Maxey, Ryan Davis of Fortigent

The use of global diversification in constructing client portfolios has come under fire in recent years due to the underperformance of many risk assets. Traditionalists who stuck to their familiar S&P 500 and BarCap Aggregate Bond index blends generally outperformed their diversified peers in 2011 and 2012, as historic risk premiums failed to materialize and various alternative investment strategies faced headwinds.

2013-03-04 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 Federal Government Employment, Tax Exemption and the Drought by Gregg Bienstock of Lumesis

This week we focus very briefly on the sequester and Federal government employment and then revisit a subject that has faded but has the potential to reappear this Spring and Summer (the drought) and conclude with a quick look at housing prices. Well, as expected (how awful that this is what I've come to expect from our elected officials), the can was kicked down the road.

2013-03-04 Out On A Limb - An Investor's Guide to X-treme Monetary and Fiscal Conditions by John Hussman of Hussman Funds

Massive policy responses, directed toward ineffective ends, are scarcely better than no policy response at all. A look at the current monetary and fiscal policy environment, as well as more effective policy initiatives, and why they make sense.

2013-03-01 Front Running the Fed by John Burns of John Burns Real Estate Consulting

We are very bullish on housing, and already thinking through the impact that 3.5% mortgage rates can have if prices rise substantially due to the interest rate stimulus. The Fed has put 34% more purchasing power into the pockets of homeowners, and investors are taking advantage.

2013-03-01 The Fed's Tightening Pipe Dream by Peter Schiff of Euro Pacific Precious Metals

Testifying before the US Senate this past Tuesday, Fed Chairman Ben Bernanke made an extraordinary claim about its bloated balance sheet: "We could exit without ever selling by letting it run off." What Bernanke means here is that the Fed could simply hold its Treasuries and agency bonds until they mature, at which point the government would then be forced to pay the Fed back the principal amount. Through this process, the Fed's unprecedented and inflationary position will be gradually and placidly unwound.

2013-03-01 3 Reasons Market Volatility Has Returned by Russ Koesterich of iShares Blog

In the last week, stocks have pulled back and volatility has once again spiked. Russ outlines the 3 factors that hindered the rally and explains the implications for investors.

2013-03-01 Ed Jamiesons Quick Take on U.S. Sequestration by Ed Jamieson of Franklin Templeton

Overall we are not that concerned about the sequester as it relates to the financial markets. From the research weve seen, if left in place, the sequester could provide a drag on the economy of about half a percent throughout the rest of the year. The markets themselves seem to suggest the economy can grow through sequestration.

2013-03-01 Critical Juncture? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Headwinds have reemerged and investor concern is heightened yet again. We still believe stocks can run further, but a pullback is more likely in the near-term. The sequestration is now in affect but that doesn't necessarily mean it's here to stay and more budget fights loom, particularly in advance of the potential government shutdown on March 27. Meanwhile, some members of the Fed are in favor of scaling back its quantitative easing (QE) program, rattling markets a bit.

2013-03-01 Greetings from Istanbul! by Frank Holmes of U.S. Global Investors

As I travel around Turkey, I am reminded how vital good government policies are to the health of a nation. Following a decade of fiscally responsible actions, Turkey is the picture of a growing prosperity. Perhaps Americas elected officials could take a tip from this vibrant country overseas.

2013-02-28 An Ephemeral Swoon by Scott Minerd of Guggenheim Partners

Although volatility is likely to stay relatively high going forward, the recent move in the markets to risk-off mode appears to be a temporary condition.

2013-02-28 Jeremy Siegel on Why Stocks Are -- and Will Remain -- the Best Bet by Team of Knowledge @ Wharton

Though stock market volatility continues to rattle investors' nerves, the future looks bright for equities in the U.S. and many emerging markets, according to Wharton finance professor Jeremy Siegel. That's not so for bonds, which could become money-losing investments as rising interest rates drive bond prices down. In an interview with Knowledge@Wharton, Siegel says that investors should think about reducing their bond holdings, buying more stocks and keeping just enough cash for a rainy day and other liquidity needs, since interest rates on cash are near zero.

2013-02-27 Understanding the Sequester by David Kelly, David Lebovitz of J.P. Morgan Funds

A recent survey conducted by The Hill found that only 36% of likely voters even knew what the term "sequester" meant. For the record, sequester in our current fiscal lexicon, refers to the $1.2 trillion of spending cuts spread out over the next 10 years that are set to commence on March 1, 2013. These cuts have the potential to impact both the markets and the economy. Although time still remains for a deal to be reached, it seems increasingly unlikely that this will actually occur, making it more likely that the effect of these spending cuts will be felt, at least temporarily.

2013-02-27 Potential Threats to Equity Rally by Chris Maxey, Ryan Davis of Fortigent

Equity markets started a third consecutive year in rather impressive fashion, gaining more than 6% to date. With so much optimism in the investment community, it is always worth keeping an eye open for risks possibly overlooked. By now, it is apparent that investors are increasing their exposure towards equities with arms wide open. Data from the Investment Company Institute (ICI) estimates $39 billion flowed into equity mutual funds this year through February 13. Following outflows of $153 billion in 2012, the sudden reversal has been impressive.

2013-02-27 ING Fixed Income Perspectives February 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Despite its diminutive size, February has been a whirlwind. Eat and drink too much on Fat Tuesday, be reminded of our corporeal nature on Ash Wednesday, receive a sappy Hallmark card on Thursday, and cap it all off with a memorial for a bunch of ex-presidents on Monday. Unfortunately, the next several weeks don't appear to offer any relief from this calendar whiplash.

2013-02-27 The Great Migration by Herbert Abramson, Randall Abramson of Trapeze Asset Management

We are value investors dedicated to creating portfolios for clients, whether growth (equities), income or a balanced blend of both, of undervalued securities with meaningful upside potential and a margin of safety to guard against permanent loss. For us, the bottom-up factors are the most compelling, but we are also mindful that we need to take account of the top-down macro factors. We know how the Crash of ?08 and the accompanying recession created havoc for investors, including us, no matter how undervalued stocks were.

2013-02-26 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 A Permanent Investment by Jeffrey Saut of Raymond James

The Buying Power, and Selling Pressure, indicators continue to suggest no major top is in the works. Ditto the Advance/Decline line traded to a new high before the mid-week pullback, also confirming the upside. The major averages continue to reside above their respect 50-DMAs and 200-DMAs; and, those moving averages are rising, another bullish sign. Then there is Berkshire Hathaway (BRK.A/$152,009/Not Covered), which is somewhat of a proxy for the stock market, as it traded to a new all-time last Friday.

2013-02-26 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).

2013-02-26 2013, Losing the Bid by Bill Smead of Smead Capital Management

Many times in my 32-year career people ask me to comment on whether an established trend for a popular investment will stay intact. My answer is always the same. We don't know when the hot streak will end for the popular investment and we don't feel comfortable with popular securities. In our view, there is a dramatic difference in what you do with popular investments based on whether they areto use terms borrowed from Warren Buffett currency assets, unproductive assets, or productive assets. It has to do with the ability to sell and the liquidity you have when the popularity disappears.

2013-02-25 Fed Will Make Excuses About Inflation by Brian S. Wesbury and Robert Stein of First Trust Advisors

Inflation is tame. For now. The CPI was flat in January and is up only 1.6% from a year ago. The PPI rose a small 0.2% in January and is up just 1.4% from a year ago. And even though energy prices spiked in February, the year ago comparisons are likely to stay tame. The consensus expects the February CPI to rise 0.6% - the largest in 44 months. Nonetheless, it would still show just 1.9% inflation in the past year, which is still below the Federal Reserves target of 2%. This wont last. With the Fed loose; we expect consumer prices to rise toward 3% during 2013.

2013-02-25 Housing, Flight Delays and Another Acronym by Gregg L. Bienstock of Lumesis

This week we start with a look at housing (not what you think), touch on the sequester (how can we not now that folks finally are taking this seriously) and the America Fast Forward Bonds.

2013-02-22 Uncovering 'Diamonds in the Rough' in Today's Credit Markets by Mark Kiesel of PIMCO

There are still good opportunities for yield and total return in the credit markets, but there has been a shift in where and how investors can find them. A "diamond in the rough" is a credit that is under-covered, or not actively followed or researched by many investors. At PIMCO, we identify these opportunities through our top-down and bottom-up investment process. We've identified a number of sectors that appear poised for above-average growth.

2013-02-22 Finding What's Real in Real Estate by Team of Franklin Templeton Investments

The U.S. financial crisis in 2008-2009 left many investors with a reluctance to take investment risks, particularly those related to any of the world's wilted housing markets. However, as your local real estate agent would likely tell you, the market in one location can be vastly different than it is in another. Wilson Magee, co-manager of Franklin Global Real Estate Fund would agree that the adage "location, location, location" applies not only to individual home buyers and sellers, but to investors seeking opportunities in the commercial real estate sector, too.

2013-02-22 A Test of Strength for Gold by Frank Holmes of U.S. Global Investors

This week, we saw the gold bears growling louder and gaining strength, as the worlds largest gold-backed ETF, the SPDR Gold Trust, experienced its largest one-day outflows since August 2011. The Fear Trade fled the sector following the Federal Reserves meeting that revealed a growing dissension among some of its members over the central banks bond-buying program.

2013-02-22 Understanding the Sequester by David Kelly, David Lebovitz of J.P. Morgan Funds

A recent survey conducted by The Hill found that only 36% of likely voters even knew what the term sequester meant1. For the record, sequester in our current fiscal lexicon, refers to the $1.2 trillion of spending cuts spread out over the next 10 years that are set to commence on March 1, 2013. These cuts have the potential to impact both the markets and the economy. Although time still remains for a deal to be reached, it seems increasingly unlikely that this will actually occur, making it more likely that the effect of these spending cuts will be felt, at least temporarily.

2013-02-21 Collateral Damage in the Currency Wars by Scott Minerd of Guggenheim Partners

Global competitive devaluation will continue to cause asset prices to rise in the near-term, but the broader implication of the policies will be increased volatility.

2013-02-20 And That's the Week That Was by Ron Brounes of Brounes & Associates

Tick Tick Tick. The President has plans for improving life in America. Tick Tick Tick. Republicans want to fix the middle class (and restricting taxes on the upper class may help). Tick Tick Tick. Earnings reports look good, but forecasts for the current quarter have been lowered. Tick Tick Tick. Weekly jobless claims keep falling, but major corporations are announcing layoffs. Tick Tick Tick. Sales figures show growth, but Wal-Mart and others are worried. Tick Tick Tick.

2013-02-20 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

The single biggest predictor of financial growth is not how much money we have stashed away in secret savings accounts, but how much confidence we feel about a fair return for the deployment of those dollars. In that sense, corporations and individuals alike uniformly adhere to a quid pro quo matrix. Investing must be fair; it must be reasonable; and, win or lose, it must be swathed in aspiration that makes us feel worth making the investment in the first place.

2013-02-20 Event Driven Investors Receive Their Wish by Chris Maxey, Ryan Davis of Fortigent

For several years, investors have wondered why M&A activity has been so benign.Corporate management teams cited uncertainty about the economic outlook as a primary reason for the depressed activity.With the latest round of tax increases and revenue cuts determined, companies finally appear willing to free their animal spirits and embark on the path of acquisition.

2013-02-20 Stock Market Lingers At A Precarious Place by Gary Halbert of Halbert Wealth Management

The Dow Jones Industrial Average has flirted with its all-time high of 14,198 twice in February as the Dow managed to rise above the 14,000 mark but then fell back. The S&P 500 Index is not quite as close to its all-time high, but it is within striking distance. There is widespread optimism that both indexes can break-out to new record highs, which would likely spark a new buying surge.

2013-02-19 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.

2013-02-16 Seeing the Forest by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Equity markets continue to be resilient and investor confidence is elevated in various sentiment indices, suggesting a near-term pullback is possible. But there are longer-term trends developing that give us hope that the US economy's expansion and market's rally are sustainable. Federal spending cuts via the "sequestration" appear sure to happen, but there will continue to be debates about the nature and size of the cuts. Similarly, questions are increasing as to the potential unwinding of current Fed policy with regard to timing and rapidity.

2013-02-16 When It Comes to Gold, Stick to the Facts by Frank Holmes of U.S. Global Investors

During short-term gold corrections, its much more important to focus on the facts, including the fact that gold is increasingly viewed as a currency. Rather than buying real estate, lumber or diamonds, central banks around the world are buying gold. According to the World Gold Council (WGC), over 2012, central bank demand totaled 534 tons, a level we have not seen in nearly 50 years.

2013-02-15 High Yield Market Overview January 2013 by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index, posted a positive total return of 1.38% in January, as the high yield market continued to rally into the new year.

2013-02-15 International Equity Commentary January 2013 by Team of Thomas White International

International equity prices sustained the uptrend in January, helped by data releases that supported the growing optimism over healthier global economic growth. Though the U.S. and U.K. economies declined unexpectedly during the fourth quarter of last year, the pace of growth improved in several Asian countries, including China, during the period.

2013-02-14 Is Inflation Around the Next Corner? Then What? by Pete Sorrentino of Huntington Funds

As the Federal Reserve Board reiterates its intention to keep interest rates near zero into 2015, it appears that the markets and many investors are growing complacent about inflation. Ever since the Financial Crisis of 2007-08, "headline inflation," as measured by the Consumer Price Index (CPI), has stayed low so far. Although it has threatened to break out at times, economic weakness has restrained the price growth that underlies inflation.

2013-02-14 Pacific Basin Market Overview January 2013 by Team of Nomura Asset Management

Improving expectations for global economic growth underpinned a solid start to 2013 for the Asia Pacific equity markets. In Asia, interest focused on China, as economic data showed further signs of recovery. On the other hand, the depreciating Japanese yen drew concerns that Asia's main exporters, which include Korea and Taiwan, will become relatively less competitive. The MSCI AC Asia Pacific Free Index including Japan gained 3.0% while the MSCI AC Asia Pacific ex Japan Free Index closed 2.6% higher during the month.

2013-02-14 How Not to Run a Pension by John Mauldin of Millennium Wave Advisors

For all the focus on the unfunded liabilities of Social Security and Medicare, there is another unfunded crisis brewing, and this one is in your own back yard. It's coming to you even if you live outside of the US; it just might take a little longer to get there. I wrote ten years ago that state and local pension funds might be underfunded by as much as $2 trillion. It turns out that I was being overly optimistic. New government research suggests that the figure might be as high as $3 trillion. But what if you take into account that retirees are living longer?

2013-02-14 When Politics Trump Economics by Scott Minerd of Guggenheim Partners

The U.S. economic expansion continues, but increasing attention to political risks, and currency wars, in particular, indicate a period of heightened volatility could be ahead.

2013-02-14 Pressure Points: Where Tax Reform Can Be Most Effective by Team of Knowledge @ Wharton

The deficit deal that averted the fiscal cliff crisis at the start of the year raised taxes on the wealthiest and postponed -- for two months -- government spending cuts that threatened to derail the economic recovery. But the problem remains: Spending far exceeds revenue. So what's to be done? Five Wharton faculty members offer their views.

2013-02-13 Our Job: Whether; Market's Job: When by Bill Smead of Smead Capital Management

Warren Buffett describes the stock market's purpose as being "a wonderfully efficient mechanism for transferring wealth from the impatient to the patient". We are reminded of this by a series of news reports and commentaries on subjects greatly influenced by basic economics. In today's missive, we consider what the law of supply and demand says about China, oil, and housing in the USA.

2013-02-13 Trading Secrets: And All Our Yesterdays by Tad Rivelle of TCW Asset Management

Markets work. Not because they are perfect, but because they self-correct. Inherent to their functioning is the ability for buyers and sellers, borrowers and lenders, to freely express their predilection to engage in commercial transactions as proxied by the price mechanism. This is all utterly basic. So, why are the capital markets in general, and the credit markets in particular, not to be trusted to operate without the price and quantity guidance of the Federal Reserve? I

2013-02-13 The Economy: Worst Five Years Since the Depression by Gary Halbert of Halbert Wealth Management

While the many facts and figures below are disappointing, even depressing, Americans need to know the truth about the real state of our economy and our union. Consider what follows as a rebuttal to President Obama's speech tonight. Feel free to forward this to as many people as you wish.

2013-02-11 Shall We Dance? by John Hussman of Hussman Funds

My impression is that the worst investment outcomes have typically followed appeals to the idea that "this time is different," and "you've got to dance as long as the music is playing."

2013-02-11 Stocks: Why "Risk On" Rules by Milton Ezrati of Lord Abbett

Investors appear to believe the equity market will muddle through its many challenges.

2013-02-08 Unconventional Policies and Capital Flows by Ben Emons of PIMCO

Although quantitative easing has grabbed the headlines, a number of central banks around the world have enacted other extraordinary measures in attempts to manage their economies. The Swiss National Bank (SNB), for example, adopted an exchange rate peg versus the euro while increasing its foreign exchange reserves to almost 80% of Swiss GDP.

2013-02-08 Messing with the Bull by Peter Schiff of Euro Pacific Capital

With the announcement this week of its massive $5 billion lawsuit against ratings agency Standard & Poor's, the Federal Government took a bold step to squelch any remaining independence of thought or action in the financial services industry. Given the circumstances and timing of the suit, can there be any doubt that S&P is paying the price for the August 2011 removal of its AAA rating on U.S. Treasury debt?

2013-02-08 Out With the Dragon In With the Snake by Frank Holmes of U.S. Global Investors

Over 2013, we expect the Chinese government to continue its accommodative efforts, which should reinforce the equity rally. In addition, the new pyramid of power is focused on growth, as it seeks to improve and reform policies that will provide its residents with opportunities and social security, increase incomes and raise standards of living, which should encourage domestic consumption. Growth is set to be considerable over the next several years.

2013-02-08 The Year in Review: 2012 by Richard Bernstein of Richard Bernstein Advisors

Politicians crave the spotlight, but it is unfortunate that investors watch the show. 2012, like 2011, was another year in which Washington theatrics scared investors. As a result, investors largely missed out on above average equity returns. Corporate profits and valuations, and not Washington, continue to be the primary drivers of equity returns. We think there are several important points to consider when reviewing 2012 performance, and when structuring portfolios for 2013.

2013-02-07 Commodities: Correlating Trends with Opportunities by Mark Mobius of Franklin Templeton Investments

Commodity price inflation is both a social and an economic issue. In emerging markets in particular, food and energy costs take a deeper slice out of consumers' income, which can lead to the type of unrest that causes governments to topple. In addition to the potential impact of extreme weather on food supplies, central banks around the world are printing a flood of money, which could lead to inflated prices for other goods and services.

2013-02-07 Investing in a Low-Growth World by Jeremy Grantham of GMO

This quarter I will review any new data that has come out on the topic of likely lower GDP growth. Then I will consider any investment implications that might come with lower GDP growth: counter intuitively, we find that investment returns are likely to be more or less unchanged a little lower only if lower growth brings with it less instability, hence less risk. Finally I will take a look at the reaction to last quarter's letter, specifically about my outlook for lower GDP growth.

2013-02-07 We Have Met the Enemy, and He Is Us by Ben Inker of GMO

If modern portfolio management has a single defining urge, it is almost certainly diversification. We look for diversifying assets, strategies, and managers. A thoughtful investor can argue against almost any asset class stocks, bonds, hedge funds, private equity, commodities, you name it but arguing against diversification is like arguing against indoor plumbing. I dont want to sound like I'm calling for a return to chamber pots and outhouses, so I'm not actually going to argue against diversification.

2013-02-06 The January Barometer by Jeffrey Saut of Raymond James

It's that time of year again when the media is abuzz with that old stock market saying, "so goes the first week of the new year, so goes the month and so goes the year." With the S&P 500 (SPX/1513.17) better by 2.17% over the first five trading sessions of this year, and up 6.10% for the month of January, it is worth revisiting the January Barometer. Devised by Yale Hirsch in 1972, the January Barometer states that as the S&P 500 goes in January, so goes the year.

2013-02-06 The Job Market Data and the Fed by Scott Brown of Raymond James

Nonfarm payrolls fell by 2.8 million in January before seasonal adjustment, that is. Adjusted, payrolls advanced 157,000, about as expected. However, annual benchmark revisions showed a more rapid pace of job growth over the last two years a pace at odds with the Household Survey data. How might the Fed view the range of job market data?

2013-02-06 GDP Report Tanks - Is A Recession Looming? by Gary Halbert of Halbert Wealth Management

We will cover a lot of ground today. We begin with a new report from Goldman Sachs which argues that the US economy will remain the strongest in the world for many more years. The report rebuts claims that America is a nation in decline. Quite the contrary, say Goldman analysts who claim that there is a growing"awarenessof the key economic, institutional, human capital and geopolitical advantages the U.S. enjoys over other economies."

2013-02-05 2012 Equity Market Market Year in Review by Natalie Trunow of Calvert Investment Management

Equities started the year strong as global inflation remained tame, and aggressive, accommodative monetary policy by central banks around the globe helped equity markets rally hard off their lows posted in the fall of 2011. Continuously improving U.S. economic data, strong corporate earnings, and policy steps toward mitigation of the sovereign debt crisis in Europe also provided support for the equity markets worldwide.

2013-02-05 Fourth Quarter 2012 Equity Market Review by Natalie Trunow of Calvert Investment Management

With the excitement of the QE3 announcement wearing off in the fourth quarter, market participants refocused on the less-than-stellar earnings season in the U.S. and uncertainties surrounding the U.S. presidential election and impending fiscal cliff, while the negative impact of Hurricane Sandy further dampened investor sentiment. Despite a double-dip recession in the eurozone, there was some progress on the European policy front and China's economy continued to show signs of stabilizing, which helped international stocks outperform their U.S. counterparts.

2013-02-04 2013 Annual Forecast by Clyde Kendzierski of Financial Solutions Group

It's that time again. January will be over by the time you read this which means we are out of holiday excuses or "just ramping up for the new year" reasons for not getting back to work. Having said that, I'd like to offer my excuse for the Annual Forecast getting to you in February instead of the first week of the year. Hand over my heart, we started early this go-round.

2013-02-04 A Look at California, Thoughts on Employment and Why I Worry by Gregg Bienstock of Lumesis

This week we consider recent information and data regarding California, GDP and the employment picture. We also touch on why I worry about the next six months (at least). We conclude with a wrap up of the data imported into DIVER last week and coming road trips. Also, be on the lookout for a Lumesis press release and "Topic of Interest" paper later this week.

2013-02-04 Some Seasonal Blips by Christian Thwaites of Sentinel Investments

We had a week of big numbers last week of which GDP, Personal Income, Durable Goods, the Conference Board's Consumer Confidence, payrolls and the FOMC were the ones that had our attention. We went to print a little earlier this week, so missed the NFPs. But this is what came at us. First GDP. There's a spin to be told but here are the raw numbers with the center column the one that caught markets wrong-footed.

2013-02-01 Q412 Portfolio Commentary by Jay Compson of Absolute Investment Advisers

While much of the fundamental picture has played out as we expected over the past 18-24 months, the financial markets appear to be concerned solely with the existence or non-existence of macro headlines and events. There seems to be a disconnect between market movements and fundamentals which means doing real work based on intellectual honesty and logic puts you at a disadvantage. Chasing momentum and profiting from central bank market manipulation appear to be the current winning strategies.

2013-02-01 Crystallization at Davos by Scott Minerd of Guggenheim Partners

The euphoria among my fellow Davos attendees was palpable, but short and long-term risks for the world's advanced economies, including competitive currency devaluation, remain concerning.

2013-02-01 For All the Sad Words of Tongue and Pen... by Jeffrey Saut of Raymond James

"For all the sad words of tongue and pen, the saddest are these: It might have been." ... John Whittier; an influential American Quaker poet. Certainly, American poet John Greenleaf Whittier's apothegm has stood the test of time, serving as a universal lament for what "might have been." I was reminded of this maxim last week as Wall Street heard increasing laments from investors on the Street of Dreams.

2013-02-01 2013 Economic & Capital Market Outlook by Gregory Hahn of Winthrop Capital Management

It took our country 229 years to accumulate $8 trillion in federal debt. It only took the next eight years to double it to $16 trillion. History shows that when a country accumulates debt at this rapid pace, economic growth languishes. Not surprisingly, Congress is pursuing policies that attempt to inflate the economy. Five years after the Financial Crisis, we really havent fixed much. Instead, we've issued more debt in order to pay our bills and sustain a quality of life society cannot afford long term.

2013-02-01 Dow To 14,000 and Beyond? by Frank Holmes of U.S. Global Investors

So will the Dow go beyond 14,000? Although you cant predict how hot the weather will be this summer, the clouds appear to be parting to reveal the sun today. Make sure your asset allocation positions your portfolio to shine.

2013-02-01 Look at the Bears! Look at the Bears! by Christine Hurtsellers, Matt Toms and Mike Mata of ING Investment Management

Yes, the grumbling of bond bears is reverberating in Treasury yields, but that sound isnt the death knell of a grizzly; at this point, the closest ursine analogue is Boo-Boo Bear.

2013-01-31 China's Market Ups and Downs by Mark Mobius of Franklin Templeton Investments

China's stock market was a roller coaster in 2012, and those investors with a weak stomach for unpredictability probably found the ride unpleasant. Its true that by many measures last year's weak market performance in China's A share market was disappointing, but in a market of this size the story isn't all good or all bad, so unlike the market masses, I remain confident about China's prospects and continue to search for long-term investment opportunities in China.

2013-01-31 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.

2013-01-30 U.S. Debt Crisis End-Game Looms in 3-5 Years by Gary Halbert of Halbert Wealth Management

Last week, one of the most respected research groups in the world predicted that the US likely has only 3-5 years before the wheels fall off and the world is thrust into a major financial crisis, possibly even a depression. We'll talk about all of these things as we go along today. But before we go there, let's take a brief look at the economy before tomorrow's advance (first) estimate of 4Q GDP.

2013-01-29 And That's the Week That Was by Ron Brounes of Brounes & Associates

The trend is your friend...so hopefully it will continue for a little (lot) longer. With the uncertainty of the fiscal cliff on the backburner (for now), investors seem to like what they are seeing from earnings season and in the economy. They continued to take stocks higher as the S&P 500 settled above 1500 for the first time in five years and is currently riding a eight session winning streak.

2013-01-29 How Much Help from Housing? by Alan Levenson of T. Rowe Price

We expect the ongoing recovery in new housing construction from unsustainably low levels to contribute roughly percentage point to real GDP growth this year, and emphasize the risks to the upside of this forecast. Imminent employment growth in housing-related industries will provide an important channel for secondary "multiplier" effects of the housing recovery. Applying recent house price increases to the entire stock of owner-occupied housing overstates their likely wealth effect on consumer spending.

2013-01-29 In Japan We Trust by Chris Maxey, Ryan Davis of Fortigent

In fewer than 60 days, one country has made a splash larger than all the others. No, we are not referring to the US, where Barack Obama was re-elected to a second term. Nor are we referring to China's recent transition of power. Instead, the country we reference is Japan. After decades of malaise, Japanese officials moved to embrace policies previously only accepted by Western officials.

2013-01-28 A Few Things to Consider. Plus a Look at Maine and Illinois by Gregg L. Bienstock of Lumesis

This week's commentary is a slight departure from our standard format. It's been a few weeks since we mentioned the fiscal cliff, sequestration and the like. This is due to our collective saturation and the perspective of so many that the problem was solved. Well, we want to provide a reminder or two and throw a few thoughts at you to kick around. We conclude with a quick look at Maine and Illinois.

2013-01-25 Feeding the Dragon: Why China's Credit System Looks Vulnerable by Edward Chancellor, Mike Monnelly of GMO

Edward Chancellor and Mike Monnelly, members of GMO's Asset Allocation team, write to institutional clients in a new white paper about China's credit boom and outlines some worrying recent developments in its financial system. In GMO's view, "China's credit system exhibits a large number of indicators associated with acute financial fragility," including China's debt and real estate bubbles, the belief that the government is underwriting financial risk, the shadow banking system, a proliferation in credit guarantees, among others.

2013-01-25 Americas: Regional Economic Review 4Q 2012 by Team of Thomas White International

The outlook for most economies in the Americas region improved during the fourth quarter as domestic consumption growth was sustained and the anticipated revival in global demand has lifted the prospects for export growth this year. Partly helped by fiscal and monetary policy measures introduced since 2011, consumer demand has held up across most countries in the region.

2013-01-25 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 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.

2013-01-25 Resource Investors: Why You Can Expect Sunnier Days Ahead by Frank Holmes of U.S. Global Investors

During the current commodity supercycle, there have been occasionstoo many to countwhen investor psyche has been damaged by reports about slowing U.S. growth, a hard landing in China or a debt crisis in Europe. Yet just behind the gloom, significant and positive trends are taking hold, causing the storms to start dissipating.

2013-01-25 High-Yield Wont Bubble Over by Gershon Distenfeld of AllianceBernstein

High yield may be a bit pricy these days, but we dont see a bubble building. In fact, we think the structural characteristics of bonds and the behavior of bond investors make a bubble nearly impossible.

2013-01-24 Quick Takes on the Investing Year Ahead by Sam Wardwell of Pioneer Investments

We covered a lot of market and investment topics at Pioneer's National Sales and Marketing Meeting last week. Here are some notes on a few that were popular: GDP Growth for the U.S.. Expectations for rates: Fed Funds Rate and the 10-year Treasury, EM equities favored over U.S. Equities?, Things that keep us up at night (outside of the debt ceiling, Europe, and Middle East tension.

2013-01-24 Get Your Funk Out by Jim Goff of Janus Capital Group

I manage investment professionals for a living. When an analyst gives me the positives on one hand and the negatives on the other hand, but offers no conclusion, I want to cut one of those hands off. The best analysts understand all the issues but come to well-founded views.

2013-01-24 Escape Velocity in the Economy by Scott Minerd of Guggenheim Partners

The broad improvement in U.S. economic data indicates that the economy is likely to continue to expand, supporting earnings growth and pointing to an eventual return of leveraged buy outs.

2013-01-23 Ignore the GDP Headline by Brian Wesbury, Bob Stein of First Trust Advisors

Next week, Fourth Quarter Real GDP will be released. Our forecast of 0.9% annualized growth, if correct, will encourage the pessimists to continue fretting about the economy in the year ahead. But we will ignore that dour response. Beneath the surface of the report will be evidence that the plow horse economy is picking up some steam.

2013-01-23 Economic Backdrop Supports Stocks, Credit Sectors and Munis by Russ Koesterich of BlackRock Investment Management

Thanks to solid earnings, some decent (if mixed) economic news and indications that the debt ceiling debate may be delayed slightly, stocks posted additional gains last week, continuing their strong start to 2013. For the week, the Dow Jones industrial average climbed 1.2% to 13,649, the S&P 500 index advanced 1.0% to 1,485 and the NASDAQ composite rose 0.3% to 3,134. Bonds have remained relatively steady, with the 10-year Us treasury closing the week at a yield of 1.84%, two one-hundredths lower than the previous Friday close.

2013-01-23 The Year of the American Consumer by Philip Tasho of TAMRO Capital

It was an above-average year for stock returns across the domestic market cap spectrum. Ultimately, unconventional and accommodative monetary policy trumped investor concerns over fiscal policy, the Presidential election and weakness overseas. The Federal Reserve (the Fed) entered uncharted waters when it announced open-ended quantitative easing through the ongoing purchasing of government securities. Importantly, other central banks globally waded in by mimicking the Fed in word if not deed and the global liquidity cycle continued apace.

2013-01-23 Inflated Expectations? by Kristina Hooper of Allianz Global Investors

Investors should prepare themselves for higher long-term inflation because the market may be ignoring it, a mistake that could come back to haunt. On the heels of encouraging economic data, central bankers are projecting only modest price increases for goods and services over the next 10 years. But history tells us that an inflation spike is inevitable when governments print money so aggressively. As such, investors with long-term time horizons should have substantial exposure to inflation-hedging asset classes. Now, more than ever, real returns matter.

2013-01-23 Is the European Crisis Over? by Chris Maxey, Ryan Davis of Fortigent

The European sovereign debt crisis that first erupted in 2010 and stoked almost three years of intense market volatility has all but faded from the front pages. Overshadowed by domestic policy issues and European Central Bank (ECB) President Mario Draghi's pledge to do "whatever it takes" to save the Eurozone, fears that the monetary union would crumble and unleash a maelstrom of financial distress appear to have dissipated.

2013-01-23 PIMCO's Secular Forum Preview by Mohamed El-Erian of PIMCO

It is almost time again for PIMCO's Secular Forum a critical part of the firm's investment process. This annual event, which takes place each May, brings together our investment professionals from around the world to debate and specify the key themes that we believe will affect the global economy and, consequently, our investment strategies over the next three to five years from asset allocation and relative value positioning to returns expectations and risk management.

2013-01-23 Avoid Disappointment, Aim Low by Christian Thwaites of Sentinel Investments

No, it's not a life aspiration. But it can work when it comes to investing. We had a rush of gains coming into the end of the year with the S&P up 22% over the year. But it's also one of the more relaxed markets and start we've had in years. The political agenda is still front and clear and we're in a lull until the debt ceiling arguments gain steam. The markets know this but seem comfortably complacent. They're probably right to be.

2013-01-23 It's What You Learn After You Know It All That Counts. by Jeffrey Saut of Raymond James

January is the time of year when strategists, economists, gurus, etc. all join in on the annual nonsense of predicting "What's going to happen in the markets for 2013?" For many, this ritual is an ego trip, yet as Benjamin Graham inferred forecasting where the markets will be a year from now is nothing more than rank speculation. Or as I have noted, "You might as well flip a lucky penny."

2013-01-23 Developed Asia Pacific: Regional Economic Review - 4Q 2012 by Team of Thomas White International

Developed Asia Pacific economies witnessed mixed economic fortunes during the fourth quarter of 2012. While the group's largest economy, Japan, suffered from stubborn deflation and slumping trade due to a bitter territorial dispute with China, Singapore and Hong Kong managed to fare better.

2013-01-22 And That's The Week That Was by Ron Brounes of Brounes & Associates

Tragedy in Algeria brought another reminder about just how dangerous the world can be. Oil prices rose on the enhanced turmoil in the region as well as on news that supplies unexpectedly dropped in the recent gov report. Financials led earnings season in a mostly positive way, though several releases included reminders about the financial crisis and the greed factor of certain professionals. The favorable economic data was well received as S&P 500 index again hit a five-year high though even the optimists remain cautious as the budget negotiations yield little positive results.

2013-01-22 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company

2012 was a year of mixed results on the economic front, but generally good investment returns as measured by the S&P 500 Index. Some progress was made in Europe and China, and some clarification in direction was made in the U.S. We presented our thoughts on these topics at our December 6 seminar; an archive will be available on our website.

2013-01-22 Pensions, Housing and The Inauguration by Gregg Bienstock of Lumesis

This week we look to 2011 pension data for States and Cities and zero in on funded ratios, unfunded liabilities and some of the assumptions of the underlying plans. We also touch on recent housing data that gives us some hope and offer some thoughts following inauguration day. We conclude with a reminder to take a look at the MMA/Lumesis FAQ addressing Municipal Holdings and OCC/FDIC Compliance.

2013-01-22 Equities Set to Break Out of the Bear Trap by Catherine Wood of AllianceBernstein

In the face of significant uncertainties, US and global equities rallied in 2012 and at the start of the New Year. We think there might be more to come as stocks break out of the bear trap.

2013-01-22 Consumer Staples: Don't Overpay for Safety by Russ Koesterich of iShares Blog

Many investors have flocked to the perceived safety of defensive sectors over the past few years, including consumer staples. But Russ gives three reasons they might want to think twice about the sector now.

2013-01-22 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.

2013-01-22 Year-End Investment Commentary by Team of Litman Gregory

Stocks shrugged off numerous worries to log a very good year in 2012, but can markets continue to climb? Certainly the worries remain. The most immediate has to do with the spending side of the fiscal cliff. The cliff deal made permanent the Bush tax cuts for all but high-income taxpayers but it did not address spending. So while the worst case of the cliff was avoided, the work is not nearly done. In this commentary we discuss our current assessment of the investment environment including a detailed look at what could go right, and tie it all back to our portfolio positioning.

2013-01-18 2013 International Outlook by Colin Moore of Columbia Management

We continue our outlook for 2013 with a review of select international economies and financial markets. Similar to the U.S. the road to recovery will be bumpy and we expect financial markets to continue being affected by macroeconomic uncertainties. While the overall environment remains uncertain, some of the significant headwinds in 2012, e.g. the Chinese leadership transition and a complete disintegration of the eurozone, are perhaps less concerning for markets than they were a year ago.

2013-01-18 Equity Investment Outlook January 2013 by Team of Osterweis Capital Management

Despite many headwinds and amid great uncertainty, both the U.S. economy and stock market enjoyed a rather good year in 2012. Real Gross Domestic Product ("GDP") grew around 2%, and the stock market, as measured by the S&P 500 Index, returned 16%. At the risk of sounding complacent, we believe that the fundamental trends that produced such favorable results in 2012 are still in place and should support another good year in 2013.

2013-01-18 Are Central Banks Easing Off Prematurely? by Team of Northern Trust

Are central banks easing off prematurely? Washington is girding for another budget imbroglio; Inflation is contained, for now.

2013-01-18 4 Sensational Facts About Gold Investing That You Might Not Know by Frank Holmes of U.S. Global Investors

1. Gold has been a consistent performer over the decades. 2. Gold should remain a hot commodity in 2013. 3. Gold is the least volatile commodity on the table. 4. The last four years were better than you thought.

2013-01-17 International Equity Commentary December 2012 by Team of Thomas White International

International equity prices made robust gains in December, as further improvement in economic trends across most regions lifted the outlook for 2013. Policymakers in the U.S. managed to put together an agreement at the last minute and averted the 'fiscal cliff', one of the major risks that had restricted investor sentiment during earlier months. In Europe, though economic signals remain largely weak, the further fall in bond yields of the troubled countries has helped sustain optimism about resolving the region's fiscal crisis this year.

2013-01-17 Rehab: An Update on Housing Recovery by Liz Ann Sonders of Charles Schwab

The National Association of Home Builders' Housing Market Index has staged a record-breaking run higher. Home prices have been rising and are feeding into real mortgage rates, consumer confidence, household net worth...and pushing fence-sitters off the fence. Housing's contribution to job growth could push the unemployment rate down more quickly than many believe.

2013-01-17 End of An Era: 30 Years of Double-Digit Chinese Growth by Bryce Fegley of Saturna Capital

Slumping exports, lackluster domestic consumption, and slowing urban migration contribute to lower growth expectations for China. With Chinese manufacturing capacity now saturated relative to global demand, and developed economies facing the consequences of over-indebtedness, external tailwinds to China's growth have passed.

2013-01-16 The Rise of Asia's REITs by Sherwood Zhang of Matthews Asia

Real estate investment trusts (REITs) in Asia are following in the footsteps of their U.S. counterparts as they become an increasingly important asset class attracting investors looking to gain exposure to a diversified pool of real assets and relatively high yields. In the past decade, REITs have become a growing force in the regions investment universe. This month Sherwood Zhang, CFA, takes a look at just how far Asia's REIT markets have come, and what new opportunities as well as risks may still exist.

2013-01-15 Template for a Year-End Client Letter 2012 in Review: Learning from the Past, Looking to the Future by Dan Richards (Article)

Client concerns about whether you're on top of things can be reduced by sending regular overviews of what's happened in the immediate past and the outlook for the period ahead. That's why each year since 2008, I have posted templates to serve as a starting point for advisors looking to send clients an overview of the year that just ended and the outlook for the period ahead.

2013-01-15 Forecast 2013: Unsustainability and Transition by John Mauldin of Millennium Wave Advisors

As we begin a new year, we again indulge ourselves in the annual rite of forecasting the year ahead. This year I want to look out a little further than just one year in order to think about the changes that are soon going to be forced on the developed world. We are all going to have to make a very agile adaptation to a new economic environment (and it is one that I will welcome). The transition will offer both crisis and loss for those mired in the current system, which must evolve or perish, and opportunity for those who can see the necessity for change and take advantage of the evolution.

2013-01-15 Are Investors Buying into the Equity Story? by Chris Maxey, Ryan Davis of Fortigent

Last week we discussed the debate over active versus passive management. We believe active managers can add tremendous value in particular segments of the market, despite recent challenges. Outside of the active management discussion, many investors are deciding whether equities are a prudent place to allocate capital at this point in the market cycle. The first week of the year answered investors' opinions on that question loud and clear.

2013-01-15 New Year's Vantage Point: Christopher Molumphy by Christopher Molumphy of Franklin Templeton Investments

For a view on the U.S. and global fixed income market and potential opportunities therein, we turn to Christopher Molumphy, CFA, chief investment officer of Franklin Templeton Fixed Income Group.

