by Phoenix Capital Research
The US Government and the US Federal Reserve downplay the threat of inflation. There are two primary reasons for this:
1) Acknowledging higher inflation would mean both revising GDP growth much lower (last quarter’s FDP growth would have been negative 1% if you accounted for the real increase in costs of living).
2) One of the primary arguments the Fed uses for why it can print hundreds of billions [...]
JIM SINCLAIR: COLLAPSE IN WALMART SALES REVEALS US RECOVERY IS DEAD
Jim Sinclair sent an email alert to subscribers Saturday, and stated that the recent decline in sales at Walmart exposes the fact that contrary to MSM MOPE, the US economy has flat-lined and expired.
”Great Rotation”, Over
…as Reuters notes, it was all into international funds as domestic funds saw outflows and domestic bond funds once again saw inflows. As Goldman Sachs’ funds flow and [...]
CITI: This Big Thrust Into Stocks Is Probably Just Seasonal, And That Means A Correction Is Looming
The month of January has been pretty interesting for market observers.
While it’s been a slow grind higher on the S&P 500, nearly every day inching closer to all-time highs, flows into equity funds have been incredible – even historic.
In the first week of January, investors poured $26.6 billion into stocks. In the second week, $21.9 billion. [...]
Gold And The Disappearing Yield, Death of Equities?
RISK IS IN THE HOUSE
LIBOR’s getting high
As central bankers try
To calm the markets down
But risk is back in town
Risk is in the house Yo!
Risk is in the house
Credit lines are drawn
Where’s the money gone
Spreads are growing fast
Markets sucking gas
Risk is in the house Yo!
Risk is in the house
Triple A means squat
Commercial paper rots
Monolines are down
‘Cause risk is back in town
Risk is in [...]
About 140 years ago, a retailer named John Wanamaker figured his customers and salesmen had better things to do than spend hours haggling. His invention: Assigning one price, “plainly marked,” to every product.
The price tag caught on nearly everywhere with one major exception: financial services. Investors still have a surprisingly difficult time figuring out what they’ll pay for financial advice, for mutual funds and especially for their retirement plans.
Pimco has doubled the size of its flagship exchange traded fund in less than two months, hitting $2 billion in assets as performance of the Total Return Fund ETF outpaces the far larger mutual fund on which it is based.
Rapid growth for the ETF, which was launched on March 1 – a widely watched experiment in active management in a market built on passive index following – reflects continued investor preference for [...]
Since January 2007, long-only equity funds have seen redemptions of $545 billion. In the same period bond funds have seen inflows of $630 billion. In the last few months, cumulative flows into equity funds have retraced all the way back to 1996. While every day is a QuEasy day for stocks, it seems the ‘financial repression’ is working as instead of getting everyone else to do the opposite of what [...]
From The Big Picture:
So I am still catching up with some of the more interesting reads from while I was away, and THIS damned cover made me fall off my chair:
BARRON’S: WHAT’S THE BEST BOND FUND FOR YOU?
A few words about this: The classic magazine cover contrary indicator is a non-business press issue. This is because by the time a specific financial issue reaches the cover of a mainstream media, [...]
By David Waring
The Big Picture: Equity Prices and Bond Yields from 1800 to Present
Reuters: U.S. municipal bond sales to sink to $59.6 million, a 20 Year Low
John Orcutt: Muni Maturing? Proceed With Caution!
Learn Bonds: World Bond Funds: Do You Know the Risks?
BlackRock: The Road Ahead For Bonds
BondSquawk: A Look at the Chart of [...]
Despite the bad month of May for the markets, ETFs saw a huge inflow of new capita, according to Lazlo Birinyi’s Ticker Sense.
Exchange traded funds had a $4.1 billion inflow of new capital, despite the market pullback in May. Total assets fell by 5.7% to $1.1 trillion. ETF total volume rose 21% in May, averaging 1.7 billion shares traded per day, the highest level since November 2011. Only seven new funds began trading [...]
Greece may have to exit the 17-nation euro and the monetary union should plan for it to ensure stability, according to Pacific Investment Management Co.’s Mohamed El-Erian.
“A Greek exit will be expensive and messy, but it’s probably inevitable and therefore we should plan for it,” El- Erian, the chief executive officer of the world’s largest manager of bond funds, said in an interview on Bloomberg Radio’s “Bloomberg Surveillance” with Tom Keene and [...]
