The Financial Times – Term premia scramble the Fed’s dot plot there is now plenty of evidence that the term premium at the front end of the bond market may no longer be positive. Since 2001, it appears to have become quite sharply negative. This means that investors’ true expected path for rates is higher… Continue reading How Term Premium Affects Investors’ Expected Path For Rates
Bloomberg View – Noah Smith: Some Ways to Put More Oomph in the Fed’s Punch Usually, economists think that the way to boost growth and inflation is to keep interest rates lower for longer. But that doesn’t always seem to work in practice. Interest rates have been at or near zero for decades in Japan, and… Continue reading FOMC Policy
Barron’s – Randall W. Forsyth: Is This How a Financial Crisis Begins? Ten years after the beginning of the great financial crisis, a few fissures appear. Too soon to worry? Anniversaries are not to be taken lightly, as any married man will tell you. To forget them means to ignore your past, which in turn puts… Continue reading The 10-Year Anniversary Of The Financial Crisis
The New York Times – Robert J. Shiller: In Long Run, There’s No Such Thing as an Einstein Investor There are no easy answers in investing. It is tempting to replicate a successful strategy — one created by an outstanding investor, like Warren Buffett, or through in-depth statistical analysis of the wisdom of crowds —… Continue reading You Can’t Beat The Market
Bloomberg – Treasury’s Ultra-Long Bonds Have No Natural Demand The demise of defined benefit pension plans removes the only logical buyers from the market The idea of locking in low long-term interest rates is obviously appealing to the government. However, the internal working group formed by the Treasury to study demand for debt with such… Continue reading Who Is The Natural Buyer Of 100-Year Bonds?
The Financial Times – Will the oil price start to disturb the junk bond market? Weakness in crude’s price will be one pressure point for markets over the next week Traffic in the US leveraged loan and high-yield bond markets has flowed in the same direction all year, as companies have refinanced or repriced debt at… Continue reading Oil’s Effect On Junk Bonds
The Financial Times – US equity market rally hinges on earnings growth Rebound in energy sector profits is under threat from a weak oil price The smallest downward revision in earnings forecasts by Wall Street analysts for three years has cheered investors worried about the extension of a record-breaking rally that has sent US stocks… Continue reading A Look Ahead To Q2 Earnings
The Financial Times – A sustained oil glut can have unsettling effects While a structural decline in demand is welcome, the timing is not The real dangers, though, lie in emerging markets that rely heavily on oil exports and have large young and restive populations. Austerity will strain the social compact between rulers and ruled in… Continue reading Gauging Oil Prices
The Associated Press – Illinois could be 1st state with ‘junk’ credit due to budget Illinois is on track to become the first U.S. state to have its credit rating downgraded to “junk” status, which would deepen its multibillion-dollar deficit and cost taxpayers more for years to come. S&P Global Ratings has warned the agency will… Continue reading Illinois Heading Towards Junk Status
The Wall Street Journal – Stockpicking Is Dying Because There Are No More Stocks to Pick In less than two decades, more than half of all publicly traded companies have disappeared. There were 7,355 U.S. stocks in November 1997, according to the Center for Research in Security Prices at the University of Chicago’s Booth School of… Continue reading The Dying Art Of Stock Picking
CNBC – Bitcoin speculators are the new day traders * Bitcoin has more than doubled in value this year, and other digital currencies have also soared. * While U.S. stocks churn near record highs, some analysts worry markets may be too ambivalent about speculation in other assets. * Bitcoin wealth is also concentrated in the hands… Continue reading Comparing Bitcoin Trading To Day Trading