2013-01-15 It's Not What Happens That Matters by Bill Smead of Smead Capital Management

Late in 2008 and in early 2009, a group of what we like to call "brilliant pessimists" hit the airwaves with their economic theories. The prognosticators' vision of the future was and is predicated on the history of similar situations and the mathematical realities of the huge debt overhang from the prior ten years of profligate economic behavior. They put very effective names on their visions like "new normal" and "seven lean years". They marketed their visions incredibly well to the point of shaming anyone who might disagree with their theories.

2013-01-15 Emerging Markets Equity Commentary: December 2012 by Team of Thomas White International

Emerging market equities outperformed during the month of December, helped by signs of further improvement in the economic growth outlook. Economic data released over the month were largely positive for most emerging countries, and strengthened the optimism that these markets could see a moderate improvement in growth rates during 2013.

2013-01-15 From Cliff to Ceiling! by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

When it was all said and done not much happened in the final quarter of 2012. Anxiety picked up immediately after the election as the bickering over the fiscal cliff escalated. In the end, the worst-case scenario was avoided at least for a couple of months and stocks ended about where they began the quarter.

2013-01-14 And That's the Week That Was by Ron Brounes of Brounes & Associates

Finally, a week not totally dominated by "fiscal cliff" discussions (though politicos now have their hands full with a gun control debate...what are the chances of compromise there?). Alcoa kicked off earnings season as usual and the early results lend credence to the thought that China will again be relied upon to lead any global recovery. Major banks announced major settlements as they continued to try to close the (negative) books on the financial crisis. Oil rose on Saudi production cuts.

2013-01-14 The More Things Change... by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

One crisis averted...another one on the way? Of course, but we're still positive on the US economy and stock market.

2013-01-14 Equity Market Review & Outlook by Richard Skaggs of Loomis Sayles

While the S&P 500 Index posted a slightly negative fourth-quarter return, the Index's 16.0% return for all of 2012 was notable in the face of a long list of global fundamental concerns. Midcap and small cap stocks performed better during the ?nal three months of the year, posting gains of roughly 2.0%-3.0%. The fourth quarter outperformance of smaller stocks was enough to overtake the S&P 500 for the year, but just fractionally.

2013-01-14 Population Trends, The Labor Force and a Look at the Muni Index by Gregg Bienstock of Lumesis

We start this week with a look at the DIVER Muni Index and then jump into a discussion about population trends, employment and wages. If you get no further than this opening, the short of it is that you really need to look closely at the data and where things are getting better really and where things are perceived to be better. This is especially so as some pundits suggest the higher tax rate on the wealthy will be beneficial to muni-land as more wealthy people seek to offset the increased tax burden.

2013-01-14 Crosscurrents and Contradictions: Which Way Will Municipal Bonds Go? by Tom Dalpiaz of Advisors Asset Management

The two possible scenarios outlined are quite different with very different outcomes for municipal bonds, and that is what makes any 2013 municipal bond outlooks difficult to offer with certainty. Scenario 1 will likely have a relatively benign impact on municipal bond values while the impact of Scenario 2 will be more negative. Of course, the possibilities municipal bond investors will face this year include more than just the two stark contrasts presented above.

2013-01-11 Special Edition: The Outlook for 2013 by Team of Northern Trust

At this time of the year we typically get warm and generous wishes for the New Year and, of course, numerous questions about what our crystal ball has in store for 2013. While many economists publish their perspectives prior to January 1, we opted to wait in the hope of having a clear fiscal picture for the United States. A lot of good that did us...

2013-01-11 Invest In Equities: Your Future Self May Thank You by Frank Holmes of U.S. Global Investors

Investors have had an illusion about the stock market since the financial crisis. With the barrage of negative headlines and abhorrence toward risk, investors seemed to feel that equities would not improve going forward. This turned out to be a mistaken belief.

2013-01-11 Thanks, Everybody...We'll be Right Back! by Colin Moore of Columbia Management

The Washington Comedy Club has taken a brief intermission and will be back in session shortly to resume the show. Please enjoy the facilities of this great country, free of charge, while you wait. Ignore the "Nero" character in the far corner playing the fiddle. Apparently, he isn't part of the show. Economic uncertainty emanating from fears of the U.S. fiscal cliff has been deferred but not avoided.

2013-01-10 Market Perspectives Q4 2012: Politics vs. Economics by Richard Michaud of New Frontier Advisors

The major news of the quarter was that a fiscal cliff deal passed in the final hours of the 112th Congress and was signed by President Obama. The deal averts tax increases on most Americans and prevents large indiscriminate cuts in spending in many government programs. It also averted, by nearly universal consensus among macroeconomists, tipping the American economy into recession with attendant global implications.

2013-01-10 Inflation Propaganda Exposed by Peter Schiff of Euro Pacific Capital

Economists who hold the popular view that expanding the money supply will provide the best medicine for our ailing economy dismiss the inflationary concerns of monetary hawks, like me, by pointing to the supposedly low inflation that has occurred during the current period of rampant Fed activism.

2013-01-09 Ten Acts for Chairman Bernanke in January 2013 by Tony Crescenzi of PIMCO

Federal Reserve Chairman Ben Bernankes term ends in January 2014, and it is unclear whether he will stay on for another. We expect Bernanke will muster every means he can over the next year to help the U.S. and indeed the world emerge from a gloomy time.Here, then, are 10 items we suggest for Ben Bernankes to-do list in 2013.

2013-01-08 Letter to the Editor by Various (Article)

A reader responds to our interview, Jeremy Siegel on 'Dow 15,000,' which was published on December 18.

2013-01-08 Why China Won't Crack by Milton Ezrati of Lord Abbett

For the world's second largest economy, a hard landing scenario looks increasingly remote.

2013-01-07 Fixed Income Asset Allocation Post-Apocalypse by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

December 21, 2012 the day the Earth was prophesized to collide with a black hole of kaputness has come and gone in defiance of the Mayan calendar. The more upbeat interpretation of the 5,125-year Mayan cycle, however, is that the end date doesn't signify Armageddon but rather the beginning of a new time for positive change here on earth. So allow us to suggest an investment playbook to cash in on this silver lining. In short, the sweetness of the metaphorical fortune cookie in your hand will depend on how you allocate your fixed income assets in 2013.

2013-01-07 Restricted Room for Higher Rates by Scott Minerd of Guggenheim Partners

Interest rates should rise through 2013, however, the level to which they can increase will be limited by the Federal Reserve's ongoing attempt to stimulate activity in the housing market.

2013-01-07 Jobless Claims, a Surprising Result, Philly Fed and Ambr by Gregg Bienstock of Lumesis

This week we provide some thoughts on the recent Cliff deal and plunge into some surprising data regarding jobless claims. We conclude with a look at the Philly Feds Leading Index.

2013-01-07 White Noise? by Jeffrey Saut of Raymond James

"Investing in the financial markets necessarily involves one's ability to change perspectives over time... And there's more of the white noise than ever before."... The Contrary Investor.com. So said the Contrary Investor; and I could not agree more given my sense that the media remains "long" volatility. Indeed, every time volatility increases, so do my phone calls from the financial media as they feel "compelled to come up with rationales for daily movements in asset prices;" last week was no exception.

2013-01-07 Investments That May Keep Me Up at Night in 2013 by Charles Lieberman (Article)

The outlook for 2013 is quite improved compared with 2012. Domestic economic growth prospects are significantly less troublesome. The election is over. Europe has (painfully) slowly made progress in reducing its own budget problems. It is not all clear sailing, however. (It never is.) Europe remains a work in progress. All of the geopolitical risks of 2012, notably North Korea, Iran, and all of the rest of the Middle East, remain on the docket in 2013. And the battle over the U.S. budget will resume in the near future.

2013-01-06 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.

2013-01-04 In 2013, Resolve to Follow the Money by Frank Holmes of U.S. Global Investors

During these first days of January, many adopt an out with the old, in with the new, approach to shed bad habits or extra pounds. Washington opted for its same ol strategy when averting the fiscal cliff, as the addictive nature of can-kicking is a transatlantic sport, according to The Economist. The short-term fix did nothing to control the unsustainable path of entitlement spending on pensions and health care nothing to rationalize Americas hideously complex and distorted tax code... and virtually nothing to close Americas big structural budget deficit.

2013-01-03 Beyond the Fiscal Cliff by Richard Bernstein of Richard Bernstein Advisors

Politicians love the spotlight, but it is very unfortunate that investors watch the show. The drama of the so-called "fiscal cliff" has scared investors, and led them to miss a very good year in the equity market (the S&P 500's total return was 16.0% during 2012 versus the long-term annual average of 11.8%). It appears as though Washington wants to continue to dominate the headlines, which means that it may be more important than ever for investors to downplay Washington's theatrics.

2013-01-03 ProVise Bullets by Ray Ferrara of ProVise Management Group

HAPPY NEW YEAR EVERYONE!We don't know what you did on Monday night to ring in 2013, but the U.S. Senate was in session as they were attempting to avoid the so-called "fiscal cliff".At 2:07 a.m. on New Year's Day the Senate passed a bill, 89 to 8, which does a number of different things.Then late that same morning, the House also passed the bill.We are going to touch on a few of the highlights in this opening Bullet and promise to give a more detailed analysis in our mid-month Bullets.

2013-01-03 And That's the Week That Was by Ron Brounes of Brounes & Associates

Welcome to the end of 2012. Investors are hardly basking in the glow of a positive year for stocks. They are less than enthusiastic about the recovery in housing. They seem to be overlooking the actions of the Fed and the implications for the indefinite low rate environment. Two words remain firmly entrenched in the minds. FISCAL CLIFF. What say you (besides bickering and backstabbing)Prez O, Speaker Boehner, Senators McConnell and Reid? Time is running out and five straight down days proves that investors are growing more and more nervous. Happy New Year (I think).

2013-01-03 Outlook 2013: Fiscal Cliff Remains Unresolved, but Opportunities Still Exist by Russ Koesterich of BlackRock Investment Management

As we look ahead to 2013, it is impossible to make any sort of forecast without first turning our attention to the still-unresolved fiscal cliff debate. We have long said that unless we were to see significant movement on the issues of tax rates and entitlement spending, the most likely outcome would be some sort of bare-bones deal. At the time of this writing, congress and the President were still negotiating, but our analysis suggests that such a bare-bones resolution remains the most probable result, even if it does not come before the January 1 deadline.

2013-01-03 2013 Forecast: Good Economy, Challenged Markets by Douglas Cote, Karyn Cavanaugh of ING Investment Management

We enter 2013 bombarded by conflicting signals. While fundamentals have been mixed of late, longer-term themes our "tectonic shifts" like the energy revolution are gaining momentum and promising to make positive contributions sooner rather than later. And while salutary measures taken by policymakers have eased global risks and lessened fears of Armageddon, there is considerable work yet to be done.

2013-01-03 And That's the Quarter that Was by Ron Brounes of Brounes & Associates

Politics ruled the day over the past three months (and beyond) and unfortunately the trend may very well continue as the averted "fiscal cliff" was merely postponed for another two months. For now, investors are happy, but what will tomorrow bring? (That's a question for you, Prez Obama and Speaker Boehner.) Happy New Year

2013-01-03 Taking Care of Business, DC-Style, to Avert the Fiscal Cliff by Liz Ann Sonders of Charles Schwab

No "grand bargain," but Congress got a deal done at the 13th hour to avert the fiscal cliff. The next two months will bring more DC wrangling and likely market angst, but we believe the outlook has brightened for the economy and market in 2013. The "wall of worry" is alive and well.

2013-01-02 Brian McMahon on Thornburg?s Investment Income Builder Fund by Robert Huebscher (Article)

Brian McMahon is the chief executive officer and chief investment officer for Thornburg Investment Management, where he the co-portfolio manager for the $11.4 billion Thornburg Investment Income Builder Fund (TIBAX). The fund's goal is income production, and it has outperformed its benchmark, the Morningstar Moderate Target Risk, over the last ten years (10.87% versus 2.88%). In this interview, he offers his views on the economy and the markets, and how he has positioned his fund.

2013-01-02 Deal or No Deal? Assessing a Bare Bones Fiscal Plan by Russ Koesterich of iShares Blog

A grand bargain in fiscal cliff negotiations remains elusive, but a bare bones deal seems likely. Russ K explains what that means for the economy and investors.

2012-12-31 And That's the Week That Was by Ron Brounes of Brounes & Associates

Welcome to the end of 2012. Investors are hardly basking in the glow of a positive year for stocks. They are less than enthusiastic about the recovery in housing. They seem to be overlooking the actions of the Fed and the implications for the indefinite low rate environment. Two words remain firmly entrenched in the minds. FISCAL CLIFF. What say you (besides bickering and backstabbing)Prez O, Speaker Boehner, Senators McConnell and Reid? Time is running out and five straight down days proves that investors are growing more and more nervous. Happy New Year (I think).

2012-12-28 Readers' Golden Nuggets Focused on Gold, Resources and Overcoming Negativity by Frank Holmes of U.S. Global Investors

The past few days Ive been counting down the most popular commentaries over the past year. China, commodities and bond fund popularity were big hits; so were the Surprises in Gasoline, Oil and Resources Stock Prices. Here are the top four.

2012-12-24 And That's the Week That Was by Ron Brounes of Brounes & Associates

Down to the homestretch. While investors generally spend the last few days of the year window-dressing and setting positions for the next, this year they face the added uncertainties of the "fiscal cliff" and the negative implications for the economy. Though the data of the week seemed positive and reflective of "solid" (too strong?) growth, the budgetary matters and inability of our "best and brightest" to work together do not bode well. So much for Plan B. Perhaps a late year holiday gift is still in order?

2012-12-21 Light at the End of the Tunnel for Gold by Frank Holmes of U.S. Global Investors

Intuition was telling me something was going on these past few days in the gold market. Our investment team was watching gold and gold stocks take a tumble for no obvious reason. It wasnt only us who felt this way: many analysts were caught off-guard. One comment from Barclays Research indicated that the week was unusually brutal with quite a few confused participants with some seemingly positive aspects of the market not having an impact.

2012-12-20 Don't Confuse Market Hiccups for Economic Heart Attacks by Matt Lloyd of Advisors Asset Management

The daily bombardment of moving toward an agreement on the fiscal cliff only to see a hesitation on the advancement is symptomatic of the tango that we have been bombarded with over the last several years. It does appear though that we are becoming a bit desensitized to the two-steps forward to two-steps back pattern we have been accustomed to in similar debt ceiling deadlines or budgetary standoffs. In looking at the markets move and comparing statements from the two parties involved, it does appear we are at least in the same ball field for negotiations.

2012-12-20 The Limits of Monetary Policy by Scott Minerd of Guggenheim Partners

With unemployment levels remaining stubbornly elevated, investors should not expect a reversal of quantitative easing by the Federal Reserve in 2013.

2012-12-19 Imagine...a Better Future by Liz Ann Sonders of Charles Schwab

After a weekend of sadness and reflection, I wanted to write something more optimistic we'll go back to the future to learn and unlearn.

2012-12-19 ING Fixed Income Perspectives December 2012 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

While all the good little boys and Cindy Lou Whos dream of sugar plums and new iPhone 5s in blue, the adults in our modern-day Christmas story can't sleep but a wink, as visions of getting Scrooge'd by the fiscal cliff are making hearts sink. No matter if this political humbug cease or persist, down the chimneys of a recuperating housing market Ol' Saint Bernanke-olas will continue to gift $85 billion of Treasury and MBS purchases per month or more until the labor market can finally get over the hump and deliver 6.5% unemployment and inflation of 2.5% and no more.

2012-12-18 Jeremy Siegel on 'Dow 15,000' by Robert Huebscher (Article)

Jeremy Siegel was one of very few individuals to have correctly predicted the strong performance of the equity markets over the last year. The Wharton professor and author of the renowned book, Stocks for the Long Run, forecasts continued strong performance for the year ahead.

2012-12-18 Three Takeaways from the Fed by David Rosenberg (Article)

The equity market likes the prospect of more money printing and the Fed's more forceful efforts to reflate the economy, and stocks are a far better inflation hedge than bonds.

2012-12-18 Better Angels by Michael Lewitt (Article)

If all else fails, President Obama should lock the members of Congress inside the Capital about a week before Christmas, post the military at the door, hang big-screen television in each chamber, tune them to CNBC, and turn up the volume up. Faced with listening to endless repetitions of the words "rising above" or "fiscal cliff" or "kick the can down the road," our legislators will have no trouble reaching a compromise quickly.

2012-12-18 The Case for Conservative Optimism by Clark M. Blackman II (Article)

Advisors should heed the wisdom from George Washington: Troubles pass. Tomorrow will be better. This kind of optimism is the key to finding success as an investor, as a businessperson, and in life.

2012-12-18 What's Going Right? by Chris Maxey, Ryan Davis of Fortigent

Discussions of the fiscal cliff are capturing investor's attention, largely at the expense of trends pointing in the right direction. Year-end is synonymous with future prognostications, but current indicators suggest there is reason to be optimistic about the turn of the calendar this holiday season.

2012-12-18 The Fed's Giant Stride by Christian Thwaites of Sentinel Investments

FOMC: The news from this meeting was widely telegraphed (see Yellen, Evans, etc. last month) but produced some real and welcome developments. Here's the quick summary.

2012-12-17 And That's the Week That Was by Ron Brounes of Brounes & Associates

Time for some year-end window dressing (before investments fall off the fiscal cliff). With little to no progress to report on the budget, politicos continue trying to earn brownie points at home, while losing them in the press. Investors still seem to believe a deal will be reached, but with the holidays (and vacations) approaching, time is really of the essence. Retailers and manufacturers rebounded in November from superstorm Sandy, but the cliff still looms as a definite possibility.

2012-12-17 I'm Dreaming of a Green Christmas by Jeffrey Saut of Raymond James

While last week, and this week, often see distortions in individual stock prices due to tax loss selling, Santa Claus tends to arrive the following week. Indeed, the last week of the year, into the first two days of January, has a pretty good track record on the upside with a rally coming about 65% of the time. As stated in previous missives, I expect the same Santa rally this year driven by a "staged in" solution to the fiscal cliff. Most readers know that I have lived in the D.C. Beltway and have a good working knowledge of how our system works.

2012-12-15 Looking Back to Look Ahead by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Markets have been more focused on short-term forces; not least being Washington and the fiscal cliff negotiations. But taking a step back and gaining some longer-term perspective can help investors better weather short-term volatility. Even beyond the fiscal cliff, Washington and fiscal policy will likely remain in focus next year. Monetary policy is also front-and-center with the Fed maintaining its extremely accommodative policy and targeting specific economic conditions instead of providing calendar guidance. Europe managed to make it through the year, but challenges and risks remain.

2012-12-15 ProVise Bullets by Ray Ferrara of ProVise Management Group

So help us understandwhere did 2012 go? While we know time really fly, it sure feels like it does when we think that 12 months have almost passed. We want to wish you and your family the happiest of holidays! Please remember the women and men serving in our Armed Forces, especially those overseas.

2012-12-15 Saving for Retirement Stage 2: The Sandwich Generation by Team of Franklin Templeton

Youve probably heard of the term sandwich generation, a time at mid-life when many individuals find themselves caring simultaneously for their children and their aging parents. Its a time when investment dollars can get squeezed out by day-to-day and unexpected expenses, a mortgage and possibly even a college savings plan. In this second of our three-part Investing for Retirement series, we take a look at some retirement savings strategies for individuals coping with these mid-life challenges as they themselves begin to look toward transitioning into retirement.

2012-12-14 2013: A Year in Global Equities by Virginie Maisonneuve of Schroders Investment Management

Global equities are very attractively valued and we are positive for their prospects in 2013 as the global economy normalises. Progress in Europe, the end of China's growth slowdown and continued momentum in the US economic recovery will support global equities. Longer-term investors must position themselves for a growth-saturated world in which sustainability and innovation will be even more important.

2012-12-14 No Way Out by Peter Schiff of Euro Pacific Capital

By upping the ante once again in its gamble to revive the lethargic economy through monetary action, the Federal Reserve's Open Market Committee is now compelling the rest of us to buy into a game that we may not be able to afford. At his press conference this week, Fed Chairman Bernanke explained how the easiest policy stance in Fed history has just gotten that much easier. First it gave us zero interest rates, then QEs I and II, Operation Twist, and finally "unlimited" QE3.

2012-12-14 Fiscal Friction is Taking a Toll on Confidence in Washington and Rome by Carl Tannenbaum of Northern Trust

Fiscal friction is taking a toll on confidence in Washington and Rome. What inflation rate should be used to index entitlements? Our updated US forecast assumes a budget resolution before year end.

2012-12-13 Rescuing the Bond Deer from the Bond Bear by Mike Temple of Pioneer Investments

It's the season to talk about the man who delivers presents. No, not Santa Claus, but Fed Chairman Bernanke who has been delivering the green stuff for the past four years in a helicopter, not a sleigh... My last installment introduced the Fixed Income Bond Deer the investor caught in the headlights confused about what to do. This week we contemplate the following: should "Bond Deer" be grateful for the green stuff or frightened by the possibility that it is fueling the next bond "bear" market? The answer: it depends on how long this experiment continues.

2012-12-13 Conditional: Fed Drops 2015 in Favor of 6.5% and 2.5%185 by Liz Ann Sonders of Charles Schwab

The Fed announced it's adding $45 billion in US Treasury purchases to QE3s $40 billion in MBS purchases and moving to economic versus calendar targets.

2012-12-13 The Fake Economy by Bill Mann of Motley Fool Funds

A random question for you (one that contemplates your breaking federal law, so be forewarned): Given enough time and ample resources, do you think you could create a reasonable facsimile of a $20 bill? I'd wager that given modern printing capabilities, a reasonably diligent and determined individual could create a fool-some-of-the-people copy of a $20 bill.

2012-12-13 Pacific Basin Market Overview - November 2012 by Team of Nomura Asset Management

Asian equity markets ended higher this month, although they were heavily influenced by events elsewhere. Improved economic data from Germany, coupled with expectations that Greece will receive a further round of financial support from the European Union (EU), helped to lift sentiment. Meanwhile, investors were paying close attention to the American congressional budget negotiations to avoid the looming year-end "fiscal cliff" risk to the economy, although U.S. economic data was generally positive.

2012-12-12 To QE Infinity, and Beyond! by Brian Wesbury, Bob Stein of First Trust Advisors

The Federal Reserve made two big changes today, but changes that were mostly anticipated by the markets.

2012-12-11 Tax Reform: A First Step by Clyde Kendzierski of Financial Solutions Group

I rarely use this space to rant about political issues, but the recent election made it obvious just how dysfunctional the American political process has become. The ongoing financial crisis in the US will never get fixed as long as both political parties remain focused on solutions that make the problem worse. The Democrats want to give people more money to spend, claiming this will grow the economy. The Republicans want to cut taxes, so that people have more to spend, claiming that will grow the economy

2012-12-11 Fiscal Cliff-Hanger by Scott Brown of Raymond James

The recent economic data are consistent with a moderate pace of growth in the near term. The manufacturing sector is mixed, but generally weak, reflecting a global slowdown and an inventory correction. The consumer appears to be hanging in there. The Bureau of Labor Statistics said that Hurricane Sandy did not have a significant impact on the November employment data. However, other economic indicators did reflect weather-related disruptions, which appear to have been only temporary. Meanwhile, the economy heads toward the fiscal cliff.

2012-12-11 PIMCO Cyclical Outlook: At Policy Crossroads by Saumil Parikh of PIMCO

The maturation of the global cyclical growth phase suggests we look to a handoff to more secular drivers of growth. But strong secular drivers remain elusive due to the continuation of New Normal headwinds.Policies are at important crossroads in every major economy. 2013 will be the year of policy change, with policymakers in major economies challenged to enact structural changes that spur private sector growth before government-balance-sheet-led growth is exhausted.

2012-12-10 Food, Water, Electricity & Shelter by John Petrides (Article)

As investors continue to grapple with near term, well documented, uncertainties surrounding the fiscal cliff and global economy, the market continues to present some interesting long term investment opportunities, particularly in our Growth strategy.

2012-12-10 13 for '13 by Richard Bernstein of Richard Bernstein Advisors

Each December we publish a list of investment themes that we feel are critical to the coming year. We continue to believe that US equities are in the midst of a major bull market that could ultimately rival 1982's bull market. It is hard to be bearish when one considers the following.

2012-12-10 Have the New Paper Clips Arrived, Enid? by Christian Thwaites of Sentinel Investments

If there's one economic stat that spans the economic/political spectrum, it's jobs. Last week's NFPs had a headline of 146,000, way above estimates, and an unemployment rate of 7.7%, the best since December 2008 and a comfortable one point below a year ago.

2012-12-10 Property Taxes Paid, More on Housing and A "Quote of the Week" by Team of Lumesis

This week we will take a look at property tax data released this week, housing-related data and the possible impact of the same. Before doing so, a reminder from last week, a brief word on the deficit reduction talks (notice we did not use the "C" word) and a quote worth considering.

2012-12-10 Is QE4 Really Coming? by Brian Wesbury, Bob Stein of First Trust Advisors

The Federal Reserve meets this week. Analysts are supposing and predicting what the statement will say and if the Fed will change its economic projections.

2012-12-08 How Gold Miners Can Leverage the Price of Gold by Frank Holmes of U.S. Global Investors

Gazing into their crystal balls this week, Wall Street firms interpreted differing futures for gold next year. Morgan Stanley awarded gold the best commodity for 2013 while Goldman Sachs called the end of the metals hot streak. After seeing 11 consecutive years of positive performance from gold, one needs to be wary of research analysts price forecasts, as they have consistently underestimated the shifting dynamics driving the precious metal higher.

2012-12-08 Weekly Economic Commentary by Team of Northern Trust

What are the margins of monetary policy? The November job report showed only modest improvement. Japan continues to struggle, with a change of government on the horizon.

2012-12-06 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

Now that the election is over, and the markets are oversold, the Mideast is again volatile, and the fiscal cliff is fast approaching, most market concern rests with whos going to be the first one in the pool? Interestingly, although the stars are aligned once again to make money in the equities markets, it is still a psychological, not financial, component that governs peoples capital deployment considerations.

2012-12-06 From a Fiscal Cliff to a Fiscal Speed Bump by Scott Minerd of Guggenheim Partners

More granular analysis of the line items in the fiscal cliff tells a less harrowing story than what Congress and the media are presenting. The official projections are showing scary numbers for the fiscal cliff, but when we dig into the details we see that the real impact will likely be materially less significant. According to the Congressional Budget Office, the fiscal cliff adds up to a total increase in tax revenue of $631 billion, which is approximately 4% of GDP. Going through the report line by line tells a different story.

2012-12-05 Market at Mercy of Fiscal Cliff Until Resolution by Liz Ann Sonders of Charles Schwab

Politics and the fiscal cliff are dominating market action and adding to the uncertainty factor. Sentiment is better, technicals are mixed and valuation is reasonable, but until we get past the cliff, fundamentals won't matter a lot. There are some coiled springs forming that could help offset any fiscal-cliff related contraction next year.

2012-12-05 Argentinas Trials & Trubulations by Chris Maxey and Ryan Davis of Fortigent

Equity markets climbed higher for a second straight week, extending a rally that began November 16. For the week, the S&P 500 rose 0.6% and the Dow Jones Industrial Average gained 0.2%. In the post-mortem on Q3 earnings season, much has been made of the first quarter of negative earnings growth in three years. However, analysis by Morgan Stanley reveals an even more disturbing picture of corporate America: just 10 companies in the S&P 500 delivered 88% of the indexs earnings growth. Of those 10, four accounted for more than half and Apple alone made up nearly one-fifth of the indexs growth.

2012-12-05 Headline Roulette by Christian W. Thwaites of Sentinel Investments

That Fiscal Thing dominated the week. Every twitch out of Washington was greeted with over analysis by the press and us. Less so the markets. Truth is, markets are not very good at discounting political uncertainty. Sure, a tax scare here and a debt ceiling impasse there might lead to a sell-off but ultimately it's about earnings, corporate health and outlook and on those metrics, nothing last week really upset the markets in a major way. The bond market tends to get this right.

2012-12-05 Resilient Markets Mask Greater Concerns in Real Economy by Douglas Cote of ING Investment Management

Though equity markets have been calm, the real economy tells a different story. If our leaders in Washington arent able to arrive at a compromise, January 1 will mark the beginning of the countrys first scheduled recession, though third quarter corporate earnings suggest a global slowdown is evident. Dont be surprised to see a Christmas rally should Congress kick the fiscal can down the road and the Fed extend Operation Twist.

2012-12-04 Nate Silver's Message for Financial Advisors by Ben Huebscher and Michael Edesess (Article)

By now you are likely aware that Nate Silver of the New York Times correctly predicted the results for all 50 states (plus DC) in this year's presidential election and all but two Senate races. Silver's predictive capabilities across a range of disciplines have made him a near-deity among those whose livelihood depends on accurate forecasting - from poker players to counter-terrorism units. It's clear why: His methods work - at least in some cases. And their strengths and limitations carry important lessons for financial advisors.

2012-12-04 The Big Picture by David Rosenberg (Article)

Our crystal ball says to stick with what works in an uncertain financial and economic climate - in other words, maintain a defensive and income-oriented investment strategy.

2012-12-04 Surprising Choices in the Search for Safety Near-Certain Loss of Purchasing Power versus Short-Term by Jason Petitte, CFA (Article)

Risk, in its many guises, is unavoidable, and investors today are taking on significant amounts of credit risk, duration, and leverage to obtain high yields from many presumably safe bonds. But certain types of risk are often mispriced. By overweighting one's portfolio to those sectors that currently offer attractive risk-adjusted returns, investors will be better positioned to meet their long-term goals.

2012-12-04 And Thats The Week That Was by Ron Brounes of Brounes & Associates

Obama meets with the nations governors and speaks before the Business Roundtable to continue drumming up support for his budget deal. (Arent most governors counted among the countrys wealthy?) Expect the bickering and blame-placing to continue until finally a small deal is reached with the majority of the work tabled for later in 2013. (How will Moodys and S&P perceive that move?) The economic calendar heats up with critical news from labor and manufacturing and retailers share insight into the holiday shopping season thus far. And Europe is never far from the radar screen.

2012-12-04 Strawberry Fields Forever? by Bill Gross of PIMCO

As John Lennon forewarned, it is getting harder to be someone, and harder to maintain the economic growth that investors have become accustomed to. The New Normal, like Strawberry Fields will take you down and lower your expectation of future asset returns. It may not last forever but it will be with us for a long, long time.

2012-12-03 Tumbling Down the Fiscal Staircase by Scott J. Brown of Raymond James

Revisions to the 3Q12 GDP data have altered the near-term consumer spending outlook, adding to the anxiety surrounding the fiscal cliff. However, even if much of the fiscal tightening is postponed, more will be needed in the years ahead. The estimate of 3Q12 GDP growth was revised to a 2.7% annual rate, vs. 2.0% in the advance estimate. Good news, right? Well, no, just the opposite. Much of the revision was due to an increase in the estimate of inventory accumulation.

2012-12-03 Paintballs?! by Jeffrey Saut of Raymond James

Alas, if only it was that easy to paintball the rapidly approaching fiscal cliff. For those of you traveling the North Yungas Road in Bolivia and unaware of the approaching dangerous cliff, let me explain. Before beginning, however, let me preface by recalling Bill Buckleys famous lament that he would rather be governed by folks listed in the Boston phone book than Harvard professors. To be sure, there are some good politicians inside the D.C. Beltway, but not many!

2012-12-03 Housing, GDP, Lumesis Muni Index & Federal $ to the States by Gregg L. Bienstock of Lumesis

While the media is fixated on the looming cliff and having everyone and their mother opine, information about the status of our economy is of as much importance. This week we take a look at housing prices, GDP, the Coincident Index, the DIVER Muni Index and how much of each States revenue comes from the Federal Government. We keep hearing how much better the housing market is. In this regard, we routinely remind our readers that better or worse depends on from where you start. Starting pre-recession to date, only Texas, Oklahoma and the Dakotas have seen positive housing price trends.

2012-12-03 Temporary Weakness Won't Last by Brian S. Wesbury and Robert Stein of First Trust Advisors

Hurricane Sandy knocked out electricity all over and is now causing some flickering in the economic data. Real consumer spending fell 0.3% in October, the steepest drop since cash-for-clunkers ended in 2009, while real income slipped 0.1%. The ISM manufacturing index fell to 49.5 in November. Considering that Sandy smashed the eastern seaboard and affected roughly 25% of the US population with the brunt hitting New Jersey and New York the economic damage will be spread out. Timing helped limit the impact on October data, given that the storm struck very late in the month.

2012-12-01 The Significant Impact of U.S. Oil Production by Frank Holmes of U.S. Global Investors

The Eagle Ford shale formation lies south of our headquarters in San Antonio, Texas, giving the U.S. Global investment team a firsthand, tacit perspective on the oil and gas industrys growing natural resources phenomenon. Weve witnessed how the oil activity is boosting the local economy with solid-paying jobs, a healthy housing market and strong consumer sentiment, as oil giants such as Schlumberger and Halliburton take a bigger stake in the area.

2012-12-01 The Bank of Canada Has Barked, But Will It Bite? by Ed Devlin and Richard Clarida of PIMCO

As Canadian consumers have increased their mortgage debt and bid up housing prices, the potential for a disorderly unwinding of these imbalances rightly concerns the Bank of Canada. PIMCO believes that the banks next policy move will be to raise interest rates, but with the traditional aim of fighting inflation rather than reducing home prices and consumer debt. We expect the Bank of Canada to continue tightening mortgage credit and using moral suasion to damp the housing boom and discourage consumers from taking on more debt.

2012-12-01 The How Matters by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Market focus has clearly been on fiscal cliff negotiations. An agreement that averts the cliff would likely ignite a further near-term rally, but the ultimate solution and its components could have longer term consequences that may not be as market-friendly. US economic data has been impacted by Hurricane Sandy, but it appears modest growth is continuing; although business investment has fallen off. Housing continues to provide support and the Fed is staying the course. There are some signs of growth stabilization globally, notably in some of the emerging economies, including China.

2012-11-30 Where Are We in the Boom/Bust Liquidity Cycle? by Thomas Fahey of Loomis Sayles

In an often cynical world, standard ?nancial and macroeconomic quantitative models give people the bene?t of the doubt. Fundamental economic theory assumes the best of us, supposing that human beings are perfectly rational, know all the facts of a given situation, understand the risks, and optimize our behavior and portfolios accordingly. Reality, of course, is quite different.

2012-11-28 A Turn in the Credit Cycle by Scott Minerd of Guggenheim Partners

Investors should understand the recent transition in the credit market and the implications it could have for the trajectory of asset prices over the long-term.

2012-11-27 Are Equities Still Cheap? by Chris Maxey, Ryan Davis of Fortigent

Since reaching a near-term top in mid-September, the S&P 500 Index fell more than 7%. After a 4% rally in the last five trading days, there are reasons to believe equity markets are poised to extend recent performance despite headline concerns.

2012-11-27 Fixed Income Perspectives by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

A wise American once said "Life is hard; it's harder if you're stupid." A good example is when your pals in Washington are so busy pushing their partisan agendas that they lose sight of what could happen to the American economic Thunderbird if it goes all Thelma and Louise over the fiscal cliff. With the latest elections in the books, it remains to be seen if a Democratic president and acrimonious Republican House can put on their thinking caps to devise a way to delicately pump the brakes of fiscal restraint.

2012-11-26 And That's the Week That Was by Ron Brounes of Brounes & Associates

Investors breathed a sigh of relief (perhaps temporarily) and expressed thanks in the form of the strongest week in the market in several months (though on light volume). Domestically, housing data confirmed strength in the sector and retailers opened their doors earlier than usual with the hope that "if you open, they will come." Overseas, Europe's struggles continued, though manufacturing in China looked to be on the mend. Happy Thanksgiving and enjoy the weekend; after all, next week starts the home stretch for the end of the year...(and the fiscal cliff).

2012-11-26 Buying Treasuries and Avoiding Stocks Not the Way to Go by John Buckingham of AFAM

While we know better than to make too much out of a low-volume rally, especially during a holiday-shortened trading week, it was interesting to hear what The Wall Street Journal had to say one week ago at this time. As the publication helped ready investors for the week ahead, one story advised folks to head toward the safety of U.S. Treasury securities: "Expect safe-haven Treasurys to draw demand at the expense of stocks in the coming weeks, bucking a seasonal trend that has often favored riskier assets."

2012-11-26 Employment, Jobs and the Next Generation by Gregg Bienstock of Lumesis

Thanksgiving offers us a time to reflect on all we have to be thankful for and to share time with family and friends. There is so much to be thankful for while misfortune is evident when you check the news we live in democracy, the wealthiest country on the planet and have a resiliency that is demonstrated every time we, as a nation, are tested.

2012-11-23 Five Amazing Global Consumer Trends by Frank Holmes of U.S. Global Investors

Fifth Avenue no longer the worlds most expensive retail location. China set to be the second largest luxury market by 2017. Viva Macau is gaming capital of the world. Inexpensive Indian Aakash 2 could revolutionize tablet industry. Emerging market residents don't need a bank account to pay with their mobile wallet.

2012-11-22 Economic Update by Carl Tannenbaum and Asha Bangalore of Northern Trust

A look beneath the surface reveals a housing sector still struggling with post-crisis transition. The Federal Reserve is intent on promoting a broader recovery in this area.

2012-11-21 Reflections: Primate in Distress by John Gilbert of GR-NEAM

The enthusiastic response of the capital markets to the Federal Reserve's announcement of the third quantitative easing program is, of course, just what they intended. It recalls the even more ebullient response to the ECB's Long Term Refinancing Operation announcement late last year.

2012-11-21 The Most Wonderful Time of the Year...for Stocks by Frank Holmes of U.S. Global Investors

November hasn't been living up to its reputation as one of the best months for U.S. stocks. Equity investors have been fed a cornucopia of negative news that has been difficult to digest, including the outcome of the "fiscal cliff," the front page photos of rioting in the eurozone, and the escalation of geopolitical risk in the Middle East.

2012-11-20 President Obama?s Re-Election and the Impact on the U.S. Economy by Eaton Vance Distributors, Inc. (Article)

President Obama?s re-election resolves a major element of uncertainty that has hung over the political landscape. But what kind of impact will his victory have on the economy and the markets, especially with the House still in Republican control? We posed that question to a roundtable of five investment professionals from Eaton Vance Management, Hexavest and Richard Bernstein Advisors.

2012-11-20 The Fallacies in Today?s Retirement Plan Assumptions: Putting the Hedonic Pleasure Index to Work by Bob Veres (Article)

Are you dramatically underestimating your clients' retirement lifestyle expenditures when you use Monte Carlo software? If you stop and look at a number of important assumptions hidden in the current models, you'll suddenly have a lot less confidence in the retirement plans you?re mapping out for your clients.

2012-11-20 Fix the Debt! by Team of Franklin Templeton Investments

In the "normal" course of a U.S. election, investors typically breathe a sigh of relief when the results come in, with at least one layer of market uncertainty removed. This time around, the political squabbling hasn't ended with the close of the polls on November 6. The debate about the "fiscal cliff," a combination of spending cuts and tax hikes set to go into effect on January 1, 2013, has heightened. Market volatility since the election seems to have heightened, too.

2012-11-20 Companies Grapple With Pressure from All Sides by Chris Maxey, Ryan Davis of Fortigent

As we move closer to closing the books on another earnings cycle, it is time to look back at the hits and misses for the quarter. Unfortunately, this quarter brought more misses than investors have seen in quite some time, despite a greatly reduced bar. The outlook also leaves something to be desired, with companies cutting forward guidance and analysts ratcheting down estimates for the next two quarters.

2012-11-20 Where Will the Jobs Come From? by John Mauldin of Millennium Wave Advisors

For the last year, as I travel around, it seems a main topic of conversation is "Where will my kids find jobs?" It is a topic I am all too familiar with. Where indeed? Youth unemployment in the US is 17.1%. If you are in Europe the problem is even more pronounced. The basket case that is Greece has youth unemployment of 58%, and Spain is close at 55%. Portugal is at 36% and in Italy its 35%. France is over 25%. Is this just a cyclical symptom of the credit crisis?

2012-11-20 On the Road to Zero Growth by Jeremy Grantham of GMO

In a new quarterly letter to institutional clients, GMO chief investment strategist Jeremy Grantham makes the case that, "the U.S. GDP growth rate that we have become accustomed to for over a hundred years -- in excess of 3% a year -- is not just hiding behind temporary setbacks. It is gone forever." He cautions, "investors should be wary of a Fed whose policy is prefaced on the idea that 3% growth for the U.S. is normal."