Via Lance Roberts of StreetTalkLive,
STRATEGIC INVESTMENT CONFERENCE – DAY 1
May 3, 2012?
If you have not read the notes of the first three presentations here are the links to Niall Ferguson on “Civilization”, Dr. Woody Brock on “American Gridlock” and David Rosenberg from Gluskin Sheff. The last presentation I will report on from Day 1 of the conference is Dr. Lacy Hunt from Hoisington Research. Dr. Hunt was a previous member of the Federal Reserve board [...]
The way to grow is to provide a sound basis whereby small and medium businesses can have access to capital as they strive to grow. This would require the government to spend less and stabilize its budget, and reduce its own growth while encouraging and supporting exports and allowing product innovations to become manufactured (not just developed) here.
Now it appears the outflow of cash is for petroleum products and other imports. If [...]
The Fed, Gold, the S&P 500, & the Retail Mindset
Courtesy of J.W. JONES
The recent rally has been breathtaking, however the majority of investors have missed out on a large portion of these gains as significant levels of cash have been either moved to bond funds or taken out of equity markets consistently during this rally. Let’s face it, financial markets around the world are not what they once were.
U.S. equity markets [...]
By Mitch Tuchman
PALO ALTO, Calif. (MarketWatch) — Active investing is a loser’s game.
Putting money with a mutual-fund manager can be six-to-eight times more expensive than passive, indexed investing because pros are trying to select a few stocks to “beat” a benchmark index. With an index fund or exchange-traded fund, in contrast, you basically get the exact returns of the index. Since computers (not humans) manage the stocks, [...]
Chris Fournier, On Tuesday August 30, 2011, 8:58 am EDT
The global economic crisis is leading to a possible “developed economy” recession in the U.S. and Europe, which may be hard to alleviate, according to Pacific Investment Management Co.’s Bill Gross.
In this environment, the world’s biggest manager of bond funds favors investing in Australia, Mexico, Brazil and Canada, along with non-dollar currencies that have strong ties to the Asian continent, Gross, [...]
Investors are finally inching back into the stock market. But are they too late?
While millions sought refuge in traditionally stable bonds over the past two years, they missed a more than 90 percent rally in stocks. Suddenly bonds don’t look so safe, and some of the $11 trillion that Americans have parked in mutual funds is shifting back to stocks.
After putting more than $570 billion into [...]
1a)Â Long “Big Oil” + “Big Pharm” + “Big Tobacco” + etc equities.Â I am precluded from making naming names, but you know what I like.Â Mega Cap international stocks with patent and pricing power.Â P/Es of 13ish (an earnings yield of 7 1/2%) and Dividend of 2 1/2% to 4 1/2%.Â FED will encourage Retail to reverse out of Bonds and into Stocks.
1b)Â For [...]
Why Investor Optimism May Be a Red Flag
By PAUL J. LIM, New York Times
NOW that the market has risen, investors are becoming optimistic again about stocks.
There are many signs of this. The American Association of Individual Investors, for example, reports that most investors now describe themselves as bullish, versus just 20 percent in July.
And the flood of money that was pouring into bond funds largely out of [...]
by David Rosenberg
1. In Barronâ€™s look-ahead piece, not one strategist sees the prospect for a market decline. This is called group-think. Moreover, the percentage of brokerage house analysts and economists to raise their 2011 GDP forecasts has risen substantially. Out of 49 economists surveyed, 35 say the U.S. economy will outperform the already upwardly revised GDP forecasts, only 14 say we will underperform. This is [...]
“Then the dollar will collapse. Whereupon there will be a lot of jawboning by the President, and that won’t work. Then they’ll go to selling gold, and that won’t work either. Then they’ll have to go to capital controls, freeze foreign assets, stop any money from going in or out, and that will be the end of all the markets, that will really be the finish. Then you will see [...]
There is no recovery and we are in a single dip recession when you back out inventory and stimulus and phony accounting.
The really sad part about all of this is that it was a debt and federal spending bubble — a constant dumping of money on the economy for over a decade — that propped up the tech bubble, the bursting of which made us lower interest rates. Investors seeking [...]