Zero Hedge (Blog) – Is Silver Merely A Levered Gold Play? A few interesting observations out of ETF Securities, which concludes that not only is silver a cheaper play on precious metal trends, but is the equivalent of a levered gold play. Yet based on the 50 year average gold/silver ratio of 50, silver still… Continue reading Gold vs. Silver
The Wall Street Journal – The Recession and the Housing Drag The more the government tries to prevent prices from finding an equilibrium, the longer it will take for the economy to begin growing again. A decent house has long been a symbol of middle-class American family life. Practically, it has been a secure shelter… Continue reading When Will House Prices Be Allowed To Find An Equilibrium?
<Click on chart for larger image> The New York Times – European Bailout Fund Receives High Ratings International credit rating agencies on Monday gave their top grade to Europe’s sovereign bailout fund, but the move failed to halt the strain on the ailing government bonds of Ireland and Portugal. The European Financial Stability Facility, as… Continue reading The European Financial Stability Facility Is Deemed AAA
The Financial Times – We need rules to limit the risks of superfast trades From a capital formation-allocation perspective, HFT provides only limited value. Clearly HFT firms are not the kind of long-term investors that companies like. Being split-second shareholders, HFT firms do not participate in corporate governance. They do not trade based on fundamentals,… Continue reading High Frequency Trading
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The New York Times – Floyd Norris: In Great Recession, Other Nations Have Suffered More THE Great Recession in America more than earned that title. But by international standards, it was not that bad. The recession caused a greater decline in gross domestic product in the United States than any American downturn since World War… Continue reading A Look At The Great Recession Across Various Countries
The Wall Street Journal – Bond surge driven by lack of supply Lost in the debate over whether the bond market has entered bubble territory is the simple concept of supply and demand. At the same time investors are snapping up bonds for their generally safe returns, borrowing overall is down as the U.S. economy… Continue reading Bond Bubble Or Simple Supply And Demand?
Bloomberg.com – John Dorfman: Shock Waves for Stocks If GOP Wins Congress A power shift in November favoring Republicans would send shock waves of varying strength through U.S. stock markets. If the GOP regains control of Congress, look for these consequences: Stocks would likely surge for a week or two. Wall Street likes Republicans. And… Continue reading What Could A Republican Congress Mean For The Markets?
<Click on chart for larger image> The Financial Times – Junk bond prices hit pre-crisis levels Strong investor demand for junk bonds has pushed the average price on such corporate debt to its highest level since June 2007, when companies could borrow with ease at the height of the credit boom. The Bank of America… Continue reading Junk Bonds
Barron’s – Randall W. Forsyth: Central Banks Embrace Risky Currency Gambit Now, with short-term interest rates in most major economies at or near zero percent, central banks have run out of basis points, the main weapon in their arsenal. Moreover, their QE has had far less than the expected impact. Having run out of conventional… Continue reading Using Currency As A Monetary Policy Tool
The Wall Street Journal – Pension Gaps Loom Larger Funds Stick to ‘Unrealistic’ Return Assumptions, Threatening Bigger Shortfalls Many of America’s largest pension funds are sticking to expectations of fat returns on their investments even after a decade of paltry gains, which could leave U.S. retirement plans facing an even deeper funding hole and taxpayers… Continue reading Pensions
<Click on chart for larger image> The Financial Times – ECB intervenes in Irish bond markets The European Central Bank intervened to stabilise the Irish bond markets on Friday after a report by a leading UK bank triggered investor fears that the country might turn to the international community for a multibillion-euro bail-out. The renewed… Continue reading Ireland