2012-11-19 And That's the Week That Was by Ron Brounes of Brounes & Associates

Could it be signs of progress? While Obama and key congressional leaders didn't exactly emerge form budget meeting arm-in-arm and singing kumbaya, they did report some progress (dare I say "compromise"?) regarding spending cut and tax hikes (better known as "fiscal cliff"). Investors remain fearful as prior discussions were always derailed over partisan bickering and the S&P and other ratings agencies remain on call should they need to act on US credit. Thanksgiving marks the beginning of what many retailers hope is a successful holiday shopping season.

2012-11-19 Little Dutch Boy by John Hussman of Hussman Funds

In the Mary Mapes Dodge book titled Hans Brinker, there is a fictional story within the story of a little Dutch boy who, on his way to school, notices a hole in the dyke. Having nothing else to fix the leak, he plugs the hole with his finger and stays there through the night until workers come to repair it. We are now into the fourth year of efforts to print trillions of little Dutch boys out of dollars and euros in order to stop a tide from crashing through a fundamentally damaged dyke. All of this has bought time, but no workers have arrived, and no real repairs have been done.

2012-11-19 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

Fortunately, no one is compelled to invest money. They do so in a climate of tranquility, or turmoil, in an attempt to utilize their specific discipline, their risk/reward tolerances, and their expectations in order to achieve capital gains. There is no "one size fits all" system, nor is everyone suited for an all-in, win or lose, paradigm.

2012-11-19 Waiting for Godot by Charles Lieberman (Article)

Democratic and republican policymakers are actively negotiating over the fiscal cliff, as investors watch and wait with baited breath. They seem to be making progress, or so they suggest in their public comments. But until the situation is resolved, markets are likely to remain volatile. Other issues do seem to be moving towards resolution.

2012-11-19 On Wealth Effects of Fed Policies: Housing Is Likely The Bright Spot by Chun Wang of Leuthold Weeden Capital Management

We've mentioned before the rapidly waning effect of the Fed policies. October was a good proof of that, with the S&P 500 index down about 2% (top chart). The stock market is no doubt part of the wealth effect the Fed was trying to create, but home prices, which represent the bulk of the average person's net worth, and personal income should also be considered a big part of the wealth effect.

2012-11-17 Three Events That Sum Up the Week by Frank Holmes of U.S. Global Investors

India regained its title as the strongest performing market, overtaking the greater China area, as the country experienced a bounceback in demand due to improved sentiment during the festival season. The Federal Housing Administration reported that it has exhausted its reserves, possibly requiring a bailout from U.S. taxpayers for the first time ever in its nearly 80-year history. The global economic picture came into focus a little more this week with the announcement of Chinas new leadership.

2012-11-16 ProVise Bullets by Ray Ferrara of ProVise Management Group

With the elections behind us, we must now look ahead to the next six weeks of a Lame Duck Congress. Given the fact that the President was re-elected, the Republicans maintained control of the House, and the Democrats gained in the Senate, we know there will either be collaboration or chaos in Washington. The positioning has already started. The more things change, the more they stay the same.

2012-11-16 The REIT Stuff: How REIT Investors Have Benefited from the Real Estate Recovery by Steve Benyik of Lord Abbett

In an otherwise slow-growth economy, real estate investment trusts' (REITs) strong returns and yields have attracted considerable investment in recent years. Steve Benyik, Lord Abbett REIT analyst, provides perspective on the sector's key trends.

2012-11-16 Fed Balance Sheet Expands, Reward-Risk Clarity Fades by Alan Levenson of T. Rowe Price

While the minutes of the October 23-24 FOMC indicated a lack of consensus regarding whether to initiate a new asset purchase program to replace the Maturity Extension Program (MEP) upon its year-end conclusion, we believe that the Committee will announce at the conclusion of its December 11-12 meeting that the Fed will begin open-ended purchases of Treasury securities at a pace close to the $45 billion per month in the MEP.

2012-11-15 Pacific Basin Market Overview - October 2012 by Team of Nomura Asset Management

Equity markets derived support this month from improved U.S. economic data and an impression that China's economy might be bottoming out. In addition, the Euro Area Industrial Production numbers came in above consensus. The MSCI AC Asia Pacific Free Index including Japan declined by 0.39% while the MSCI AC Asia Pacific ex Japan Free Index gained 0.44% in October 2012.

2012-11-15 Chuck Royce Remains Optimistic After the Election by Chuck Royce of The Royce Funds

The likelihood of fiscal and tax reform in 2013 gives us faith in the long-term viability of both the U.S. economy and equities.

2012-11-15 Nothing Changed by Doug MacKay, Bill Hoover of Broadleaf Partners

Many events have transpired since our mid-September update, but not much has really changed. Economic growth should remain slow for as far as the eyes can see, as each region of the world struggles with its own version of the New Normal. Capitalistic animal spirits have gone the way of the modern American male and while not completely extinct, he's decidedly more metrosexual. Flannel has ceded ground to the skinny jean and ambition has given way to contentment. Save for the halls of America's top military brass, unbridled passion is simply no longer.

2012-11-14 U.S. Economic and Interest Rate Outlook - November 2012 by Carl Tannenbaum, Asha Bangalore of Northern Trust

Our updated forecast anticipates some movement on the "fiscal cliff."

2012-11-14 Helplessly Hoping...That a Market Riot Isn't Needed for Fiscal Cliff Fix by Liz Ann Sonders of Charles Schwab

A status-quo election puts the "fiscal cliff" front and center. The stock market's knee-jerk reaction was to sell; could further weakness light a fire under politicians? Good news has come from recent economic numbers, but sentiment will remain under pressure until the fiscal cliff is resolved.

2012-11-13 Voyages by Michael Lewitt (Article)

Anything short of drastic entitlement reform, serious cutbacks in defense spending, and serious tax reform that alters incentives away from speculation in favor of production will leave this country stuck on the dangerous path it is on today.

2012-11-13 The Election by Jeffrey Saut of Raymond James

As most of you know I was in Glasgow, Edinburgh, London, Zurich, and Geneva during election week seeing institutional accounts and speaking at conferences. Of course the question on all the portfolio managers' (PMs) minds was about the election, the subsequent effect on the economy and the various markets, currencies, and the Fiscal Cliff.

2012-11-13 Sequestration - What It Means for the Municipal Bond Market by Michael Taylor of Columbia Management

If Congress fails to quickly reach an agreement on deficit reductions, automatic cuts to federal discretionary spending (sequestration) are scheduled to take effect January 2, 2013. On September 14, the U.S. Office of Management and Budget (OMB) released its report detailing how it would implement sequestration, as required by the Budget Control Act of 2011 (Act). Designed to impact defense and non-defense (domestic) program budgets equally, most agencies are subject to cuts between 7% and 11% over the next decade. The exception is Medicare which is subject to a 2% cut.

2012-11-13 Argo and Ethel: America Has Never Been a "Rose Garden" by Bill Smead of Smead Capital Management

We recently had the pleasure of seeing a movie, Argo, and a documentary on HBO, Ethel. Argo is the story of the rescue of the six Americans from the Canadian Ambassador's residence at the time of the Iranian takeover of the US Embassy in Teheran. Ethel is a documentary which tells the story of Ethel Kennedy, the wife of Senator Robert Kennedy. It was produced, directed and narrated by Ethel Kennedy's youngest daughter, Rory. I rate both of these films highly and believe they tell US investors something they need to be reminded of.

2012-11-12 After the Election, Fiscal Cliff Outcome May Surprise by Libby Cantrill, Josh Thimons of PIMCO

Our base case for a fiscal cliff resolution continues to be a lame-duck mini-deal that would reflect about 1.5% of GDP in fiscal contraction in 2013 (vs. nearly 5% without a deal). But the dynamics of polarization and partisanship that played a role in past dysfunctional negotiations may have gotten worse. On a more optimistic note, it is widely known that second-term presidents are largely interested in their legacies spearheading noteworthy, bipartisan and lasting accomplishments for the history books.

2012-11-12 Can Housing Save the U.S. Economy? by Stephen Sheehan of Columbia Management

After leading the U.S. out of the Great Recession, the manufacturing sector has recently begun to show signs of sputtering. Uncertainty surrounding the election and fiscal cliff in the U.S., decelerating growth in China and a perpetually weak Europe have led to a soft patch in the third quarter. This global hiccup has caused some U.S. companies to catch a cold, most notably those in heavy machinery, transportation, metals and mining, and general industrials.

2012-11-12 Fiscal Cliff, US Economy and Election Results - What Happens Next? by Liz Ann Sonders of Charles Schwab

Housing, manufacturing, and post-Sandy rebuilding could help offset the drag from the fast-approaching "fiscal cliff," but for now, uncertainty is front and center.

2012-11-12 Housing Recovery - A Dose of Realty Reality by Milton Ezrati of Lord Abbett

Media and the investment community have made much of recent good news on housing. Certainly, the recent upturn in sales, building, and real estate prices is welcome. But if the 1980's housing bust is any guide, popular references to strength and imminent recovery grossly overstate. That older experience suggests that health in the sector will return only slowly. Residential real estate may well have turned a corner, but major gains and price recovery will likely wait for some time.

2012-11-09 Looking Past the Election by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

The election results are in, removing at least one area of uncertainty from the equation. For the near term, economic data in the United States may take a back seat. Growth around the world appears soft, but some pockets are more encouraging than others.

2012-11-09 Weekly Economic Commentary by Carl Tannenbaum, Asha Bangalore, Victoria Marklew of Northern Trust

Hurricane Sandy will impact the pattern of upcoming data, but is not likely to have a lasting economic impact. Our updated forecast anticipates some movement on the "fiscal cliff." France may be part of Europe's problem, not a source of Europe's solutions.

2012-11-09 Fiscal Cliff, US Economy and Election ResultsWhat Happens Next? by Liz Ann Sonders of Charles Schwab

Even if the United States falls off the "fiscal cliff," the hit to the economy will probably be gradual. And while the fiscal cliff probably figured into the recent market pullback, it's not the only contributor. Resolution to this issue, the continuation of positive trends in housing and manufacturing, and fundamental tax reform could help give the economy a boost.

2012-11-09 A Portrait of Two Presidents by Frank Holmes of U.S. Global Investors

On Friday, President Obama addressed the two topics that have been on many equity investors minds since election night: the economy and the dreaded fiscal cliff. In his speech, he delivered his familiar plan to combine spending cuts with increasing revenue by raising taxes on the wealthiest Americans. Thats how we did it in the 1990s, when Bill Clinton was president, says the president.

2012-11-09 Americas: Economic Review 3rd Quarter 2012 by Team of Thomas White International

Economic trends in most countries across the Americas region saw a moderate recovery during the third quarter, though the pace of growth remains subdued. Slower global demand due to the ongoing European recession and the slower expansion in Asia continues to restrict exports from the Americas. At the same time, domestic consumption growth has been relatively more robust than expected and has helped most regional economies prevent a deeper slowdown.

2012-11-08 Magic 8 Ball Knows All by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

The efficacy of 1980s technology turned out to be a real bummer, huh? Flying DeLoreans and flux capacitors are the ultimate heartbreakers, but the clairvoyance promised by those iridescent black and white Magic 8 Balls is definitely a close second. Give one a few shakes today and see for yourself. "Magic 8 Ball, [SHAKE] will financial markets rally post the U.S. election?" "It is decidedly so." "Magic 8 Ball, [SHAKE] are you lying?" "Yes definitely." "Magic 8 Ball, [SHAKE] seriously?" "Reply hazy, try again."

2012-11-08 Overcoming the Brake Light Shockwave by Christian Thwaites of Sentinel Investments

Big democratic breakthroughs, say Egypt, Tunisia are halting and fall far short of the hopes they embodied. Technology is a race over mobility and brevity but hardly elicits the same wonder from years past. Governments are polarized. The US had almost no voting overlap in recent years so big ideas are on the wane. In Europe, the supra-national organizations like the EU are swift to talk and slow to act. No we're not reactionaries. We think all this is explained by the deepest drop in output in the post-war period and the slowest recovery.

2012-11-08 Developed Europe: Economic Review 3rd Quarter 2012 by Team of Thomas White International

Amid signs of a deepening economic slowdown in Developed Europe, three key events brought some cheer to the beleaguered region, raising hopes of a lasting solution to its debt crisis. In early September, the European Central Bank (ECB) announced its new Outright Monetary Transactions scheme, which is in effect a commitment by the ECB to buy unlimited quantities of sovereign bonds with up to three years in maturity, providing the bond-issuing member country agrees to a reform agenda.

2012-11-07 October 2012 Monthly Commentary by David Kelly of J.P. Morgan Funds

A light flashed on in my car this morning, telling me that it was due for service. When I take it in, the mechanics will presumably check both the engine and the brakes before deciding on exactly what it is that I need to repair, replace or adjust. For investors, after nine months of ups and downs in markets, an investment strategy checkup is in order.

2012-11-07 US Olympic Swim Team and Warren Buffett: Buy and Hold by Bill Smead of Smead Capital Management

The US swim team has their own criteria for developing young athletes. We assume in every ten-year stretch that they support the swimming efforts of 25 to 30 young athletes in hopes of finding an occasional Mark Spitz or Michael Phelps. Most of them share the characteristics we described about Michael Phelps. The US Olympic team is the most successful swim team portfolio manager in the world. What can we learn from them as portfolio managers?

2012-11-07 Forecasts & Trends by Gary Halbert of Halbert Wealth Management

Last Friday's unemployment report for October had the headline rate rising from 7.8% to 7.9%, in line with expectations. However, the pleasant surprise was that the economy created 171,000 new jobs last month, well above the pre-report consensus of 125,000 and above the average monthly increase of 157,000 jobs this year. That's the good news.

2012-11-07 October Surprise by Douglas Cote of ING Investment Management

Third quarter earnings growth for S&P 500 companies is at risk of being negative for the first time in three years. While the presidential election is important, Congress will ultimately control spending and tax legislation. Monetary stimulus alone is both inadequate and unsustainable; pro-growth taxation, spending and regulatory policy is key to our economic revival.

2012-11-06 ClearBridge Advisors - Market Commentary Q312 by Harry ?Hersh? Cohen (Article)

Vibrant end demand is missing, as consumers have neither the wherewithal nor the will to spend as they did in prior periods.

2012-11-06 Asset Location: Nine Tips to Create ?Tax Alpha? by Glenn Frank (Article)

With campaign season finally over, taxes are going to dominate the debate in Washington in the months ahead ? however things shake out at the polls today. It's going to be confusing; it's going to be uncertain. But many of the most critical questions advisors will ask can be answered with an analytical approach to deciding where to 'house' assets ? in taxable or tax-sheltered accounts.

2012-11-06 Earnings Cliff? by Mike Boyle of Advisors Asset Management

We are now about 63% (316 of the 500 S&P 500 companies have reported) of the way into the third quarter earnings season and the popular opinion seems to be that the earnings are disappointing, that this current earnings cycle has peaked and that earnings going forward will fall sharply (earnings cliff). In a nutshell, we don't believe that this is the case and will begin with the former, that the current crop of earnings reports are disappointing.

2012-11-06 Favorable Reports Post Sandy by Christian Thwaites of Sentinel Investments

The devastation of Sandy blighted the week. We were lucky in that most of our employees escaped the worst effects. We had some evacuations and plenty of lost power. But the images of devastation were overwhelming and we hope our clients and friends of the firm are safe. Perhaps, as a non-native, my perspective is warped but in the US we have an uncanny ability for industry, problem-solving, drive, inventiveness and optimism. Sometimes the very best of us comes out in these times.

2012-11-05 Americans Head to the Polls Tuesday to Decide Tight Presidential Race by Matt Rubin of Neuberger Berman

As the eastern seaboard continues to recover from the aftermath of Hurricane Sandy, estimates for the economic cost of the storm continue to climb and currently stand in the range of $30 to $50 billion. In the near-term, economic activity in the region is likely to be negatively impacted by the storm; however, the rebuilding of infrastructure, housing and businesses should boost growth in areas most impacted by Hurricane Sandy over the longer term.

2012-11-05 A New Queen Bee by Jeffrey Saut of Raymond James

By the time a queen bee is five she is old and no longer reproduces, leaving her army of honeybees torn between loyalty and survival. Since the hive cannot survive without a productive queen, the beekeeper reached into the hive with a long-gloved hand and squashes the enfeebled queen. With the entire hive as witness, all know the queen is dead. Absent the scent of their leader, the honeybees panic. Something similar to that "queen bee" sequence may be happening currently. The "old queen," at least in the private sector, was driven by exports and manufacturing.

2012-11-05 And That's the Week That Was by Ron Brounes of Brounes & Associates

Superstorm Sandy overshadowed most all newsworthy stories during the week as much of the East Coast (and beyond) suffered some ill-effects and many will be fighting to overcome challenges for many days (weeks, months) to come. The stock market closed over consecutive days to start the week and uncertainty (volatility) ensued with investors enjoying the best single day performance in a month-and-a-half, only to give up those gains a day later as many set portfolios in advance of the election. Soon the campaign will be a distant memory (but the "fiscal cliff" will become a near-reality).

2012-11-05 Commentary and Statistics by Team of ING Investment Management

U.S. equity markets were mixed during an abbreviated trading week in which Hurricane Sandy forced the longest weather-related shutdown of U.S. stock trading since 1888. While the S&P 500 eked out a small gain, the DJIA and Nasdaq closed slightly lower.

2012-11-05 Day of Reckoning by Charles Lieberman (Article)

Tomorrow's election is too close to call according to the polls, while Friday's jobs report was decent, blemishes notwithstanding. Super storm Sandy was and remains a severely disruptive force to the Northeast, particularly New Jersey. A few thoughts on these issues follow.

2012-11-02 World's Economies Come of Age by Mark Mobius of Franklin Templeton Investments

As we grow and age, our needs and habits often change. The same is true of economies, which grow and change along with their people. Short-term statistics that impact a country's economic growth rate, such as consumer spending, exports and the like are certainly important, but there are also long-term shifts that can have significant economic implications for the future. Changing demographics is one of them. As a long-term investor, I have to look not only at today's opportunities, but also plan for tomorrow's developments.

2012-11-02 Of Varied States: Cyclical, Storm-Tossed and Swing by Alan Levenson of T. Rowe Price

The latest readings on employment growth and household formation show a firm underpinning for moderate growth, with the household sector gathering momentum toward the emergence of positive feedback loops. Despite the immense human cost of Superstorm Sandy, the adverse impact on measured economic activity is likely to be short-lived, with a compensating rebound to emerge before quarter-end. Next week's general election results should bring clarity to the route that policy makers will take to avoid the year-end fiscal cliff.

2012-11-02 Who Will Lead America Over the Next Four Years? by Frank Holmes of U.S. Global Investors

If President Obama is reelected, it could be a negative for certain energy companies involved in natural gas fracking, says International Strategy & Investment (ISI). Conversely, a Governor Mitt Romney win could be significant for energy companies. In its Romney Portfolio ISIs rationale is that Romney and the GOP will try to do more to promote traditional forms of energy, including offshore drilling, approving the Keystone pipeline, and exploiting the nations coal resources.

2012-11-02 Blind Faith by Steven Romick of First Pacific Advisors

Although we cannot impose our will on this administration as to Mr. Bernankes continued role at the Fed, we would at least like to make our case for a Fed chairman more aware (at least publicly) of the unintended consequences of ultra easy monetary policy, and one with less hubris.

2012-11-01 A Value Recovery Is Long Overdue by Sharon Fay of AllianceBernstein

It's been a long, hard slog for value stocks lately. I'd say we're long overdue for a value recovery. But what would it take?

2012-11-01 Time To Vote! by Bill Gross of PIMCO

So I pulled out my magic lamp that for some reason works only every October 22nd, and rubbed until the Genie appeared in his red and white checkered cloak with a 10-inch diameter Flavor Flav clock hanging ceremoniously around his neck. Being a rather forward, although not disrespectful Genie, he immediately said, "Mr. G, instead of the yield on the 10-year Treasury, perhaps this year you should wish to know who is going to win the Presidential election?"

2012-10-31 Defying the Crowd on Chinese Stocks by Stuart Rae of AllianceBernstein

Slowing economic growth, uncertainty about government policy and disappointing returns have made equity investors wary of China. In other words, it's a perfect time to hunt for investment opportunities.

2012-10-31 Switch: Business Confidence Sinks While Consumer Confidence Lifts by Liz Ann Sonders of Charles Schwab

A wide gap has developed between sagging business confidence and improving consumer confidence...and the election and fiscal cliff appear to be the culprits.

2012-10-31 Macro View: Natural Disaster Economics by Scott Minerd of Guggenheim Partners

"Super-Storm" Sandy will distort economic activity and data over the coming months.

2012-10-30 The Yield Hunt by Michael Lewitt (Article)

The high-yield market is not in danger of imminent collapse as some have argued. As long as defaults remain relatively low, and interest rates remain invisible, investors will continue to chase yield. But a few things could cause a sharp sell-off in the near future.

2012-10-30 Nice Speech, Tough Crowd by Christian Thwaites of Sentinel Investments

Sandy is pummeling everything we know on the eastern seaboard. I hope everyone stays safe and we can ride this out without too much damage. Thankfully markets are closed. Meanwhile, here's our views on capital markets on Monday.

2012-10-30 Weekly Update: Commentary and Statistics by Team of ING Investment Management

U.S. equity markets fell back into decline during the week, as earnings reports and more specifically, forward outlooks inspired investor caution. Meanwhile, a potential "Frankenstorm" has the East Coast on edge for the coming week.

2012-10-29 And That's the Week That Was by Ron Brounes of Brounes & Associates

Disgruntled investors took a look at the earnings reports and ran for the hills. With some industrial and techs issuing pessimistic reports (mainly in their outlooks), investors chose to take a hiatus. Election season is just a week-ish away and then the fiscal cliff looms in the not-so-distance future, so plenty of uncertainties and concerns remain for the time being. (And don't forget Spain.)

2012-10-29 A Moderate Recovery More Of The Same by Scott Brown of Raymond James

The advance estimate of 3Q 12 GDP growth was not far from expectations. Consumer spending growth was moderately strong, while business fixed investment was a bit weak. The details suggest that some of the headwinds may be abating, although risks are tilted to the downside.

2012-10-29 Velocity, Uncertainty & the Economy by Brian Wesbury, Bob Stein of First Trust Advisors

Recently we lifted our recession odds to 25% from 10%. For some, this was worrisome. In recent weeks we've been asked, "If you guys get a little bearish on the economy, after being bullish for so long, shouldn't I get really nervous?" Our answer to this question is "no."

2012-10-29 The White Hurricane by Jeffrey Saut of Raymond James

I revisit The White Hurricane this morning because it potentially looks like another 100-year storm is heading pretty close to Manhattan. So in addition to dealing with the Benghazi scandal, Syrian atrocities, Euroquake, the "fiscal cliff," a stalled U.S. economy, softening earnings momentum, waning revenues, a dysfunctional government, the nastiest campaign I have ever seen, and who Taylor Swift should date next, Wall Street now has to contend with the potential of being flooded out.

2012-10-26 October 2012: Fixed Income Investment Outlook by Team of Osterweis Capital Management

Like last year, this summer's quarter was eventful. Investors entered the quarter with high expectations that the European Central Bank (ECB) and Federal Open Market Committee (FOMC) would provide the markets with more monetary largesse. On July 26th, Mario Draghi, President of the ECB, vowed to "do whatever it takes" to preserve the euro. Risk assets then began an anticipatory rally heading into some key events in mid-September.

2012-10-26 October 2012: Equity Investment Outlook by Team of Osterweis Capital Management

Equity and other "risk" assets rallied in the third quarter in anticipation of further monetary easing by central banks around the world. The prospect of increased liquidity from the central banks appears to have focused investor attention, at least temporarily, away from the generally softer economic data that continue to emerge from Europe and Asia.

2012-10-26 Don't Fear a Normal Gold Correction by Frank Holmes of U.S. Global Investors

Dont let the short-term correction fool you into selling your gold and gold stocks. The dramatic increase in money suggests that monetary debasement will continue, and in addition to all the above drivers, these are the positive dynamics driving higher prices for gold and gold stocks.

2012-10-26 What Now? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

The market appears to be in a "wait-and-see" mode in advance of the elections, but looking beyond November 6th is important for investors. The election is only one piece of the puzzle, and certain aspects of the political landscape likely won't be much clearer after Election Day. Earnings season has been somewhat disappointing, even though there was a relatively low bar to hurdle. We see more signs that the slowdown in the United States may be ending, however, with strength in housing particularly noteworthy.

2012-10-26 Weekly Economic Commentary by Carl Tannenbaum, Asha Bangalore and James Pressler of Northern Trust

Fiscal policy is a matter of multiplication. US GDP growth accelerated in the third quarter, but remains less than ideal. Recent reports out of China reassured the markets, but underlying trends are not so promising.

2012-10-25 Cheap Debt is Good News for Stocks by Scott Minerd of Guggenheim Partners

The eventual return of leveraged buy-outs (LBOs) and an uptick in mergers and acquisitions (M&A) should give investors further reason to be bullish on stocks.

2012-10-25 Third Quarter EPS: A Harbinger for 2013? by Robert McConnaughey of Columbia Management

Prospects for this quarter's results are being very closely scrutinized. After healthy growth in Q1, Q2 results proved quite sobering, as sales decelerated and operating leverage proved hard to come by.

2012-10-25 October 2012 Newsletter by Harold Evensky of Evensky & Katz Wealth Management

Oh the joys of driving to a baseball game; sitting in endless traffic four miles from the stadium, inching past full lot after full lot, or not finding your car when it's time to go home (was it D-4 or 404 Green?). Now you can streamline your parking experience with ParkWhiz, a Chicago-based company that's recently gone national. This and other missives from Harold Evensky.

2012-10-24 Policy at a Crossroads by Investment Strategy Group of Neuberger Berman

On September 13, the Federal Reserve announced a third round of quantitative easing, dubbed QE3, in the hope of providing an additional boost to the slow U.S. economic recovery. Although this latest policy action reinforces the notion that the U.S. is prepared to support its economy for as long as needed, some economists question whether the stimulus can really make a difference. In this issue of Strategic Spotlight, we consider the recent effects of loose monetary policy and whether the Fed has "reached its limit."

2012-10-23 There's New Hope for US Recovery as Early Cyclical Sectors Rebound by Joseph Carson of AllianceBernstein

Something is changing in the US economic recovery. Housing and autos are finally starting to wake up from a recession-induced slumber, and the timing couldn't be better.

2012-10-23 A Tepid Week for Earnings by Matt Rubin of Neuberger Berman

Through the first two weeks of earnings season, corporate results have largely mirrored the releases we witnessed a quarter agoof the 118 S&P 500 companies that have reported to date, only 60% have exceeded their earnings estimates while 29% have surpassed their revenue expectations. This week, we will see financial results from 169 S&P 500 companies, representing 32% of the index market capitalization, which will be well dispersed across all 10 S&P 500 sectors.

2012-10-22 And That's the Week That Was by Ron Brounes of Brounes & Associates

Maybe a four day work week would make some sense? Well, at least, it would have been helpful this week. After a strong start in the equity markets (and a four-day winning streak), the anniversary of Black Monday brought horrid memories of past bearish times and stocks gave up all (most) of their early gains. Major techs reported poor earnings and the Nasdaq struggled more than most as weak PC demand continues to take its toll. Good news...one bad day does not a market make.

2012-10-22 The Data-Generating Process by John Hussman of Hussman Funds

For anyone who works to infer information from a broad range of evidence, one of the important aspects of the job is to think carefully about the structure of the data what is sometimes called the "data-generating process." Data doesn't just drop from the sky or out of a computer. It is generated by some process, and for any sort of data, it is critical to understand how that process works. In the financial markets, the data-generating process is often very misunderstood.

2012-10-22 An Alternate Reality by Robert Stimpson of Oak Associates

The largest positive factor affecting the environment for stock prices this year has been the recovery in the housing sector. After years of struggle, the sector appears to have turned the corner. The housing market had been showing signs of improvement for some time, but the debate as to whether the recovery was legitimate weighed on the group and added to concerns over the economy.

2012-10-22 More traction...Just Look Through the Earnings by Christian Thwaites of Sentinel Investments

Last week saw an important debate on how the US has fared in the post recession recovery. The short answer is, "not well" if measured by a return to GDP growth trends or per capita income. But the counter, as explained by Reinhart and Rogoff, is "faster than you would expect." We're in the second camp.

2012-10-19 House of Mirrors by Jeremy Boynton of Laureate Wealth Management

Did you ever try to navigate the "House of Mirrors" as a kid at your local carnival? You know the one I mean ---- where you walk through a labyrinth of mirrors designed to confuse your orientation while mocking you with various distortions of your body? If you were particularly skilled, you could use the mirror to your own advantage. What a compelling metaphor for the current state of the financial markets.

2012-10-19 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company

In his latest quarterly letter, Ron Muhlenkamp, president and portfolio manager of the Muhlenkamp Fund, re-examines Europe, China, and U.S. Politics as the major drivers of the markets. On September 7, 2012, Muhlenkamp published a Market Commentary, headlined "Threat of European Banking Crisis Recedes." In it, he discusses the Outright Monetary Transactions program, introduced by the European Central Bank. Mr. Muhlenkamp thinks this program makes credible the ECB's promise to do all it can to keep the Eurozone together.

2012-10-19 Muddling Down the Middle by Josh Thimons of PIMCO

PIMCO expects that the debate over the fiscal cliff will end in fiscal consolidation, but not a fiscal catastrophe. Unfortunately, while the Fed's monetary policy actions have been, by and large, successful in achieving its intermediate-term goal of increasing asset valuations, they have not been effective in influencing real economic outcomes. Our forecast for the drag on GDP from the fiscal cliff in the coming year is roughly negative 1.5%. Improvement in the housing market will only fill a small part in that hole.

2012-10-19 Global Overview: September 2012 by Team of Thomas White International

Aggressive policy action by the U.S. Federal Reserve and the European Central Bank (ECB) helped lift investor sentiment further in September, even as economic signals from across the world continued to be jaded. The Fed has committed to buy mortgage backed securities and keep interest rates low until U.S. economic growth becomes more vigorous and the unemployment rate declines to more comfortable levels.

2012-10-19 Not by Housing Recovery Alone by Team of T. Rowe Price

Strong August-September housing starts are a clear bricks-and-mortar response to reports of rising buyer traffic, confirming a broad-based cyclical recovery in new housing construction. This trend will contribute 0.4 percentage points (pp) to real GDP growth directly through in construction activity, and perhaps another 0.2 pp indirectly through the consumer purchases of those newly employed in housing-related industries and via wealth effects related to the nascent recovery in house prices.

2012-10-19 Chinese Stocks Looking Like a Bargain by Frank Holmes of U.S. Global Investors

This appears to be a good time to be investing in China, as stocks are historically cheap. Chinese stocks are also cheap compared to emerging markets.

2012-10-19 ECB Needs to Rescue German and French Banks More than European Periphery: Global Macro View by George Bijak of GB Capital

Whenever we talk about rescuing overleveraged Europe it is always about Spain, Italy, Portugal, Ireland, and Greece the European periphery loaded with debt that they cannot possibly repay. But a closer look at the recent IMF data reveals that German and French banks need rescue more than anybody

2012-10-18 Investment Outlook 2013: "ABCD" Investing: Anything Bernanke Cannot Destroy by Cliff Draughn of Excelsia Investment Advisors

The Ben Bernanke and Mario Draghi concert gave the markets a double shot of their love in the month of September by promising to print as much money as needed to finance the debts of their respective countries. Ever since the financial fraternity party ended in 2008 and the world began deleveraging its massive credit hangover, the global markets have been hooked on the next shot of love from the central bankers.

2012-10-17 Great US Companies: Tomorrow's Foundation by Bill Smead of Smead Capital Management

Fears of a collapse in European economies and of a US recession subsided. Residential real estate appears headed for a comeback (Surprise?) in the US and nothing gives American consumers more confidence than knowing that their house is becoming more valuable.

2012-10-17 Fuzzy Math from the Continent of Peace by Christian Thwaites of Sentinel Investments

Whoops! The IMF made two announcements last week that caught our attention. But to set up the joke in all this, it's worth remembering that for decades the IMF preached austerity economics to any country that needed balance of payments assistance.

2012-10-17 Economics is Such a Drag by Fred Copper of Columbia Management

At least in Europe it is. Central bankers around the world are doing everything they can to try and pump up the global economy. Mario Draghi, President of the European Central Bank, has been incredibly aggressive and creative in trying to rectify the imbalances plaguing Europe.

2012-10-17 Emerging Europe: Third Quarter 2012 Economic Review by Team of Thomas White International

In its recent economic assessment, the European Bank for Reconstruction and Development (EBRD) said it expects growth to slow down during the year in member countries such as Russia, Poland, Hungary, and Turkey as the effects of the Euro-zone crisis spills over. The bank said many of these countries have already seen lower growth, but Russia especially is affected by falling commodity prices. Striking a similar note, the International Monetary Fund in its World Economic Outlook said emerging economies of the world are at risk should the developed economies experience a continued slowdown.

2012-10-17 Q3 Investor Letter by Team of HORAN Capital Advisors

At the beginning of the third quarter, investors following the "sell in May" strategy felt vindicated as the S&P 500 Index declined over 9.0% from May 1st to June 4th. The June 4th date turned out to be the intra-year market low and the equity rally was almost uninhibited throughout the remainder of the third quarter. We have been experiencing mixed global economic data over the past several months and in response, the Federal Reserve announced a third round of quantitative easing. While the market initially responded favorably, it ultimately declined through the end of the quarter.

2012-10-17 Rise Up: US Soft Patch Appears to be Ending by Liz Ann Sonders of Charles Schwab

By definition, inflection points are characterized by maximum weakness. Many US economic readings are again suggesting notable signs of life. Will the improvement be enough to offset the "fiscal cliff"?

2012-10-16 The New World of Credit by Michael Lewitt, Editor, The Credit Strategist (Article)

In an era in which economies are driven by the creation of fiat money by central banks, and where the base of hard money is dwarfed by the volume of outstanding debt, every form of capital is tied to credit. In 1919, William Butler Yeats famously wrote that 'the center cannot hold.' A century later, there is no center.

2012-10-16 Inflation: Washington is Blind to Main Street's Biggest Concern by Peter Schiff of Euro Pacific Capital

Journalists, politicians and economists all seem to agree that the biggest economic issue currently worrying voters is unemployment. It follows then that most believe that the deciding factor in the presidential race will be the ability of each candidate to convince the public that his policies will create jobs. It seems that everyone got this memo...except the voters.

2012-10-16 Bank of England Still Aiming at the Wrong Target by Darren Williams of AllianceBernstein

The UK is celebrating a near three-year low in consumer price inflation, but we think the Bank of England (BOE) should be more worried about the role that money and credit play in the inflation process.

2012-10-15 Equity Market Review & Outlook by Richard Skaggs of Loomis Sayles

Global equity markets performed well in the third quarter after posting modest losses in the second quarter. The soft second quarter, which followed back-to-back double-digit quarterly gains, proved to be a pause rather than a signal that the equity bull market was ending. Though defensive sectors garnered favor in the second quarter, economically sensitive sectors have generally led performance this year, with technology, financials and consumer discretionary topping the list year to date.

2012-10-15 Bond Market Review & Outlook by Thomas Fahey of Loomis Sayles

Aggressive policy responses from major central banks were dominant forces in the third quarter. The European Central Bank (ECB), Federal Reserve (Fed), Bank of Japan (BoJ) and other central banks took decisive action, prompted by the escalating European sovereign debt crisis, slowing global growth, ?nancial market volatility, and the impending US "?scal cliff."

2012-10-15 Seven Varieties of Deflation by A. Gary Shilling of Gary Shilling & Associates

Inflation in the U.S. has historically been a wartime phenomenon, including not only shooting wars but also the Cold War and the War on Poverty. That's when the federal government vastly overspends its income on top of a robust private economyobviously not the case today when government stimulus isn't even offsetting private sector weakness. Deflation reigns in peacetime, and I think it is again, with the end of the Iraq engagement and as the unwinding of Afghanistan expenditures further reduce military spending.

2012-10-15 Economic Singularity by John Mauldin of Millennium Wave Advisors

There is considerable disagreement throughout the world on what policies to pursue in the face of rising deficits and economies that are barely growing or at stall speed. Both sides look at the same set of realities and yet draw drastically different conclusions. Both sides marshal arguments based on rigorous mathematical models "proving" the correctness of their favorite solution, and both sides can point to counterfactuals that show the other side to be insincere or just plain wrong.

2012-10-15 And That's the Week That Was by Ron Brounes of Brounes & Associates

Though investors seemed to overlook the negative earnings projections for the third quarter, the initial releases finally brought out the sellers. While the naysayers had been drowned out by the optimism of the Fed moves, the early results and management warnings prompted investors to sell (and sell and sell) as the major equity indexes each plunged over 2% in what was considered the worst week since June. Heck even a "cheery" Joe Biden couldn't save the markets this week.

2012-10-15 Commodity Inflation Complicating Pro-Growth Policies by Ryan Davis of Fortigent

The return of commodity inflation raises several questions, primary among them being the impact it will have on emerging markets. While rising commodity prices are generally bullish for equity prices in emerging markets, it may also inhibit central bank flexibility at a time when many developing countries are experiencing decelerating economic growth. This issue was paramount in 2010, leading to underperformance in many EM stock markets. Since then, however, commodity prices have generally moved sideways, allowing those fears to subside.

2012-10-15 ProVise Bullets by Ray Ferrara of ProVise Management Group

Some recent research by InvesTech Research shows that the performance of the Dow Jones Industrial Average can indicate who will win the White House. James Stack, President of InvesTech recently released a study that showed in elections since 1900 90% of the time the Dow has correctly predicted the outcome of the election based on its returns from Labor Day until Election Day. If the Dow posts a positive return during this time period, the party in power keeps the White House and if the return is negative, they do not

2012-10-12 China's Thousand Talents by Christian Halvorsen of Matthews Asia

Employment is one of many paradoxes of mainland China. The country has been adding approximately 6 million new college graduates annuallymore than any other country. Despite the fierce competition for entry-level work, China faces the additional challenge of attracting enough skilled labor in many key industries. Compounding this problem is the fact that China has for years experienced a severe brain drain, often with Chinese citizens staying abroad after completing their overseas studies.

2012-10-12 Teetering on the Edge? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

Concerns about a possible US recession remain elevated in light of the pending "fiscal cliff," resulting in some lackluster stock market action. The fiscal cliff and uncertainty around tax and regulatory policy appear to be influencing business decisions to the detriment of economic growth. While worst-case scenarios for Europe may have been taken off the table by the ECB, Spain's reluctance to ask for aid is causing consternation. And although we see continued weak growth in China, signs indicate the global slowdown may be turning around.

2012-10-12 Chinas Pyramid of Power by Frank Holmes of U.S. Global Investors

We've been able to witness Chinas incredible growth, with GDP averaging 10 percent per year and more than 500 million people moving out of poverty over the past 30 years. Now after three decades of tremendous expansion, this new generation of leaders will have to carefully maneuver the country into the next decade, towing the line between maintaining the stability created during the previous Hu-Wen administration and continuing the political and economic reform necessary to adjust to the countrys slowing growth.

2012-10-12 U.S. Economic and Interest Rate Outlook - October 2012 by By Carl Tannenbaum and Asha Bangalore of Northern Trust

Budget negotiations in the US and Europe are attempting to balance austerity, prosperity, and posterity. US exports and imports are showing the strains of sluggish conditions overseas. Our updated economic forecast reflects some "cliff" effects, but not a renewed recession.

2012-10-12 The Golub Group Commentary by Team of The Golub Group

High-quality businesses that have the ability to pay and increase their dividends are even more attractive in this low yield environment and the valuations of these businesses are cheap on an historic basis and relative basis to the alternatives.

2012-10-11 Unemployment Surprise or Conspiracy? by Marie Schofield of Columbia Management

The blogosphere is overflowing with conspiracy theories about the household survey unemployment data in this pre-election period. I do not give any credence to these stories and believe the data is the data. But it needs to be interpreted carefully as it can be complex and volatile.

2012-10-10 Beyond the Fiscal Cliff: the Dollar At Risk? by Alex Merk of Merk Funds

Looking beyond the fiscal cliff, we are afraid the greenback may be at risk no matter who wins the election. We examine the risk to the U.S. dollar in the context of the likely policies pursued under either an Obama or Romney administration.

2012-10-10 Pacific Basin Market Overview by Team of Nomura Asset Management

Regional equity markets remained largely directionless and volatile during the third quarter amid the summer trading lull. Government policy action towards the end of the quarter triggered the biggest market moves. However, the euphoria was short lived following the announcements of the European Central Bank's Outright Monetary Transactions and the Federal Reserve Board's third round of quantitative easing.

