MoneyBeat (WSJ Blog) – Uber Bear Sees ‘Super Spike’ In VIX Lots of investors assume that the quiet in the stock market won’t last long. But one noted bear on stocks is reiterating her two-year old call for a “super spike” up in volatility, the likes of which haven’t been seen since the depths of the… Continue reading Volatility
A view of West Qurna oilfield is seen in Basra, southeast of Baghdad MoneyBeat (WSJ Blog) – Where Does the Oil Price Goes From Here? The price of oil is trading near nine-month highs as the situation in Iraq remains febrile. Oil market analysts Monday described the situation as “more persistent than geopolitical scares in… Continue reading Iraq Crude
The Financial Times – Central banks shift into shares as low rates hit revenues Central banks around the world, including China’s, have shifted decisively into investing in equities as low interest rates have hit their revenues, according to a global study of 400 public sector institutions. “A cluster of central banking investors has become major… Continue reading Central Banks Investing In Equities
<Click on chart for larger image> The Wall Street Journal – Global Oil Consumption Outpaces Production Global oil consumption last year grew faster than oil production, BP PLC said in its annual snapshot of world energy statistics. The BP Statistical Review of Energy, unveiled Monday morning at a Moscow conference, found that world-wide, oil consumption grew… Continue reading Oil Production vs. Oil Consumption
MoneyBeat (WSJ Blog) – Blast From the Past: Could Stocks Melt Up? Even after small declines last week, the major stock indexes remain near records. Money managers and analysts are beginning to talk about an idea that dates from the roaring ’90s: a rapid stock gain known as a melt-up. In the late ’90s, people thought… Continue reading Looking For A Stock Melt-Up
Bloomberg.com – Bond’s Liquidity Threat Is Revealed in Derivatives Explosion The boom in fixed-income derivatives trading is exposing a hidden risk in debt markets around the world: the inability of investors to buy and sell bonds. While futures trading of 10-year Treasuries is close to an all-time high, bond-market volume for some maturities has fallen a… Continue reading Fixed Income Liquidity
The Financial Times – Mohamed El-Erian: Time to take some chips off the table Investors have rekindled their romance with the “Great Moderation”, and fallen back in love with “goldilocks”. These two terms are among the most powerful in the markets lexicon. They encourage many investors to stretch and stretch again for extra returns by levering… Continue reading El-Erian Gets Defensive
MoneyBeat (WSJ Blog) – Can You Handle the Market’s Stress Test? Investing graybeards like to say that “bull markets climb a wall of worry.” This one has been sleepwalking up a wall of boredom. As of this Friday, the S&P 500 has gone 980 days without a 10% decline, according to Birinyi Associates, the fifth-longest such… Continue reading Dealing With The Pressure Of Investing
The Wall Street Journal – China Tops U.S. in Corporate Debt Issuance China has overtaken the U.S. as the world’s largest corporate debt issuer, but a slowing Chinese economy and weakened financial conditions among its companies are causing overall corporate risk to increase globally, said Standard & Poor’s Ratings Services. The latest assessment and warning by… Continue reading Corporate Issuance
Real Time Economics (WSJ Blog) – Official: Recapitalizing Fannie Mae, Freddie Mac Would Take 20 Years It would take at least 20 years to adequately recapitalize Fannie Mae and Freddie Mac, a top Treasury official said Friday, the latest effort by the Obama administration to push back against arguments that the government-controlled mortgage-finance giants could be… Continue reading Fannie & Freddie
The Wall Street Journal – High-Frequency Trading Needs One Quick Fix Typical of most regulations, Reg NMS has had many unintended consequences. The main culprit has been NMS Rule 611, known as the Order Protection Rule. Due to expensive lobbying by existing exchanges, the rule requires trades to take place at the “best price.” Sounds fair,… Continue reading How To Fix High Frequency Trading Problems
<Click on graphic for larger image> The Wall Street Journal – Economists Debate: Has All the Important Stuff Already Been Invented? Northwestern University Colleagues Have Opposing Views of 21st Century Economy Robert Gordon, a curmudgeonly 73-year-old economist, believes our best days are over. After a century of life-changing innovations that spurred growth, he says, human… Continue reading Has Everything Been Invented?