Greenlight Capital – Partner Letter, January 18, 2011 On August 27, 2010, Federal Reserve Bank Chairman Ben Bernanke gave a speech in Jackson Hole, Wyoming where he hinted that the Fed would provide additional monetary easing. At the time, the S&P 500 was down more than 3% for the year. From that point through the… Continue reading The Federal Reserve And The Stock Market – It’s A Bubble!
The Wall Street Journal – Global Price Fears Mount As Food, Raw Materials Soar, Europe’s Central Bank Head Warns on Inflation In an interview with The Wall Street Journal ahead of this week’s annual meeting of the World Economic Forum in Davos, Switzerland, Jean-Claude Trichet warned that inflation pressures in the euro zone must be… Continue reading Differing Views On Inflation
Bloomberg.com – Euro’s Slide Meets Resistance as Analysts Draw Line at $1.30 Traders are starting to believe German Chancellor Angela Merkel when she says Europe’s biggest economy will do whatever it takes to save the region’s currency. Demand for contracts used to hedge against a decline in the euro is disappearing at the fastest pace… Continue reading The Euro
The Wall Street Journal – E.J. McMahon: State Bankruptcy Is a Bad Idea Politicians already have the power to tame public unions without roiling municipal bond markets. They merely have to use it The focus of state bankruptcy advocates on employee compensation costs is somewhat misplaced. More than half of all state expenditures go to… Continue reading Munis
The Wall Street Journal – Is Steep Yield Curve Signaling Pain to Come? Anomaly Suggests, to Some, Investors’ Fear of a Possible Downgrade for U.S. Credit Ratings; Moody’s Disagrees Some bond experts believe yields in the Treasurys market are signaling the U.S. could one day be stripped of its triple-A status as it confronts a… Continue reading What Does The Steep Yield Curve Mean?
<Click on chart for larger image> Bloomberg.com – Ireland Races to Pass Budget as Coalition Government Collapses Irish political leaders said they’ll press to pass a budget before elections as the collapse of Prime Minister Brian Cowen’s coalition threw the government into disarray. Finance Minister Brian Lenihan will meet today lawmakers from the Green Party,… Continue reading Ireland’s Government Collapses
The Wall Street Journal – Markets Rediscover the Fundamentals In recent weeks, for example, moves in stocks and the U.S. dollar have had little connection—a breakdown of the trend during much of 2010, when they were virtual mirror images of each other. Stocks were considered risky and would rise when investors were feeling confident, while… Continue reading The Markets
The Wall Street Journal – Fannie-Freddie Report Likely to Be Late The Obama administration is likely to miss a deadline for issuing a long-awaited report about the future of mortgage giants Fannie Mae and Freddie Mac, and what might replace them. The Dodd-Frank law enacted last year to overhaul financial-industry regulations didn’t address how to… Continue reading Fannie/Freddie Get Worse
The Wall Street Journal – Jon Hilsenrath: New Push at Fed to Set an Official Inflation Goal Federal Reserve officials last year, prodded by Chairman Ben Bernanke, seriously considered adopting an explicit target for inflation of 2%, but Mr. Bernanke failed to forge a consensus and backed away. The issue could resurface in 2011. The… Continue reading Will The FOMC Adopt Formal Inflation Targets?
The Independent (UK) – Worst December retail sales since records began Terrible winter weather and rising prices kept shoppers away from the high street and prompted the worst December retail sales on record, official figures revealed yesterday. Retail sales remained flat compared with the previous December, which was the worst annual performance for the month… Continue reading The UK Christmas Sales Disaster
Barron’s – Roundtable Part 2: All Over the Map In the second installment of the Roundtable, our pros’ picks range widely over commodities, previous metals, financial stocks and big-cap tech. Two better-than-bonds plays. Thus, Felix Zulauf, head of Zulauf Asset Management in Zug, Switzerland, one of the savviest observers anywhere of the global investment scene,… Continue reading Barron’s Roundtable, Part 2
The Wall Street Journal – The Bulls Want Jets Grounded For Stocks to Rise in ’11, Super Bowl Indicator Says New York Must Fall With apologies to New York Jets fans—especially since the team’s defensive line used to be called the New York Sack Exchange—it appears that the only thing that can keep the stock… Continue reading Jets Lose, Investing World Safe For Another Year!