2012-10-10 And That's the Week That Was by Ron Brounes of Brounes & Associates

Don't bury Candidate Romney quite yet. The man looks to be in come-back mode and he has some experience in this area. Remember when Republicans preferred anyone but Mitt (Perry, Bachmann, Cain, Gingrich, Santorum) and yet he emerged victorious from the primary season.

2012-10-10 And That's the Quarter That Was by Ron Brounes of Brounes & Associates

The "quarter of Bernanke" left investors optimistic over the past three months despite the ongoing concerns at home and abroad (and a critical election).

2012-10-10 Third Quarter Surge Caps 12-Month Relentless Risk Rally by Douglas Cote of ING Investment Management

Despite the rally of the past year, equity markets still look cheap. Weakening manufacturing data suggest the 12-quarter streak of positive earnings growth may come to an end in the third quarter. Housing has turned the corner, providing consumers with cause for confidence. Though fundamentals have wavered a bit, we are constructively bullish on risky assets, as "successful investing demands a choice between prudent risk control and outright risk avoidance".

2012-10-09 Riding Into The Sunset or a Brick Wall? by Peter Schiff of Euro Pacific Precious Metals

A month ago, I presented the case for why Fed Chairman Bernanke would have strong motivation to launch another round of quantitative easing (QE) before the election. In short, it would save him his job. Now, I didn't predict with certainty that he would do so - only the few men at the FOMC knew that for sure - but it seemed likely. Shortly thereafter, Bernanke not only announced more stimulus, but promised to keep it flowing to the tune of an additional $40 billion a month until conditions improve.

2012-10-09 Expect Economic Sluggishness to Persist by Bob Doll of BlackRock Investment Management

Although the economy does seem to have improved a bit in recent months compared to where it was in the second quarter, growth levels in both the United States and around the world will likely remain subpar at least through the middle of next year. The base case for the United States appears to be the economy continuing to grow at around 2% (perhaps a notch higher) over the course of 2013. This growth level would be contingent on avoiding the full force of the fiscal cliff and would be underpinned by a recovery in housing and a pickup in capital spending levels.

2012-10-09 This Fortress built by Nature for Herself by Dennis Gibb of Sweetwater Investments

It has been some time since I have taken keyboard in hand in any attempt to inform anyone of my thoughts on the world of investing. I am taking the time to write now because we are embarked on some events that are, in my humble opinion, truly historic. As these events play out the United States may not be a fortress built by nature for herself. So hang on this could get rough and as usual it will be opinionated with a different perspective.

2012-10-09 High Yield and Equities Mind the (Equity) Gap by Hozef Arif of PIMCO

High yield bonds returned 12% through September, even as corporate defaults continued to rise, albeit gradually. While the default rate is an important market metric, it has been a lagging indicator of high yield bond total return performance. Investors should closely monitor equity markets for signals on where high yield spreads may go.

2012-10-09 Global Investment Outlook by Team of Aberdeen Asset Management

Global growth remains positive but momentum is lacking. Central bank action has eased tensions. Markets are calmer but future direction is uncertain

2012-10-08 House Prices on the Rise by Dmitri Rabin of Loomis Sayles

After four years of consecutive declines, US housing prices appear to be stabilizingand even beginning to rise. While we expect the recovery to be slow and geographically uneven, we do believe that US house prices bottomed in the first quarter of 2012 and could grow approximately 2-3% per year through 2015. In our view, these slow increases in house prices will gradually help consumers repair their balance sheets and increase demand for housing, supporting homebuilders and other housing-related industries.

2012-10-08 China: Towering Ambitions by Team of Thomas White International

The proposed Sky City will have schools, hospitals, homes, stores, and offices.

2012-10-08 The Great Debate by John Petrides (Article)

The first of three presidential debates kicked off last week with each candidate portraying the core fundamentals of their respective party, neither of which backed down from their beliefs. As the candidates continue to jockey for sound bites, a debate among investors continues to rage: What will happen to the market after the election?

2012-10-05 Economic Recovery and Debt Reduction: Faster, Please! by Chris Molumphy of Franklin Templeton Investments

It's tough to be patient in an age of instantaneous communications and instant gratification. We all want immediate answers to our questions and quick fixes to our problems. When it comes to real world tangles like the global economy, though, Chris Molumphy, CIO of Franklin Templeton Fixed Income Group, reminds us that patience, not a magic pill, is the order of the day when it comes to European and U.S. struggles to cure their economic ailments. He's realistic about these problemsbut isn't waiting to act where he does spot investment opportunities.

2012-10-05 When Do You Ignore Your Gut? by Team of Franklin Templeton Investments

Anyone who took an introductory psychology class probably remembers the classic study in which different people witnessing the same crime each report a different take on what happened. Though each presumably sane, sober person witnessed the events with his or her own two eyes, individual expectations and biases influenced how they perceived what happened. Sure, you say, but what does this have to do with investing? Well, it turns out that our individual expectations and biases influence how we view investments, too.

2012-10-05 Market Respite by Richard Michaud of New Frontier Advisors

In a period of looming macroeconomic risks and great investor uncertainty the quarter resulted in solid gains in most global equity markets. The Dow was up 4.3%, the S&P 500 5.8% and the NASDAQ 6.2% for the quarter. Year-to-date the Dow was up 10%, the S&P 14.5% and the NASDAQ 19.6%. The news internationally was encouraging though mixed with European indices up 8% for the quarter and 11.8% for the year while Pacific indices were up 2% for the quarter and 7.4% for the year.

2012-10-05 Keep up the pressure the US jobs crisis is not yet over by Mohamed El-Erian of PIMCO

The monthly US employment report has evolved steadily: once a lagging indicator of the underlying state of the economy, it is now seen more as a leading indicator of economic, political and social trends. Friday's data tell us, for once, rather good news.

2012-10-04 Market Dimensions by James Damschroder of Gravity Capital Partners

An interesting and perhaps volatile fourth quarter is upon us. We have elections and the fiscal cliff straight ahead. Markets dislike uncertainly, making asset prices potentially marginally lower.

2012-10-03 The Fed Plays All Its Cards by Peter Schiff of Euro Pacific Capital

There never really could be much doubt that the current experiment in competitive global currency debasement would end in anything less than a total war. There was always a chance that one or more of the principal players would snap out of it, change course and save their citizenry from a never ending cycle of devaluation. But developments since September 13, when the U.S. Federal Reserve finally laid all its cards on the table and went "all in" on permanent quantitative easing, indicate that the brainwashing is widely established and will be difficult to break.

2012-10-03 Stocks Are Taking a Breather from the Rally by Bob Doll of BlackRock Investment Management

To at least some extent, the pause in the rally we have seen over the past couple of weeks can be attributed to some profit-taking on the heels of a significant multi-month uptrend (US stocks rose close to 6% in the third quarter). It is also likely, however, that investors are coming to grips with the fact that the world continues to face some serious risks and are recognizing that not all of the world's problems can be solved by central bank action.

2012-10-03 Don't Bring Me Down: Not Swayed by Pessimism at BCA Conference by Liz Ann Sonders of Charles Schwab

We present highlights, key takeaways and perspective on the recent BCA Research Investment Conference. The eurozone crisis and China's slowdown remain risks, but are somewhat offset by optimism about US markets. Politics will remain a force underpinning uncertainty and volatility.

2012-10-03 Let the Good Times Roll by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

To summarize our current position, while we acknowledge there are many risks we feel those are already reflected in the market and stock prices will drift higher as investors begin to recognize the positive developments outlined above. Analysts remain very bearish and continue to recommend a below-average weighting to stocks. Moreover, despite strong returns from equities investors have pulled money from U.S. stock funds for 18 straight months and are largely under-allocated when compared to history.

2012-10-03 A Funny Thing Happened On The Way To Economic Armageddon by Scott Colyer of Advisors Asset Management

After the recent announcement by the U.S. Federal Reserve (Fed) that they would begin to engage in what has been deemed "QE3," there has been a lot of skepticism that such a plan could actually work. The Fed is attempting to carry out their dual mandate of price stability and full employment by engaging in a new round of asset purchasing targeted at the mortgage market.

2012-10-02 Pottersville by Tony Crescenzi of PIMCO

The excessive use of debt fueled by money printing was the pathway to the global debt crisis. Fed Chairman Ben Bernanke, an expert on the Great Depression, understands the ravages of debt deflation and his every action has been to prevent it from occurring. Greater care must be taken in the future to ensure that our fiat based, fractional reserve system does not run amok. This is why regulators are demanding that banks raise capital, reduce their proprietary trading activities, and shift their business models closer to a utility-style model.

2012-10-02 QE and the Equity Market: Is the Fed Driving or Along For the Ride? by Patrick Lawler of PIMCO

Federal Reserve officials have said several times that among other benefits, its quantitative easing (QE) programs have helped boost U.S. equity prices. Based on our analysis, QE has not been the driving force behind rising equity prices in recent years. How does the Federal Reserve measure the success of its asset purchase programs, or quantitative easing (QE), since the 2008 financial crisis QE1, QE2, Operation Twist (OT) and QE3?

2012-10-01 More Pieces of the Puzzle by Scott Brown of Raymond James

Recent economic data have been mixed. Consumer attitude measures have improved, but manufacturing figures have softened. On balance, the numbers are consistent with more of the same: a positive, but lackluster-to-moderate pace of growth.

2012-10-01 Typical Post-QE by Christian Thwaites of Sentinel Investments

We have typical post-QE market behavior. GTs sold off, then rallied. Equities rose, then flattened. The dollar sold off then strengthened. Gold crept up. Other commodities rose, yawned and gave up most of their gains. Earlier QEs took several months for this to play out. It now all happens in quick time.

2012-09-28 The Danger of Safety by Owen Murray of Horizon Advisors

Investors have become cautious and anxious following the bear market of the past twelve years and the recent bouts of extreme volatility. We examine risks and opportunities in light of the difficult market environment in our special report The Danger of Safety."

2012-09-28 The Housing Market: For Real or Fakeout? by Jeffrey Dow Jones of Jones & Company

Most of you guys know that I bought a new house last summer. I spent two years looking at properties with the lovely (and patient!) Mrs. Concord, and eventually we found one that had what we each were looking for. My #1 criteria was value. Not price, but value.

2012-09-28 Schwab Market Perspective: Disrespected RallyCan It Continue? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

US equities are trading near five-year highs but numerous measures show investors remain skeptical. The enthusiasm following the Fed's announcement of more quantitative easing was short-lived, although the summer rally in stocks could be at least partially attributed to anticipation of more stimulus. The enthusiasm following the Fed's announcement of more quantitative easing was short-lived, although the summer rally in stocks could be at least partially attributed to anticipation of more stimulus.

2012-09-28 Look Out Below! The Fiscal Cliff Steepens by Russ Koesterich of iShares Blog

Despite the recent happy headlines, most measures of US economic activity point to slower growth, which makes the threat of the fiscal cliff pushing the US economy into a recession even greater. Russ K explains how investors can prepare.

2012-09-27 PIMCO'S Cyclical Outlook for Asia: Structural Slowdown Shaping Near-Term Growth Dynamics by Tomoya Masanao, Robert Mead, Ramin Toloui of PIMCO

Rather than a hard landing for China, we foresee a structural downshift that could be called a "New Normal with Chinese characteristics." Australia has considerable scope for additional rate cuts and more expansionary fiscal policy to address regional weaknesses. The Japanese economy will be affected by weak economic growth in China, which will add more pressure for the Bank of Japan to respond.

2012-09-26 Bernanke Put: Beware of Easy Money by Alex Merk of Merk Funds

Central bankers around the world may be providing a backstop to the financial markets in much the same way Greenspan did during the "Goldilocks" years, but when the short-term euphoria wears off, will the negative repercussions be even more severe?

2012-09-26 Is China Becoming Less Competitive? by Dara White of Columbia Management

Concerns about the pace of economic growth in China and the imminent change in leadership have continued to escalate. At the beginning of the year, we highlighted the potential for the rate of economic growth to slow significantly. I recently visited Asia to get a clearer perspective on the situation in China specifically, and Asia generally.

2012-09-26 Are BRICs Hitting a Growth Wall? by Mark Mobius of Franklin Templeton Investments

A global pattern of easing economic growth in the first half of 2012 has impacted the "BRIC" nations Brazil, Russia, India and China. However, I don't think the BRIC economies have hit a brick wall. While some market participants have been waiting impatiently for governments to undertake further stimulus measures, others have wondered whether something more fundamentaland less within governmental controlmight be at work.

2012-09-25 Jim Bianco ? Markets Will Benefit From Disastrous Fed Policy by Robert Huebscher (Article)

The Fed's quantitative easing policy will be 'disastrous,' according to Jim Bianco, but prices for riskier assets will rise over the near term as a result. In remarks last week, Bianco, the head of the Chicago-based economic research firm that bears his name, also gave the US economy a near-failing grade of C-, and warned that inflation will be 'problematic.'

2012-09-25 Stocks Should Overcome Hurdles to Continue the Bull Market by Bob Doll of BlackRock Investment Management

Although global economic data has been relatively weak in recent years, risk asset prices have nonetheless advanced. We would attribute this trend to the fact that weak economic growth does not, by itself, limit the potential for risk assets. In our view, the liquidity-driven reflationary policies of the world's central banks have been a more important factor for asset prices than economic growth levels have been.

2012-09-24 And That's the Week That Was by Ron Brounes of Brounes & Associates

These days, the various central bankers keep trying to outdo themselves with new stimulus deals. This week, Bank of Japan followed the Fed leads with an expanded bond buying program. Perhaps the moves will reap dividends and the global economy will surge to higher highs in the not so distant future. (Or perhaps the "easy money" strategies will have little impact long-term and lead to periods of inflation and asset bubbles.) Apple's latest "new new" thing remains in hot demand (but can supplier keep up?).

2012-09-24 If youre a partisan Republican, skip this commentary by David Edwards of Heron Financial

In June after stocks slumped over concerns about Europe, we wrote "US stocks however, were a good value a month ago and a better value today. With the weak hands forced out by the recent 10% pullback, we are moving forward with investments in stocks." With two and half months remaining in the year, our "buying panic" forecast is starting to look prescient.

2012-09-24 Some Parting of the Clouds by Charles Lieberman (Article)

The ongoing rally in the equity market and corresponding rise in Treasury yields mirror the slow improvement in financial market conditions in Europe and moderate gains in domestic economic data. This still leaves more progress to be made on both fronts, but uncertainty remains elevated over the fiscal cliff, the threat of military conflict in the Middle East, the upcoming election, and tax policy.

2012-09-24 Clear Progress by Christian Thwaites of Sentinel Investments

Two weeks into a new era of ECB and Fed policy and it is a tie between the gains in equities, with the US and European broad indexes up around 2.2%. But it's the lack of follow-through and opacity of the ECB moves which are perhaps the most disconcerting and so, probably, the more short-lived. While both central banks reported easing in the form of securities purchases they had very different origins and aims.

2012-09-24 Housing Recovery Still Young by Brian Wesbury, Bob Stein of First Trust Advisors

The turnaround in the housing market is perhaps the brightest spot in an otherwise tepid economic recovery. Home sales, home building, and even home prices are all headed up. In the past twelve months, sales of existing homes are up 9% while sales of new homes are up 25%. Housing starts are up 29%. The two most prominent home price measures, Case-Shiller and FHFA, are both up at about a 7% annual rate in the past six months.

2012-09-24 Who Deserves Blame (Or Credit) For Current Tax Policy? by Ryan Davis of Fortigent

U.S. Presidential candidate Mitt Romney received sharp criticism this week for his comments regarding the "47% of people who pay no taxes." Regardless of one's political stance, Romney's comments were instructive in highlighting a very real problem. The notion that Republicans or Democrats deserve blame for the current challenges is shortsighted, however, because both parties were contributing members to the current legacy.

2012-09-22 QE Infinity: Unintended Consequences by John Mauldin of Millennium Wave

Last Monday an op-ed in the Wall Street Journal, penned by five PhDs in economics, among them a former Secretary of the Treasury and an almost-guaranteed Nobel laureate (and most of them former members of the President's Council of Economic Advisors) minced no words in excoriating the current QE policy. We will look at that op-ed in detail below. The point is that there are grave reservations about the current policy among some very serious policy makers.

2012-09-21 The Hard Road Ahead for Housing by Carl Tannenbaum of Northern Trust

The housing sector has come a long way, but has a long way to go. Mortgage underwriting standards have reverted to much more conservative norms, and housing policy is very much in a state of flux. The result: renting is on the increase, and may enjoy renewed popularity for some time.

2012-09-20 QE n+1 What The Fed Is Really Up To by JJ Abodeely of Sitka Pacific Capital Management

As I survey the news stories and other analysis on the Feds recent announcement, most fall short of describing what the Fed is really up to. Here is a hint: it's not really about employment. It's not really about "price stability" or really about growth either.

2012-09-19 Us and Them: Household Sector Deleveraging vs. Public Sector Leveraging by Liz Ann Sonders of Charles Schwab

The eruption of the financial crisis in 2008 unleashed a household deleveraging cycle, triggering unprecedented Fed easing and now QE?. Next up, government sector deleveraging.

2012-09-18 Federal Reserve Actions Help the Rally to Continue by Bob Doll of BlackRock Investment Management

The headline news last week was the US Federal Reserve's announcement of a new round of quantitative easing in which the central bank plans to purchase $40 billion of mortgage-backed securities on a monthly basis (without a predetermined end date). The Fed also pushed back the timeframe on how long it will maintain its current zerointerest-rate policy, indicating that the current level of rates should be in effect through the middle of 2015.

2012-09-18 Fed Delivers another Big Dose of QE by Scott Colyer of Advisors Asset Management

Yesterday, the Fed delivered the much anticipated dose of Quantitative Easing (QE) announcing that it would continue to buy U.S. Agency Mortgage Backed Securities (MBS) in an effort to further drive growth in the U.S. economy and decrease the ranks of the unemployed. The monthly purchase rate of $40 billion will be in addition to the already $10 billion that is being reinvested from QE 1&2 in mortgage-backed securities. This new money balance sheet expansion by the Fed accompanies additional guidance that the Fed would stay low on interest rates likely until mid-year 2015.

2012-09-18 Housing Recovery? Try Long Convalescence by Russ Koesterich of iShares Blog

The US Federal Reserve's decision to expand quantitative easing is dramatic, but we don't think it will have a significant impact on the US housing market. While the extra liquidity is supportive of risky assets in the very near-term, lower mortgage rates are not a game-changer for a consumer still struggling with little income growth and too much debt.

2012-09-17 And That's the Week That Was by Ron Brounes of Brounes & Associates

Dr. B. has spoken and investor are happy (though some Republican investors probably have mixed feelings). Though not all economists were on board with QE3, the policymakers looked at the labor market and took action. With promises of more bond-buying and low fund rates into 2015, investors went on a risk asset buying spree and stocks shot up to multi-year highs. So let the over-analysis (and political bickering) begin.

2012-09-17 Charlie Dreifus on the Global Economy and Its Impact on Stocks by Charlie Dreifus of The Royce Funds

Portfolio Manager Charlie Dreifus examines the data from Europe, China, and the U.S. and discusses how it may affect domestic stock prices.

2012-09-17 Ben Wants You To Spend Cash by John Petrides (Article)

This week the Federal Reserve launched its third round of monetary policy easing in as many years. Under QE3 (quantitative easing), the Fed will purchase $40 billion of mortgage backed securities on a monthly basis with the purpose of continuing to fuel the housing market. Under QE3, the Fed said it will keep its zero interest rate policy until mid-2015, with the goal of removing market assumptions of a rising rate environment. The Fed is and always will be data dependent, so all of these actions are subject to change.

2012-09-17 "QE" Stands for Quality Employment by Kristina Hooper of Allianz Global Investors

The Fed's expansive and open-ended quantitative easing program centers on building up a depleted workforce and quickening the pace of the housing recovery, but higher inflation and tight credit could play the role of spoiler. Buying mortgage-backed securities and pushing interest rates lower is designed to boost the housing sector, help loosen lending standards, stimulate corporate spending and increase foreign demand for U.S. products. This is a tall order and there are many "ifs" in this scenario, but the flexibility and breadth of QE3 increases the likelihood of its effectiveness.

2012-09-17 Was QE3 Necessary? It Depends on Who You Ask... by Ken Taubes of Pioneer Investments

Last week Chairman Bernanke and the Fed launched another aggressive stimulus program, QE3, saying that they will buy $40 billion in mortgage debt per month and continue to purchase assets in order to boost growth and reduce unemployment. He also announced that the Fed is not likely to raise rates from the current rock bottom lows until at least mid 2015, vs. 2014 as previously stated.

2012-09-17 A Fed Fueled Rally by Chris Maxey of Fortigent

The week was overshadowed by policy actions from the Federal Reserve, which led to a 2.2% gain in the Dow Jones Industrial Average and a 1.9% increase in the S&P 500 Index.

2012-09-14 QE3: Ineffective Parachute for Fiscal Cliff by Russ Koesterich of iShares Blog

While the most likely scenario is that Washington reaches a compromise at the last minute, until then the uncertainty will keep the markets volatile and potentially drag down fourth quarter growth. Given recent comments out of Congress, there is also a non-trivial chance that we will, at least temporarily, go over the cliff. If that happens, QE3 will not be a particularly effective parachute.

2012-09-14 All In by Bob Rodriguez of First Pacific Advisors

2013 is a critical moment in time. If a material and timely fiscal restructuring does not take place by next September, I fear and believe that it will not occur before 2017. Unfortunately, if this were to occur, my 2009 warning of a crisis of equal or greater magnitude than the Great Recession by 2017 would be a more likely outcome. My worst fear is that fiscal gridlock continues, coupled with the policies of this activist Fed Chairman. Todays Fed actions add to my anxieties. ALL IN may be a good strategy for poker but not for this economy.

2012-09-14 Operation Screw by Peter Schiff of Euro Pacific Capital

The Fed will try to conjure a recovery on the backs of currency debasement. It will not stop or alter from this course. If the economy fails to respond to the drugs, Bernanke will simply up the dosage. In fact, he is so convinced we will remain dependent on quantitative easing that he explicitly said he won't turn off the spigots even if things noticeably improve. In other words, the dollar is screwed.

2012-09-14 All Signs Pointing to Gold by Frank Holmes of U.S. Global Investors

So, gold investors, if you havent put in your orders, consider getting them in quickly, because the bulls are buying. Credit Suisse saw 'massive inflows' into gold exchange-traded products in August after experiencing significant outflows compared to crude oil and the broader market in March, April, May and July. August shows a clear preference toward gold.

2012-09-14 Central Banks Take Center Stage by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Accommodative central banks have traditionally been good for equities and stocks have responded positively to recent action. However, each market reaction to US Fed action has been shorter in length and challenges persist. Although recent economic data has been beating relatively low expectations, it is still not meeting the Fed's hopes. We appreciate the sentiment of wanting to stimulate growth, but the Fed's power is limited. It's down the street in Washington where the real power to stimulate growth lies.

2012-09-14 All In by Doug MacKay and Bill Hoover of Broadleaf Partners

Dissatisfied with progress on the jobs front, the Fed went "all in" yesterday in its much anticipated, most recent policy announcement. Unlike QE1, QE2 and Operation Twist, the latest addition to the monetary smorgasbord is open-ended, meaning that it has no pre-established termination date. Policy will remain stimulative for as long as it takes to see a substantial improvement in employment. Rather than keeping rates low well into 2014, it could now be well into 2015 before they tick back up.

2012-09-14 Open-Ended Easing by Carl Tannenbaum and Asha Bangalore of Northern Trust

The Federal Open Market Committee (FOMC) took a very forceful set of steps this week, designed to stimulate what officials have called a "frustrating" job market. Our updated forecast suggests that the growth trajectory of the US economy is positive but sufficiently sub-par for the Fed to have initiated additional monetary policy support. There are increasing signs that China's economy is slowing more than the official readings would suggest.

2012-09-12 Housing's 'Green Shoots' by Investment Strategy Group of Neuberger Berman

Headwinds in the housing market appear to be abating as the U.S. economy gradually heals.

2012-09-12 On Uncertain Ground by Howard Marks of Oaktree Capital

I'm going to devote this memo to the uncertainty in the world and the investment environment and then offer my take on the appropriate strategy response. This will require me to touch on a large number of topics, but I will try to dwell less than usual on each of them.

2012-09-12 PIMCO Cyclical Outlook: Building Rickety Bridges to Uncertain Outcomes by Saumil Parikh of PIMCO

Without structural change aided by well-planned fiscal policy, we are afraid the nominal bridges of monetary policy will fail to reach their desired outcomes. The probability of a deflationary left-tail outcome emanating from the eurozone has declined substantially in the short run, yet outright economic growth in the eurozone will remain elusive in 2013.The much-publicized "fiscal cliff" is set to hit the U.S. economy on January 1, 2013, and could reduce U.S.

2012-09-12 Investing is Like Duck Hunting by Pamela Rosenau of HighTower Advisors

The discussion of additional monetary easing by the Federal Reserve has been the topic du jour in recent weeks. As a result of potential additional monetary stimulus, the US dollar has experienced a decline. Also, after a weaker than expected jobs report last week, US treasuries initially rallied given an increased expectation of Fed action. However, as pointed out by the market commentators at Sober Look, the Treasury curve has begun to steepen with the "30-year bond and other longer dated treasuries steadily selling off."

2012-09-11 Rally Should Continue, but Look for More Volatility by Bob Doll of BlackRock Investment Management

Despite a relatively disappointing jobs market report for August, stocks rose last week as investors focused on the European Central Banks (ECB) announcement of its longawaited plan to buy bonds in the secondary market. The ECB program represents an important step in terms of lowering volatility and providing a cushion for Europes debttroubled countries to make some longer-term improvements in their fundamentals.

2012-09-10 Late-Stage, High-Risk by John Hussman of Hussman Funds

The market conditions we observe at present are very familiar from the standpoint of historical data, matching those that have appeared prior to the most violent market declines on record (e.g. 1973-74, 1987, 2000-2002, 2007-2009).

2012-09-10 The August Employment Report and the Fed by Scott Brown of Raymond James

The August job market report was disappointing. Nonfarm payrolls rose less than expected and previous figures were revised lower. The unemployment rate fell, but that was due to a decrease in labor force participation (dont read too much into that).

2012-09-10 As the Euro Tumbles, Spaniards Look to Gold by Peter Schiff of Euro Pacific Precious Metals

The unremitting deterioration of the eurozone's sovereign debt landscape continues to fuel uncertainties about the longevity of the euro as a strong currency. Such uncertainties are not only leading to capital flight from the EMU's periphery to the core and destabilizing markets worldwide, but they are also beginning to frighten southern European savers into seeking refuge outside their 10-year-old currency.

2012-09-10 The Case for Real Estate by Jeff Kolitch, David Baron, David Kirshenbaum of Baron Funds

We believe we are in the early stages of a multi-year real estate recovery fueled by improving cash flows, rising demand, a scarcity of new development projects, improving credit availability, and generationally low interest rates. We believe the outlook is promising for both residential and commercial real estate.

2012-09-10 Better Policy, Better Recovery by Brian Wesbury, Bob Stein of First Trust Advisors

Politicians always shift the blame. So, hearing them say that "no one" could have cleaned up the so-called mess and fixed the economy in just a few years is not surprising. What else do you say when after three years of recovery the unemployment rate is still at 8.1% -- down only 1.9 points since the peak almost three years ago and real economic growth has averaged a tepid 2.2% for three years of economic recovery?

2012-09-10 When Bad Is Good by Kristina Hooper of Allianz Global Investors

Faith in the Fed is growing more devout. Despite another disappointing jobs report, stocks drifted higher Friday to close out a strong week for the major averages as investors pinned their hopes to an imminent policy move from central bankers. It is becoming more apparent every day that the U.S. economy is sputtering. While housing appears to have stabilized, jobs and manufacturing are areas of concern.

2012-09-07 Spinning Pessimism Into Opportunity by Peter Langerman, Ed Jamieson of Franklin Templeton Investments

In the markets and in life, we face bullish and bearish periods. Some days are good and some days are bad. But even on bad days, good things can and do happen, which may explain our sometimes Pollyanna-sounding persistence on the existence of a bright side even in the face of somber-sounding issues like fiscal cliffs and austerity measures.

2012-09-07 The Fed's Campaign by Peter Schiff of Euro Pacific Precious Metals

This past Friday, as Fed Chairman Ben Bernanke delivered his annual address from Jackson Hole - the State of the Dollar, if you will - I couldn't help but hear it as an incumbent's campaign speech. While Wall Street was hoping for some concrete announcement, what we got was a mushy appraisal of the Fed's handling of the financial crisis so far and a suggestion that more 'help' is on the way.

2012-09-06 September: A Rough Month for the Markets? by Gary Halbert of Halbert Wealth Management

September is often a bad month for the stock markets, historically speaking, and this year it could be especially turbulent. In addition to all the uncertainty about the weak US economy, there is uncertainty about what the Fed may do just ahead and what, if anything, will be done to address Europe's recession and debt crisis. In addition, there is the looming presidential election which no doubt will go hyperbolic this month.

2012-09-05 September Economic Update by Justin Anderson of Cambridge Advisors

August was characterized by relatively low volatility as stocks continued to grind higher and bond yields traded in a fairly narrow range. The economy saw little change as the slow growth theme continued. European officials mostly took the month off so the sovereign debt crisis fell off the radar for the month. Politics have dominated the headlines, but a close race hasn't provided an impetus for investors to make significant portfolio changes.

2012-09-04 ProVise Bullets by Ray Ferrara of ProVise Management Group

At one time during the dotcom craze, the NASDAQ closed over 5000, but, as it tumbled downward, it last crossed the 3000 mark on December 11, 2000; that is until it crossed that mark on March 13, 2012, or 11.25 years later. My, how the times have changed! The income tax was introduced in the U.S. in 1913. This means that when we file our taxes on April 15, 2013 for the year 2012, it will be the 100th year that income taxes have been paid.

2012-09-04 Civility by Jeffrey Saut of Raymond James

Webster's defines "civility" as: civilized conduct; especially: courtesy, politeness. But, there was no civility last Friday afternoon. The place, CNBC; the time 3:05 p.m.; the anchors Michelle Caruso-Cabrera and Bill Griffith; the show "Closing Bell"; the guests were myself, Bill Spiropoulos, Lee Munson, and Matt McCormick. The interview started off well enough with each interviewee responding to the anchors' questions.

2012-09-04 Housing's Slow Climb Out of the Cellar by Milton Ezrati of Lord Abbett

After being down so long, it is finally looking up for the beleaguered sector. But the recovery still faces a number of obstacles.

2012-09-04 Still No Recession in Sight by Brian Wesbury, Bob Stein of First Trust Advisors

Real GDP in the US has grown 2.3% in the past year, a mediocre rate of growth, little different than its 2.2% average since mid-2009, when the recovery officially began. It's what we call the Plow Horse economy and we expect it to continue plodding along, at least through this fall.

2012-09-04 All QE, All the Time by Chris Maxey of Fortigent

In a week of relatively light trading to wrap up the summer, equity markets trickled lower, as the Dow Jones Industrial Average lost 0.5% and the S&P 500 Index fell 0.3%. It was a mixed week of economic data in the U.S., but markets were clearly locked in on Ben Bernanke's speech in Jackson Hole, Wyoming. News on housing seems to confirm that a bottom is in place, while manufacturing data continues to move in all different directions.

2012-09-01 Schwab Market Perspective: Back to Work by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

As summer winds down, we expect things to heat up as policymakers get back to work, resulting in a challenging investment environment.

2012-09-01 And That's the Week That Was by Ron Brounes of Brounes & Associates

Isaac vs. Romney vs. Bernanke. Each took their turn in the limelight this week. While the Hurricane dropped plenty of rain and brought damaging winds into Louisiana, the devastation didnt compare to Katrina. Romney humbly accepted his party's nomination, while still trying to prove to T-Partiers (and women) that he should be their guy (and he can bash his opponents with the best of them.

2012-09-01 The Consequences of Easy Monetary Policy by John Mauldin of Millennium Wave Advisors

We heard from Bernanke today with his Jackson Hole speech. Not quite the fireworks of his speech ten years ago, but it does offer us a chance to contrast his thinking with that of another Federal Reserve official who just published a paper on the Dallas Federal Reserve website. Bernanke laid out the rationalization for his policy of ever more quantitative easing. But how effective is it?

2012-08-29 International Real Estate Securities: Review and Outlook by Jon Cheigh, Rogier Quirijns, Gerios Rovers, Luke Sullivan of Cohen & Steers

We would like to share with you our review and outlook for the international real estate securities market as of July 31, 2012. The FTSE EPRA/NAREIT Developed ex-U.S. Real Estate Index had a total return of 5.2% for the month (net of dividend withholding taxes) in U.S. dollars. By comparison, U.S. REITs returned 2.0% for the month, as measured by the FTSE NAREIT Equity REIT Index. Year to date, the indexes returned 21.3% and 17.2%, respectively.

2012-08-28 Real Estate Resiliency: the REIT Model Proves its Mettle by Josh Olazabal, Amit Arora of PIMCO

REIT unsecured debt has been one of the best-performing sub-sectors in the entire investment-grade credit area. When insurance companies began to look at REIT unsecured debt, they asked for the same type of covenants associated with property-level mortgages. These requirements have coalesced into a standard REIT covenant package. We believe low default rates and relatively high recovery rates make the sector attractive over the long term particularly for buy-and-hold investors.

2012-08-28 Are Markets Nearing a Crossroads? by Chris Maxey of Fortigent

A relatively quiet, end-of-summer week resulted in modest losses for equity markets. The Dow Jones Industrial Average closed down 0.9% and the S&P 500 index lost 0.5%. There were limited amounts of economic data for the market to digest last week, but plenty of other headlines kept participants active. It was a decent week overall for economic data, as reflected by the continued recovery in the Citigroup Economic Surprise Index.

2012-08-28 The Gold Standard Gets Another Look by Peter Schiff of Euro Pacific Capital

As Republicans convene in Tampa to nominate Mitt Romney and hammer out their party platform, one of the planks that could attract the most attention is the Party's official position on the gold standard. As it is now being considered, the platform stops short of recommending a return to the gold standard, but does advocate a commission to consider the possibility.

2012-08-28 Whats A House Really Worth? by Carl Tannenbaum of Northern Trust

Despite the well-documented correction in real estate prices, our property taxes have been slow to react. My wife is on a singular mission to correct this asymmetry, collecting evidence from a variety of sources that suggest that our house is relatively worthless. Good thing we don't need a home equity loan.

2012-08-27 Inside the Feds Head by Kristina Hooper of Allianz Global Investors

Now more than ever, investors are getting a glimpse into the minds of policy makers. While economic forecasts remain foggy, recent FOMC minutes reveal why the Fed is sharpening its tools and which ones it is likely to use.

2012-08-27 U.S. Real Estate Securities: Review and Outlook by Jon Cheigh, Thomas Bohjalian of Cohen & Steers

We would like to share with you our review and outlook for the U.S. real estate securities market as of July 31, 2012. The FTSE NAREIT Equity REIT Index had a total return of 2.0% for the month, compared with a 1.4% return for the S&P 500 Index. Year to date, the indexes returned 17.2% and 11.0%, respectively.

2012-08-27 And That's the Week That Was by Ron Brounes of Brounes & Associates

When Ben Bernanke talks...investors listen, Republican moans, Romney belittles, and markets react. For now, the jury is still out about any upcoming stimulus move as the policymakers appear far from consensus. Housing continued its rebounding ways, though manufacturing again raised concerns. Europe still appears to be in disarray as Greece takes direction (and a scolding) from its stronger brethren. Stocks ended their nice winning streak, though closed the week on a high note.

2012-08-27 FPA Crescent: Steve Romick's Semi-Annual Report by Steven Romick of FPA Fund

FPA Crescent Fund has released its Semi-Annual report on the state of the fund and its investments. The piece also delves into portfolio manager Steve Romick's market outlook and thoughts regarding the fund's positioning moving forward.

2012-08-24 Emerging Markets Real Estate Securities: Review & Outlook by Jason Yablon of Cohen & Steers

We would like to share with you our review and outlook for emerging markets real estate securities as of July 31, 2012. For the month, the FTSE EPRA/NAREIT Emerging Real Estate Index had a total return of 2.2% in U.S. dollars (net of dividend withholding taxes), compared with 3.6% for the FTSE EPRA/NAREIT Developed Real Estate Index (net), a broad measure of the global real estate securities market. Year to date, the indexes returned 19.0% and 18.9%, respectively.

2012-08-24 Gold: First Mover Advantage by Frank Holmes of U.S. Global Investors

This week, gold bugs were rewarded with the long-awaited positive momentum in the yellow metal, and on Friday, bullion rose to about $1,670. After falling below the 200-day moving average, gold had been stuck in quicksand for several months. With the jumps in the price this week, bullion swiftly rose above this critically important long-term moving average.

2012-08-23 Setting Up for Jackson Hole by Carl Tannenbaum of Northern Trust

I was once favored with an invitation to the Federal Reserve's annual retreat in Jackson Hole, Wyoming. It was an amazing experience; the participant list was a Who's Who of global economic policy makers. I called my mother to brag, but all she wanted to talk about was the mischief that she and my father had gotten into while honeymooning in the area some fifty years earlier. Too much information.

2012-08-23 Global Real Estate Securities: Review and Outlook by Jon Cheigh, Chip McKinley of Cohen & Steers

We would like to share with you our review and outlook for the global real estate securities market as of July 31, 2012. The FTSE EPRA/NAREIT Developed Real Estate Index had a total return of 3.6% for the month (net of dividend withholding taxes) in U.S. dollars. Year to date, the index returned 18.9%.

2012-08-22 What Will it Take for the Rally to Continue? by Bob Doll of BlackRock Investment Management

One of the factors underlying the upturn in stock prices over the past couple of months has been a modestly improving trend in US economic data. Last week, retail sales advanced 0.8%, well ahead of expectations. This was the first increase in four months, which suggests that while households remain generally cautious, spending levels are beginning to tick higher.

2012-08-22 Relative Value by Bill Smead of Smead Capital Management

Everyone wants to wait for the perfect time to buy into the stock market or into any major investment market. They want to enter at historically cheap prices or at "absolute values". We at Smead Capital Management believe that these people are kidding themselves and everybody else. At the time of historical lows and "absolute value" those same folks are too mortified to pull the trigger and always come up with the reason that "it's different this time". Inertia rules the day.

2012-08-22 R-E-S-P-E-C-T by Jerry Wagner of Flexible Plan Investments

With 18 Grammys, the Queen of Soul, Detroiter Aretha Franklin has certainly earned the respect of millions over a fifty-year career in show business. Conversely, despite six advancing weeks in a row, the latest bull rally just can't get any of that R-E-S-P-E-C-T.

2012-08-21 Hype and Reality in the Muni Bond Market by Hildy Richelson (Article)

Meredith Whitney's prediction last year of billions of dollars in municipal bond defaults stirred investors' fears. Earlier this summer, bankruptcies in three California cities reignited them, and last week a Federal Reserve study revealed that muni bonds have defaulted at a higher rate than previously reported. But no crisis has befallen the municipal bond market, and it is highly unlikely that one ever will.

2012-08-21 Anniversary Weaks by Christian Thwaites of Sentinel Investments

A couple of anniversaries last week: five years since the start of the credit crunch and one year since the US downgrade. The ramifications of both are still evident daily, of course. We're still living the consequences. So this is as good a time as any to take stock.

2012-08-21 Inflation Subdued, But Will It Last? by Chris Maxey of Fortigent

As the economy continues to grind along at a sub-optimal rate of growth, many pundits are calling for additional quantitative easing measures from the Federal Reserve. Recent inflation data keeps the door open for further easing, but pockets of higher prices exist, keeping the Fed at bay.

2012-08-21 Young Americans: The Death of Equities May be Exaggerated by Liz Ann Sonders of Charles Schwab

PIMCO founder Bill Gross believes the "cult of equity is dying" let me take the other side. Mutual-fund flows suggest that we may have lost a generation of investors. However, demographics suggest there may be another generation that could be the stock market's savior.

2012-08-20 And That's the Week That Was by Ron Brounes of Brounes & Associates

Once upon a time, Facebook and Groupon were prospective Wall Street darlings. Now both they are pushing all-time lows with analysts questioning their overall revenue models. For now, they are in the minority, as some decent earnings numbers and economic data brought back the "bulls" (at least those who arent on vacation) and sent the major indexes higher (again). Europe still has plenty of issues; the jury is still out on the Fed's next moves; and the campaign season is heating up.

2012-08-20 The Basis For Fear by Charles Lieberman (Article)

Last week, I wrote about how stocks are cheap historically and also with respect to other asset classes, such as bonds. This week, I want to focus on the reasons for this. Stocks are not cheap by accident. Investor concerns over Europe, renewed recession in the U.S., the fiscal cliff and the huge budget deficits provide ample reason for caution. However, not all of these concerns are well placed and some of the issues can be resolved favorably.

