Georgetastic

Why You Shouldn't Own DIA, SPY or QQQQ

Also, you'll note that currently, the dividend yield is higher for SPY, most likely because of it's popularity over IVV. I agree that this article should be updated for more general advice. Thanks for your ETF articles David! They're awesome!

Implications of the Fed's Purchase of Treasuries

Great article. I was just thinking about this yesterday during the statement.

If the Fed "chooses to respond with more aggressive Treasury bond buying", what implications does that have for the US economy as a whole? Stocks?

I agree that it will definitely be bullish for gold, no doubt.

TIPS: The Swiss Army Knife of the Bond Market

To me, the most plausible outcome is that banks and consumers will stem their deleveraging, and possibly begin to lever up again. That combined with the Fed's low rates and the bailout cash, we should see inflation coming back. Since rate hikes take a while to set in, we can expect inflation to increase then come off the peak. The Fed's policy is to keep inflation between 2% and 3%, so we know we won't see inflation as low as it is today until the next recession.

Overall, looks like inflation will come back, and to expect 1.4% inflation for 10 years is a pipe dream.


On Jan 27 04:52 AM RiskTrade wrote:

> The Federal reserve has cut interest rates to historic lows to get
> the economy moving again. When the economy moves again the Fed will
> raise rates quickly to stem inflationary pressures. Hence as a TIPS
> holder you are betting that a) The markets estimate of inflation
> is wrong and b) risking lower coupon income should deflation occur
> c.) betting the fed won't be able to curtail inflation risk in the
> future by raising rates quickly enough d) taking interest rates risk
> (duration risk) as rates will need to rise in the future and e.)
> uncertainty about when inflation will finally occur ( if you have
> to wait 5 years then isn't TIPS as an asset class as attractive as
> any other asset class).

Existing Home Sales: At Least December Was Better Than November

Interesting charts. I'd be interested in knowing the source of the purchases (foreclosures? first-time buyers or speculators?). That might give us a clearer picture of what might happen in the future.

California's Tipping Point

Awesome article! As a CA resident, I too am fed up with how insanely large the state government has gotten. The overly stringent laws and taxes push out private enterprise. Finally, the time has come to prove that giant state government only works in good times, not in all times.

Global Slowdown To Hit Low-Income Countries Hard in 2009

What effect does this have on emerging market growth? I assume it means ETFs like EMG are probably not a good idea. Hopefully Grameen bank will help build up their financial infrastructure more quickly than it would otherwise.

Tech Bellwethers: Earnings Scorecard

The point of the article is to highlight that the majority of tech bellwethers are showing poor results. AAPL and GOOG certainly did great, but they are only 2 of the 14. The implication is that at least 86% of the tech companies that have yet to release earnings will give poor results.


> You clearly omitted that AAPL beat by 28%.
> Isn't it encouraging?
> Plus AAPL showed over 40% of growth in non-GAAP base.
> Looks like only negative results were emphasized.

More Housing Charts: Existing Home Prices vs. Median Income, Interest Rates

Wow, thanks for these graphs.

Banking on a Rally for Quick Profits

Now it looks like you're too early. Good luck with this one, it's just crazy enough to work :)

Taking Stock of New World Oil

Once storage on land and at sea is full due to arbitrage, I would expect oil prices to fall and stay low until the glut is removed. Demand doesn't seem to be coming back, but supply and storage have not reacted proportionally. I see oil futures a good opportunity to short.

Banks Flail as TARP Is Looking Inadequate

Good article. While everyone seems to be concerned with decoupling, deflation, hyperinflation, etc., it is important to focus on the base problems that started this mess, and to look there for recovery before anything.