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  • Bernanke press conference: In a change to the Fed's exit policy (if it ever happens), the chairman says a majority on the FOMC expects the Fed will not sell MBS, and will instead let the paper mature or get paid off. He reiterates that the unemployment rate falling to 6.5% will not automatically trigger a rate hike. The Fed could begin tapering asset purchases later this year if its economic forecasts are correct. [View news story]
    The Fed must and will gradually taper QE. This is the only sensible thing to do since anything else will kill the stock market which, at this time, is a major driver for our economic recovery engine. As the economy improves, tax revenue will increase and eventually if the government behaves and all goes well the debt will be brought down to reasonable levels. If this happens, we will get out of our current mess without extremely high levels of inflation. If this does not happen we will pay down our debt with inflated, cheap dollars.
    Jun 19, 2013. 04:44 PM | Likes Like |Link to Comment
  • Government contractor Booz Allen Hamilton (BAH) has become caught up in the revelations about the National Security Agency's surveillance programs after one of its (soon to be former?) employees, Edward Snowden, came forward as the source of the leaks. Booz Allen has said in securities filings that leaks could hurt its business - the firm generated 98% of its $5.76B in revenue in the last fiscal year from the government, with 23% coming from intelligence work. [View news story]
    Why all the fuss about the news that the government is watching our email, phone use, and internet use? This started with Bush and continued with Obama and we and the world knew about it. Is this suddenly an issue due to politics or am I missing something?
    Jun 10, 2013. 02:07 PM | Likes Like |Link to Comment
  • Look for any piece of news that smacks of an improving economy to send stocks falling next week, warns CNBC's Jim Cramer. Why? Big money investors will interpret any positive economic signs as a signal that the Fed is about to pull back economic stimulus rather than risk runaway inflation. Still, he says, there may be opportunities in the pullback, particularly in the bank, tech and industrial spaces. Just says away from anything with a higher yield, like utilities and MLP's. [View news story]
    What is wrong with this thinking? If interest rates move up, holders of bonds will dump them. This money will then have to flow into the stock market. If this is true, the market will take an initial hit and then be fed by all the new money coming in.
    Jun 1, 2013. 06:50 AM | 2 Likes Like |Link to Comment
  • "Run for the hills," says Jim Rogers, busy making sure all of his bank accounts are within guaranteed levels. With the IMF and the EU saying its ok to loot bank accounts, a precedent has been set, he says, and the next country getting in trouble will point to Cyprus and do the same thing. "What more do you need to know ... the gall of these politicians." [View news story]
    There is a maximum of insurance on each account for a reason. Now you know the reason. Don't go away mad, just stay within insured limits. Of course the larger the amount, the more difficult it might be to do.
    Mar 28, 2013. 05:06 PM | Likes Like |Link to Comment
  • More on Cyprus: EU finance ministers approve deal. Bloomberg says deposits above €100K at Bank of Cyprus could incur losses up to 40% while deposits above the €100K threshold at Cyprus Popular Bank (Laiki) may be wiped out entirely. Deal may not need to be approved by the Cypriot parliament.
     [View news story]
    Sounds like the real story is not out yet.
    Mar 24, 2013. 09:36 PM | 6 Likes Like |Link to Comment
  • The budget deficit shrank to $260M in December from $86B in the same month a year earlier and came in well below consensus of $1B. The numbers were helped by tax payments being shifted to December to avoid higher rates in 2013, says Jefferies economist Thomas Simons. "We are still going to run fairly substantial deficits this year and in coming years," he adds. [View news story]
    The increase in budget deficit is driven by the lack of tax revenues caused by the housing collapse that hurt the economy. As the economy improves the deficit will decrease. If Republicans had their way, they would immediately kill as much spending as possible in order to kill the economy and create a backlash that will get them elected.
    Jan 13, 2013. 12:26 PM | 3 Likes Like |Link to Comment
  • The House will vote on the unamended Senate bill at 9 PM ET, reports CNN's Dana Bash. Any attempt to alter the bill by adding spending cuts has reportedly been abandoned for now. Update at 9:10: The vote has been pushed back to 11 PM ET. [View news story]
    The cause of our debt was a recession induced by the housing bubble.
    The recession caused government expenditures to increase and government revenues to decrease because people out of work cost money and don’t bring in tax revenue.
    The faked Republican idea of cutting spending is designed to screw the country out of spending induced stimulation so that things will get worse and Republicans will be elected.
    The fiscal cliff backfired on the Republicans and to a lesser extent on the Democrats because our leaders are in a category of net worth that will result in passing most of their estate value on to the government and not to their heirs.