2012-08-17 Fiscal Cliffhanger by Brian Horrigan of Loomis Sayles

In the famous 1955 movie Rebel Without a Cause, troubled high school student Jim Stark (played by James Dean) winds up playing a game of chicken with his classmates. The US economy is at risk of driving, so to speak, over a "fiscal cliff" starting January 1, 2013, an event that threatens to wreck the economy. There are fewer than five months to avoid going over this cliff.

2012-08-17 Press Play by Liam Molloy, Bethany Carlson of Galway Investment Strategy

The Treasury has doled out approximately $10.5 billion on excess bank reserves over the last four years. The emergency Fed policy of paying 25 basis points on excess reserves was enacted on October 6, 2008 to incentivize banks to hold them in the midst of the financial crisis. It worked. But the policy also introduced another headwind to velocity of money.

2012-08-17 Love Trade Cools as Central Banks Gold Demand Heats Up by Frank Holmes of U.S. Global Investors

Although the Love Trade (purchasing gold for coins or jewelry) is on ice for now, a relatively new gold buyer has been warming up to gold. Central bank purchases hit a record high since the official sector became gold buyers three years ago. If this trend continues over the remainder of 2012, central banks will be entering a new territory of gold buying that has not been seen since the early 1960s and since the end of the Bretton Woods System in 1971.

2012-08-17 How Change Happens by John Mauldin of Millennium Wave

This is an encore appearance of the letter that is clearly the most popular one I have ever written, updated with a few thoughts from recent times (it was also part of a chapter in Endgame). Numerous reviewers have stated that this one letter should be read every year. As you read, or reread, Ill be enjoying a week off.

2012-08-16 The Chinese Hangover: As Infrastructure Spending Drops, So Does Demand for Chinese Steel by Raja Mukherji of PIMCO

The Chinese steel industry today shows many signs of serious economic difficulties brought about by the unprecedented size and speed of industry expansion. However, as the country's focus shifts away from public investments and toward tax cuts, it will be difficult for China to absorb this overabundance of domestically produced steel. Ripple effects of this oversupply may include softening iron ore prices, a possible drop in the Australian dollar, and potentially weaker global steel prices.

2012-08-16 Monthly Investment Bulletin by Team of Bedlam Asset Management

A good month: a gross increase of 3.13%, over twice the index at .49%. Opinion polls the morning after the opening ceremony for the London Olympic Games estimated that 2.5% of the television audience (or 30m viewers) actually believed that the Queen and James Bond parachuted into the Olympic arena. Even if true (the poll was tiny and perhaps respondents had a better sense of irony), such gullibility is understandable on live TV. But naivety in financial markets is unforgivable.

2012-08-16 Searching for a Fiscal Ladder by David Kelly of J.P. Morgan Funds

As America begins to cool down after a long hot summer, the economy remains sluggish. Economic growth in the first half of the year is estimated to be less than 2%, reflecting continued business and consumer caution, tight lending standards and a shrinking government sector. This pace of growth, in turn, has produced a monthly average of just over 100,000 new jobs since February, leaving the unemployment rate marooned above 8%. For investors, however, the picture is not that bad.

2012-08-16 Markets Holding Up Despite Volatility by Ken Taubes of Pioneer Investments

Despite a steady stream of negative headlines and high volatility, markets are holding up pretty well. The broadest measure of the stock market, the S&P 500 Index, is up nearly 13% year-todate through today, August 13, 2012. The NASDAQ is up almost 17%. High yield bonds are up almost 9.7% while investment grade corporate bonds have gained over 7%. Even Europe has managed 7.5%, as measured by the FTSE Eurofirst 300 Index in dollar terms.

2012-08-14 China Growth Threatened by the West by Chris Maxey, Ryan Davis of Fortigent

As we head further into the second half of 2012, it is clear that policy from central banks in the US, Europe, and China will drive markets and the global economy. Monetary policy in the US is becoming less impactful, while central bankers in Europe appear unwilling to tackle the enormity of their collective problem. It could be China that provides a sparkplug for second half global growth...

2012-08-14 Oil: Does Supply and Demand Matter? by Bill Smead of Smead Capital Management

We believe the long-term demand for oil will be greatly influenced by where the world gets its best future growth. As the chart below shows, the US has cut by 50% the amount of energy which is required to generate each dollar of Real Gross Domestic Product (GDP).

2012-08-14 Maybe This Time is Different by Andrew Redleaf of Whitebox Advisors

This Time Is Different, the catchy title of the popular book by economists Carmen Reinhart and Kenneth Rogoff, has also become a catchphrase summing up the world-weary wisdom of our time. Reinhart and Rogoff, in recounting eight hundred years of financial follies and investment bubbles, gleefully point out that in every case experts offered plausible arguments for dispensing with traditional rules of valuation, i.e., "this time it's different."

2012-08-13 Driving with the Doors Off by Doug MacKay, Bill Hoover of Broadleaf Partners

Two months ago I bought a bulldozer-yellow Jeep Wrangler, replacing my eight year old black Audi A6. While the A6 had been a wonderful car, I was ready for something new and a Jeep fit the bill. Driving with the doors off was a lot of fun, but certainly a different feeling than I was used to experiencing. The stock market over the last two months and perhaps even last three summers has been a lot like that, different, but ultimately rewarding.

2012-08-13 Double Dip? Doubtful by Milton Ezrati of Lord Abbett

The flow of economic news is hardly encouraging. Jobs growth remains disappointing. Recent readings on consumer spending and business activity show weakness as well. If the picture of the housing market has improved a bit, it still hardly portrays strength. Talk of an imminent recessionary dip has become common, for the third time now in as many years. While some recent economic reports have been discouraging, underlying fundamentals do not point to a return to recession.

2012-08-13 Commodities to Power Emerging Markets Higher by Dawn Bennett of Bennett Funds

In Latin America, Brazil leads as a natural supplier of copper and crude oil, which it is now able to extract and export on competitive terms. Nations rich with natural resources perform well during times of global economic expansion. In particular, countries rich with industrial commodities tend to outperform those without.

2012-08-13 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The rally in stocks which no one seems to believe in continued again last week. With Europe on vacation or celebrating the Olympic Games the macro background remained quiet and allowed stock prices to advance even as investor pessimism continues to grow.

2012-08-13 Stocks Look Poised for Continued Gains by Bob Doll of BlackRock Investment Management

Although investor attention seems focused on a number of well-known downside risks (including the European debt crisis, hesitant US economic growth and the pending US fiscal cliff), stocks have continued to climb higher and last week notched their fifth consecutive week of gains.

2012-08-10 Schwab Sector Views: Cautiously Cautious by Brad Sorensen of Charles Schwab

We remain slightly defensive with our sector recommendations but admit that we're a bit concerned over doing so. While we certainly believe this is the appropriate positioning given the continued elevated uncertainty in the market, combined with sluggish economic data, we also acknowledge that some defensive areas appear extended and the possibility of a near-term cyclically-based rally exists.

2012-08-10 2012 2Q Economic - Capital Market Summary by Greg Hahn of Winthrop Capital Management

The single biggest driver for the economy and investment returns is the deleveraging process which we are currently struggling through. Arguably, we have successfully transferred debt from the financial sector to the U.S. government through the Fed's QE programs. As we move through the long process of reducing debt, economic growth inevitably moderates as resources are applied to debt reduction rather than fixed investment and consumption within the economy. As a result, expected returns on financial assets are lower.

2012-08-10 Citius, Altius, Fortius by Carl Tannenbaum of Northern Trust

Countries across the globe seek faster, higher, stronger growth. Central banks in the United States and Europe are both seeking new ways to stimulate economic activity. Recent news from the housing market has been encouraging, but the race to recovery is likely to be a marathon, not a sprint. Headwinds blowing from Europe and China will continue to present significant downside risks to U.S. economic growth.

2012-08-09 Market Surge is Amplified by Low ExpectationsAs Expected by Matt Lloyd of Advisors Asset Management

European fears have subsided a bit as the European Central Bank's (ECB) president continued to offer words of support for a more comprehensive solutionthough he appeared to dampen the statements with concessions about the ECB's ultimate subservient role to the governments.

2012-08-08 How Hoover Caused the Euro Crisis by Christian Thwaites of Sentinel Investments

There is a Burkean principle that many sorts of change must be regarded with skepticism. In the last few months in Europe we have seen new maxims, new ideas, new commitments, new resolves, lots of new acronyms, yet very little has changed from two years ago when Greece surfaced as the first casualty of the banking/sovereign crisis.

2012-08-08 Monthly Product Commentary: International Equity - July 2012 by Team of Thomas White International

International equities made modest gains during the month of July on repeated assurances from European policymakers that they will explore all possible steps to prevent a collapse of the monetary union and arrest further economic decline. Developed markets in Europe's Nordic region and the Asia Pacific, excluding Japan, as well as select emerging markets in Asia ended with healthy gains for the month.

2012-08-07 Robert Shiller on the Social Benefits of Finance by Laurence B. Siegel (Article)

It's a bad sign for the finance industry that one of its leading minds - the distinguished Yale economist Robert Shiller - has felt compelled to write a book in order to defend the idea that finance itself is a constructive pursuit, worthwhile to modern society. Have things really gotten that bad?

2012-08-07 Lose The Swimmies! by Dan Morris of Morris Capital Advisors

As the end of June and the July 4th holiday approached much of our nation was gripped in an oppressive heat wave. Most people sought some respite from the weather at the pool, the lake, or the beach. For us, it was the pool, and it was crowded, with adults wishing for some quiet space, teenagers splashing and creating a commotion, and the young ones in their swimmies. I even saw one youngster, with a overprotective parent or nanny, using a flotation ring and swimmies.

2012-08-07 Mixed Signals Color Downgrade Anniversary by Kristina Hooper of Allianz Global Investors

Two trouble spots for the economy, the job market and housing, generated some good vibes amid gloom over no action from central banks and manufacturing weakness. Unfortunately, it wasnt enough to push the stock market into positive territory for the week. But looking through a longer-term lens, stocks have been resilient since last year's debt-ceiling drama and Standard & Poors downgrade of U.S. debt.

2012-08-07 All That and Nothing To See by Christian Thwaites of Sentinel Investments

The ECB learned a tough media lesson last week. If you say, as Mr. Draghi did in a pre-Olympic euphoria, that you will do "whatever it takes to preserve the euro" then markets will take you at your word.

2012-08-07 A Plane on the Tarmac by David Kelly of JP Morgan Funds

A few weeks ago, I was sitting in a plane on the tarmac at La Guardia. We had pulled away from the gate, but the pilot had just come over in the intercom to let us know that we were number 35 in line for takeoff. Since we were going nowhere fast, I took out my laptop and tried to think of an analogy to describe the current state of the American economy. Then I realized that I was sitting in one.

2012-08-06 Diamonds in the Rough by Mark Kiesel of PIMCO

The demand for most high-quality, income-producing assets continues to exceed supply due to a weaker growth outlook and aggressive policy action by global central banks. Yet we are still finding numerous opportunities globally through our bottom-up research that targets areas around the world where fundamentals are supportive and the outlook remains constructive.

2012-08-06 Why the Long Face? by Brian Wesbury, Bob Stein of First Trust Advisors

Back in early 2009, the University of Chicago Booth School of Business and the Northwestern University Kellogg School of Business teamed up to create the Financial Trust Index. The latest readings from July 2012 show that just 21% of Americans trust the financial system and only 15% trust the stock market. For many, this negativity is understandable.

2012-08-03 GDP Report: "Good News" - You've Got to be Kidding! by Gary Halbert of Halbert Wealth Management

We dissect last Fridays controversial 2Q GDP report, which most found disappointing but some in the mainstream media found encouraging (ie at least were not in a recession). From there, well discuss the Feds latest monetary policy meeting that ends tomorrow. The stock markets rallied strongly last week, partly on perceived good news from Europe, and partly because of renewed expectations that the GDP report would be weak enough to move the Fed to enact QE3.

2012-08-03 2nd Quarter Small Cap Newsletter by Team of 1492 Capital Management

The stock market posted a strong start for the year but quickly surrendered most of its gains as the macro environment (European debt concerns and China’s slowing economy) caused near-panic selling pressure until the last week of the quarter.

2012-08-03 A Funny Thing Happened on the Way to the Recession by Martin Pring of Pring Turner Capital Group

Every day it seems the media are filled with forecasts of dyer economic times ahead based on troubles in Europe, Asia, and the Fiscal Cliff. The list goes on. Indeed the latest unemployment and GDP numbers, reflect a declining growth rate that is on the verge of going negative. Consequently, a number of commentators have used a projection of these trends to forecast an imminent recession. This is typical of crowd behavior, which has a strong tendency to extrapolate the recent past.

2012-08-03 The Race for Resources by Frank Holmes of U.S. Global Investors

The world watched in awe as American swimmer Michael Phelps became the most decorated Olympian of all time. It's inspiring to see the incredible results of his tremendous sacrifice and commitment. Investing in global markets requires the same sort of stamina, especially at times like this week, when the month's reading on the manufacturing industry was not encouraging. The J.P. Morgan Global Manufacturing PMI of 48.4 for July was the lowest since June 2009.

2012-08-02 Two Inflection Points by Andrew Redleaf of Whitebox Advisors

I'm generally happiest, professionally, when I have at least one strong investment conviction. Currently I have two. I want to be long large-cap equities and short small-cap equities. And I want to be long cheap options on natural gas, mostly by owning E&P (exploration and production) firms that have become attractively cheap with the collapse of gas prices.

2012-08-01 America's Other 30% by Stephen Roach of Project Syndicate

Consumption typically accounts for 70% of America's GDP. But the 70% is barely growing, and is unlikely to revive strongly at any point in the foreseeable future, which puts an enormous burden on the other 30% of the US economy to generate any sort of recovery.

2012-08-01 Housing: Good Vibrations by Liz Ann Sonders of Charles Schwab

It's time for an update to January's report on housing, and the news continues to get better. Household formations are key. Household formations are moving higher but housing completions aren't keeping pace. Real mortgage rates plunge into negative territory. Key housing market index indicates continued sales (and pricing) recovery.

2012-08-01 China's Growing Pains by Mark Mobius of Franklin Templeton Investments

Many feel that China is the engine for the world economy and that if it slows down, we may be doomed to a recession or even a depression. Yes, China's growth is decelerating from the double-digits of recent years; various forecasters are predicting a possible GDP growth range of 7-8% this year. However, I think it's important to emphasize that would still represent an impressive pace, and remember that China isn't the world economy's only locomotive.

2012-07-31 An ECB Rally by Christian Thwaites of Sentinel Investments

We remain dependent on European statements but what a difference a year makes. This time last year we saw softening economic data and increasingly poor news coming out of Europe. But then we had a diffident ECB president who had just finished a round of rate increases as Europe slumped. This time we have combative words from Mario Draghi to support the euro, apparently at all costs.

2012-07-30 Sharp Decline in Earnings and Revenue Estimates by Mike "Mish" Shedlock of Sitka Pacific

For the first time in three years, US Quarterly Earnings are Poised to Drop. "Third-quarter earnings of Standard & Poor's 500 companies are now expected to fall 0.1 percent from a year ago, a sharp revision from the July 1 forecast of 3.1 percent growth, Thomson Reuters data showed on Thursday. That would be the first decline in earnings since the third quarter of 2009, the data showed."

2012-07-30 Right Down the Middle by Michael Kayes of Willingdon Wealth Management

A tenuous moment occurs in our household every time we get down to the last piece of dessert. My kids fight over it, and I'm right there with them. When I was a kid, my mom had the perfect solution to this age old dilemma. She would allow the first child to cut the dessert and the other to choose which half they wanted. The interconnectedness between the process and the final outcome ensured fairness. A truly cooperative attitude like this seems nowhere to be found in our world today.

2012-07-30 Heads, I Win, Tails, You Lose by Brian Wesbury, Robert Stein of First Trust Advisors

Up, down, sideways...it's all bad, all the time. Take oil, for example. Between September 2011 and March 2012, oil prices rose about 20%. This generated all kinds of "sky-is-falling" stories about consumers having less money to spend. But, recently, as oil prices headed south in May and June, do you think the negativity went away? Not! The Pouting Pundits of Pessimism said falling oil was a bad sign, signaling weak global demand. It's all bad, all the time. The glass is always half empty.

2012-07-30 The Central Bank by John Petrides (Article)

Global markets responded favorably last week to comments from Mario Draghi, President of the European Central Bank, saying that he would do whatever it takes to save the euro (this reminded me of Fed Chairman Bernanke's comments in February 2009, when the Fed started its asset purchase program, and markets responded favorably soon after). Although the world awaits more details as to what Mr. Draghi's comments entail, equity markets rallied, and the yields on Spanish and Italian bonds came in.

2012-07-30 The Longest Yard by Tony Crescenzi, Ben Emons, Andrew Bosomworth, Isaac Meng of PIMCO

As the global slowdown progresses, we can expect central banks to deploy more policy tools without limits to stem the pace of deleveraging. In Europe, quantitative easing using ESM bonds could prove to be another bridge that buys politicians more time, but does not solve the root problem. We expect real economic growth in China to be muted. While some stabilization is possible later this year, it is hard to foresee a sustained recovery.

2012-07-27 Demographic Headwinds for Housing by Mike "Mish" Shedlock of Sitka Pacific

Boomer demographics and postponement of marriage on account of student debt and poor finances are two of the key reasons that I long-ago stated the housing recovery would be slow for a decade. Declining birthrates now show that is indeed what is happening.

2012-07-27 Challenging the Paradigms of Investing by Frank Holmes of U.S. Global Investors

Global investors constantly need to be watchful of individual biases, impaired thinking and emotional reactions that can have an adverse effect on a portfolio. One of our values at U.S. Global Investors is to always be curious to learn and improve, and the Investor Alert was borne from a belief that shareholders want to understand the very subtle nuances of biases and misconceptions. I have selected a few that I believe challenge the paradigms of investing.

2012-07-27 FOMC Preview: Christening QE III by Carl Tannenbaum of Northern Trust

Look for the Federal Reserve to embark on a new round of quantitative easing next week.

2012-07-27 Bringing it Back Home by Philip Tasho of TAMRO Capital

Our financial system has been cleaned up and recapitalized; consumers have paid down debt and seem to be looking to buy houses again. A large part of the improvement in the domestic economy is centered on the housing revival. It is not rapid - again, its a slow recovery - but at least we seem to be moving forward.

2012-07-27 Treading Water by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Stocks seem to be biding time until the action heats back up as summer winds down, but market-moving events can happen at any time. The US economy continues to slow and Bernanke had a relatively dour outlook before Congress. But it appears things would have to get worse before another round of easing is initiated; the effectiveness of which we continue to question. Yields in Spain and Italy indicate action may be needed sooner rather than later, but we did get positive remarks by the ECB, which led to market rallies and a big drop in yields, providing a measure of hope.

2012-07-25 Top Line Growth Stalling Amid Global Weakness by Chris Maxey, Ryan Davis of Fortigent

At this juncture, positive catalysts seem few and far between. According to FactSet, 18 of 22 companies have already guided lower for the third quarter. Analysts are also ratcheting down forecasts quickly, with flat earnings growth expected in Q3. While growth is expected to pick back up in the fourth quarter, analysts have not cut those estimates aggressively yet. If the economic picture does not improve in the next few months, expect a pattern of downgrades to follow suit.

2012-07-25 Economic Review: Americas - 2Q 2012 by Team of Thomas White International

Among the developed economies in the region, growth forecasts for both the U.S. and Canada have been revised lower. Though the U.S. outlook has weakened, the Mexican economy has so far remained unaffected, as manufactured goods from the country remain competitive in export markets. Brazil is yet to see a recovery even after a series of monetary and fiscal measures taken since the second half of last year to support the economy.

2012-07-25 Low Interest Rates Are Not Enough by Mohamed El-Erian of PIMCO

Welcome to what could be called "GGIRC," the great global interest rate convergence whereby interest rates steadily converge to zero in many countries around the world, both advanced (other than the crisis European economies) and emerging (other than the persistent financial basket cases). In theory this is a good thing for a global economy. In practice, however, the situation is much more complicated and not so benign.

2012-07-24 Weaker Headlines by Christian Thwaites of Sentinel Investments

Well, the whole Spanish banking solution from a few weeks ago was not destined to last. Back in late June, the EU welcomed, along with the ECB, EBA and IMF that the EFSF /ESM would provide around 50bn of capital, provided the financial sector gave certain conditions and horizontal restructuring plans. And, even better, the FROB would receive the funds and ensure at the time of the capital infusion, Spain would honor its Excessive Deficits Procedures. Got that?

2012-07-24 Litman Gregory Mid-Year Commentary by Team of Litman Gregory

High debt levels in developed countries create headwinds that are likely to hamper global economic growth in the years ahead. Europe's debt woes raise the risk of a damaging financial crisis, and global stock markets reflected these concerns in the second quarter. Why are we discussing this now? It is partly a reflection on having reached a quarter of a century in business and thinking about how we have conducted our business.

2012-07-23 Emerging Asia Pacific: Economic Review 2nd Quarter 2012 by Team of Thomas White International

Emerging Asia, which posted strong results during the first quarter of 2012 on optimism that Europe's sovereign debt problems would be solved quickly, returned to struggling ways during the second quarter of 2012 as prospects for Europe continued to wobble throughout the period. The uncertainty about Greece's fate in the European Union and the destiny of the single market itself kept industrial firms in Europe guessing for the most part of the second quarter.

2012-07-23 Economic Review: Developed Europe Second Quarter 2012 by Team of Thomas White International

Developed Europe remained on tenterhooks for the greater part of the April-June quarter, but ended the period on a high note. At their Brussels summit on June 28-29, European leaders chalked out two crucial policies. They decided that the monetary unions permanent bailout fund or European Stability Mechanism (ESM) would be allowed to provide capital to ailing banks directly rather than through the governments of the countries in which they are located.

2012-07-23 Europe Flares As Summer Heat Continues by John Nyaradi of Wall Street Sector Selector

Summer heat covers the nation as Europe's debt crisis flares again. Last weeks economic reports brought spots of sunshine to the housing market with the NAHB Home Builder Index rising, along with a strong June Housing Starts report.Equity markets were rallying most of the week in response to relatively positive earnings reports and hopes for more easing by Dr. Bernanke and the Federal Reserve.

2012-07-23 China's Economy - A Great Wall of Worry? by Milton Ezrati of Lord Abbett

The population of China bears seems to keep growing. This already large colony of doomsayers can point to any number of legitimate troubles facing China today, and they glibly do so, from slowing exports growth to an aging population, from real estate excesses to a moribund consumer sector. Bears think China is in for a "hard landing," but their pessimism is overdone. Here's why.

2012-07-23 Investing off the Beaten Track in an Uncertain Global Economy by Dan Ivascyn of PIMCO

The global economy remains in a multiyear period of global deleveraging; it will be an uncertain and, at times, volatile process. The substantial uncertainty and volatility affecting interrelationships across different markets are providing relative-value opportunities. Alternative strategies can be enticing, but the decision to use them needs to be fully informed and weighed against all the options.

2012-07-23 Spain's Molasses Jeopardizing Eurozone? by Axel Merk of Merk Funds

Spanish 10-year government bond yields are trading near 7.5% as Spain's central government is expected to bail out its regions and in return may ask for a bailout itself. Guarantees don't make a system safer, quite the opposite: everything is safe until the guarantor itself is deemed unsafe.

2012-07-23 Housing, Profits Shine Amid Rain in Spain by Kristina Hooper of Allianz Global Investors

Despite continued crisis in Europes periphery pressuring stocks, a rebound in housing, surprisingly strong profits and a spike in M&A activity may point to a healthier U.S. economy. And institutional equity managers are more optimistic on the stock market. However, with employment still showing weakness and the euro-zone crisis remaining a critical concern, one has to wonder why these institutional investors are becoming more bullish. Heres some insight into why they may be keeping the faith.

2012-07-22 And That's The Week That Was by Ron Brounes of Brounes & Associates

Tragedy in Colorado overshadowed earnings and economic news and even the Prez candidates could find common ground in expressing sorrow. The earnings numbers remain confusing at best (often better than downwardly revised projections); economic data depicts ongoing consumer concerns; Bernanke is attacked and attacks right back; and the markets settle not far from where they began the week. Coming up in the week ahead: New Home Sales (Wednesday), Durable Goods Orders (Thursday), GDP (Friday).

2012-07-21 The Lion in the Grass by John Mauldin of Millennium Wave

Today we'll explore a few things we can see and then try to foresee a few things that are not so obvious. This is a condensation of a speech I gave earlier this afternoon in Singapore for OCBC Bank, called "The Lion in the Grass." The simple premise is that it is not the lions we can see that are the problem; but rather, in trying to avoid them, it is often the lions hidden in the grass that we stumble upon that become the unwelcome surprise.

2012-07-20 Long Journey, Map Provided by John Gilbert of GR-NEAM

It is almost four years since the Lehman bankruptcy. In the periods of economic contraction that were typical of the postwar period, the clouds would be parting by now. Income growth would have resumed and necessary balance sheet repair would be more or less complete. By any standard, the current episode is a balance sheet recession of historic proportion. Previous downturns were initiated by central bank rate increases, which occurred this time as well.

2012-07-20 How Fast is Slow? China's Recent Slowdown in Perspective by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, examines China and its perceived economic slow down. Mr. Sicart suspects that this slowdown has several causes, each of which could be considered more or less normal in isolation, but their concurrent timing certainly has aggravated the feeling of withdrawal from the usual state of affairs.

2012-07-20 America's Competitive Spirit by Frank Holmes of U.S. Global Investors

We believe there are many great American companies to invest in. We like those that are growing their top line revenues and paying robust dividends. Currently 47 percent of the S&P 500 stocks pay a dividend yielding more than a 10-year Treasury, demonstrating the resiliency and strength of American enterprises.

2012-07-19 Quarterly Review and Outlook by Hoisington and Hunt of Hoisington Investment Management

Long-term Treasury bond yields are an excellent barometer of economic activity. If business conditions are better than normal and improving, exerting upward pressure on inflation, long-term interest rates will be high and rising. In contrary situations, long yields are likely to be low and falling.

2012-07-19 Equity Investment Outlook by Team of Osterweis Capital Management

In the politically correct atmosphere that permeates many of our college campuses, the euro-centric view of world history is regarded as hopelessly anachronistic, small-minded and possibly even racist. In the last year, they have become hopelessly euro-centric, rising or falling in concert with the news coming from the eurozone. A few years ago the markets focused on growth in emerging markets. Today, they focus on problems in the developed world.

2012-07-19 Developed Asia Pacific: Economic Review 2nd Quarter 2012 by Team of Thomas White International

Developed Asia Pacific economies experienced significant headwinds during the second quarter of 2012. While optimism about business conditions in the Euro-zone helped sustain export growth during the first quarter of 2012, significant challenges from the Euro-zone hampered both investor and consumer sentiment in most developed Asian economies during the second quarter.

2012-07-19 Chinas Growth Slows for Sixth Straight Quarter by Michael Sullivan of American Century Investments

Gross domestic product (GDP) growth in China, the world's second largest economy, dropped again on a year-over-year basis, from 8.1% last quarter to 7.6% for the second quarter. Growth is at its lowest level in three years. In domestic news, the major U.S. equity markets rallied last Friday and erased earlier losses to finish positive for the week.

2012-07-17 Gundlach ? Avoid Riskier Assets by Robert Huebscher (Article)

Since early this year, Jeffrey Gundlach has warned investors to avoid exposure to riskier assets ? among them, equities, non-dollar-denominated securities and sovereign debt. Still reluctant to move to a more aggressive position, Gundlach said on Thursday that 'substantial opportunities await,' but they may be as much as a year away.

2012-07-17 Game of Thrones by Cliff Draughn of Excelsia Investment Advisors

An economy consists of a gazillion simple transactions, all working together; and our economy used to be grounded is such factors such as supply and demand, growth, and imports and exports. But today the economy is driven by the political rhetoric of our elected officials as it relates to regulations, taxes, and anticipation of QE3. We are in global slowdown mode, and to understand how we should invest we need to better understand what deleveraging will mean over the coming couple years.

2012-07-17 Global Slowdown: Preparing for a Recession by Russ Koesterich of iShares Blog

While Russ believes that the most likely scenario for the global economy in 2012 is continued slow growth, he explains what's behind the recent global slowdown and what investors may want to consider doing if it grows worse.

2012-07-17 Bull Market Has Been Buffeted, but Remains Intact by Bob Doll of BlackRock Investment Management

During a relatively modest week in terms of trading activity, stocks managed to stage a rally on Friday that helped erase the declines of the previous four days. The stock market gains over the past month can be largely attributed to the perception that policymakers in Europe have been making some progress combatting the ongoing debt crisis. There is a sense of uncertainty over the state of the US economy, and that uncertainty is making investors, companies and consumers wary about the future.

2012-07-17 Impact of ETF Growth on Active Managers by Dmitriy Katsnelson, Ryan Davis of Fortigent

A paradigm shift away from active management has been in place for more than a decade. Active mutual funds held more than 19 times the amount of assets than passive strategies before the SPDR SPY ETF was launched in 1993. As seen below, they have gradually lost market share to passive vehicles, particularly in US Equities.

2012-07-17 Is a U.S. Recession Looming? by Scott Colyer of Advisors Asset Management

There are many indicators that we look for that tends to define cyclical market bottoms and give us signs of an upturn. Recent investor lack of volume and record high cash balances can also point to a change toward higher market valuations. Every day I hear about the relative cheap valuations of U.S. equities. We know that valuations can stay depressed for years, even decades. Why would we be thinking that a potential melt-up might be about ready to happen?

2012-07-16 And That's The Week That Was by Ron Brounes of Brounes & Associates

Now that's a nice way to end a losing streak. After six consecutive down days (and little in the way to promote optimism), investors jumped back into the equity pool feet first and the Dow surged over 200 on the final day of trading. In terms of new news, the JP Morgan earnings announcement was not as bad as expected (I guess), though investors may have been looking for any excuse to seek out bargains in the aftermath of a pretty dreary week-plus.

2012-07-16 Pacific Basin Market Overview by Team of Nomura Asset Management

Europe's sovereign debt crisis continued to hound the global equity markets throughout the second quarter, while economic data from the U.S. was also lackluster. Despite a late recovery, the Japanese equity market fell during the April-June quarter, owing to instability in the European financial system, economic distress in Europe, the U.S. and China, and the yens appreciation.

2012-07-16 Stocks, ETFs Send Mixed Messages by John Nyaradi of Wall Street Sector Selector

Major U.S. stock indexes and ETFs send mixed messages with difficult week ending in Friday rally. U.S. stock markets had been in steady decline until Fridays unexpected rally brought the S&P 500 (NYSEARCA:SPY) into slightly positive territory for the week.

2012-07-14 The Beginning of the Endgame by John Mauldin of Millennium Wave Advisors

For the last year I have been writing that it is not clear that Europe (with the probable exception of Greece) will in fact break up. The forces that would see a strong fiscal union are quite powerful. In today's letter, I will try to bring you up to date on some insights I have had in the 18 months since Jonathan Tepper and I did the final edits on our book, The Endgame.

2012-07-13 Worried about Higher Taxes? Take Action by Frank Holmes of U.S. Global Investors

About 1.25 million Americans would pay more in taxes next year if President Barack Obamas latest plan is approved. The White House wants to allow taxes to rise for households making more than $250,000 by boosting the top marginal tax rates to 36 and 39.6 percent (currently, its 33 and 35 percent). In an environment where government policy favors higher taxes, investments that lower a tax bill can look attractive.

2012-07-13 End Game: What Happens to Residential Mortgage-Backed Securities if There's a Eurozone Exit by Rod Dubitsky of PIMCO

An exit would substantially affect euro-denominated RMBS mortgage collateral. Currency redenomination and devaluation would likely wipe out the entire available credit enhancement for most deals. Losses of redenominated loans could overwhelm credit support, even for well-performing deals.

2012-07-12 The View From the Fiscal Cliff by Chris Molumphy of Franklin Templeton Investments

Six months into 2012, investors whose New Years resolutions included a vow to hold strong through market dismay may be finding that the eurozone crisis and slowing global growth are testing their resolve. As we move into the second half of the year, sluggish growth and continued market uncertainty seem likely to be ongoing scenarios for the U.S., as the nation faces a fall presidential election and teeters on the edge of a precarious-sounding fiscal cliff.

2012-07-11 Gold to Outshine Dollar? by Axel Merk of Merk Funds

As the price of gold has gone up fivefold over the past 10 years, why would one buy it at todays prices? For the same reason an investor would buy any other asset: if one believed it would be a good investment now, that is if one believed it may appreciate in value and add portfolio diversification benefits. A key reason to hold gold today might be to prepare for the crisis tomorrow.

2012-07-10 Is Higher Inflation on the Horizon? by Orhan Imer of Columbia Management

For nearly two decades inflation in the U.S. has been fairly contained except for a few periods of moderate acceleration around peak levels of economic activity. More recently, headline inflation as measured by the year-over-year change in the CPI-U (Consumer Price Index for Urban Consumers) declined from 3.9% in September 2011 to 1.7% in May 2012 driven primarily by the slowdown in the U.S. economy and the sharp drop in energy and commodity prices.

2012-07-09 Disappointing, but Not Terrible by Charles Lieberman (Article)

Job growth has slowed to a disappointing pace over the past three months, insufficient to bring down unemployment, but not so weak that recession is much of a threat. This mediocre performance also leaves the Fed in a quandary, neither making an obvious case to leave policy unchanged or a clear case to implement yet another form of policy accommodation.

2012-07-09 Unemployment a Secular Problem by Brian S. Wesbury and Robert Stein of First Trust Advisors

Last Fridays employment report was a Rorschach test for economists. (You know, show an inkblot and find the obsession.) Its not a surprise that the response to the report was pessimistic. We heard all kinds of rhetoric, including a new one - Zombie Economy.

2012-07-06 Business Investment Dwarfs Housing by Brian S. Wesbury of First Trust Advisors

Since 2008, the market punditry has focused on housing, housing and housing. Business news channels have housing experts who report on every housing number as if it were the golden key to all economic activity. People say we cant have a recovery without housing. Conventional wisdom has an obsession with housing.

2012-07-06 Mid-Year 2012 Economic Update by Team of Horizon Advisors

The questions we hear most often from our clients have to do with the Eurozone, U.S. politics, and closely related, the so-called fiscal cliff. We thought we would approach each of these in turn.

2012-07-06 Are You Limited by Linear Thinking? by Frank Holmes of U.S. Global Investors

Dont be limited by linear thinking in your portfolio. As an alternative to low yielding Treasury bonds, consider resources stocks that pay dividends. Weve found that most materials, utilities and energy stocks in the S&P 500 Index pay a dividend higher than the 10-year Treasury: Materials and utilities companies yield an average of 2.3 percent and 4.1 percent, respectively, while energy stocks pay an average yield of 2.2 percent. Nonlinear thinkers have historically benefited from the inclusion of natural resources as part of a balanced portfolio.

2012-07-05 And That's the Quarter That Was by Ron Brounes of Brounes & Associates

So much for that Random Walk Theory. During the past two years, equities started strong before running into headwinds in the second quarter and Europe (namely Greece) was perceived to be the primary culprit. As another very solid first quarter came to a close, perhaps smart investors should have been looking at charts and reading the Greek press to predict another downturn.

2012-07-03 Gleanings by Jeffrey Saut, Art Huprich, Scott Brown of Raymond James Equity Research

With this Gleanings report, we begin a monthly chart presentation and discussion, which attempts to pull together the separate disciplines of Economics, Fundamentals, Technical analysis, and Quantitative analysis. The report contains what we think are currently some of the most important charts. We will have an overview and then highlight some of the key near-term variables that we believe could have a measurable effect on where the various markets are going.

2012-07-03 Let's Twist Again by Daniel Kurland of Corby Asset Management

Ben Bernanke must be nostalgic for his childhood. On June 19th in the summer of 1961, when Chairman Bernanke was only 8 years old, Chubby Checker released his smash hit, Lets Twist Again. Chairman Bernanke, citing decreased inflationary concerns and heightened employment weakness, announced that Operation Twist, which had been set to expire at the end of June, would be extended until the end of the year.

2012-07-02 Anatomy of a Bear by John P. Hussman of Hussman Funds

The unusually bad outcomes of similar historical precedents help to convey why we retain such a durable sense of doom, even after last weeks scorching risk on advance. A moderate continuation of constructive market action would likely be sufficient to move us to soften our presently hard defense by retreating from a staggered strike option hedge. At present, conditions remain aligned with those that have preceded some of the most negative consequences in market history.

2012-07-02 U.S. Economic Outlook: Potential for Growth, Vulnerability to Policy Mistakes by Saumil Parikh of PIMCO

There are very early signs of improvement in the housing market. Another plus is the shift in U.S. energy supply from imported oil to domestic oil and natural gas. The U.S. economy still faces significant headwinds from over-indebtedness, large imbalances, growing inequality and policy incrementalism. In our view, investors need to consider the implications of rising forward tax rates and that price inflation will play a greater role in generating nominal GDP growth than in the past.

2012-07-02 Has Housing Stabilized? by Ryan Davis of Fortigent

In the past two weeks, several important indicators have illustrated a market that, while not quite in a state of recovery, appears to be stabilizing. This sentiment was echoed in the latest Beige Book released by the Federal Reserve, which reported, several Districts noted consistent indications of recovery in the single-family housing market, although the recovery was characterized as fragile.

2012-07-02 The Virtue of Necessity by Jeffrey Saut of Raymond James Equity Research

The call for this week: In my opinion, last week the Commodity Index bottomed and the Dollar Index topped. If so, recession fears should abate in the months ahead. Moreover, if a recession was really on the horizon "junk" bond yields would be rising on worries of increased defaults and that is not happening with the iShare High Yield Fund (HYG/$91.29) attempting to make a new reaction high (i.e., lower yields).

2012-06-29 A Strategy to Navigate the Housing Cycle by John Burns of John Burns Real Estate

The memories of 2007 through 2011 are clouding too many people's vision. There are plenty of legacy problems from the housing boom that have yet to clear, and plenty of risk to the downside, but the demand, supply and affordability measures are in place to help us put the housing downturn behind us and move forward. We are leaving stage one of the recovery and moving into stage two. Don't miss the ride.

2012-06-29 Fat Tails by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Stocks have moved modestly higher and may now be in a relatively large trading range. US economic growth remains sluggish and is drifting dangerously close to stall speed. Policymakers in Europe appeared to make some progress in the most recent summit, but much is left to be done and time is running out. Meanwhile, global growth is slowing and central banks are attempting to stem the decline.

2012-06-29 Meanwhile, Back at the Ranch... by Scott Brown of Raymond James Equity Research

With worries about Europe and the individual mandate of the Affordable Care Act behind us, we can go back to looking at the economy. At issue is whether recent signs of slowing were an illusion or more real. In particular, the June job market figures will be critical.

2012-06-29 And That's the Week That Was by Ron Brounes of Brounes & Associates

Hip Hip Hooray. Europe is saved (again); the equity markets are back on track (again); and investors can enjoy a much needed holiday come hump day next week. With positive news out of Europe and some favorable signs for the housing sector, investors moved back into risk assets and stocks enjoyed a nice end of the week (quarter). Supreme Court Chief Justice put his stamp on ObamaCare (and earned some enemies along the way). The second quarter could not end soon enough.

2012-06-29 Unmasking the Asian Giant by Frank Holmes of U.S. Global Investors

China is far from perfect: While actors can perfect their lines and use masks to captivate an audience, smart investors know better to use a wealth of information across numerous sources to guide investment decisions. Weigh the evidence and judge for yourself. As my friend, Investment Strategist Keith Fitz-Gerald recently said in an interview, A powerful China is coming, and we have two choices. Either we're at the table, or we're on the menu. To him this means, Good news from China is good news for the U.S.; bad news from the Chinese economy is bad news here.

2012-06-26 Running on Empty by Marie Schofield of Columbia Management

In a move that was more anti-climax than comforting, the Federal Reserve (Fed) satisfied the minimum expectation of the markets and extended Operation Twist, or the MEP (Maturity Extension Program), through the end of the year thankfully taking us beyond the election period.

2012-06-25 And That's the Week That Was by Ron Brounes of Brounes & Associates

Ahthe doldrums of summer. Sure Greece just completed crucial elections that could have dramatic impact on the euro-zone and the global economy; AND Spain just saw its interest rates rise above the key seven percent level into traditional bailout territory; AND JP Morgan, of failed hedging fame, just received a major ratings downgrade by Moodys Investors Services; AND Facebook disappointed the investment world with its disastrous IPO, a comedy of errors for most everyone involved

2012-06-25 Enter, the Blindside Recession by John P. Hussman of Hussman Funds

The joint evidence suggests that the U.S. economy has entered a recession that will eventually be marked as having started presently. In recent months, our measures of leading economic pressures have indicated the likelihood of an oncoming U.S. recession.

