My afternoon train reads:

If you make the same forecast repeatedly for 15 years, you will eventually be right: Dow 36,000 Is Attainable Again (Bloomberg
• Why analysts should not be investors, Andy Zaky edition (Reuters)
• What to do now if you’re mostly in cash (MarketWatch) but see Wrong question. (The Reformed Broker)
• More to Dow’s Rally Than Just the Fed (WSJ)
• When the Corporate Elite Supported Raising Taxes (Echoes)
• Why 401k Investors Chase Performance – and How to Prevent It (Fiduciary News) see also 401Ks are a disaster (USA Today)
• Investors Seek Ways to Profit From Global Warming (Businessweek)
To Hell with Reg FD! Bank of America Investors Grill CFO At Dinner (The Street)
• How Disney Bought Lucasfilm—and Its Plans for ‘Star Wars’ (Businessweek)
• A Day in the Life of a Freelance Journalist—2013 (Natethayer)

What are you reading?

 

Low Interest Rates Drive Consumer Spending

Source: MarketWatch

Category: Financial Press

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

14 Responses to “10 Thursday PM Reads”

  1. mad97123 says:

    Wrong question – “So is it too late for investors to join the party?”

    These timing articles strikes me as silly when talking about tax deferred accounts, where current long positions can be converted to cash in a flash for minimal fees.

    Imagine your cat jumps on your key-board and hits the sell-all button and you find you are suddenly all in cash. 5 minutes later the market has gone nowhere, so you buy back all your positions with your fresh “new” money.

    What the difference if that same scenario plays out over 5 day, 5 months or 5 years instead of 5 minutes?

    For some reason those who are currently all long are comfortable staying that way, but they advise caution for “new” money. If it’s not safe for “new” money, why is it safe for “old” money? Money is money.

  2. TennesseeTrader says:

    If I see one more article of the “More to Dow’s Rally Than Just the Fed” ilk….

    I mean it’s obviously true, but it’s also obviously true that the FED component is appreciable percentage that supports the current prices. Want proof. Have Bennie Boy say tomorrow he will cease all Quantitative Easing initiatives. His experiment is over. I think we all know what happens to stock prices under that scenario, and it wouldn’t simply be a one or two day decline either. That market has, and is continuing to price in indirect FED buying.

  3. Woof says:

    Barry you’ve impressively navigated the markets and for long periods as a ‘short’. How does one square that with Reformed Broker’s advice to always “be in”?

    ~~~

    BR: I’m not sure I understand your question: I am not “a Short”; and that’s not what Josh was referencing — he specifically is referring to: a. saving for retirement; b. missing a 140% rally over four years; c. What is their plan?

  4. Anonymous Jones says:

    Of course there is more to the rally than just the Fed. Corporate profits as a percentage of the economy have greatly increased.

    And yes, both trends portend very bad things for stock indices when they reverse (i.e., rates rise and profits go back to a lower percentage of the economy).

    I mean, it’s going to be obvious in hindsight when this reverses (and no, I’m not a prognosticator and am not making anything other than a nebulous but extremely likely intermediate-term observation). You can’t expect the indices to overcome rising rates or to somehow return 10% per year when the overall economy increases 2% per year. You eventually have constraints that some people call mathematics.

    Hey, but if you want to bet that 10yr notes remain at 2% for the next decade and that there will be no political pushback to an ever-rapacious corporate state, be my guest (you can of course make boatloads of money in the short term, regardless).

  5. Joe Friday says:

    401Ks are a disaster (USA Today)

    Both 401Ks and HSAs (and it’s derivatives) are dismal miserable disasters. Both were pushed by Heritage and other RightWing front groups to shift pensions and healthcare from employers to workers.

    They want to extend their magnificent success to Social Security and Medicare.

