jimau

6 Comments

    • TED Spread Shrinking - But It Ain't Over Yet [view article]
      So the questions is why is there so much supply in T-Bills is that a sign of more short term debt issuance not a sign that things are improving?
      Libor being the rate between banks which has not really improved in a large amount to warrant an up tick in sentiment.
      I'm a novice when it comes to understnding the bond market, are my assumptions off the mark.       May 21 09:31 PM
    • Growth vs. Value Performance [view article]
      The lack of clarity amongst the great growth stock boom leading up to the dot com bust was not so out of the ordinary, history has shown other so called stocks of unprecedented promise metting simular fates when highly speculative attitudes failed to recognise speculation alone doesn't cut it.
      Trends into and out of corrections are also speculative short term, my feeling is with safety of returns for pensions at the formost of investors minds, and the not so distant memerios of October 2001 to march 2003 also taking effect, unless you are very good at picking growth stocks at reasonable prices thus allowing for safety margin (remembering the greater the enthusiasm the market has for these hot stocks, and the faster it rises in price compared with actual growth in earnings, the greater the disapointment the market shows when earnings disapoint) then I think value will take the honors.       May 20 09:58 AM
    • P/E Divergence Between Growth and Value Stocks: The Wrong Way [view article]
      Historical records show that growth stocks over promise and under deliver in comparison to good dividend paying, well managed value stocks that show a more sustainable growth pattern over many years and even decades.
      In reference to your graph and I'm little confused as to which stocks are in focus, but in general a flight to quality may be in play as investors run to the rocks for safety.
      Please add to my knowledge if I'm missing something.       May 19 09:59 PM
    • The Home Start Numbers Are Not a Positive [view article]
      johngonole-I agree with your analysis of builders balance sheets even if it was a few years back I don't think much would have changed but very open to clarification.
      At this point in time can the emerging markets afford to in any significant amount buy anything other than cheaply manufactured goods from their own countries that would see that shift in trade balances? Have these economies build up their middle class sufficiently to take on this advantage of a deflated US dollar. The prospects for a stronger US economy long term are great just because of the economies of scale issue but on a short term prospect if emerging economies try to build their middle class consumption to soon in an already overheating environment inflation will tick up and a more serious problem will arise globally as the already stretched and debt dependent consumer tackles inflation, slow growth, job uncertainty and deflating equity cushion at home.       May 19 03:08 AM
    • Donald Trump on Oil [view article]
      I can't believe you guys don't like the Donald isn't he one of your greatest exports, his shows are watched here (Australia) by many.
      Like him or loathe him fuel cost's will definitely pull a economy down, if you don't think so just go ask a few truckers if they expect to make their repayments this month and do they see themselves absorbing the cost's of fuel much longer.
      Over here truckers charge a fuel surcharge on top of GST and freight costs. That charge is in general 10% but fuel has gone up in the last 2 months by 35% at the pump, does that mean this latest increase in fuel of 35% can be absorbed and ignored by an already bleeding industry. The smaller operators that are the last left standing suppliers of service and reliability will surely go to the wall this time and the big operators will clean up and raise their prices. Who will be left to keep the buggers honest?       May 19 01:55 AM
    • The Home Start Numbers Are Not a Positive [view article]
      The problem with all these numbers is the denial of the facts. Fact No 1 OECD members have been living beyond their means for 2 decades exporting inflation and importing deflation this has lead to many bubbles e.g. lending, consumption of cheap worthless goods and by hostrical measures an excessive run up in home equity appreciation as well as other asset prices and this drawing down on equity has fueled growth and created a false sense of wealth in the domestic and commercial arena. Fact No 2 Risk levels and the criteria that determines risk have been ignored to the point that the financial system froze and now will have to undergo a massive de leveraging of that risk at the expense of the masses that gorged on this orgy. Fact No 3 the reliance on the American dollar as a standard of world currency is coming under threat and more decoupling will get underway this will force the indebted consumer driven economies to cut back and create a surplus buffer or at least a narrowing of trade deficits at expense of emerging markets. Fact No 4 Inflation is raising its ugly head and holding economies that are affected by this curse to ransom because by fuelling growth so as to balance risk is to add more pressure to prices which in turn fuels more inflation and un affordability which in turn will add more risk. Fact No 5 The only reason we have averted deep economic pain in the past is because of the emerging economies story, they have to this point exported deflation allowing the OECD economies to spend on more with less until the addiction to spending and expansion has out stripped income growth which when measured by historical income/debt ratios is at unsustainable levels and must correct to bring about sustained growth with low inflation. Fact No 6 The key to profit is the proper utilization of assets. When you generate turnover in environment that has asset prices inflation with debt that is leveraged from that inflated asset the risk of default goes up because the inflated assets may have to be written down in poor economic or a corrective environment. May 19 12:47 AM
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