2012-06-25 Let's Twist Again by Kristina Hooper of Allianz Global Investors

It looks like the Fed is finally facing up to the facts. The U.S. economic recovery has stalled and policymakers have realized that they need to step in. Despite a favorable election outcome in Greece, a renewed commitment to austerity and staying in the euro zone, the Fed has lowered its outlook for growth and extended Operation Twist.

2012-06-25 Markets Vacillate Between Weaker Data and Hopes for Policy by Bob Doll of BlackRock Investment Management

Last week was a modestly negative one for stocks as investors continued to focus on a trend of weakening economic data. Additionally, many were disappointed by what was perceived to be a less-than-robust response from the Federal Reserve following its policy meeting last week.

2012-06-25 Jilted Investors Unsure Where to Turn by Chris Maxey and Ryan Davis of Fortigent

Institutional and individual investors are at an uncertain juncture, waiting to see what the next shoe to drop is. With an important series of events occurring soon, such as the US Presidential election this fall and the fiscal cliff facing the US at years end, investors may need to wait to get more clarity on the market outlook.

2012-06-25 Timid Actions, Fearful Times by Christian Thwaites of Sentinel Investments

Since 2010, investors have traveled between optimism and pessimism every three months. It's negative right now. Here's why: A very timid move by the Fed. What was glaring was the entire board revised down their expectations on the economy: i) GDP down by $500bn ii) unemployment up 500,000 and iii) lower core and PCE inflation. Not just for 2012 but next year as well. That takes complacency to a new level.

2012-06-25 Government Mortgage Policies Will Determine the Speed of the Recovery by Lisa Marquis Jackson of John Burns Real Estate

Our current view on housing is that the market has bottomed and the slow recovery is underway. But now the question we are often asked is, "What does that recovery look like?" Even in a down market, the mortgage industry remains a multi-trillion dollar business and our takeaway is that a full-fledged housing recovery won't completely take hold until housing finance begins to rebuild itself.

2012-06-22 An Ending Made For Gold by Frank Holmes of U.S. Global Investors

Hold tight to your convictions, gold investors. Review your allocation to gold and gold stocks to make sure it remains around 5 to 10 percent of your portfolio. That way the precious metal can act as a shock absorber to help protect from any unexpected bumps in the financial system.

2012-06-21 Cohen & Steers Closed-End Fund Strategy by Team of Cohen & Steers

We would like to share with you our review and outlook for the closed-end fund market as of May 31, 2012. For the month, the total return of the Morningstar U.S. All Taxable ex-Foreign Equity Closed-End Fund Index was 4.4 percent based on market-price and 4.6 percent on a net-asset-value (NAV) basis. Year to date, the index had a market-price total return of 5.1 percent and a NAV return of 2.6 percent.

2012-06-20 Growth Versus Austerity: A U.S. Dollar Perspective by Axel Merk of Merk Funds

Austerity versus Growth? Which economic model is sustainable? If it werent for those pesky bond vigilantes, it may be only politics. Lets not get too excited that either path will work. Lets look at the implications for investors with a focus on the U.S. dollar.

2012-06-19 Achilles Last Stand: Greeks Vote in Favor of Euro by Liz Ann Sonders of Charles Schwab

The June 17 Greek elections favored the pro-bailout party and allow for a likely coalition to be formed probably the least-tumultuous outcome. However, kicking the can further down the road doesn't solve the eurozone's structural problems, nor does it stem contagion. Next on investors' radar is this week's Federal Reserve meeting, where additional easing is expected.

2012-06-19 Is China Running Out of Steam? by Matthew Rubin, Ing-Chea Ang, Justin Gaines of Neuberger Berman

The Chinese growth story is especially impressive. At a time when many economies have struggled, China has continued to expand rapidly, helped by its dominant position in manufacturing, growing middle class and, after the 2008 credit crisis, its successful injections of capital and stimulus to ward off recession. Nevertheless, recent data have suggested that the Chinese expansion is now slowing more quickly than most investors expected.

2012-06-19 Down and Out in Wenzhou by Bill Smead of Smead Capital Management

Much like in the US in 2006, the Chinese government officials and the worldwide media need to believe that what is going on in Wenzhou is not the first domino in a series of dominos which fall over the next two years. The Chinese economy and its miracle of the last 30 years were originally driven by the competitive advantage of cheap labor.

2012-06-19 Shocking Fed Survey on Consumer Finances by Gary D. Halbert of Halbert Wealth Management

Today we focus on a new Fed study which found that Americans net worth plunged almost 39% in the period from 2007 to 2010. That period included the so-called Great Recession, a financial crisis and a severe bear market in stocks. There are lots of interesting statistics to look at in this new Fed study.

2012-06-19 Will Policy Response Follow Policy Rumor? by Bob Doll of BlackRock Investment Management

The past two weeks have been better for stocks, with the major indices up in consecutive weeks for the first time in more than a month. Europe remains stuck in a cruel cycle of recession, a banking system in need of life support, frozen policymakers, too much debt and a downward confidence spiral. In the United States, economic growth slowed this spring (likely due to poor weather and the earlier spike in gasoline prices), but remains intact.

2012-06-19 Consumers Remain Perplexed by Chris Maxey and Ryan Davis of Fortigent

Consumers have long been the cog behind the American economic engine. After suffering a terrible fate in 2008, there was a long, slow build to post-recession normalcy. Consumer balance sheets are in a better place, but remain tenuous and suggest there continues to be a long distance to travel before we can once again depend on the American consumer to be the buyer of last resort.

2012-06-18 And That's The Week That Was by Ron Brounes of Brounes & Associates

With Fed officials preparing for next weeks policy meeting, traders and investors alike have been busy dissecting economic data and global developments as they speculate about any potential moves. While Spain and Italy saw their yields surge and Greece moved closer to Decision 2012, investors focused on the potential for European action and compromise that could put the Union back on a road to recovery (with or without Greece).

2012-06-18 A Brief Primer on the European Crisis by John P. Hussman of Hussman Funds

Europe has repeatedly been successful at addressing its recurring liquidity crises with the help of other central banks, but its still an open question whether they can durably solve the solvency crisis without more disruption and more restructuring of both government debt and troubled banks. In my view, the hope for an easy solution is misplaced, and the likelihood of recurring disruptions from Europe will remain high.

2012-06-18 Cohen & Steers Large Cap Value Strategy by Team of Cohen & Steers

We would like to share with you our review and outlook for the U.S. large cap value market as of May 31, 2012. For the month, the Russell 1000 Value Index had a total return of 5.9%, compared with a total return of 6.0% for the S&P 500 Index. For the year to date, the Russell 1000 Value Index had a total return of +3.5%, compared with +5.2% for theS&P 500 Index.

2012-06-18 I Like These Calm Little Moments Before the Storm by Christian Thwaites of Sentinel Investments

It is the job of investment managers to look beyond the gloom. There's plenty of it. The big list last week was the slow hand clap the market gave to the Spanish bank rescue, the probable downgrade of India, one of the dead cert BRICs we all read about, and queasy economic data from the US. Now we don't just jump in and buy on all the bad news. We're not likely to retain clients that way.

2012-06-15 Schwab Market Perspective: Time for Action by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

With escalated uncertainty, sitting back can be an easy choice, but we believe investors and policymakers alike need to take action. Equities bounced off of what appeared to be oversold conditions but although the US economy appears to be holding its own, a renewed sustainable uptrend may be hard to come by until some substantive policy actions are taken around the globe. The time for decisive action in the eurozone appears to be quickly approaching as short-term solutions are no longer satiating the market.

2012-06-15 Every Economists Career Ends in Failure - The Irony of Hyman Minsky by John Gilbert of GR-NEAM

The economist Hyman Minsky held that capitalist economies are inherently unstable because investments are financed with debt, and the financial markets pricing of debt is volatile. Economies are prone to booms and busts as the cost of financing falls too far, or rises too much, revealing poor investment decisions. This has always been obvious to observers of business cycles, of which Minsky was one. Too many of his colleagues in economics ignore this, which we have found puzzling.

2012-06-15 Cohen & Steers Global Real Estate Securities Strategy by Team of Cohen & Steers

We would like to share with you our review and outlook for the global real estate securities market as of May 31, 2012. The FTSE EPRA/NAREIT Developed Real Estate Index had a total return of 6.4% for the month (net of dividend withholding taxes) in U.S. dollars. Year to date, the index returned +7.9%.

2012-06-14 Out of Order by Peter Schiff of Euro Pacific Capital

I was invited to testify about the Federal Housing Administration's (FHA) policy in the apartment lending market. Although this was a fairly narrow issue, I told the congressmen the same thing I did last year when I was invited by a different subcommittee to testify about job creation: government programs don't solve problems, they just create new ones. While I thank the Committee for inviting me, I believe the congressmen may have gotten more than they bargained for.

2012-06-14 Patient But Vigilant Fed by Asha Bangalore of Northern Trust

Chairman Bernanke failed to offer broad hints about an imminent round of financial accommodation or an extension of Operation Twist (Maturity Extension Program) in his testimony on June 7. There were three key takeaways pertaining to the near term economic outlook from Bernanke's testimony and response to questions.

2012-06-14 Chart of the Week: Growth Dichotomys Diminished Influence by Team of American Century Investments

Despite weaker-than-expected U.S. employment data for May (released June 1) and other signs of slow economic growth, the Fixed Income Macro Strategy Team at American Century Investments does not believe the U.S. economy is headed toward another recession (though the marginal possibility of recession has increased). Rather, the team believes the economy remains on a sub-par recovery/slow (1-3%) growth path, with headwinds.

2012-06-13 U.S. Commercial Real Estate: A Technical Affair by John Murray of PIMCO

We believe attractive investment opportunities will arise in sectors of CRE that haven't yet caught the eye of technicals-driven capital. Demand for CMBS arguably comes from a lack of alternatives as opposed to any sort of inherent belief in rental fundamentals. Fickle technical factors are not the only headwinds: Deleveraging, regulatory uncertainty and weak fundamentals add further pressure.

2012-06-12 Modern Day Fairy Tale of 3 Economic Wizards (Except It's True) by Mike "Mish" Shedlock of Sitka Pacific Capital Management

Once upon a time (today), in a land not so far away (USA), there lived a trio of economic wizards (economists), whose names shall remain anonymous (Paul Krugman, Greg Mankiw, Ben Bernanke). A fourth wizard, Murry Rothbard, is no longer among the living but resides in the netherworld. The above wizards seldom agree with each other because they come from competing schools of wizardry. (1) Keynesian School of Fiscal Voodoo and Witchcraft (2) Monetarist School of Monetary Voodoo and Witchcraft (3) Austrian School of Sound Money, Sound Economic Principles and Common Sense.

2012-06-11 The Heart of the Matter by John P. Hussman of Hussman Funds

The ongoing debate about the economy continues along largely partisan lines, with conservatives arguing that taxes just aren't low enough, and the economy should be freed of regulations, while liberals argue that the economy needs larger government programs and grand stimulus initiatives. Lost in this debate is any recognition of the problem that lies at the heart of the matter: a warped financial system, both in the U.S. and globally, that directs scarce capital to speculative and unproductive uses, and refuses to restructure debt once that debt has gone bad.

2012-06-11 Investors Look Forward to More Policy Help by Bob Doll of BlackRock Investment Management

Following a significant slide the week before, stocks bounced back last week, primarily due to a growing sense that policymakers in Europe and the United States may be ready to engage in further easing measures. The increasing stress in Europe has put additional pressure on the European Central Bank (ECB) and on other policymakers to take stronger action, and, indeed, over the weekend European finance ministers announced a new plan to recapitalize the Spanish banking sector.

2012-06-11 Bertha and Casey by Christian Thwaites of Sentinel Investments

Markets braced last week for a bailout on Spain which came this weekend. Its banking sector is in wretched condition and joins other European banks at 25 year lows in share price. The official downgrades came long after the stock market had voted with its feet. European leaders had little to add to the debate. There's some talk of a twin track: some European countries pressing on to further integration, some coping with contraction and austerity on their own.

2012-06-08 The Accidental Empire by George Soros of Project Syndicate

Germany is likely to do what is necessary to preserve the euro but nothing more resulting in a German-dominated eurozone in which the divergence between creditor and debtor countries continues to widen. The EU would then become a German empire with a permanently depressed peripheral hinterland in need of constant transfer payments.

2012-06-08 Waiting for Clarity and Action in the Euro Zone by Neil Dwane, Stefan Hofrichter of Allianz Global Investors

Poor economic data and the collapse of a Spanish bank have kept the pressure on Europe and the financial markets, but we believe Greece will stay in the euro and the European Union. U.S. investors should know that Germany is pro-Europe and recognizes the need for growth, not just fiscal austerity. It is also important to point out that ECB policy has been supportive, but they do not want to do the job of the government. U.S. investors should look to high-quality dividend-paying stocks in this uncertain environment...

2012-06-08 And That's The Week That Was by Ron Brounes of Brounes & Associates

Add the Fed to the equation to make things a bit more interesting. With stock prices plummeting (with no end in sight), enter Dr. B. and friends with comments that led some to expect future stimulus moves (or maybe not). The European Central Bank made similar remarks, and China took it a step farther with an actual rate cut. Investors welcomed the potential moves and a bit of optimism returns (even if just for a short period). As always, the political bickering is heating up (at home and in Europe) and yet November still remains several months away.

2012-06-07 May Rout Leads to June Rally by David Edwards of Heron Financial Group

We got three exogenous events in May: Greek credit crisis resumed, with Greece likely to exit the Eurozone this summer. JP Morgan Chase lost $3 billion on Credit Default Swap trading. The FaceBook FacePlant. And on June 1st, the Labor department reported a minimal gain in jobs, which has economists worried anew about the United States returning to recession.

2012-06-06 Our House: Is the United States the Best House in a Bad Neighborhood? by Liz Ann Sonders of Charles Schwab

I won't try to put lipstick on the pig that was last Friday's May jobs report, but I will try a little lip gloss. Somewhat lost in the mire of the dire reaction to the report were several other more-positive readings on the economy. That's testament to the likelihood that there are many more drivers to today's malaise than just jobs growth, or lack thereof. It seems clear we're in the midst of the third consecutive mid-year economic slowdown, driven by similar forces, most dominantly the eurozone debt crisis.

2012-06-05 When OK is Good Enough by Team of BondWave Advisors

The US economy continues to grow, but in recent months manufacturing and employment indicators have remained positive but have been flagging. While there might not be a lot to get excited about economically here in the US, OK is better than elsewhere, like Europe. We discuss the situation in the US and Europe and provide a commentary of the US Treasury, Corporate and Municipal bond markets.

2012-06-04 It's All Relative by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Equities have pulled back and are flirting with correction (-10%) territory. We believed this was a needed process, and remain modestly optimistic that economic data will rebound and the market will eventually resume its move higher over the next several months. The Federal Reserve has made clear that it stands ready to act should the US economy deteriorate, or the European debt crisis escalate, but we remain skeptical. The more important issue in our view is how the coming "fiscal cliff" is addressed.

2012-06-04 More Muddling Along by Charles Lieberman (Article)

It appears that economic growth has slowed a bit once again, although a relapse into recession seems fairly unlikely. Consumer spending, business investment and a recovery in housing should support growth at a moderate pace. Europe remains a dark cloud hanging over better prospects. Budget deficits at the sovereign level and bank capital needs at the corporate level must be resolved before markets can breathe easily. So volatility in our markets is likely to continue. Since we can exert very little control over Europe, policymakers here must remain focused on maintaining growth domestically.

2012-06-04 Why Smaller Banks Are Attractive by Richard Bernstein of Richard Bernstein Advisors

We continue to prefer smaller, US domestic banks to larger, multinational banks. A backdrop of anemic yet improving US employment and stabilizing housing markets will likely benefit domestic lenders, but the continued deflation of the global credit bubble could continue to hurt the growth prospects for global financial institutions. Although the vast majority of the risks related to the deflation of the US credit bubble seem well-known, investors still appear to be underestimating the risks of credit deflation in Europe and in the Emerging Markets.

2012-06-04 Job Recap/How Big of an Impact from Europe? by Scott Brown of Raymond James Equity Research

Job growth has slowed. However, its unclear exactly why or even, despite all the hand-wringing on Friday, whether its something to worry about. A European recession would have a moderate impact on U.S. exports, but there are some positives. There are a number of other possible explanations for the recent slowdown in (seasonally adjusted) job growth.Firms may be reluctant to hire for a number of reasons: political uncertainty, fiscal policy uncertainty, higher gasoline prices, and worries about the fallout from Europe.

2012-06-04 And That's the Week That Was by Ron Brounes of Brounes & Associates

Nothing good to report here so why even try to spin it. (Effective politicians may beg to differ.) The once promising labor picture just turned from bad to worse; manufacturing is no longer the one staple in the economy; Spain may be replacing Greece as the poster child for what ails the EU (and thats not because things are looking up in Greece). Stocks suffered their worst day of the year to end the week and the gains of the first quarter have been long forgotten. (Even the Astros stink again.)

2012-06-04 Weekly Market Commentary by Scotty George of du Pasquier Asset Management

More importantly than not, it is vital to focus upon a bigger broader landscape when evaluating the condition of ones portfolio, than to focus upon tinier exogenous noise as those factors which indicate the probability of outperformance. Too often, and with more frequency, I have seen micro-analysis paralyze investors decision-making, rendering them incapable of reasonable response.

2012-06-04 Negatives Intensify, but Panic Isn't Warranted by Bob Doll of BlackRock Investment Management

For some time, we have been suggesting that the US economy had been holding up relatively well compared to the rest of the world. While we are not changing that view, last weeks data (particularly Mays employment report) provided a negative jolt and pushed stock prices down sharply. Our summary view of the US economy is that while the United States appears to have entered another slowdown phase with the data growing more disappointing in recent weeks, the case for a renewed recession still looks flimsy.

2012-06-02 Will the ECB and Fed Follow Where China Leads? by Frank Holmes of U.S. Global Investors

Every month, policymakers track purchasing managers indices (PMI) around the world as they consider fiscal and monetary actions. To us, a PMI is a measure of health of companies around the world, because it includes output, new orders, employment and prices across manufacturing, construction, retail and service sectors. Historically, weve seen Chinas PMI number leading the year-over-year change in exports by three to four months, so when the PMI has increased, a few months later, Chinese exports have historically risen, and vice versa.

2012-05-30 CBO Warns of Recession in 2013 by Gary D. Halbert of Halbert Wealth Management

The non-partisan Congressional Budget Office (CBO) has calculated the expected negative effects on the US economy if the Bush tax cuts expire at the end of this year. Their numbers just released last week are eye-opening! To give us some perspective, US Gross Domestic Product rose by 2.2% (annual rate) in the 1Q of this year.

2012-05-30 Beyond Short-Term Risks, Stocks Are Growing More Attractive by Bob Doll of BlackRock Investment Management

Given our view that the European debt crisis should remain reasonably well contained and our belief that the US recovery remains on track, our outlook for risk assets continues to be a positive one. The combination of the rising equity risk premium, falling stock prices, improving corporate arnings and lower Treasury yields means that stocks have become quite cheap relative to bonds. Assuming that the world is not headed for a renewed deflationary spiral, there is little doubt in our view that stocks are poised to provide superior long-term returns over bonds given their current levels.

2012-05-30 Gannett: Where Buffett Meets Zillow by Bill Smead of Smead Capital Management

You will be surprised to hear that I am somewhat addicted to keeping track of the value of the home we have in the Seattle area and the one in Scottsdale, Arizona. It seems that Zillow uses comparisons to recent sales as the primary vehicle to come up with their Zestimates. We believe at Smead Capital Management (SCM) that comps are a useful tool in valuing common stocks. They are even more useful if the transactions are recent and spectacularly useful if the comps come from a savvy buyer. We would like to run our version of a Zillow estimate on Gannett (GCI).

2012-05-29 Can Krugman Fix Our Economy? by Robert Huebscher (Article)

Our economy faces depression-like conditions, according to Paul Krugman, in its alarmingly high unemployment rate. It needn?t be that way, though, Krugman says ? a few simple steps could quickly solve our problems.

2012-05-29 AND THATS THE WEEK THAT WAS by Ron Brounes of Brounes & Associates

When something seems too good to be true For years, investors had (im)patiently awaited the Facebook IPO and a chance to own a piece of the new new thing. Zuckerberg and Co. liked the control and were already wealthy; however, inevitably, they would be selling a piece of the pie to would-be buyers willing to invest, despite a complete lack of understanding of its revenue model. (When has that stopped investors before?) Every new random offering brought more anticipation about Facebooks which finally went public on May 18th.

2012-05-29 Being There by Jeffrey Saut of Raymond James Equity Research

The call for this week: I am out of the country seeing institutional accounts, so these may be the only strategy comments for the week. In my absence the stock market will likely resolve its near-term directionality because the "selling stampede" is now 18 sessions long and such stampedes tend not to last for more than 17 to 25 sessions. Despite the decline, by my work there has been no Dow Theory "sell signal," although there are some Wall Street wags who are using very short-term pivot points and believe otherwise.

2012-05-29 Unraveling the Mess in Europe by Charles Lieberman (Article)

There is considerable nonsense written about the European debt crisis. Greece must balance its books, whether they remain inside the Euro or not. There are major benefits and costs to both remaining inside the Euro and to exiting. There is no silver bullet that will solve their problems easily. More broadly, banks need to be recapitalized all across Europe. This has not been done as yet, perhaps for political reasons, which only compounds the economic problems and allows them to fester. It seems like the Europeans are working towards solutions, but painfully slowly.

2012-05-29 Europe Is Near Term Driver of Market Movements by John Buckingham of AFAM

Plenty of uncertainty surrounds developments in Europe, so Ive chosen to pen this Memorial Day version of our Market Commentary on Monday afternoon rather than the usual Sunday evening. Of course, had the U.S. stock markets been open today, we might have seen a modest advance, given that the equity futures were suggesting that gains of some 40 or 50 Dow Jones Industrial Average points would be in the cards when trading resumes.

2012-05-29 Amid Uncertainty, What is an Investor to Do? by Chris Maxey and Ryan Davis of Fortigent

Markets rebounded last week after a two-week slide. The S&P 500 and Dow Jones Industrial Average rose 1.7% and 0.7%, respectively, in a choppy trading period. Discussion of a potential Greek exit from the Eurozone rattled investors, while economic data in the US was modestly positive.

2012-05-24 The Real Crash by Peter Schiff of Euro Pacific Capital

I first came to national attention back in 2008 and 2009 when the housing and credit markets imploded. I became known as the guy that other market "experts" laughed at when I warned of trouble brewing in the seemingly indestructible American economy. After the wheels ground to a halt in mid-2008, people noticed that my bookCrash Proof, originally released in early 2007, read like a detailed preview of many of the events that eventually unfolded.

2012-05-23 Market Gut Check Time, Again by Mike Boyle of Advisors Asset Management

Our research of the last 50 years shows 3% pullbacks occur on average four times a year. So, clearly pullbacks are commonplace during a normal bull market; however, every time they occur they still set investor emotions on edge and test their resolve. At times like this we like to try and decipher what drove the selloff and try to resolve if we think it is just a normal correction or the beginning of a longer trend down and possibly the start of a new bear market.

2012-05-23 Greece Poised to Default & Exit the Euro by Gary D. Halbert of Halbert Wealth Management

Weve all heard horror stories about the global financial crisis that could unfold if tiny Greece defaults on its debts later this year. There are genuine fears that if Greece defaults, that leaves the door open to similar defaults by Portugal, Ireland and possibly even Spain. Some fear, in this nightmare scenario, that even Italy could default (although I doubt it). Will the ECB pony up even more taxpayer money for Greece this time around? Most agree that this will be decided largely by Germany.

2012-05-23 Global Investment Outlook by Mike Turner of Aberdeen Asset Management

Investors continue to focus on the global macroeconomic backdrop, which is still relatively positive despite slightly disappointing data recently. There are signs that some of the imbalances within the Eurozone are starting to ease as competitiveness is improving in some of the peripheral countries and this is beginning to be reflected in trade figures. Looking further ahead, we feel that global consumption should be supported by falling headline inflation.

2012-05-22 David Rosenberg - I am not a Permabear by Robert Huebscher (Article)

While most sell-side analysts are correctly classified as permabulls, Gluskin Sheff's David Rosenberg has been branded as the opposite - a permabear. He rejects that label. He recently said he's indeed bullish - on bonds and income - and has been so for quite a while.

2012-05-22 What History Tells Us about a Potential Greek Exit by David Schawel (Article)

Greece's future is less certain given the recent elections. Is an exit now possible or probable? What would an exit from the euro look like, and how would it be accomplished? Some historical examples give us a clue to the repercussions.

2012-05-22 Investing Through a Bumpy Ride by David Kelly of J.P. Morgan Funds

Its been a tough quarter so far. The U.S. economy is still growing, but not at a sufficient pace to excite anyone. Meanwhile, investors have had plenty to worry about including a fiscal cliff in the United States, a slowdown in China and, right now most ominously, further turmoil in Europe. Despite plenty to worry about, the realities of a U.S. economic recovery, very conservative allocations and relatively attractive valuations suggest that investors should still consider adding stocks and other risky assets to their portfolios.

2012-05-22 Return to Normalcy: The False Argument of "Austerity" vs. Growth by Team of Institutional Risk Analyst

To rescue Europe, to reinvigorate the United States, and to set the global economy on a sustainable path toward expansion, the current debate offers a so-called "choice": either slash government spending or spend your way to growth. In Europe, German Chancellor Angela Merkel is one of the most prominent proponents of fiscal restraint -- in part because Germany is picking up the tab for the continent's debt crisis. And in the United States, economist and New York Times columnist Paul Krugman is the fullest-throated supporter of more government spending.

2012-05-22 New Lows and a Dud IPO by Christian Thwaites of Sentinel Investments

We're testing all sorts of lows: 1) record low for GT10 auction last week 2) GT30 yield, same level as Dec 2008 3) European banks are at same price level as 1987...so 25 years of gains wiped out 4) euro stocks same level as March 2009, so all the gains gone 5) US safest and best place to be 6) China stocks at same level as 2006, since then the Chinese economy has doubled and 7) to cap it all we had an IPO that should never have happened. We're back in risk territory and markets don't want to extend or commit.

2012-05-22 Were Off to See the Wizard by Bill Smead of Smead Capital Management

In October of 2010 we explained in a missive called The Wizard of Oz that investors had put too much confidence in the ability of a group of Chinese National, US-educated economists to manage the China economy. Thanks to the writing of Ambrose Evans-Pritchard in The Telegraph on May 13th of 2012, we can see just how successful the Wizard has been in perpetuating the myth that China can be the first major world economy to defy business cycles.

2012-05-22 The Harsh Realities of Bond Math by Mark Oelschlager of Oak Associates

Shortly after I graduated from college my father sat me down and tried to teach me about bonds. He proceeded to explain that prices and yields. He tried to explain the difference between a bonds yield and its coupon as well as the effect that time to maturity has on the sensitivity of a bonds price to changes in interest rates. It all sounded so complex, and there were intertwining effects. This, combined with its counter-intuitive nature, made the concept of bond pricing difficult to grasp in a short lesson.

2012-05-21 Facebook IPO Not a Flop; Underwriters Priced it Right by John Buckingham of AFAM

he social media giant ended its first day of trading up a measly 23 cents, or 0.6% from its $38 offering price, and technical difficulties at Nasdaq delayed the opening of trading and impacted market activity throughout the day, I give kudos to the underwriters for actually pricing the deal as best they could to match the relatively limited supply to the unprecedented demand. Certainly, Facebook could eventually grow into its lofty valuation, but it is eye-opening to think the disappointing first day of trading still left the company with a $100 billion+ market capitalization.

2012-05-21 And Thats The Week That Was by Ron Brounes of Brounes & Associates

Dell (5/22), HP (5/23) and Costco (5/24) release earnings next week, but no one seems to care much these days. The Greek crisis and ongoing EU contagion will weigh on investors as G8 leaders head to Camp David to debate fiscal responsibility. (Any opportunities to compromise, Germany?) Talks of harsh financial regs continue to heat up in the aftermath of JP Morgan. Did you guys cash-out of any Facebook (as a hedge), Mr. Dimon?

2012-05-21 A Worthy Scapegoat by Charles Lieberman (Article)

The $2 billion trading loss reported by J.P. Morgan Chase has unleashed a torrent of comments suggesting an even greater need to impose Dodd-Frank, that bank trading operations need to be reined in, that banks managers are badly overpaid and suffer from hubris that gets them into trouble, that our largest banks are too big to fail and too big to manage, and that regulators need to do a better job of keeping banks from taking too much risk with depositor money.

2012-05-21 The Plow Horse Rolls On by Brian S. Wesbury of First Trust Advisors

Turn on the television, pick up the newspaper, search the Internet and you will find story after story about Greece, JP Morgan, austerity, the labor force, student loans, California, the G-8, or the Facebook IPO. Just about every bit of the coverage is negative. And yet, amid all this, our plow horse economy keeps moving forward through the stumps and rocks and mud. Its certainly not Ill Have Another, who, with one more win, can take the Triple Crown a measure of strength, courage and greatness. But it aint headed for the glue factory either.

2012-05-21 Markets Fall on Negative Europe Sentiment by Chris Maxey and Ryan Davis of Fortigent

Worries over the European sovereign debt crisis worsened this week as Greeces political instability increased concern that the country could depart the Eurozone. Greece saw a virtual run on its banks during the week, as depositors withdrew 1.2 billion in two days on fears of massive devaluation from a return to the drachma. While this represented just 0.75% of Greek deposits, it foreshadows a potentially larger crisis if a Greek Eurozone departure becomes imminent.

2012-05-18 Rental Housing Boom Set to Explode by John Burns of John Burns Real Estate

Rental households comprise 34% of the housing stock, and are growing at the incredible rate of 1.6 million per year, while owned households are actually declining in number. This is an incredible surge in demand. In our summary of the U.S. housing market only 20% of renters live in large buildings and the remaining 80% of renters live in alternative types of housing. Approximately 55% of new renters are renting single-family homes, while 45% are renting apartments. The single-family rental business, which is already larger than the institutional quality apartment business, is booming.

2012-05-18 Gold: The World's Friend for 5,000 Years by Frank Holmes of U.S. Global Investors

Investors have defriended gold recently in favor of the dollar, as Greek and French voters rejected austerity measures. Greeks have been responding to their escalating debt issues for a while by steadily pulling money from overnight deposits. I often say, money goes where it is best treated, and these deposits will need to find a safe haven.

2012-05-18 U.S. Real Estate Securities Review & Outlook for April 2012 by Team of Cohen & Steers

We have a generally favorable view of key office markets, including life sciences, technology and media, as well as NY offices broadly. We have decreased our allocation to apartments based on valuations and the prospects for more direct and indirect (housing rentals) competition. We continue to favor prime retail owners, while staying cautious toward health care properties, suburban offices and secondary retail.

2012-05-18 Emerging Markets Real Estate Securities April 2012 Review and Outlook by Team of Cohen & Steers

In a global economy characterized by moderating inflation and tepid growth in developed markets, we believe emerging markets real estate securities offer attractive upside potential on a risk-adjusted basis. Policymakers in emerging economies have indicated increasing comfort with accommodative monetary policies, while domestic demand remains robust, creating a positive operating environment for both landlords and developers. On a relative value basis, we are finding more opportunities in residential developers, as we believe share prices remain depressed following their poor 2011 returns.

2012-05-18 Global Real Estate Securities April 2012 Review and Outlook by Team of Cohen & Steers

North America fundamentals are on a slow but positive trajectory. European economic challenges keep us focused on high-quality names. Policy easing trends likely to benefit Asia Pacific.

2012-05-18 International Real Estate Securities April 2012 Review and Outlook by Team of Cohen & Steers

European economic challenges keep us focused on high-quality names. Policy easing trends likely to benefit Asia Pacific.

2012-05-17 Our Fixed Income Insights on Yield Traps by Team of American Century Investments

From a fixed income perspective, we explain why aggressive yield-enhancing strategiesresulting from this extended period of historically low U.S. interest rates and yieldscan threaten the potentially valuable long-term portfolio benefits from holding fixed income positions. In particular, chasing yieldand stumbling into yield trapscan derail the important volatility reduction and diversification benefits offered by carefully selected and well-managed fixed income holdings.

2012-05-17 You should worry about EM inflation. Not US inflation. by Richard Bernstein of Richard Bernstein Advisors

Investors seem overly concerned about US inflation. Both market-derived expectations and actual rates of US inflation remain very subdued, yet we are consistently asked about inflation and whether our investment strategies are adequately structured for high US inflation. Across the board, these data do not support structuring investment strategies for the US inflation that investors, oddly enough, feel is inevitable. The data do, however, suggest that investors recent rush into emerging market debt is much riskier than they anticipate.

2012-05-16 ProVise Bullets by Team of ProVise Management Group

If you listened carefully to the CEOs during their earnings announcements, they were tepidly upbeat but upbeat nonetheless, as they looked forward into the remainder of the year. On a day-to-day basis the markets will be driven by the headlines and emotions. We encourage you to refrain from getting caught up in that fray. At the end of the day it will be about an economy that moves forward creating jobs and not one built on the back of debt.

2012-05-15 Lacy Hunt on Debt, Austerity and Recovery by Robert Huebscher (Article)

Global economies are experiencing unsustainable debt disequilibrium, according to Lacy Hunt. Economic textbooks preach that equilibrium, rather than transition, should be the predominant condition. But our attempts to reduce our indebtedness by taking on more ? and less productive ? debt are weakening our economy and creating unstable conditions.

2012-05-15 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.

2012-05-15 Austerity Its All In The Timing by Scott Brown of Raymond James Equity Research

One problem with designing fiscal stimulus is determining how rapidly to move back toward fiscal balance. The U.S. economy has already faced some degree of austerity. According to the National Income and Product Accounts, government consumption and investment subtracted 0.6 percentage point from GDP growth over the last six quarters, where in normal times, it would have added about 0.3 percentage point (consistent with population growth). Real GDP averaged 1.8% growth over the last six quarters. It would have been nearly a full percentage point higher if not for the contraction in government.

2012-05-15 Earnings Seasons Recap: Is Corporate Strength Fading? by Chris Maxey and Ryan Davis of Fortigent

Strength in the corporate sector since the recession ended has been well documented. In the face of general economic malaise, record profits have been achieved through aggressive cost-cutting and low financing costs. This phenomenon has been one of the major pillars propping up the markets (with the other being central bank policy). Now with Q1 earnings season all but over, it is not unreasonable to question whether that corporate strength is fading. Initial impressions of first quarter earnings season were very favorable after the first big wave of earnings releases.

2012-05-15 Month of May: Sell and Go Away, or Hang in There? by Liz Ann Sonders of Charles Schwab

We believe the stock market's correction is likely to be less severe this year relative to 2010 or 2011. Be aware of the possible perils of following a "sell in May" trading strategy. For now, macro concernsincluding Europe and the looming "fiscal cliff"are trumping better micro news.

2012-05-14 Dancing at the Edge of a Cliff by John P. Hussman of Hussman Funds

Our recession concerns remain intact, as do our separate concerns about extreme stock market risk. I've emphasized that our estimate of prospective market return/risk in stocks has slipped into the most negative 0.5% of historical data. Last week that estimate actually deteriorated, but I am reluctant to make comments on such a small sample, as the only more negative estimate in post-Depression history was on September 16, 2000. Even in the conditions that match the worst 2% of our return/risk estimates, the market has lost an average of 20-25% just in the following 6-month period.

2012-05-14 Brazil: Compelling Opportunities for the Long Term by Brigitte Posch of PIMCO

Although economic growth has moderated somewhat in recent years, Brazils growth story remains compelling. Underpinned by favorable GDP growth, Brazilian bank fundamentals are solid; banks are closely regulated and well-capitalized. PIMCO believes several key corporate sectors oil, gas, utilities, infrastructure and major banks will dominate the outlook for Brazil over a secular horizon thanks to stronger pricing power and improved profitability.

2012-05-14 Time to Face Reality by Charles Lieberman (Article)

European markets remain in turmoil, even as these governments prefer to keep their heads buried in the sand. Sooner or later, reality intrudes. Greece and Spain are in the vanguard of being forced out of their fantasy world and a second default, following closely on the first, now appears likely. Greece is small enough so its problems will impinge little on markets, if Spain can handle its bank issues sensibly. Europe's attention will soon shift towards protecting Spain.

2012-05-14 The Bull Market Has Not Yet Reached Its Highs by Bob Doll of BlackRock Investment Management

It has been the case for some time, but recent events serve as a reminder that the primary risk to the global economy and markets is the ongoing debt crisis in Europe. Confidence over policymakers' ability to deal with the crisis took a hit recently given that the election results in Greece and France signal a shift away from governments' willingness to move forward with unpopular austerity measures. The resulting political uncertainty and investor confusion has put downward pressure on stocks and other risk assets. Unfortunately, the reality is there is no quick fix for Europe's problems.

2012-05-14 And Thats The Week That Was by Ron Brounes of Brounes & Associates

Europe is never too far away from the headlines and investors surely will be watching 1) Greece to see if its internal politicos can get along to forge a coalition and 2) France to see if its new Prez can make nice with German Chancellor Merkel. Retailers take center-stage next week as Home Depot, JC Penney, Target, Wal-Mart, and Gap all post earnings. Additionally, retail sales heads a hectic week on the economic calendar, though investors must remember that declining energy prices should help in the months to come.

2012-05-11 Here We Go Again....or Not? by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Softer economic data has prompted concerns that the market may be headed for a summer swoonsimilar to the previous two years. We believe the backdrop is decidedly different (and better) this time around but investor and business confidence will continue to be important. Some appear to be hoping for weaker data in order to spur the Fed to enact QE3. We believe the bar is much higher and that the Fed should look to return to a more normal monetary stance. Complicating the overall picture and the Feds job is the coming "fiscal cliff" out of Washington at the end of this year.

2012-05-11 Looking to China to Fire Up its Economy by Frank Holmes of U.S. Global Investors

Following on the heels of renewed concern over Europes debt situation, China released its monthly economic data. Fixed asset investment, industrial production and retail sales all rose in April, yet growth was not as strong as analysts anticipated. Weak is the word to describe Chinas April figures, says CLSAs Andy Rothman in his Sinology Report. But China wants the ability to manage a stable decline to promote medium-to-long-term structural reforms as well as avoid a hard landing, says CEBM.

2012-05-10 I Question, Therefore I Am by Francois Sicart of Tocqueville Asset Management

Historically, the attraction of value investing has been that, by purchasing stocks whose price does not incorporate a large hope premium over intrinsic value, the downside would be muted. Conversely, the potential for the premium to increase should investors perceptions change would promise worthwhile returns even in the absence of spectacular growth by the company. These assumptions suffered a severe setback in 2007-2009, when practically all stocks were caught into the same panic-driven downward spiral. But it does not entirely negate their validity.

2012-05-10 Q112 Portfolio Commentary for the Absolute Strategies Fund by Jay Compson of Absolute Investment Advisers

It is no secret the structural problems and crises throughout the global economy stem from excess debt. This letter attempts to explain why we think the global economy is in this situation, why the process for creating the problems continues to this day, why financial markets are not out of the woods. We are extremely optimistic about the future investing climate, but only after we get through the final stage of the credit bubble. In our view, the root of the problem stems from the willingness of a broad swath of investors and money managers to bid up asset prices to extreme levels.

2012-05-10 Staying Bullish by Herbert Abramson and Randall Abramson of Trapeze Asset Management

We believe we are in a new bull market, and bull markets thrive on climbing that proverbial wall of worry. Bullish sentiment is low and bearish sentiment high. Anxious retail investors, having suffered two ugly bear markets since 2000, continue to shun stocks, with money flowing out of mutual equity funds now for more than 5 consecutive years. The public is hugely underinvested. Cash on the sidelines is enormous. The fuel to ultimately power stocks higher as confidence returns.

2012-05-08 Richard Bernstein: US Assets will Outperform over the Next Decade by Robert Huebscher (Article)

Prior to founding the firm that now bears his name, Richard Bernstein was the chief investment strategist at Merrill Lynch & Co. In this interview, he discusses why he expects US assets - both equities and fixed income - to be the outperformers among global markets over the next decade.

2012-05-08 Why Be Scared Of A Hat by Christian Thwaites of Sentinel Investments

Markets tend to overreact and the last few weeks in France were no exception. Equities fell around 9% on the expectation of a change in government. On close look, the Hollande manifesto is modest...a change in retirement age here, a year difference to a balanced budget, a non-descript growth pledge, tax banks more, reduce immigration. Markets also have notoriously short memories: socialist (i.e. left of center) governments are good for markets. Stocks rose vigorously in the years after leftist governments took control of France in 1981, Sweden in 1998, the UK in 1997, the US in 1992.