    Republicans couldn’t take this and are forced to vote for something they didn’t like.
    They will try to justify their vote by saying it is for a tax decrease since we went over the cliff already.
    With all the publicity this issue has gotten, the public has gotten a little wiser.
    Jan 1, 2013. 10:48 PM | 2 Likes Like |Link to Comment
  • The House will vote on the unamended Senate bill at 9 PM ET, reports CNN's Dana Bash. Any attempt to alter the bill by adding spending cuts has reportedly been abandoned for now. Update at 9:10: The vote has been pushed back to 11 PM ET. [View news story]
    Nothing wrong if you are protected against inflation.
    Jan 1, 2013. 09:43 PM | 1 Like Like |Link to Comment
  • The House will vote on the unamended Senate bill at 9 PM ET, reports CNN's Dana Bash. Any attempt to alter the bill by adding spending cuts has reportedly been abandoned for now. Update at 9:10: The vote has been pushed back to 11 PM ET. [View news story]
    Did you ever think, for a moment, the Republicans or the Democrats were not going to protect themselves from large increases in estate tax?
    Jan 1, 2013. 09:24 PM | 1 Like Like |Link to Comment
  • The haggling to avert a fiscal cliff brings more movement, with President Obama offering to limit tax increases to those earning over $400K - up from his long-held desire of $250K but well below John Boehner's proposal of $1M. The latter's aides say the offer represents "a step in the right direction" but is too heavy on the tax revenues and too light on the spending cuts. [View news story]
    Because some taxes are only a small portion of what is needed does not mean they should be ignored. (Taxes on those making over a certain amount) Many small portions of spending cuts, efficiency improvements, and increases in age for Social Security and Medicare would solve the problem. Robbing Medicare to pay for Affordable Health Care was improper.
    Dec 18, 2012. 08:22 AM | Likes Like |Link to Comment
  • The haggling to avert a fiscal cliff brings more movement, with President Obama offering to limit tax increases to those earning over $400K - up from his long-held desire of $250K but well below John Boehner's proposal of $1M. The latter's aides say the offer represents "a step in the right direction" but is too heavy on the tax revenues and too light on the spending cuts. [View news story]
    Whatever the final agreement is on the breakpoint for defining the income for tax increase, it should be indexed or it will become another AMT tax.
    Dec 18, 2012. 07:09 AM | 1 Like Like |Link to Comment
  • Markets are priced for "almost permanent disaster," says Goldman Sachs' Jim O'Neill in an otherwise forgettable interview in which he rehashes the need for Europe to create a fiscal union to go alongside monetary union.  [View news story]
    We have fiscal union in the US with respect to government insuring deposits and taking over failing banks. Maybe a model like ours should be followed.
    Jul 25, 2012. 08:47 AM | Likes Like |Link to Comment
  • Senior IMF economist Peter Doyle is resigning, and has published a fiery resignation letter (.pdf) accusing his ex-employer of failing to issue warnings about the eurozone's crisis in spite of being told to do so by staff. Doyle also accuses the IMF of "analytical risk aversion, bilateral priority, and European bias," and calls the last decade's Managing Director appointments to have been "disastrous." "After twenty years of service, I am ashamed to have had any association with the Fund at all."  [View news story]
    Whenever someone is on the giving side of the IMF they will have negative comments about the receiving side. Is it just possible that they are trying to so what they think is overall best?
    Jul 21, 2012. 12:41 AM | Likes Like |Link to Comment
  • If the ECB only cuts its overnight lending rate by 25 bps to 0.75% on Thursday, investors are likely to be disappointed and unload euros, writes Citi's FX team. What the market needs to continue to move higher is something beyond what's already priced in - just 5 of 62 forecasters expect a 50 basis point move.  [View news story]
    The Spinners are always at it.
    Jul 3, 2012. 04:56 PM | Likes Like |Link to Comment
  • Gold prices clawed their way out of bear market territory today, as gold futures spiked over $40 to more than $1575 an ounce, posting the biggest one-day gain of the year. Whats behind the move? Beyond just a dismal U.S. manufacturing report, there appears to be a fundamental shift in investor sentiment. Individuals, as well as governments, have started pricing in the potential for prolonged global economic weakness going forward.  [View news story]
    There are 2 main forces driving gold. When the dollar is stronger gold valued in dollars is priced lower. When the dollar is weaker or currencies are in economic turmoil, gold is the flight to safety and goes higher.
    May 17, 2012. 10:17 PM | 1 Like Like |Link to Comment
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