<Click on chart for larger image> MoneyBeat (WSJ Blog) – Euro-Zone Bonds Keep Rallying. But Why? With Greek bond yields now back to the lowest they’ve been since 2010 and the government diving back into the market, the European Central Bank can claim victory in its promise to secure the euro’s survival. But depending on… Continue reading A Vote Of Confidence Or Eye On Deflation?
The Financial Times – Credit bubble fears put central bankers on edge Central bankers have been debating whether monetary policy should take into account asset bubbles ever since the low interest rates cultivated under Alan Greenspan were blamed for herding investors into riskier investments in the years preceding 2008. However, in recent months, that debate… Continue reading Fighting Bubbles
The Wall Street Journal – Moody’s Is No-Show in Bond Deal Rating When the sale of more than $1 billion in commercial-mortgage bonds went off without a hitch last week, one name was conspicuously missing from the prospectus: Moody’s Investors Service. The ratings firm, known for adopting more-cautious stances than its rivals, has been a… Continue reading Should Moody’s Be Concerned?
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Charts of the Week Topics Covered This Week Include: Mutual Fund Flows The Federal Reserve’s Fixed Rate Reverse Repo Facility An Updated Look At ETF Assets An Updated Look At ETF Assets – 2 Margin Debt Gold A Long Term Look At Stock & Bond Returns Investor Sentiment An Updated Look At Credit Spreads An… Continue reading Charts of the Week
TABB Forum – Larry Tabb: No, Michael Lewis, the US Equities Market Is Not Rigged While Michael Lewis’s new book, “Flash Boys,” is an amusing read and does talk about the very complex execution framework of the US equities market, he has not portrayed the full story of the US equities market, leaving much on… Continue reading The HFT Debate Heats Up
Historical Market Performance Under Various Deflation/Inflation Scenarios In this study, we look at how the markets perform under various deflation/inflation scenarios. This study stretches as far back as 1801 and covers stocks, “real” stocks, long term interest rates, “real” long term interest rates, short term interest rates, and the CRB. We also compare returns before… Continue reading Historical Market Performance Under Various Deflation/Inflation Scenarios
Bloomberg.com – Draghi Must Act to Avert Deflation The dangers of deflation are well understood, especially for economies burdened with debt, as Spain and many others still are. Falling prices make debts weigh more heavily and threaten to sink distressed economies into an even deeper hole. The ECB understands this. So why hasn’t it acted… Continue reading More On Europe’s Deflationary Concerns
MoneyBeat (WSJ Blog) – Equities For the Long Run? Or Property? Or Neither? Over the past twenty two years, there’s been no clear and consistent winner between equities and property across the world’s four major developed markets: the U.S., the U.K., Germany and Japan. In Japan, both equities and property have seriously underperformed the broad… Continue reading Comparing Asset Classes Across Countries
The Financial Times – The art of talking down earnings Hopes for the first quarter are sharply down, due to near-record proportions of profit warnings relative to early good news from companies. Only two quarters in the past two decades have been worse, according to Greg Harrison at Thomson Reuters…It does not look good. The… Continue reading Earnings Continue To Be Revised Down
The Financial Times – Rate rise pattern is different this time Of particular relevance to the current situation is the finding that central banks under-predicted increases in the policy rate in the early stages of an upturn. Their monetary policy framework had not changed but stronger than forecast macroeconomic developments led them to move the… Continue reading What Happens When The Fed Raises The Funds Rate?
<Click on chart for larger image> <Click on chart for larger image> MoneyBeat (WSJ Blog) – No Fret Over Margin Debt [T]here are reasons to believe the latest run-up in margin debt shouldn’t cause concern. The amount borrowed has increased at a much slower pace than the previous two times margin debt peaked. In March… Continue reading Margin Debt