2012-05-08 Sentiment Readies for a Tumultuous Fall by Chris Maxey and Ryan Davis of Fortigent

Market sentiment has oscillated quite rapidly in recent months on the heels of dramatic market intervention by the ECB and shifting views of global economic stability. Sentiment is likely to remain unstable in the months ahead as investors grapple with any number of events, from elections in Europe and the US to the end of recent monetary easing efforts domestically. While markets have rallied substantially over the past six months, retail investors are maintaining a somewhat neutral view on their allocations.

2012-05-08 Dont Fight the Last War Lessons from the Battlefields of Risk Management by Niels C. Jensen of Absolute Return Partners

Investors often behave as if they operate in a world of logic and certainty even when that is not the case. For that reason, history is littered with investors who have failed miserably. In this month's Absolute Return Letter we look at many of the pitfalls facing risk managers and we take a stab at where the next big crisis is going to surface. Our conclusion may surprise a few readers.

2012-05-08 A New Economic Era: The Usual Rules No Longer Apply by Dawn Bennett of Bennett Group Financial Services

Against this backdrop of economic woes in the U.S. and Europe, business activity in Asia and Latin America is on the rise. The developing economies and emerging markets are where we see the better metrics, not in the US, Europe or Japan. One needs to look at the BRIC countries connection to commodities growth, and understand how they are getting on top of inflation. We believe China will lead the emerging markets in 2012. They will lean towards easing so their consumers will not be hurt by the less than healthy European export business as well as the weaknesses in the exports to the U.S.

2012-05-07 The Labor Market Outlook by Scott Brown of Raymond James Equity Research

The April Employment Report disappointed stock market participants. However, it really wasnt a bad report. Private-sector job growth has been moderately strong this year. The Household Survey data suggest that the economic expansion has been strong enough to absorb the growth in the working-age population, but not enough to take up much of the labor market slack that was generated during the downturn. These figures tell us nothing about where the labor market is headed. Job growth over the next six months will have important implications for investors and for the November election.

2012-05-07 Unbalanced Risk by John P. Hussman of Hussman Funds

Maybe our present concerns won't amount to as much downside as we expect. But if investors were to choose a point to test the hypothesis that this time will be different and risk will be well-rewarded, I hardly think a worse moment could be found.

2012-05-07 After Austerity by Joseph E. Stiglitz of Project Syndicate

So many economies are vulnerable to natural disasters earthquakes, floods, typhoons, hurricanes, tsunamis that adding a man-made disaster is all the more tragic. The pain that Europe, especially its poor and young, is suffering as a result of its leaders willful ignorance of the lessons of the past is entirely unnecessary.

2012-05-07 Mixed Data and Patience is a Virtue by John Buckingham of AFAM

The labor report issued by the U.S. Bureau of Labor Statistics found that nonfarm payroll employment rose by 115,000 in April, and that the unemployment rate dropped to 8.1%. The improvement in the jobless rate came about only because 342,000 folks left the workforce, so there was little cause for cheer, even though the rate stood at 9.0% in April 2011 and 9.9% in April 2010. Employment increased in professional and business services, retail trade and health care, but declined in transportation and warehousing, while the private sector added 130,000 jobs and government payrolls fell by 15,000.

2012-05-07 Despite Uncertainty, the Bull Market Should Persevere by Bob Doll of BlackRock Investment Management

There is a great deal of uncertainty that is acting as a headwind for the markets. In the United States, perhaps the main uncertainty is over the looming fiscal and tax issues that must be dealt with before the end of the year. Additionally, the still-developing European debt crisis has the potential to derail markets, as does the possibility for worse-than-expected economic growth. In any case, while we do expect to see markets continue to churn for the near term, we also believe that stocks will eventually be able to resume their climb.

2012-05-05 A Graphic Presentation by John Mauldin of Millennium Wave Advisors

The job market is still in a deep hole. At April's rate of job gains, it would take well over three years to return to December 2007's employment level, without adjusting for population growth; at the average rate of the last six months, it would take about two years. Earnings are weak, and the strongest sectors aren't those of which economic miracles are spun. QE3 looks like more of a possibility than it did a few days ago.

2012-05-04 Bullish on America by Andrew J. Redleaf of Whitebox Advisors

Todays crisis has nothing to do with the shadow banking system or any other sort of shadow. Todays crisis is all out in the bright sunshine and remarkably straightforward. The supposed danger is that some major economic power (i.e., not Greece) will become unable to access credit markets. Spanish or Italian or French bonds will decline so steeply as to imperil the banks that own them or appear to do so, causing a run on global financial institutions as severe as 2008s.

2012-05-04 Housing in One Graphic by John Burns of John Burns Real Estate

The following graphic summarizes the U.S. housing market. The red boxes are a small percentage of the total, yet are receiving all the media and political attention. Americans make astute financial decisions, at least in the short-term (debt will hurt us in the long-term). We will bailout very few homeowners. We will increase construction by building in the ever-increasing number of areas that need homes and builders can make a profit. We will figure out how to make portfolio investments in the massive single-family rental market. We will buy homes if it makes financial sense for us to do so.

2012-05-04 Back In by Mark Kiesel of PIMCO

U.S. housing may be a decent place to put money over the next several years due to improved absolute and relative valuations. U.S. housing fundamentals have improved significantly, led by lower prices, record low mortgage rates, improving inventory and delinquency trends and a gradually improving labor market, which in combination are helping homebuyer confidence and potential demand. While the outlook for U.S. housing has improved, several headwinds remain, including tight credit, potential supply from the shadow inventory and weak household formation due to a subpar economic recovery.

2012-05-04 Do Emerging Markets Win, Place or Show in Your Portfolio? by Frank Holmes of U.S. Global Investors

The recovery in U.S. stocks is significant and helps restore confidence in equities. Were pleased to see markets improving, especially following a rough finish in 2011. Yet there lingers a persistent negativity toward emerging markets growth and commodities that prevents many investors from jockeying their portfolios into a position for growth. Rather, they remain spectators on the sidelines, with equity fund outflows continuing.

2012-05-03 A Troika of Problems by Team of BondWave Advisors

The troika of the International Monetary Fund (IMF), European Union (EU), and European Central Bank (ECB) has continued to prescribe austerity. But at the end of what is now a lengthy cycle of agreements and ever-increasing austerity measures, the debt still remains significant and much of the region has either been plunged into recession or is heading that way. We discuss these ongoing problems and provide additional insight on the US Treasury, Corporate and Municipal Bond Markets.

2012-05-02 Chinas Landing Pattern by Mark Mobius of Franklin Templeton

Our main investment themes in general have been focused on consumers and commodities. It is our belief that Chinese consumers are likely to continue gaining clout, and Chinese macroeconomic policy has increasingly been moving from an export-based model to one fueled by domestic demand. We also expect that demand for hard and soft commodities should remain strong as China and many other emerging markets industrialize, gain wealth and increase spending on infrastructure, which tends to tilt the balance between supply and demand in favor of producers.

2012-05-02 Investments vs. Outvestments by Andrew J. Redleaf of Whitebox Advisors

This is a great time to invest. But you have to make sure you really are investing and not accidentally outvesting. The market is currently sorting credit into about four big categories. Three of those categories are priced roughly in reference to Treasuries (outvestments). Those are the categories in which we are not interested. The first category, obviously, is Treasuries themselves. Next, short-term paper of super-blue-chip firms. Third, bonds that are just on the border of being investments. Finally, all domestic bonds whose prices are detached from Treasuries.

2012-05-02 Its Good To Be The King by Chris Richey of Neosho Capital

The sovereign Greek debt default will ultimately lead to a sovereign Spanish debt default, and thus we tell you why sovereign debt should not be viewed as risk-free.

2012-05-02 One Up on Wall Street by Bill Smead of Smead Capital Management

Peter Lynch went to the mall with his wife back in the days when he ran Fidelity Magellan. The purpose was to see what stores were getting good traffic and creating a buzz. Peter felt this was an advantage the average individual investor had over the professionals on Wall Street. We like to buy companies in the Warren Buffett-Charlie Munger tradition. We like to buy most during periods of pessimism ala John Templeton. We use our proprietary eight criteria for selecting. Finally, we get excited when the current evidence hints that we are onto something, getting good traffic and creating a buzz.

2012-05-02 Digbys Umbrella and a Dinner to Remember by Christian Thwaites of Sentinel Investments

The US economy is on a painfully slow road. It is recovering. Jobs numbers are better, even though some hiring in the first quarter may have been brought forward by mild weather. Production, manufacturing and exports, all signs of regained competitiveness in the US, are showing steady improvements. And the government sector is contracting. Not on purpose mind you, but jumping off a cliff and letting inertia do the work result in the same end. Above all of this, we have a Fed using every monetary policy at their disposal to try and promote growth and employment.

2012-05-02 A New Wave of Foreclosures Could Challenge the Housing Market by Team of American Century Investments

The most recent data on the U.S. housing market suggests we may have reached a bottom. However, most experts anticipate the housing market will be hit by a large new wave of foreclosures that will substantially affect the current supply-demand balance for the remainder of this year and possibly into 2013. As a result, we may be looking at one more phase of price declinesparticularly in local markets where the housing bubble grew largest before it burstbefore we truly find the bottom to our five year housing crisis.

2012-05-01 Another Story of Too Much Debt: Investing During Unsustainable Economic Conditions by Brian McAuley (Article)

US-based investors cannot ignore the macro environment, and therefore must consider the consequences of our increasing indebtedness and its impact on capital markets. We can gain valuable insights into our fiscal problems from the housing bubble and the European sovereign debt crisis - lessons which every value investor should heed.

2012-05-01 Don't End the Fed, Mend the Fed by Paul Kasriel of Northern Trust

Congressman Ron Paul has written a book entitled End the Fed. I have to admit that I have not read his book. But I have read many of Congressman Pauls excellent (in my opinion) essays on monetary theory and policy. Congressman Paul likely argues in End the Fed that the Fed and other central banks have created monetary "mischief" in the past and are likely to continue to do so in the future. Because of this monetary mischief, I assume that Congressman Paul would like to replace the Fed and other central banks with some form of a gold standard. I share Congressman Pauls sentiments.

2012-05-01 Is Now The Time To Brace For Another Volatile Summer? by Chris Maxey of Fortigent

In the latest week, the Federal Open Market Committee reiterated its stance that economic conditions are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014. While rates will remain low for now, the Fed will need to fend off other challenges in the months ahead, ones that could send investors racing for the beach sooner than normal. The biggest challenge for the Fed and the economy in the coming months is in the form of Operation Twist. The hope was that such actions would drive down interest rates and encourage borrowing of all forms.

2012-05-01 A Wake-up Call on the Economy by Milton Ezrati of Lord Abbett

Economic statistics seem at times to have their own ebb and flow, sometimes overstating and sometimes understating the underlying fundamentals. Sadly, these often meaningless data variations can create false feelings about economic possibilitiesenthusiasm, when the statistical flow leans toward the strong side, or despair, when it leans on the soft side. Investors, in particular, succumb to such swings in attitude, but, to a lesser extent, so do businesspeople. So, it was with a string of insupportably good numbers late in 2011 and earlier this year.

2012-04-30 Housing Recovery Now Underway by Charles Lieberman (Article)

Many focused on the slower than expected pace of growth in first quarter GDP, but the stronger rise in housing activity merited little more than passing mention. However, housing construction is gathering steam, as inventories are now severely depressed and demographic trends require a resumption in new construction. Autos were another significant contributor to growth. We expect both sectors to continue as key sources of demand in the ongoing expansion.

2012-04-30 Here We Go Again by Brian S. Wesbury and Robert Stein of First Trust Advisors

We are not saying the negative data is meaningless. Its not. But some of the reaction is, once again, overdone. Debating the worry-warts has become a full-time job and we cant prove them wrong until the future becomes the present. So, lets look back to last year when we said in a few months we will be looking back at recent reports as just statistical noise. Sounded good then, so lets not mess with success. The more things change, the more they stay the same.

2012-04-30 Euro Risks Continue but Support for Risk Assets Is by Bob Doll of BlackRock Investment Management

At this point last year, two of the major downside risks were the possibility of the European debt crisis spiraling out of control and the inability of the United States to get its fiscal house in order. Today, while these remain two factors that have investors concerned and while there are some similarities between the situations one year ago and today, there are also some important differences. The US fiscal policy is murky. The tax and fiscal policies that are set to expire at the end of 2012 are clouded in uncertainty and it is impossible to view them outside the 2012 elections.

2012-04-27 Managed Futures and Macro: Q1 2012 Market Commentary by Jon Sundt of Altegris Investments

With Eurozone concerns receding and the macroeconomic picture showing strength, the market outlook at the end of Q1 is notably brighter than at the end of last year. Reduced correlations, lower volatility and the prospect of less government intervention have led some players to hope for a return to a new old period in which fundamentals drive the markets. If that theme does indeed prove to be sustainable, we expect that: a) more managed futures managers, would profit from stronger trends; and b) more circumspect global macro managers may take advantage of increasingly bullish positioning.

2012-04-27 Happy (Third) Anniversary: Now What? by Jon Quigley of Advanced Investment Partners

During the trading day on March 6th, 2009, the S&P 500 Index hit its intraday bottom of 666.79. In the ensuing three years the Index has advanced over 100%. Along the way, weve witnessed the collapse of some of the older and more hallowed names in the financial industry buh-bye Lehman Brothers, so long Merrill), endured the most severe recession in at least 25 years, suffered through incredible spates of market volatility, and gathered a few gray hairs (or lost some hair) along the way.

2012-04-27 Roller Coaster Returns by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Despite an earnings season that has been much better than expected so far, investors appear to be again focusing on more macro concerns. Europe and China are dominant concerns but US growth sustainability is also being questioned. We remain optimistic on the ultimate direction of the stock market. The Fed meeting provided no changes but did show a slightly more hawkish tilt in their economic forecasts. Meanwhile, the US government continues to play a dangerous game of chicken as election season is already in high gear and the so-called "fiscal cliff" looms.

2012-04-27 Sell in May and Go Away? Not this Year by Frank Holmes of U.S. Global Investors

One catchy investing maxim thats popular this time of year is sell in May and go away, the notion that investors should cash in their investments and take the summer off. We believe its a much better market this year. After following a similar trajectory as the previous year from October to the beginning of March, improving economic data pushed the S&P 500 over 3 percent higher in March 2012 after trending sideways during the same time period last year.

2012-04-27 Bond Market Reflections Spring 2012 by Bruce A. Weininger of Kovitz Investment Group

Faced with the prospect of loaning money out for eight years knowing that our best case return over that time was 2%, we decided that, for a while anyway, wed rather hold onto to cash in hopes that pricing will become more rational over the coming weeks or months.

2012-04-26 One Step Closer: Fed Keeps Rates Low But Gets More Hawkish by Liz Ann Sonders of Charles Schwab

The Federal Reserve's Open Market Committee (FOMC) made no change to short-term interest rates, but provided no hints that a third round of quantitative easing (QE3) was in the offing. As usual, the committee repeated its comment about keeping the Fed's balance sheet under review and being willing to act "as appropriate," while also confirming its pledge to keep rates "exceptionally low" through 2014. For the third consecutive meeting, there was one dissenterRichmond Federal Reserve Bank President Jeffrey Lackerwho believes the first increase in rates will be necessary in 2013.

2012-04-26 The Bernanke-Krugman Smackdown by Mike "Mish" Shedlock of Sitka Pacific Capital Management

Bernanke is trying like a madman to get banks to increase lending but Bernanke and Krugman both do not understand economic reality. Banks cannot lend because they are still capital impaired, hiding losses yet to come, and holding assets that are marked-to-fantasy instead of marked-to-market. Consumers are busted and holding interest rates at 0% when prices of food and gasoline are soaring exacerbates the problem. There are few credit-worthy businesses that want to borrow in this environment. The businesses that do want to borrow are not credit-worthy and banks would be foolish to lend to them.

2012-04-25 Is The Economic Recovery Stalling? by Gary D. Halbert of Halbert Wealth Management

The US economic recovery is facing some stiff headwinds. Those include high gasoline prices, the recession and higher interest rates in Europe and the recent disappointing unemployment numbers in the US, just to name a few. The apparent slowdown in the recovery recently is in part due to the unusually warm winter, which served to pull economic activity forward in January and February, thus making March and April so far look softer. Some in the mainstream media concluded that we dont have a problem with the economy. Maybe so, but the recovery has had an uneasy feeling about it recently.

2012-04-24 Is 2012 the Year for Hedge Funds? by Chris Maxey of Fortigent

Prior to the financial crisis, hedge funds were largely viewed as alpha generating, high return seeking, portfolio diversifiers. In 2008, that model came under attack from multiple angles fraud, illiquidity, and poor returns being the primary culprit. Ever since that time, the value proposition of hedge funds and alternative investments remains in question, causing some to wonder if this is a make or break year for the space. There is reason to think the environment for hedge funds and active managers is improving.

2012-04-24 Chinas Growing Pains by Milton Ezrati of Lord Abbett

Among all the fears discussed in the financial community these days, worries over Chinas expansion loom large. The government in Beijing has revised down its growth expectations to 78% a year from the former breakneck pace of 1012%. Private groups, such as the American Chamber of Commerce in China, have made similar downward adjustments in their expectations. Though there is good reason to anticipate a slowdown in the pace of Chinese growth, it would be a mistake to exaggerate the risks, and especially to do so by drawing easy parallels to Americas real estate debacle.

2012-04-24 And Thats The Week That Was by Ron Brounes of Brounes & Associates

Dr. Bernanke and friends get together again to set monetary policy and will discuss oil and gas prices and the effect on inflation as well the newfound labor slowdown. Still, no one expects any additional stimulus moves at this time and the policymakers should reiterate their intent to keep the funds rate at near-zero percent well into 2014. The future of Europe remains atop the headlines as France holds crucial national elections and the IMF convenes for its semi-annual soiree.

2012-04-23 Emerging Asia Pacific: Economic Review 1st Quarter 2012 by Team of Thomas White International

Emerging Asia Pacific economies, which reported dismal economic numbers during the fourth quarter of 2011, recovered some lost ground during the first quarter of 2012. Export-led growth in many Asian countries, which had come under pressure during the last months of 2011, witnessed slight improvements in 2012 thanks to receding fears about a sovereign debt crisis in the EU and a stronger-than-expected recovery in the U.S. China, the regions largest economy, however, signaled that it will accept a slightly lower growth rate of around 7.5 percent over the coming years.

2012-04-23 Middle East/Africa First Quarter 2012 Economic Review by Team of Thomas White International

While the Middle East and Africa (MEA) region continues to weigh the impact of the tumultuous Arab Spring uprisings, the area is facing against another challenge yet again. In addition to the existing domestic instability, a strained external environment (the Euro debt crisis) is proving to be a major threat to the regions trade, tourism, remittances and other exports receipts. According to the World Banks Global Economic Prospects report, the economic recovery seen in Morocco, Jordan and Tunisia in late 2011 is likely to stall in 2012.

2012-04-23 Blowin in the Wind by Scott Brown of Raymond James Equity Research

Recent economic data have been mixed, but generally consistent with moderate economic growth. The recovery continues, but has failed to gather much steam and remains relatively fragile. Were on our way, but weve a long way to go. Over the last year, the economy has faced a number of headwinds, capping the pace of improvement. Those headwinds appear to be lessening to some extent although there are uncertainties, particularly as one looks to 2013.

2012-04-23 Americas: Economic Review First Quarter 2012 by Team of Thomas White International

Optimism over economic prospects increased across the Americas regions during the first quarter of the year, as economic data showed sustained improvement and global risks eased somewhat. Despite costlier fuel, consumer spending climbed in most countries across the region, especially in the U.S. The European fiscal crisis now appears less worrisome when compared to last year, while the slowdown in Asia has turned out to be milder than expected earlier. Commodity prices have recovered after the correction during the second half of last year, on an improved outlook in global demand.

2012-04-23 A Seesaw of Surprises by Kristina Hooper of Allianz Global Investors

It was a week full of surprisesboth good and bad. Corporate profits in the United States have come in stronger than expected. U.S. consumers are spending more money than anticipated. But continued housing weakness, higher-than-expected jobless claims and deeper disruptions in Europes debt crisis have raised some eyebrows. Adding to uncertainty are the events in the Netherlandsone of only a few AAA-rated lenders in Europeas its government rejected a fiscal austerity plan and now is in jeopardy of collapsing. Here is how to put such a mixed bag in perspective.

2012-04-20 Currency Wars: Gambling With Other Peoples Money by Axel Merk of Merk Funds

If running out of your own money wasnt bad enough, policy makers are increasingly spending other peoples money to bail their country out. At the upcoming G-20 meeting, finance ministers from around the world will contemplate an increase to the resources of the International Monetary Fund (IMF). At stake for politicians is whether they can continue to do what they know best to play politics. In contrast, at stake for investors may be whether currencies will retain their function as a store of value.

2012-04-20 Small Cap Outlook 1Q12 by 1492 Investment Team of 1492 Capital Management

While weve seen the markets advance nicely, we think the market could gain more than 25% this year as the U.S. economy continues to move ahead and the rest of the world is in stimulus mode. Most importantly, there are still plenty of bears calling for recession, despite an ongoing barrage of better economic statistics. No doubt the remainder of the year will give the stock market plenty to ponder like the U.S. Presidential election, ongoing European debt crisis fallout and concerns about Chinas economic growth. Read on to understand why were so bullish on the U.S. stock market.

2012-04-20 Monthly Investment Commentary by Team of Litman Gregory

Stocks and other risk assets surged in the first quarter, continuing the strong run that began in the fourth quarter of last year. In each of the past two quarters, domestic stocks gained about 12%, marking one the strongest runs over the October-March span going back to the 1920s. Developed foreign stocks increased nearly 12% in the quarter, emerging-markets stocks gained 14, small-cap U.S. stocks were up 12%, high-yield bonds rose 5%, and emerging-markets local-currency bonds added 8%.

2012-04-20 Equity Investment Outlook April 2012 by Team of Osterweis Capital Management

We think stocks are reasonably priced on an absolute basis and extremely attractive relative to bonds. Bonds have performed well over the past three decades, but with interest rates at record lows, there is not much room for bonds to continue outpacing stocks on a total return basis. Meanwhile, companies are steadily increasing dividends. Even Apple recently instituted a dividend. For some time, investors have been lowering their exposure to U.S. equities. We believe this trend should reverse, especially once interest rates start to rise and bond market returns turn negative.

2012-04-20 Fixed Income Investment Outlook April 2012 by Team of Osterweis Capital Management

The Feds easy money policy will likely not reverse in the near term, but may do so before 2014, if economic growth strengthens meaningfully; some inflation is also acceptable to the alternative deflation. We are seeing some economic strength in the U.S., which is translating into higher equity prices (and hopefully higher capital gains). We are still generally avoiding exposure to interest rate risk found in Treasuries and investment grade bonds. We believe the easy money has been made there and we are not currently being compensated for the risk of rising interest rates.

2012-04-20 Weighing the Evidence of Oil and Gold Stocks by Frank Holmes of U.S. Global Investors

We believe in thinking contrarian and keeping a close eye on historical trends to discover inflection points, as stocks tend to eventually revert to their means. For example, in March 2009, we noted significant changes signaling the market had hit rock bottom; following that time through the end of the first quarter, the S&P 500 Index rose more than 100 percent. Todays extreme divergence in oil and gold stocks and their underlying commodities presents a rare opportunity: what these stocks need now are investors to take advantage of it.

2012-04-20 Preferred Securities First Quarter 2012 Review and Outlook by Team of Cohen & Steers

Preferred securities continue to offer a compelling total return proposition. Treasury yields are at or near historic lows, and the Federal Reserve appears committed to holding interest rates steady for the foreseeable future. At the same time, with preferred yields near 7%, the yield spread between preferred securities and Treasuries remains far wider than its long-term average, and few other investments offer as much income.

2012-04-20 Emerging Markets Real Estate Securities Investment Review & Outlook First Quarter 2012 by Team of Cohen & Steers

A general moderation in inflation pressures is giving emerging market authorities more liberty to pursue policy stimulus, auguring well for domestic growth. We believe this will create opportunities for residential developers in various markets and we have increased our allocation to these companies.

2012-04-20 U.S. Real Estate Securities Review and Outlook, First Quarter 2012 by Team of Cohen & Steers

We have a very favorable view of specific office markets, including life sciences, technology and media, as well as New York offices broadly. We also continue to like prime retail and self storage owners, which are seeing very strong fundamentals. In contrast, we remain cautious toward health care properties and secondary retail. We have also reduced our allocation to apartment REITs on the margin following their strong run in 2011.

2012-04-20 Closed End Funds First Quarter 2012 Review and Outlook by Team of Cohen & Steers

. With borrowing rates likely to remain low for an extended period, we believe the yield advantage of leveraged closed-end funds will continue to draw investor interest. As a result, we see potential for the broad closed-end fund market to trade at even narrower discounts or even premiums to NAV. In addition, the recent success of new issues should allow the closed-end fund IPO window to remain open in 2012. At the present pace, we do not believe new supply will pressure pricing in the secondary market or impede discount narrowing.

2012-04-20 U.S. Large Cap Value Investment Commentary as of March 31, 2012 by Team of Cohen & Steers

Valuations are still attractive, in our view, if somewhat less so than at the beginning of the year, and volatility has subsided. We expect to see an increase in dividend payers; Apple has opened the door for other technology companies, a sector that has had a relatively low proportion of dividend-paying companies. We are also seeing solid dividend increases among industrials companies.

2012-04-19 Current Conditions Cater to Our Rigorous Muni Investment Process by Team of American Century Investments

The last four years have been a remarkable period in municipal bond (muni) market history. The 2008 Financial Crisis and the Great Recession transformed the high-grade U.S. muni market and how people invest in it. What was once a relatively homogenous bond sector in terms of its credit quality and ratings became much more heterogeneous. Under these conditions, we believe experienced professional credit research and portfolio management are now crucial to investment success. This article outlines our muni investment processes.

2012-04-19 Huge Dilemma: Do You Protect Your Job or Your Clients' Money? by Mike "Mish" Shedlock of Sitka Pacific Capital Management

I feel like a broken record. Jeremy Grantham, John Hussman, and Lance Roberts of Streettalk Live surely feel the same way. I have been preaching the "low returns for a decade" concept for quite some time. It is very tough preaching caution, when caution is routinely tossed to the winds. Yet history has proven time and time again, that such times are precisely when caution is warranted, even though timing the precise moment is simply impossible.

2012-04-19 What to Do With the Daily Data Divulge? by Matt Lloyd of Advisors Asset Management

Simply ignoring the immense amount of data would be foolhardy and we must use more corroborating data and scrutinizing the data among trends and the volatile monthly data. This has given rise to the more artistic aspect of viewing the markets than how we may have in the past. This is why ones prediction for the markets may differ completely from another while looking at the exact same data. As such, the importance of the rationale for why one may feel a certain way about the markets is as important as the actual conclusion.

2012-04-19 Price and Waistline Stability Prove Elusive as Inflation Creeps Up by Scott Colyer of Advisors Asset Management

The long-time trends are firmly in support of consistent price inflation during the history of the US. Inflation is a natural inclination for people, businesses, politicians and central banks. Given the Feds ultra-easy monetary policy aimed at creating inflation, we will eventually see it. Higher inflation requires investors to rethink where they invest. Cash and fixed income do little to cope with inflation and actually can be losers if held at times of higher than normal inflation rates. We think investors should take advantage of current bargains in real estate and equity asset prices.

2012-04-18 Stock Picking in a World of Profit Margin Mean Reversion by Bill Smead of Smead Capital Management

We feel investors should avoid capital intensive companies which are tied to commodities or emerging markets. As interest rates rise and capital becomes dear, those who eat capital lose and those with strong balance sheets and who generate high and consistent free cash flow, should win. As Buffet, Grantham, Hutchinson and Stein pointed out, someone loses in the reversion to the mean of profit margins when compared to GDP. Lastly, dont be fooled by those who are bearish on the stock market because of their belief in profit margin reversion.

2012-04-17 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.

2012-04-17 Earnings on a Hot Plate by Chris Maxey of Fortigent

While the economy has displayed fits and starts of entering a sustained recovery over the past several years, there has been no doubt about the ability of companies to reshape their balance sheets and refocus their businesses. In the midst of first quarter earnings season, there are some concerns that the corporate hot streak will come to an abrupt end, but the reduction in earnings expectations since late last year appears to be favoring another positive earnings season.

2012-04-17 Asia-Pacific Portfolio Committee on PIMCOs Cyclical Outlook by Robert Mead, Tomoya Masanao and Ramin Toloui of PIMCO

We do not expect to see aggressively expansionary policy to combat the incremental economic slowdown in China. We believe that most countries in emerging Asia will continue to put their currency appreciation on hold, as inflation is expected to remain subdued over the cyclical horizon. We are concerned about the sustainability of Japans economic growth beyond 2012, as the governments reconstruction spending will fade in 2013. Relatively speaking, Australia is indeed a beneficiary of higher commodity prices as a result of the strong demand for coal, iron ore and liquid natural gas.

2012-04-17 Mind the Gap by Liam Molloy and Bethany Carlson of Galway Investment Strategy

There is almost always a gap between price and value. Over the next few years price volatility is likely to be the source of the gap as sentiment waffles from overly exuberant to downright pessimistic. In the era of the 24-hour news cycle, high frequency trading, and an ever shortening investor attention span, prices move fast. Markets are emotional creatures and have a tendency to boom and bust. There have been occasions when underlying changes of value have gone unrecognized for sustained periods, and the gap was not primarily a function of price volatility.

2012-04-17 Quarterly Review and Outlook First Quarter 2012 by Van R. Hoisington and Lacy H. Hunt of Hoisington Investment Management

From both economic theory and historical experience the answer is clear; austerity is the solution to too much debt. McKinsey Global Institute examined 32 cases where extreme leverage caused financial crises since the 1930s. In 24, or 75% of these cases austerity was required, which McKinsey defines as a multi-year and sustained increase in the saving rate. Public and/or private borrowers took on too much debt because they lived beyond their means, or they consumed more than they earned. Thus, to reverse the problem spending had to be held below income, increasing the saving rate.

2012-04-16 Market Drawdown Presents Buying Opportunities by Bob Doll of BlackRock Investment Management

Given the relative differences between the economy in 2011 and what it looks like today, we believe the US economy will be more resilient than it was last year. We would also look to corporate earnings as a source of strength. Although we are forecasting that the pace of earnings growth will be slower this year than it has been in the recent past, so far the data has shown that corporate earnings have been doing just fine. Expectations for the first quarter have been set relatively low, but so far over 80% of the companies that have reported have surpassed expectations, which is a good sign.

2012-04-14 The War for Spain by John Mauldin of Millennium Wave Advisors

The inflection point that I thought the ECB had pushed down the road for at least a year with their recent 1 trillion LTRO is now rushing toward us much faster than Draghi had in mind when he launched his massive funding operation. So, we must pay attention to what Spain has done this week which, to my surprise, seems to have escaped the attention of the major media. It may be considered a tipping point when the crisis is analyzed by some future historian. And then we'll get back to some additional details on the US employment situation, starting with a few rather shocking data points.

2012-04-13 Pacific Basin Market Overview - March 2012 by Team of Nomura Asset Management

Our outlook for global economic growth remains reasonably optimistic. The U.S. in particular has exhibited some surprisingly buoyant conditions driven by improvements in the job market and stronger consumption. Europe for now appears to have disproved the more pessimistic forecasts, whilst Japan will benefit from reconstruction activity. Our sector allocation strategy remains biased towards growth. We hold overweight positions in the Industrials, Consumer Cyclical, and to a lesser extent, Technology, while we remain underweight in the Telecommunications and Utilities sectors.

2012-04-13 Developed Asia Pacific: Economic Review 1st Quarter 2012 by Team of Thomas White International

Developed Asia Pacific economies showed more promise in the first three months of 2012 compared to the gloomy scenario witnessed during the last quarter of 2011. A marked upturn in the U.S. economy along with receding fears about the debt crisis in Europe gave a fillip to export-based economies in Asia such as Japan and Singapore. Whats more, inflation in most of the developed Asia Pacific economies became less of a concern during the first two months of 2012, with Singapore, Hong Kong and New Zealand all reporting subdued inflation.

2012-04-13 Dutch Disease Lite in Australias Economy by Robert Mead of PIMCO

Australia is probably more likely to feel the effects of an extended structural change in the economy as resources continue to be reallocated, rather than the effects of a full-fledged, but transitory, case of Dutch disease. China is Australias largest trading partner, and Chinas historical focus on infrastructure building has amplified the divergence in Australias two-speed economy. We believe Australias strong initial conditions should help ensure that Commonwealth Government Bonds remain one of the worlds cleanest dirty shirts for risk-averse investors.

2012-04-13 Schwab Market Perspective: Concern or Correction? by Liz Ann Sonders, Brad Sorensen, and Michelle Gibley of Charles Schwab

Economic data has softened a bit lately but still indicates growth in the US. After a long stretch of relative calm in the markets, we've seen the markets pull back, possibly fulfilling the correction that was overdue. We believe the longer-term trend is higher but near-term risks continue to be elevated and earnings season could bring more volatility. The minutes from the most recent meeting of the Fed seemed to solidify that another round of quantitative easing (QE3) is not in the offing. Although the stock and bond markets initially reacted negatively, we are heartened by the rhetoric.

2012-04-13 Wheres the Beef for Gold Equities? by Frank Holmes of U.S. Global Investors

If you plan on shopping for bargains in the gold miner department, youre going to fight a crowd. Numerous global investors have been pounding the table for gold stocks, including Marc Faber who said gold shares have become extremely oversold and could rebound in the next few days and Global Portfolio Strategist Don Coxe, who reiterated that gold equities are undervalued compared to the precious metal. A big buyer has been the miners themselves. Mergers and acquisitions in the mining sector have been at an all-time high over the past two years. Theyve been willing to pay a premium too.

2012-04-13 The Next Error by John Gilbert of GR-NEAM

The escalating frenzy for yield may in fact prolong the trying process of deleveraging by tacitly supporting bad investment decisions, and underpricing of risk. The relentless destruction of private capital in real terms is policymakers' answer to reducing leverage in nominal terms. If central banks err in the direction of ease, as the Fed will signal if it ignores the Taylor Rule for a time, poor long-term investments are likely to do well for a transitory period. The eventual reckoning can be suppressed, but only for a time.

2012-04-12 Evolution, Impact and Limitations of Unusual Central Bank Policy Activism by Mohamed A. El-Erian of PIMCO

I will speak in a central bank and to central bankers about the role of their institutions particularly the Federal Reserve and the European Central Bank in todays highly complex, perplexing and historically unusual policymaking environment. I will go further and try to link actions to motivations. And, when it comes to implications, I will attempt to put forward questions and hypotheses that, I believe, are critical for the future of the U.S. and global economies but for which I, like others, have only partial answers.

2012-04-12 Global Investment Outlook - March 2012 by Team of Aberdeen Asset Management

Global economic growth sustains its momentum for now. Fiscal policy remains a global focus. Further monetary policy accommodation should support markets. Recent positive momentum within the U.S. economy is driving the global economic recovery, overwhelming the negative sentiment emanating from peripheral Europe. Real incomes, boosted by employment growth and easing inflation, are showing signs of turning positive in the U.S., feeding through to the broader economy.

2012-04-12 Equity Market Review & Outlook by Richard Skaggs of Loomis Sayles

Looking out to year-end, Congress and the White House will be required to act on a long list of expiring tax measures and a debt ceiling increase is necessary as well. As we saw in 2011, compromise is very difficult to achieve and the elections introduce another level of uncertainty. However, the markets current attractive valuation builds in some of these risks. Beyond our shores, there is always the possibility of disappointment in Chinas growth trajectory, and further serious challenges with weaker members of the euro zone should be anticipated.

2012-04-12 Bond Market Review & Outlook by Thomas Fahey of Loomis Sayles

Central banks around the world sent a rush of liquidity into the global financial system, and this coordinated effort helped stem the risk of a major European credit crunch that was brewing at the close of 2011. In our view, the liquidity provision has improved the macroeconomic outlook and buys some much needed time for sovereigns, banks and other indebted private sector agents to try to get their balance sheets in order. Risk assets have generally responded very well to easy money policies over the last two quarters, while negative real interest rates have piqued the global thirst for yield.

2012-04-11 Will Baby Boomers Wreck the Market? (The Sequel) by Gary D. Halbert of Halbert Wealth Management

The basic premise behind the idea that Baby Boomers might lay waste to the stock market makes sense intuitively. The idea is that as Boomers retire, they will shift assets away from stocks to less risky alternatives such as bonds, annuities, CDs, etc. and begin living on the interest. All of this selling activity, the story goes, will put downward pressure on stock prices and lead to a major selloff.

2012-04-10 Allocating to Real Assets: Why Diversification Matters by Cohen & Steers (Article)

One way to extend the long-term purchasing power of a traditional stock and bond portfolio is through an allocation to real assets. But individually, categories like commodities, natural resource equities and REITs can be volatile. Cohen & Steers meets the challenge with a focus on broad asset-class diversification.

2012-04-10 Paul Kasriel's Parting Thoughts on the Economy by Robert Huebscher (Article)

Paul Kasriel, the chief economist at Northern Trust, will retire at the end of this month. In this interview, he explains why he is optimistic about the prospects for the US economy and why supposed headwinds - from the price of oil to the housing market - pose much less of a threat than most people believe.

2012-04-10 Super Macro - A Fundamental Timing Model by Theodore Wong (Article)

Rather than endure losses in bear markets - as passive investors must - I have shown that a simple trend-following model dramatically improves results, most recently in an Advisor Perspectives article last month. Now it's time to extend my approach by showing how this methodology can be applied to fundamental indicators to further improve performance.

2012-04-10 Which Stocks Win on Main Streets Comeback? by Bill Smead of Smead Capital Management

We are very excited about the next three to five years because we believe it is likely that Main Street will start to compete with Wall Street for capital and economic growth will accelerate. Unemployment rates would fall in that scenario and pent-up demand for goods and services could come out of the woodwork among average American households. What we mean by saying this is that capital will begin being demanded for business activities. As capital gets demanded for business activities ranging from housing to business expansion, the cost of capital will rise and bond prices would fall.

2012-04-09 And That's The "QUARTER" That Was... by Ron Brounes of Brounes & Associates

Europe hopes the latest (bailout and reg) moves will help it get its act together. (Good luck with that.) China applies the brakes. Labor looks strong, but can it continue? The Fed debates the need for more stimulus (without any consensus). Facebook moves closer to IPO (and investors beg to participate). The world lectures Iran and finally takes harsh measures (stand by to help Saudi). Investors hope to keep the mo going for another quarter, while being tempted to take profits along the way. Can we finally start focusing on Obama vs. Romney?

2012-04-09 Is the Fed Promoting Recovery or Merely Desperation? by John P. Hussman of Hussman Funds

What we've observed in the employment figures is not recovery, but desperation. Having starved savers of interest income, and having repeatedly subjected investors to Fed-induced financial bubbles that create volatility without durable returns, the Fed has successfully provoked job growth of the obligatory, low-wage variety. Over the past year, the majority of this growth has been in the 55-and-over cohort, while growth has turned down among other workers. All of this reflects not health, but despair, and explains why real disposable income has grown by only 0.3% over the past year.

2012-04-09 Strong Fundamentals Drive Best First Quarter Since 1998 by Douglas Cote of ING Investment Management

The best first quarter since 1998 was marked by strong fundamentals and reduced volatility and global risk.Could it be that the vicious cycle of the past few years has been broken? Could we have entered into the type of virtuous cycle in which positive data beget more positive data, as has marked prior sustained bull markets? Sell in May and go away and other bear strategies that have worked in prior years will likely be ineffective this year, driven in large part by strong fundamentals and global risks that have been excessively discounted.

2012-04-06 Managing Expectations: Why Gold Should Thrive by Frank Holmes of U.S. Global Investors

Its been a challenging week for gold investors. As I often say, investing, like life, is about managing expectations. Over the past 11 years during golds spectacular bull run, investors should remember that price action can go both ways. What helps is to look at the historical rise and fall of gold. For example, looking at the past decade of one-day 5 percent drops in gold, you can see that this event is pretty rare. In 2006, gold dropped more than 5 percent in a day only two times. In 2008, there were three such events. Another one occurred at the end of this February.

2012-04-06 A Generational Shift in the Making by Rick Palacios of John Burns Real Estate

The housing market is carving out a bottom and renters are slowly starting to purchase homes again. The percentage of apartment REIT renters moving out to purchase a home rose last quarter.

