This seems to have been proven in multiple studies. Corporations are accumulating cash and not investing either. Time for radical rethinking!
Focus government on funding basic research and shoring up SS, (bring back the full payroll tax) initial $50-100 Billion reduction in military spend Zero corporate tax rate in exchange for mandatory 12% dividend payout - get the money into the hands of the consumers!!! the only part of the GDP equation that seems to be working.
Bonds Are Not Safer Than Blue-Chip Stocks [View article]
Agreed. I have recommended hoisingtonmgt.com's quarterly newsletter many times as required reading for those who want more info on bonds, rate forecasts and really good Econ 401 fodder. (newsletter is FREE!!).
Highly recommend any writings by Lacey Hunt, Ph.D. who also works with HM.
A good bit of debt available under SVU is also Albertsons, et. al. you're buying good brands and getting monster interest payments 12-14% and a potential of 30-50% appreciation. I'll take that.
Bonds Are Not Safer Than Blue-Chip Stocks [View article]
There's a time for equities and a time for bonds.... Treasuries have been rallying since the 70s when rates were at 15-18%.... since then we've had significant corrections, 80s, 90s, 2000s, etc. offering many fabulous opportunities to take some of those bond gains and buy equities at outlandish discounts....
A properly laddered bond port., held to maturity, will protect you sufficiently from any significant "crash" in bond prices which frankly isn't coming any time soon. The Fed must have rates low so that banks can continue to write off mortgage losses into appreciating tier 1 capital (US Treasuries).
The Fed, and the USD are driving this entire global market, imho, and as the dollar breaks into the 90 handle, the markets will pull back accordingly.
As such, zeroes, strips, treasuries (even TIPS!) and the USD will remain the safe havens for at least the next few quarters.
Expedia Is The Top E-Commerce Pick Among Mega Fund Managers [View article]
Looks like all the EXPE shares were all bought at the end of April which prompted that huge spike from 32 to 40.... with EXPE trading now at 47, I'd be surprised if there were not some measure of profit taking over the next few quarters.... especially given the last two quarters' relatively flat earnings. That said, even if they only make "only" $2.50 for the year, the valuation is not outrageous relative to others... Nevertheless, I expect that huge gap to back fill over the next 6-9 months...if not sooner. and might go long then myself. Disclosure: Long EXPE 40-35 Jan14 Put spread.
10-Year Treasuries Telling A Much Scarier Story Than Stocks [View article]
Agreed but where is it coming from?
C, G, I or N? the coefficient of G is negative to zero at best, I seems weak, N also weak with a strong dollar, C is tenuous as private savings/debt reduction seems to be increasing Add in the tax multiplier effect (estimated at about 3 by Christy Romer one of the best studies I've seen) which would also put pressure on C... what's left?
Look at the MV side of it - M may be increasing but if it is, given the very weak growth, that means V is declining to flat (barely above zero?)
a great article on this at hoisingtonmgt.com gives a wonderful macro summary on it.
My two cents? Have corporations pay a one time fee to buy their way out of the corporate tax, I mean Zero corporate tax by paying a one time exit tax of say 3--5% of cash and equivalents on hand. Then require a mandatory dividend payout in lieu of taxes of at least 8% and tax that at regular income rates (no more special dividend rate).
I think that would trigger a wave of Consumption and get Velocity going again and put money in the hands of the consumers rather than institutions who have been stepping in it for years....
10-Year Treasuries Telling A Much Scarier Story Than Stocks [View article]
Exactly, and if they're putting that kind of pressure on treasuries, you can expect yields to stay very low... because as also stated above, that money is sitting in the bank, not in circulation...
couple that with some of the highest bid to cover ratios in a long time and you've got demand driving bond prices higher.... This would be the time for the treasury to issue 40/50 year bonds at 2% and get out from under the ever present risk of this short term financing....
The Meaning Of Google Fiber [View article]
Vodafone: Get Paid 5% To Wade Through The Euro Crisis [View article]
Holding Cash Is No Way To Build Wealth [View article]
More on Q2 GDP: What stimulus? Government spending has been a negative to flat contributor to GDP since 2010. [View news story]
Focus government on funding basic research and shoring up SS, (bring back the full payroll tax) initial $50-100 Billion reduction in military spend
Zero corporate tax rate in exchange for mandatory 12% dividend payout - get the money into the hands of the consumers!!! the only part of the GDP equation that seems to be working.
U.S. Drought And Food Inflation: Impact Of Corn, Soybean, Ethanol [View article]
The Fed Should Stimulate Lending [View article]
eliminate the corporate income tax entirely based on a one time, $1billion buyout per corporate return.
Mandate a 9% dividend based on GAAP income as filed with the SEC.
Achieves multiple objectives, gets cash to the consumer (the only part of the GDP equation that has a multiplier >1 at this point).
Eliminates corporations from washington DC lobbying (or by quite a bit at least.)
Get anice big cash injection from very willing companies
Head Fake: Don't Trust The Euro [View article]
Bonds Are Not Safer Than Blue-Chip Stocks [View article]
Highly recommend any writings by Lacey Hunt, Ph.D. who also works with HM.
The Bull Case For Supervalu Bonds [View article]
Bonds Are Not Safer Than Blue-Chip Stocks [View article]
A properly laddered bond port., held to maturity, will protect you sufficiently from any significant "crash" in bond prices which frankly isn't coming any time soon. The Fed must have rates low so that banks can continue to write off mortgage losses into appreciating tier 1 capital (US Treasuries).
The Fed, and the USD are driving this entire global market, imho, and as the dollar breaks into the 90 handle, the markets will pull back accordingly.
As such, zeroes, strips, treasuries (even TIPS!) and the USD will remain the safe havens for at least the next few quarters.
Expedia Is The Top E-Commerce Pick Among Mega Fund Managers [View article]
Disclosure: Long EXPE 40-35 Jan14 Put spread.
10-Year Treasuries Telling A Much Scarier Story Than Stocks [View article]
http://bit.ly/Nf6Bmp
10-Year Treasuries Telling A Much Scarier Story Than Stocks [View article]
10-Year Treasuries Telling A Much Scarier Story Than Stocks [View article]
C, G, I or N? the coefficient of G is negative to zero at best, I seems weak, N also weak with a strong dollar, C is tenuous as private savings/debt reduction seems to be increasing Add in the tax multiplier effect (estimated at about 3 by Christy Romer one of the best studies I've seen) which would also put pressure on C... what's left?
Look at the MV side of it - M may be increasing but if it is, given the very weak growth, that means V is declining to flat (barely above zero?)
a great article on this at hoisingtonmgt.com gives a wonderful macro summary on it.
My two cents? Have corporations pay a one time fee to buy their way out of the corporate tax, I mean Zero corporate tax by paying a one time exit tax of say 3--5% of cash and equivalents on hand. Then require a mandatory dividend payout in lieu of taxes of at least 8% and tax that at regular income rates (no more special dividend rate).
I think that would trigger a wave of Consumption and get Velocity going again and put money in the hands of the consumers rather than institutions who have been stepping in it for years....
10-Year Treasuries Telling A Much Scarier Story Than Stocks [View article]
couple that with some of the highest bid to cover ratios in a long time and you've got demand driving bond prices higher.... This would be the time for the treasury to issue 40/50 year bonds at 2% and get out from under the ever present risk of this short term financing....