<Click on chart for larger image> The Financial Times – When investors are complacent, stupid deals happen When investors are complacent, stupid deals happen. Time Warner and AOL merged at the height of the dotcom bubble in 2000, in what turned out to be one of the worst deals ever. Another candidate for this title… Continue reading M&A Deals On The Rise
Bloomberg.com – Fed’s Junk Loan Bubble-Busting Faces Trouble as Sales Jump One of the Federal Reserve’s first post-crisis tests of its ability to quash excessive risk-taking using regulatory tools is so far looking like a failure. The Fed’s Board of Governors told Congress last week that it’s engaged in “strong supervisory follow-up” to guidance given… Continue reading The Fed Tries (And Fails) To Tame The Junk Bond Market Via Regulation
<Click on chart for larger image> The Financial Times – Chinese moves trump Fed’s effect on US bonds All eyes are on the future path of US Federal Reserve policy and what it means for the economy and asset prices. But growth trouble across the Pacific may have a much bigger impact on US yields… Continue reading Chinese Purchases Of Treasuries
The Telegraph – Have central banks been breaking the law? The best way to destroy the capitalist system, the Russian revolutionary leader Vladimir Lenin is reputed to have said, is to debauch the currency. The world’s major central banks have certainly been having a fair old go at it. In the six years since the… Continue reading Questioning The Legality Of Central Bank Activity
The New York Times – Who Routinely Trounces the Stock Market? Try 2 Out of 2,862 Funds The study, “Does Past Performance Matter? The Persistence Scorecard,” provides new arguments for investing in passively managed index funds — those that merely try to match market returns, not beat them. Yet it won’t end the debate over… Continue reading The Case Against Active Money Management
Bloomberg.com – Mohamed El-Erian: What to Do About the Jobs-Growth Conundrum A strange thing is happening in the U.S. labor market: The unemployment rate has been falling much faster this year than it should given the slow underlying pace of economic growth…How much one should worry about the jobs-growth gap depends to some extent on… Continue reading Fixing The Jobs Market
The Financial Times – Markets and the Fed have to practise a new dance The key question is whether the business cycle pattern that analysts have depended on for so long is still usable because of those fundamental structural changes. For example, the huge strides in technology in recent decades are most likely impossible to… Continue reading Cyclical Patterns
<Click on chart for larger image> MoneyBeat (WSJ Blog) – The Correction-Less Market Most investors and strategists think the stock market is ripe for a correction. Not Jonathan Golub. The S&P 500 has gone 1,020 days without a 10% drop, the third longest stretch in the past 25 years, according to Mr. Golub, chief U.S.… Continue reading Making The Case Against A Stock Market Correction
The Financial Times – Barclays’ dark pool trading volumes crumble Shallower waters. Barclays’ dark pool continues to drain following a lawsuit alleging the UK bank misled clients about high frequency trading going on in it, reports Nicole Bullock in New York. In the week beginning June 30, just 66m shares traded in Barclays’ pool, down… Continue reading Dark Pool Trading
Comment Three days before the incidents involving MH-17 and Israel/Gaza we shared the following story from The Wall Street Journal: The Wall Street Journal – (July 14, 2014) An Arc of Instability Unseen Since the ’70s A convergence of security crises is playing out around the globe, from the Palestinian territories and Iraq to Ukraine… Continue reading Why Markets Do Not Respond To Geopolitical Events
Zero Hedge – Here Is The Source Of “More Than 95% Of The Market Rally In Q2” Which simply means one thing: the relentless surge in the S&P500 continues not on the back of “solid fundamentals” as the straight to CNBC pundits will shout, but on even more hope for future growth, i.e. multiple expansion.… Continue reading Earnings Update