2012-04-04 Fed - Actions Speak Louder Than Words by Axel Merk of Merk Funds

The Fed has a credibility problem: having assured investors that rates will remain low for an extended period, it may only take one or two FOMC members to turn more optimistic about the economic outlook to cause the markets to more aggressively price-in tighter monetary policy. Conversely, Bernanke has made it clear that he is most concerned about a recovery in the housing market and that low interest rates throughout the yield curve are desirable. Operation Twist is specifically aimed to achieve that, lowering long-term rates and flattening the yield curve.

2012-04-04 Economic Update by Richard Hoey of Dreyfus

We believe that a full-scale global recession is unlikely, assuming that there is no major oil price spike from a disruption of the flow of Middle East oil. We believe that a key cause of global economic expansion will be the easy monetary policy prevailing in many regions and countries worldwide. We expect a global growth recession in 2012, with declining economic activity in Southern Europe, an economic stall or temporary declines in the U.K. and much of Northern Europe, a moderate slowdown in emerging markets and a U.S. expansion at a near-trend pace in 2012, somewhat faster than last year.

2012-04-04 Time Heals All Wounds by Robert Stimpson of Oak Associates

The US stock market enjoyed a strong first quarter of 2012. Fueled by better economic data and a calming of fears over Europe, the stock market surged higher. For the first quarter, the S&P 500 rose 12.6%. Oak Associates accounts did much better, gaining on average more than 17%. The strongest performing sectors of the market were financials, technology, and consumer discretionary. These three groups are the most cyclical and their strong performance bodes well for a broader economic recovery through 2012.

2012-04-04 Kasriel's Parting Thoughts - Has the Fed Boosted the Stock Market? by Paul Kasriel of Northern Trust

The Feds actions have benefited the stock market as well as aggregate demand for goods and services in the U.S. economy. Would you have preferred that the Fed sit idle as it did in the early 1930s, with likely similar results for the stock market and the economy in recent years as occurred at that time? The Fed has simply provided some of the credit to the economy that the private MFI system would have had it not been crippled with loan losses. And even with the Feds additional credit creation, total MFI credit growth has fallen short of the long-run normal credit creation of private MFIs.

2012-04-03 The Easy Money Saloon by Michael Lewitt (Article)

When two of the world's soundest central banks (Israel and Switzerland) start investing their reserves in stocks (the Bank of Israel is run by the highly respected Stanley Fischer for God's sake!), one has to wonder what the world is coming to. Apparently the global saloon is expanding its boundaries. No doubt we will soon hear the ECB is merging with the London Stock Exchange.

2012-04-03 Good Quarter. More to Come. by Christian Thwaites of Sentinel Investments

Good week ending an even better quarter. We like this rally because i) large cap stocks were in line with small and mid, that means less speculative juice and more reality investing ii) GTs came unglued fast but iii) Baa spreads came in thanks to low net issuance and high demand, again crushing the crowding out theorists but, no matter, iv) Europe came back from the brink and fewer daily catastrophe headlines and v) the Fed gave plenty of information to not expect a policy reversal. This is solid stuff and markets feel better than this time in 2010 and 2011 when we saw spring sell offs.

2012-04-03 Have We Reached the End of the Rally? by Bob Doll of BlackRock Investment Management

Our overall view about the markets is that improvements in the global economic outlook, continued easy financial conditions and slowly improving investor risk appetites are all reasons that stock prices should continue to crawl higher. Markets have, however, paused somewhat in their rally over the last several weeks. This can be attributed to the fact that prices had risen so far so quickly and that markets were overdue for a period of consolidation or correction, but it is also important to emphasize that we will need to see further evidence of economic improvement for gains to continue.

2012-04-03 Time to Pay the Piper by Frank Holmes of U.S. Global Investors

One way investors can offset higher tax rates is through municipal bonds. In general, interest generated from municipal bonds is exempt from all federal income taxes and some state and local taxes (depending on your state). While municipal bonds carry a greater amount of risk than Treasury bonds, tax advantages and higher yields make them extremely attractive to Treasuries on a relative basis. The yield on government debt is currently in the doldrums just above 3 percent while the yield on the Bond Buyer 40 Index of munis is above 4 percent.

2012-04-03 Risk On by Jim Tillar, Steve Wenstrup and Tim Roesch of Tillar-Wenstrup Advisors

Overall both risk and return seem muted until something in the current environment changes. As long as yields on assets like bonds and cash remain low, it is hard for stock markets to collapse. But those yields are so low because central banks are frightened about the economic outlook which makes it very hard for a bull run to be sustained. While there has been improvement is some areas of the economy some are struggling to grow beyond previous levels.

2012-04-03 Christine Lagarde: Emerging Market Nations Will Get More Power in the IMF by Team of Knowledge @ Wharton

Christine Lagarde, managing director of the IMF, sees no alternative to the strict austerity policies being imposed on many peripheral European countries, says the double dip recessions in Italy and Ireland just announced come as no surprise, and notes that IMF reforms will shift 6% of current quotas to dynamic emerging and developing countries. Lagarde's comments came in an exclusive interview with Knowledge@Wharton and media partner ParisTech Review late last week, as BRIC countries demanded more voting power in return for the larger financial contributions being requested by the IMF.

2012-04-03 Have Investors Moved Past Europe? by Chris Maxey of Fortigent

At the end of 2011, the Long-Term Refinancing Operation brought a modicum of stability to financial markets in Europe.When coupled with the orderly default of Greece, the situation in Europe is seemingly on a road to more pleasant ground. Just as soon as investors place Europe in their periphery, however, problems once again begin bubbling to the surface.In recent weeks, the spotlight has turned to Spain, where unemployment is near 24% and the government is expected to run a 5.9% budget deficit for 2012.

2012-04-02 It's All Data (Jobs) Dependent by Charles Lieberman (Article)

The performance of the economy has improved quite substantially over the past several months, with very significant implications for policy and politics. A healthier labor market is sufficient to insure a healthier economy, which supports the rally in the stock market, the decline in bond prices, and the rise of President Obama in the polls. Numerous issues will affect the political polls in the coming months, but the outlook for the economy remains one of continued improvement.

2012-04-02 Better News On Consumer Spending, But ... by Scott Brown of Raymond James Equity Research

The monthly report on personal income and spending rarely gets much interest from the financial markets. However, the spending figures are a direct part of the governments GDP calculation. The latest numbers (through February) paint a much brighter picture than they did a month ago. While the outlook has improved from a month ago, its not enough for most Fed policymakers. It will take much more substantial economic growth to undo fully the recessions damage to the labor market. QE3 is still seen as unlikely, but its not off the table completely.

2012-03-31 All Spain All the Time by John Mauldin of Millennium Wave Advisors

The events of the last 24 hours compel me to once again look "across the pond" at the problems that not only plague Europe but will be a drag on world growth as well, as Europe goes through its continued painful adjustment as a consequence of trying to adopt a single currency. Since Spain is going to be on the front page for some time, it will be useful to look at some of the problems it is facing, to put it all into context. And what I heard while in Europe in private meetings is troubling.

2012-03-30 China's Family Planning by Elizabeth Dong of Matthews Asia

Family planning in China has become a complex topic of debate as the country feels increasing pressure due to its growing elderly population. Chinas current one-child policy, introduced in 1979, allows some exemptions, including those for ethnic minorities, rural farming families and parents who themselves are single children. But the social and economic costs of implementing the one-child policy have risen, and many are calling for change.

2012-03-30 Shifting Winds-Turbulence Ahead? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Treasury yields have moved somewhat higher, while stocks have largely continued to rise. Recent correlations appear to be breaking down, which could lead to increased volatility but we remain relatively confident in equities. Perception as to the next moves by the Fed appeared to be shifting, but Bernanke reiterated their easy monetary stance. Uncertainty is rising and the Feds goal of increased clarity through more transparent communication is under scrutiny. Liquidity concerns in Europe have eased but economic risks remain, while Spain and Italy face deal with their ongoing debt crises.

2012-03-30 Does China Hold the Winning Ticket? by Frank Holmes of U.S. Global Investors

Some bears may think the odds of China being the winner among emerging markets in 2012 are also remote. Over the past few years, Chinese stocks have lagged compared to its emerging market peers. However, the Periodic Table of Emerging Markets perfectly illustrates: last years loser can be this years winner. Historically, every emerging country has experienced wide price fluctuations from year to year. Over time, though, each country tends to revert to the mean.

2012-03-29 China's Gravity-defying Economy: How Hard Will It Fall? by Team of Knowledge @ Wharton

As China's high-octane economy shifts into lower gear, virtually everyone agrees that the double-digit, super-charged boom years are drawing to a close. Speculation over the possibility of a so-called "hard landing" for the country flourishes with each boom and bust cycle, only to die down as China's growth revs up again. This time, however, both external and internal factors -- including global conditions, domestic politics and financial trends -- are reinforcing the downturn. Many experts warn that without some painful reforms, there will be worse trouble to come.

2012-03-28 Revisiting the Liquidity Cycle with the Minsky Model by Thomas Fahey of Loomis Sayles

Once an extreme event occurs, standard models offer limited insight as to how the ensuing crisis could play out and how it should be managed, which is why policy responses can seem disjointed. The latest policy responses to the European crisis have been no exception. To understand and respond to a crisis like the one in Europe, perhaps we need to consider some new models that include the human factor. Economic historian Charles Kindleberger can offer some insight

2012-03-28 The End of the 30-year Bond Bull Market? by Team of Knowledge @ Wharton

Is the great 30-year bull market in bonds coming to an end? Yes, perhaps -- or maybe not: It depends on whom you ask and how flexible your timing is. While many people think of bonds as conservative holdings, they have produced stellar returns for decades, thanks to the taming of inflation and other factors. But some experts say economic recovery could now reverse the process by driving interest rates higher, causing bond prices to fall.

2012-03-27 Housing Boom? Not Yet by Russ Koesterich of iShares Blog

Despite some recent signs the US housing market may be stabilizing, Russ explains why he doesnt expect a strong housing rebound in the near term and doesnt advocate aggressively leveraging to housing-related investments.

2012-03-27 Home Prices Have Been Rising for 3 Months, but Nobody has Been Telling You by Wayne Yamano of John Burns Real Estate

Over the last 3 months, prices are up in 90 of the 97 markets we analyzed. The average price increase over the last 3 months is 1.1%, or a 4.5% annual rate. This is big news, so why isn't anyone else reporting it? It is because most price indexes are at least 3 months behind what's happening with home prices right now. The Burns Home Value Index (BHVI) gives you a 3-month competitive advantage. We developed the BHVI to answer the question, "What is happening to home prices today?" The answer is, "Home prices are rising!"

2012-03-27 Buy Commodities, Sell Brands by Bill Smead of Smead Capital Management

Warren Buffett was quoted the other day saying, We like companies which buy a commodity and sell a brand. We thought it would be very helpful to unpack his thought and put it into the context of today. We believe these current circumstances are framed by the historical over-pricing of commodities, the coming economic contraction of China, the successful cleansing of the income statements of US households and the inevitable rebound in housing in the US. We will look at the makeup of our portfolio companies which buy a commodity and sell a brand to consider their upside in this environment.

2012-03-27 Uncovering Equity Yield Traps by Team of American Century Investments

As the low interest rate environment persists, uncertainties continue even as new marketplace concerns begin to emerge. This observation is especially applicable to investors that are desperate for current income opportunities. In their search for equity investments, many will opt to screen for opportunities using current yield as the main filtering criterion. In situations such as this, those in hot pursuit of rich rates find themselves at risk of falling prey to nasty yield traps. Although yield traps exist in the fixed-income space, this piece focuses on yield traps involving equities.

2012-03-26 Monthly Investment Commentary by Team of Litman Gregory

We recently spoke with portfolio managers from two fund management teamsChris Davis and Ken Feinberg of Clipper and Selected American Shares, and Pat English of FMIwho have historically exhibited different views toward banks and financial services firms. In addition to providing insight on current risks and opportunities in the financial sector, the interview touches on a number of topical subjects including the Federal Reserve, the European debt situation, and the housing market.

2012-03-26 A Tale of Two Tech Sectors by Kristina Hooper of Allianz Global Investors

March is a fitting time to talk about tech because it is the month when investors witnessed the infamous noise heard round the world: the bursting of the dot-com bubble 12 years ago. And while their ears might still be ringing from the blast, when it comes to tech stocks, a little perspective goes a long way. In 1999, irrationally bullish sentiment drove tech valuations to lofty heights with little regard for actual profits. Today, the tech sector is among the most attractive and fundamentally sound areas of the economy.

2012-03-26 Overcoming Objections to Equities by Bob Doll of BlackRock Investment Management

So what are some of the improved economic conditions that have been pushing yields higher? We have devoted quite a bit of space in recent weeks to discussing the improvements in the labor market, and while jobs growth is certainly among the most important economic indicators, there are other factors that have been showing signs of improvement as well. Debt deleveraging remains a source of concern, but we have been seeing progress on that front. Individuals have been paying down their debt over the past few years and household debt levels have been falling noticeably.

2012-03-26 And Thats The Week That Was by Ron Brounes of Brounes & Associates

Europe takes a well-deserved back seat to the global headlines as all eyes shift to China to see how the country deals with its recent economic slowdown. Consumer activity is on the hot seat domestically as a key confidence gauge is released and analysts closely dissect personal income and spending data in light of the sudden pickup in the labor market. The markets continue to test key levels as investors weigh the low yields in fixed income against the current risk in equities. Hows that speaking tour treating you, Dr. B.? Any Ron Paul sightings?

2012-03-23 U.S. Real Estate Securities - February 2012 Review & Outlook by Team of Cohen & Steers

We are encouraged by the recent trend of U.S. economic data showing measured improvement, including solid employment gains, as well as positive developments in Europe that have somewhat brightened the outlook for risk assets globally. With funding costs likely to remain low and demand showing signs of strengthening, we believe U.S. real estate fundamentals will continue to gradually improve in 2012, supported by a scarcity of new supply in most markets.

2012-03-23 Emerging Markets Real Estate Securities - Investment Review & Outlook February 2012 by Team of Cohen & Steers

As emerging economies work through the late stages of a mid-cycle slowdown, policy markets are attempting to engineer soft landings as inflation pressures continue to moderate. Given the potential for better domestic growth in such an environment, we expect to take advantage of buying opportunities among residential developers. Our favored markets include Brazil, based on its natural resources, growing consumption trends and shareholder-friendly business environment. We particularly like the retail market, which continues to exhibit strong fundamentals.

2012-03-23 Global Real Estate Securities Investment Review and Outlook February 2012 by Team of Cohen & Steers

Global real estate securities added to their year-to-date gains in February, although the pace of the rally moderated. Most markets in Europe and Asia Pacific continued to benefit from the retreat of macro risk concerns. U.S. REITs, which advanced in 2011 while other regions struggled, had a modest decline.

2012-03-23 Large Cap Value Strategy February 2012 Review & Outlook by Team of Cohen & Steers

Our near-term outlook for the U.S. economy and markets is increasingly favorable, as several of our long-term concerns appear to be easing. Economic indicators are strengthening, the danger of a eurozone collapse has receded and earnings reports for 2011 have been good. Valuations remain attractive, if somewhat less so than a few months ago, and investors are poised to put their considerable cash balances back to work. Cyclical names and sectors are most likely to lead the rally over the next few months.

2012-03-23 Whats Next for Equities? by Matthew Rubin and Justin Gaines of Neuberger Berman

In 2011, the S&P 500 finished essentially flat on a price-return basis. That return, however, would not have been achieved without a 15% gain over the last three months of the year. Equities have since picked up where they left off and, year-to-date, most major indices are up by double digits. Front-of-mind for investors is whether this momentum can be maintained. We offer the bear and bull cases as well as our thoughts on what may lie ahead.

2012-03-23 A Random Walk Through the Data Minefields by John Mauldin of Millennium Wave Advisors

We are once again to a point in Europe where there are no good choices, only very bad ones. But this time it is with a country that actually makes a difference. (No slight intended to Greece, but you are just small.) Spain has no good way to cut its deficit without things getting worse. But Europe must be willing to then fund Spanish debt, even if "only" through more LTRO actions by the ECB.

2012-03-23 Gold and China: Where the Bulls and Bears Square Off by Frank Holmes of U.S. Global Investors

To paraphrase the great Steve Martin, todays investors are very passionate people and passionate people tend to overreact at times. An overreaction is exactly whats happened in gold and global markets in recent weeks. While market bulls have been sniffing out data points to support their case, market bears have continued to take a glass-half-empty approach. Gold and China are two areas that have been caught in the bear trap this week, but we believe the gold and China bulls still have room to run.

2012-03-23 Where is the Unemployment Rate Headed? by Mike "Mish" Shedlock of Sitka Pacific Capital Management

I have a pretty cool interactive map below that will let you graph the unemployment rates based on parameters that you can choose. First let's take a look at the current unemployment rate and a discussion of the parameters that define it.

2012-03-22 Brazil Retail Sector Riding the Wave of Middle Class Growth by Team of Thomas White International

Even in the late 1990s, Brazil was just like any other emerging economy, characterized by extremes of wealth and abject poverty with no social class dividing the bridge between. A decade and more down the line, the effervescence in the middle cannot be missed. Yes, the great Brazilian middle class defined as those who earn between $690 and $2,970 a month has arrived and is here to stay. If Brazil has made a name in the global retail sector, it had better thank these late comers, empowered with good purchasing power and access to credit.

2012-03-22 Explaining the Stir over Recent Fed-Speak by Team of American Century Investments

The official statement from the Federal Reserves March 13 interest rate policy committee meeting was relatively ho-hum (no significant changes from Januarys statement), but other recent Fed communications have raised more of a stir. In particular, we explain what fiscal cliff and sterilized QE mean, and help put them into context. Its all part of a mixed, uncertain economic outlook in which slower mid-year growth, like last year, cant be ruled out, but higher inflation by next year is also a possibility.

2012-03-21 Trade Rains on the Jobs Parade by Peter Schiff of Euro Pacific Capital

Back in the late 1980s, when annual trade and budget deficits were but a small fraction of today's levels, the markets were rightly concerned about America's ability to sustain its twin deficits. This anxiety helped lead to the stock market crash of 1987. More recently, large and persistent trade deficits were a significant factor in building the imbalances that caused the U.S. economy to implode in 2008. But in recent years, most Americans have lost their concern with gaping trade deficits. I believe it will soon come back with a vengeance.

2012-03-20 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 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.

2012-03-20 Is There a Bubble in Treasuries? by Mike "Mish" Shedlock of Sitka Pacific Capital Management

Both Sides of the Case; Explaining the 2011 Treasury Rally (It's Not What You Think); Where to From Here? People have been calling a bubble in treasuries for at least a decade. The shocking result, especially to hyperinflationists, has been a stair-step decline in yields for 30 years. That's quite a long time.

2012-03-20 Game On by Scott Brown of Raymond James Equity Research

Nothing in the recent economic data suggests that the Fed is any closer to raising short-term interest rates. However, the figures also imply that further Fed asset purchases are less likely. While the Fed did not surprise last week, the bond market had factored in some chance that the Fed would eventually undertake QE3. In the short term, the recent pop in bond yields may simply be a case of be on the bus or be under it. However, bond yields seem unlikely to rise sharply from here, at least for now.

2012-03-20 A Turning Point by Christian Thwaites of Sentinel Investments

Bottom Line: Bonds are now outside of the recent range, especially in the 30-year. We could see another 10bp retrace to 3.50%. Equities have had a good run but still have reasonable valuations. New money goes to IG bonds. Spreads are approaching their long-term mean but demand from natural buyers is high.

2012-03-20 An Actively Passive Debate by Chris Maxey of Fortigent

The debate surrounding active versus passive investment management continues to attract a growing share of investor interest. After several years of underperformance, active managers are finally outperforming their benchmarks YTD, but it may be too late. Investors, frustrated with the underperformance and higher fees, are piling en masse into exchange-traded funds (ETFs) and other low cost solutions. The time for an all-passive solution may not be right now, but active managers are undoubtedly concerned about what the future may hold.

2012-03-19 Did You See The 10-Year? by John Petrides (Article)

This week the US 10 year Treasury note spiked from 2% yield on Monday to 2.4% by the end of Wednesday. Around the office we were marveling at this move. Given the recent volatility in the equity market, that might not seem like much to stock investors, but to those in the fixed income world thats quite a change. The sudden spike in Treasuries has several implications: 1. Those investors who rushed into U.S. Treasuries over the past four months out of fear and panic (presumably not in hopes of achieving income) in search of safety, actually have an unrealized loss in their position!

2012-03-16 The Real Debate: Preservation of Capital vs. Preservation of Purchasing Power by Chris Clark of The Royce Funds

Investments in high-quality companies that have embedded pricing power and high returns on their invested capital look to us to be some of the best investments to protect and grow purchasing power, and we believe they need much broader representation in investors' asset allocation. We think that the period of exclusively focusing on the preservation of capital has passed and that now is the time to be focused on the preservation of future purchasing power.

2012-03-16 February Leaps to a Multi-Decade Market Open by Doug Cote of ING Investment Management

The markets YTD success has been fueled by a dramatic reduction in global risk and upbeat economic data. The fence to contain the euro crisis has been definitively established. Oil prices are a concern, but the real economy has the wind in its sails. Though equity fund outflows continue, its never too late for investors to do the right thing.

2012-03-16 The Heart of March Madness by Frank Holmes of U.S. Global Investors

Everyone agrees that its unethical to put the firms interest ahead of its clients. More importantly, a self-serving financial attitude is a breach of fiduciary duties. It may be possible that Goldman Sachs has moral issues, but not all financial firms are morally bankrupt. Nor are thousands of executives and professionals employed in the industrymoms, dads, uncles, aunts, daughters, sonswho are hard-working and acting in the best interest of their customers.

2012-03-15 Investment Management with a Conscience by Douglas Hodge of PIMCO

Earlier this year the Financial Times ran a series of editorials under the title Capitalism in Crisis. Contributors ranged from Bill Clinton and Alan Greenspan to FT editors Martin Wolf and John Kay. There was also a submission with the byline, Occupy London. While I am admittedly unable to add much to their collective wisdom, I think a sound analysis of capitalism requires an understanding of the role of the investment management industry within the financial services ecosystem."

2012-03-15 Market Update: A Real Recovery, or a False Start? by Team of Knowledge @ Wharton

The Dow has hit its highest level in years, loan rates are at record lows and the U.S. economy appears to be gaining momentum. Even the housing market is starting to look inviting. But is this a real recovery -- or a false start like last year's? Wharton's Jeremy Siegel and Scott Richard think the economy is showing signs of a true rebound, and predict that stocks should do well in the next 12 months. But bonds, they warn, are in dangerous waters, and economic growth will be in jeopardy if oil prices keep rising and the European credit crisis worsens. (Video with transcript)

2012-03-15 Stress Tests No Sweat by Peter Schiff of Euro Pacific Capital

The Federal Reserve ran another "stress test" on major financial institutions and has determined that 15 of the 19 tested are safe, even in the most extreme circumstances: an unemployment rate of 13%, a 50% decline in stock prices, and a further 21% decline in housing prices. The problem is that the most important factor that will determine these banks' long-term viability was purposefully overlooked - interest rates.

2012-03-15 Everyone Hates Stocks ...and That's Why You Shouldn't by Bill Mann of Motley Fool

I dont tend to put currency into market moves, particularly short-term ones. But it has to be said that the tenor of the news regarding economies worldwide has been unambiguously bad. Why in the world would stocks go up in the face of such misery? Havent people heard about whats going on in Greece? Of course they have -- its why so many rushed out of risk assets last October and November. But while the caterwauling has done its job in spooking people, the underlying facts belie the news cycle: the American economy is booming.

2012-03-14 Chart of the Week: The Worlds Infrastructure Plans by Frank Holmes of U.S. Global Investors

Demand for access to basic needs, an emerging middle class and a never-ending use of global resourcesthese are the primary drivers of major infrastructure projects over the next several years. The infrastructure plans taking place across emerging markets emulate a 1950s America. As these governments help their residents pursue the American Dream of better homes, health care and quality of life, I believe the companies with a strong footprint in these growing markets stand to benefit.

2012-03-14 No QE3 Yippee! by Liz Ann Sonders of Charles Schwab

The Fed made no major changes to its policy statement and announced a continuation of Operation Twist, but did not hint at or announce further quantitative easing. The Fed's assessment of the economy did improve somewhat. Richmond Fed President Lacker's dissent and Dallas Fed President Fisher's pronouncements ring true.

2012-03-13 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.

2012-03-13 Employment Outlook Weather and Gasoline by Scott Brown of Raymond James Equity Research

Nonfarm payrolls rose more than expected in February, with an upward revision to figures for December and January. The job market figures have been strong. However, an unusually mild winter has certainly had an impact. Its difficult to isolate the effect of mild weather. The labor market is definitely improving, but recent figures may be somewhat exaggerated. Mild winter weather may pull forward some seasonal gains that would have otherwise occurred in March and April. In addition, higher gasoline prices threaten to dampen the pace of improvement in the near term.

2012-03-13 The Ambergris Factor! by Jeffrey Saut of Raymond James Equity Research

I had a meeting with two PMs from Switzerland that had 10 questions they wanted answered. 1. Would you buy cyclical stocks or defensive stocks? I would buy cyclicals because I dont believe we are going to see another recession in the U.S. for the near future. 2. 2011 was a risk on/risk off year, so is it a top down or bottom up strategy for 2012? Last year you only had to get two things right. You had to raise cash in March/April and put it back to work during the bottoming sequence of August October. One always needs to employ a bottom up strategy combined with a top down view.

2012-03-13 Economic Update by Mark Oelschlager of Oak Associates

As one might expect after a near-doubling of the market in three years, investor sentiment, by many measures, is much more positive these days. These psychology indicators had reached worrisome levels (too much optimism often augurs below-average stock returns) a few weeks ago but have since come in a bit, which is healthy. The recent bullishness is hard to square though with the general anxiety individuals still have toward stocks. While some are returning to the market, many are still spooked by the volatility of recent years.

2012-03-13 Home Prices and Inflation, Part 1 by Mike "Mish" Shedlock of Sitka Pacific Capital Management

Various charts show home prices are now back to levels last seen in September-October 2002. I posted such a chart constructed from the LPS Home Price Index (HPI) in LPS Home Price Index Shows U.S. Home Prices Accelerated Decline.

2012-03-09 Economic Update - March 2012 by Team of Cambridge Advisors

We continue to deal with the added risk to the global economic system caused by the high degree of debt that exists throughout the developed world. A spirit of cooperation in Europe helped to put those concerns on the back burner in February. Solutions for Greece have been announced however, these are not permanent solutions and the problems go much further than Greece. We expect more turbulence from sovereign debt problems to reemerge in coming months.

2012-03-09 Why Equities Are Attractive Today by Matthew OConnor of Hartland & Co.

Is today the right time to invest in equities? Equity investors have experienced a roller-coaster ride. As a result, many investors have run as far as they can from equities, pulling out roughly $135 billion from U.S. stock mutual funds last year. Even with the S&P 500 Index off to its best start in 25 years and inching closer to its 2008 high*, investors continue to withdraw money from U.S. stock mutual funds. So, where are we? Is it the right time to invest in equities? Due to a combination of reasons, we believe equities do look particularly attractive today and for the long term.

2012-03-09 Appreciating China to its Fullest by Frank Holmes of U.S. Global Investors

While most analysts dont expect another moon shot rise in China's GDP this year, a 7.5 percent growth rate still exceeds most emerging economies and all developed nations. Advanced economy growth is expected to be meager, slowing from 1.6 percent to 1.3 percent in 2012, according to The Conference Board. For long-term investors learning to appreciate the finer points of the country, we believe China is somewhat like fine wine; it only gets better with age.

2012-03-08 Of Tulips and Treasuries. Treasuries Securities Entering Bubble Zone. by Scott Colyer of Advisors Asset Management

U.S. Treasury securities could take their place alongside other bubble assets like tulip bulbs did in the 1630s. There are signs of a secular change afoot in the U.S. Treasury market as rates set historic lows. The U.S. Treasury market is indeed a crowded market as Euro-singed capital is being tucked behind the ultimate safety of the U.S. obligations. Add to that the Feds own record setting buying binge in these securities and you have an asset that may have well crossed the line of what its long-term value could possibly be.

2012-03-08 Global Forecast Update: Growth Upgraded, But Problems Remain by Azad Zangana and Keith Wade of Schroder Investment Management

We have upgraded our forecasts for global growth in response to better data and a further easing of policy. In particular, the success of the European Central Banks (ECB) long term liquidity operations and surprising resilience of Germany mean that we expect the recession in Europe to be shallower than before. However, it is still a weak picture. We do not see US activity taking off as the de-leveraging process has further to run. Much of the recent improvement in growth reflects an inventory cycle as the factors which held the economy back last year fade and go into reverse.

2012-03-08 And Thats The Week That Was by Ron Brounes of Brounes & Associates

New week; same old story. EU ministers continue debating the Greek bailout package which should (hopefully) come to resolution next week. Unemployment highlights a busy economic calendar as investors look to see how the solid weekly jobless claims releases translate into the key labor rate and nonfarm payroll data. Bring on Super Tuesday, right Mitt?

2012-03-07 Winning the War in Europe by Scott Minerd of Guggenheim

Given my view on the global liquidity glut, it probably will come as no surprise that I remain bullish on U.S. investments, including equities, high yield bonds, bank loans and other risk assets, as well as art and collectibles. I believe the United States has entered a period of self-sustaining economic expansion, driven primarily by the aggressive monetary policy of the Fed, which is now being reinforced by the ECB. U.S. growth is necessary to reduce domestic unemployment and to provide support to the struggling economies in Europe and Asia.

2012-03-07 The Truth Behind High Gasoline Prices by Gary D. Halbert of Halbert Wealth Management

While the latest report on 4Q GDP came in a bit better than expected, most economists agree that growth in 2012 will not be as good as the 4Q of last year. Following that, we look at some remarks from Fed Chairman Ben Bernanke in his recent Senate testimony. While he defended quantitative easing, it doesnt sound like the Fed is going to do QE3 anytime soon.

2012-03-06 More Mixed by Scott Brown of Raymond James Equity Research

The economic data reports have become more mixed. Growth is rarely even across time and industries, but the stock market often has a hard time with conflicting evidence. For Mr. Market, the economy has to be either booming or falling apart completely. Mild winter weather has clearly been a factor in the last few months, but unusual weather often merely shifts growth from one quarter to another. Last year, the economic gears were starting to catch, but gasoline rose from around $3 per gallon at the beginning of the year to $4 per gallon in early May. Are we in for a repeat?

2012-03-06 U.S. Covered Bonds: Reassessing Credit Risk and Relative Valuations by Marco van Akkeren and Ben Emons of PIMCO

We believe nominal spread analysis is insufficient, since investors must now consider recovery and default risk under various economic conditions. Our factor-based approach provides a means to quantify default probabilities across a range of outcomes instead of analyst-defined ad hoc assumptions. We also investigate historical CDS spreads as a means to quantify default risk relative to national home price appreciation. The potential for an emerging U.S. issuer market, combined with ongoing foreign issuance, leads us to believe the U.S. covered bond market has viability.

2012-03-06 Continued Struggle Between Borrowing and Lending by Chris Maxey of Fortigent

Nonfarm payrolls and the unemployment rate headline the weeks economic data. Consensus expects another 200K+ gain in payrolls and no change in the unemployment rate. Other major economic data of note includes the ISM Non-Manufacturing index and the US trade balance. Abroad, there are important releases on tap including Q4 EU GDP and EU retail sales. Both the ECB and Bank of England meet this week, but neither is expected to adjust their key interest rates. Other central banks meeting include Russia, Australia, Brazil, Poland, New Zealand, Indonesia, South Korea, Canada, Peru, and Malaysia.

2012-03-05 Dipping a Toe Back Into the Market by Team of Franklin Templeton

After the rollercoaster that was 2011, trying to explain why now seems like a good time to venture back in still sounds a little crazy. But for those who are looking for some perspective, youve come to the right place. Read on for why Ed Jamieson, president/CIO of Franklin Equity Group, Peter Langerman, president/CEO of Mutual Series, Gary Motyl, president/CIO of Templeton Global Equity Group, and Mark Mobius, executive chairman of Templeton Emerging Markets Group, all think it might be time for investors to consider taking the plunge.

2012-03-05 Warning: A New Who's Who of Awful Times to Invest by John P. Hussman of Hussman Funds

Last week, the estimated return/risk profile of the S&P 500 fell to the worst 2.5% of all observations in history on our measures. This is not a runaway bull market. Rather, it is a market that again stands near the highs of an extended but volatile trading range. Importantly, the market is again characterized by an extreme set of conditions that we've previously associated with a Who's Who of Awful Times to Invest.

2012-03-05 Sound Fundamentals, Scary Geopolitics by Charles Lieberman (Article)

Data revisions indicate that household income grew more strongly than reported earlier, so consumers are far better able to sustain growth in spending, particularly as job gains are also increasing. Housing is recovering too, adding a new source of demand to the economy. Thus, the economic underpinnings to growth appear distinctly healthier. At the same time, the threat of conflict in the Middle East has pushed up oil prices, which eats into disposable household income. An actual conflict would chill discretionary spending, at least temporarily.

2012-03-02 Will Oil Continue Heading Higher? by Frank Holmes of U.S. Global Investors

We expect there to be corrections in the price of oil throughout 2012, just like the ups and downs commodities experience from year to year. While the world is hungry for energy, theres no free lunch on the Periodic Table of Commodities, and historically, from year to year, commodities fluctuate. Crude oil, for example, has seen its share of ups and downs: In 2008, oil lost 53 percent; in 2009, it increased a substantial 78 percent. While oil may remain elevated, use these higher prices to your advantage by owning natural resources companies that benefit from higher prices.

2012-03-01 2012: A year in US bonds by David Harris of Schroder Investment Management

There are two new factors that came to the forefront in late 2011 and which are set to influence investments throughout 2012. Indeed, it appears the collective bond market had a series of epiphanies in Q3 that should frame investment activity for some time to come, and these factors are by no means isolated to the US. The first factor is the broad recognition that debt expansion will not be the large driver of economic growth as it has been for the past several decades. The second factor is that political policy pronouncements will often trump economic and credit fundamentals.

2012-02-29 Dirt Economics: Demographics Matter! by Shane Shepherd of Research Affiliates

Generations ago, people had large families, ensuring an adequate supply of labor to work the farm and provide a comfortable retirement. Now, families are small and we face a mountain of debt and soaring deficits. This months Fundamentals examines the implications for the economy and investors portfolios.

2012-02-29 2012: A Year in the Global Economy by Azad Zangana and Keith Wade of Schroder Investment Management

Global growth is set to slow further in 2012 largely as a result of the euro crisis. On the positive side, two factors should support activity in 2012. The first is a fall in inflation, which will support household real incomes leading to stronger consumer spending. The second is the strength of the corporate sector; companies have stockpiled cash and built up profits. However, Europe is entering a serious recession and will weigh on growth elsewhere. Euro policymakers should redouble their efforts to find a solution to the eurozone crisis.

2012-02-28 Globalization: Its Saboteurs and Its Chicken Littles by Michael Edesess (Article)

The word 'globalization' provokes both excitement and fear. The excitement has sold millions of Tom Friedman books and turned a drab annual business conference, the World Economic Forum, into one of the hottest events of the year. It is front-and-center in recent tensions between the U.S. and China, and makes the European Union's economic crisis a concern for the whole world. Should we fear or embrace globalization?

2012-02-28 The Big Picture Through a Small-Cap Lens by Kristina Hooper of Allianz Global Investors

Things are looking up for investors as a recovery in the job market and a rosier consumer outlook have helped fuel optimism. But spiking oil prices could spoil the party in the short run. A look at small-cap stocks may offer perspective. The rally, Oct. 4 - Feb. 23, has seen the Russell 2000 jump 37%, well ahead of both the Russell Mid-Cap and the Russell 1000 indices. The small-cap rally may be headed for a hiccup, however, one foreshadowed by last weeks slight decline in the Russell 2000. Still many portfolios can benefit from a long-term allocation to small-cap and even micro-cap stocks.

2012-02-28 Oil Prices, Mixed Data Slow Market Gains by Chris Maxey and Ryan Davis of Fortigent

The continued march higher in oil prices is filtering its way down to consumers in a less-than-favorable way. By the end of the week, the average price for a regular gallon of gas was $3.65, 30 cents higher than the price one year ago. Consumers are all too familiar with the taxing effect of higher gas prices, particularly given the extreme run up early last year. Interestingly, the number of Google searches for gas prices recently overtook those for Greece, suggesting that the domestic economic situation is trumping consumers concern about an overseas shock.

2012-02-28 The Bottom Line #9 - Land of the Rising Debt-to-GDP Ratio by Paul Azeff and Kory Bobrow of Euro Pacific Capital

The way we see it, Japan has no choice but to sell more bonds to foreigners. They cant cut their debt service costs because they would then essentially be in default, and would lose access to the capital markets; they cant reduce their retirement costs, because even if they tried, the retirees would have no choice but to make up the shortfall by selling more bonds. In technical financial market terms, we call this a Catch-22.

2012-02-27 And Thats The Week That Was by Ron Brounes of Brounes & Associates

A few retailers (Abercrombie & Fitch, Nordstrom) take center stage in earnings season as investors get another glimpse into the recent holiday activity. Likewise retail sales highlights the economic calendar and offers some follow-through from the season. Fed minutes depict the mindset of the policymakers. And, of course, there will be news from Greece.

2012-02-27 And Thats The Week That Was by Ron Brounes of Brounes & Associates

Europe will continue to make headlines as Greece took strides this week to achieving its bailout, but still must appease its European trading partners and the International Monetary Fund. The domestic economic calendar heats up as news from manufacturing and consumer-related releases highlight the data of the week as the month of February comes to a close (a day later than usual). The Federal Reserve publishes its Beige Book and investors can again start speculating about any future stimulus moves and the continued dissension among the policymakers.

2012-02-27 Weekly Market Commentary by Ron Brounes of Brounes & Associates

The spectre of Dow 13,000 haunted the market last week. In the midst of a political debate, a moral dilemma, and a global debt conflagration, nothing could be less significant than a numerical integer whose relevance is highly overrated. As numbers crunchers go, there are integers and there are integers. More to the point is the location of the integer and the trend within which it is contained. For example, if Dow 13,000 represents the end of a cycle, a destination, then its significance is diminished as opposed to a breakout on the way to somewhere else.

2012-02-27 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The stock market paused last week in its 2012 rally over concerns about what might happen in Greece. As the charts above illustrate, both the Dow Jones Industrial Average and the NASDAQ Composite fell fractionally for the week, but certainly showed underlying strength given the urge of many to take short-term gains.

2012-02-27 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks moved higher last week in anticipation of a deal over Greek sovereign debt, as well as evidence the economy is not falling into a double-dip recession. As the charts above illustrate, the Dow Jones Industrial Average gained over one percent, while the NASDAQ Composite moved higher by 1.65% led by Apple, Inc.

2012-02-27 Brute Force and Two Serious Problems by Christian Thwaites of Sentinel Investments

The brute force of liquidity driven markets is waning. Earnings season draws in and there were enough negative surprises, about 30% of reporting companies, to take the edge off the rally. As of writing, we're up over 6% YTD on SPX [1] but with little decisive break out in the last three weeks. Why? Well, the culprits are: Greece: Greece has been punching well above its weight as a pain for some time. China: After a pretty awful 2011, when stocks fell 20% and remain at about half the 2007 peak, inflation, housing and net exports remain a problem.

2012-02-27 Equity Gains Likely to Continue, But at a Slower Pace by Bob Doll of BlackRock Investment Management

It was a relatively subdued week in terms of economic data, with the highlight perhaps being the weekly initial unemployment claims, which were unchanged (a stronger-than-expected result). This data helps confirm that improvements in the labor market have been gaining traction. This Friday we will see the February employment report and most economists are calling for a new jobs number of 200,000 or higher with a flat or perhaps slightly lower unemployment rate.

2012-02-25 The Emotions of Fear and Apathy Create Good Buying Opportunities by Frank Holmes of U.S. Global Investors

One of the reasons money has found its way back to the market is that low interest rates and a bubble in bonds have upped the attractiveness of equities relative to other asset classes. In fact, many large-cap equities come with a higher yield. This means that investors can wait for the growth, while receiving the income. Overall, it looks like the markets dark clouds are lifting and we could be in for a period of sunny skies in the months ahead.

2012-02-25 Tax That Other Guy by John Mauldin of Millennium Wave Advisors

Last week's letter on taxes drew more response than any letter I have written in years. Questions that were raised simply beg for an answer, and some of the replies were very thoughtful, well-written suggestions for alternatives. This week I am going to do something I can't ever remember doing, and that is to use the entire letter to involve and respond to my readers.

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