The Wall Street Journal – Jason Zweig: Just How Dumb Are Investors? A new study finds that the average investor in all U.S. stock funds earned 3.7% annually over the past 30 years—a period in which the S&P 500 stock index returned 11.1% annually. That means stock-fund investors underperformed the market by approximately 7.4 percentage… Continue reading Mutual Fund Investing
<Click on chart for larger image> The Wall Street Journal – Overvaluing the ‘Undervalued’ View of the Yuan The Chinese currency has no real ‘equilibrium value,’ even if Treasury wishes it did. Since Jan. 1 the yuan has fallen 2.9% against the dollar, reversing the Chinese currency’s 2.9% appreciation in 2013. Such a dip would… Continue reading China’s Slowdown
The New York Times – Floyd Norris: The Older Cling to Jobs, Crowding Out the Younger THE proportion of Americans with jobs fell sharply during the Great Recession, and has barely begun to recover, according to overall figures. In 2007, before the downturn began, 63 percent of working-age Americans held jobs. That proportion fell to… Continue reading The Demographics Of The Jobs Market
The Wall Street Journal – Pension Funds Wrestle With What to Do With Cash From Private Equity Some Funds Are Concerned About What Might Happen in Market Downturn U.S. pension funds face a dilemma that might be considered a nice problem to have: record amounts of capital flowing back from private-equity investments. Strong markets have… Continue reading Pension Funds Looking For Investments
The Financial Times – It was the point where the eurozone could have exploded To the astonishment of almost everyone in the room, Angela Merkel began to cry. “Das ist nicht fair.” That is not fair, the German chancellor said angrily, tears welling in her eyes. “Ich bringe mich nicht selbst um.” I am not… Continue reading Revisiting The Eurozone Crisis
Comment Yesterday we hosted a conference call titled “The Bond Rally.” If you missed it, below are links to the handout, audio, and webcast: Handout [pageview class=”PDFViewer” url=”https://www.biancoresearch.com/bianco/wp-content/plugins/PDFViewer/plugin.php?id=188″] Audio [audio:https://www.biancoresearch.com/bianco/SubscriberArea/050814.mp3|titles=Conference Call ] Webcast [hana-flv-player video=”https://www.biancoresearch.com/bianco/SubscriberArea/050814.flv” width=”600″ height=”495″ description=”” player=”3″ autoload=”false” autoplay=”false” loop=”false” autorewind=”true” splashimage=”https://www.biancoresearch.com/bianco/wp-content/themes/twentyten/images/splash.jpg” /]
Comment Yesterday Bloomberg updated its monthly survey of economists. The table above shows the latest outlook for 10-year yields. April’s survey attracted a lot of attention as 100% of economists expected higher yields. May’s survey down-ticked to 99% bearishness. 70 of 71 economists are looking for higher yields over the next six months. The lone… Continue reading Bond Bearishness Goes From 100% to 99%
<Click on chart for larger image> MoneyBeat (WSJ Blog) – ECB Action: ‘Everything is Possible….It’s All on the Table’ An ECB rate cut in June is a sure thing, right? Mario Draghi promised! Well, not quite. Some ECB watchers are convinced that a decision not to ease next month could “shatter” the central bank’s credibility.… Continue reading The ECB Considers Everything, Does Nothing
David Stockman – Janet Yellen’s Bathtub Economics: Excuse Me Doctor—There’s Bubbles In That Tub! Yes, the forward PE for the S&P 500 in October 2007 was a respectable 15X, but that was because it was based on “ex-items” and sell side hockey sticks showing 2008 EPS of $115. In the actual event, ex-items turned out… Continue reading Janet Yellen
The Economist – Shadow banking: The lure of shadow banking Shadow banks helped cause the financial crisis. Better regulated, they could help avert the next one MARK CARNEY, governor of the Bank of England and head of the Financial Stability Board (FSB), an international watchdog set up to guard against future financial crises, was recently… Continue reading Shadow Banking
The Financial Times – Henny Sender: Blame the Fed for scale of tech stocks retreat Investors are weary and wary of easy money effect on asset prices In fact, today many investors are both weary and wary, because of the effect of easy money in lifting all asset prices. They think the stock market is… Continue reading Tech Stock Bubble Talk