  6. flocktard says:

    Re the low rates: I saw a piece on Housing Wire about 74% of all mortgage activity in 2012 being refinances. That’s billions upon billions in deleveraging, and gobs of additional cash flow for millions of homeowners. (It also helps government receipts- you can’t write off as much interest expense at 3.5% than you did at 7%.) On the corporate side, firms that were paying out 12% coupons have rolled over their debt into rates they couldn’t even dream of, bailing them out of years of reckless behaviour. But in spite of this windfall, we still have a halting recovery and painfully slow job growth. It serves as a reminder that the economy has deeper issues than just getting out of the overleveraged position we were in. There is no returning to what we once were. And that is frightening.

  7. Bob A says:

    Those Amazing Deals On Foreclosed Homes Are Disappearing
    http://www.businessinsider.com/tight-supply-hits-foreclosure-discounts-2013-3

  8. S Brennan says:

    White House Press Secretary Jay Carney quoted from the letter that Holder sent to Paul today. “Does the president have the authority to use a weaponized drone to kill an American not engaged in combat on an American soil? The answer is no.”

    That seemed a little too clear cut for Washington…and the phrasing was so very unique…I figured, I’d better take a moment to look up what Merriam-Webster’s Definition of “combat” is….and not surprisingly, Holder’s phrasing is broad enough to include just about anybody who displeases those in power:

    Merriam-Webster’s Definition of “combat”
    1: a fight or contest between individuals or groups
    2: conflict, controversy
    3: active fighting in a war

    So for the record, I would like to ask Mr. Holder, what definition of “combat” was he referring to? Because, as the wording stands, just about any citizen who has a complaint with the powers that be is to be considered fair game…if Mr. Holder’s very unique phrase is not more clearly defined.

  9. TennesseeTrader says:

    I like my HSA and high deductible policy and want to be able to keep it, but alas, despite all of the promises it appears that this will not be happening. And for the record, I put 100 percent of the contribution into the HSA and my company pays a sizable portion of the insurance premium. I think it’s the way insurance is meant to be, as opposed to having it free every time you go to the doctor.

  10. Joe Friday says:

    TennesseeTrader,

    Who (with insurance) goes to the doctor for “free” ?

    HSAs are great for the affluent, but are the opposite of preventive care for everyone else, which ends-up costing the system more when they eventually seek treatment when they are far sicker.

    Not to mention, how is it fair that some slob who doesn’t take care of himself gets to roll-over his account or even cash it out in some instances, while a perfectly healthy person gets run down by a hit-and-run driver and has his account completely drained ?

  11. swag says:

    James K. Glassman is Executive Director of the George W. Bush institute, a public policy “think tank”.

  12. juneau says:

    RE:Wrong Question

    I will answer this as I am also angry at myself for staying out of the market and need to forgive myself.

    In the crash of 2008 I lost 25 percent of my life’s savings. I pulled out of the market completely before 25 percent became 40 percent roughly. I had an aggressive 401k portfolio and had done well but when the losses touched some of my “principle” I got out.

    Had I returned I might be better off (for sure I would be) and I imagine I would be at 160 percent or so of my 2007 portfolio plus any added contributions. Instead I am at 75 percent. I refused to go back in because I am furious with the lawbreaking, the theft of my savings and the outright arrogance of the politicians and financial leaders who rigged this broken game. I foolishly took my marbles and went home. I also have a PHOBIA of putting money in the market. You might as well ask me to jump off a cliff. Irrational but true. I accept this about myself and am working on other ways to save. Primarily by increasing my income.

    ~~~

    BR: There is no one who was angrier at the insane theft and wealth transfer than I (and wrote a book about it) — but that did not stop me from flipping bullish in March 2009. Investors have to learn to compartmentalize their anger at policy makers versus what the market is doing.

  13. juneau says:

    I cannot help but agree. I am attempting to correct my error now and appreciate your efforts to educate and assist folks like me. Phobic fear is by definition irrational, but is best dealt with by pushing through the fear. The losses are realized but hopefully more opportunities remain.