10 Thursday AM Reads

Its the day after the FOMC meeting, and apparently, a new era is upon us:

• We Still Don’t Know What $1.6 Trillion Bought Us (fivethirtyeight) see also Do the Fed’s Forecasts Get Marked to Market? (Barron’s)
• Is the Strong Dollar Good for Stocks? (Barron’s)
•  How to Join 9,000 U.S. Taxpayers With Romney-Sized IRAs (Bloomberg)
• From Case to Shiller, a poem on the real-estate bubble (Real Time Economics)

Continues here


Category: Financial Press

The Fed and the Media

The Fed and the Media David R. Kotok September 18, 2014   We know the Fed meeting results; the coverage has been exhaustive. Note that the new “dots” analysis of the median dot now points to an expected 1.375% Fed Funds target rate by the end of 2015. (See Craig Torres’ report on the FOMC.)…Read More

Category: Federal Reserve, Financial Press, Think Tank

Supersized IRAs Under U.S. Scrutiny

About 9,000 U.S. taxpayers have each accumulated at least $5 million in individual retirement accounts, said the Government Accountability Office, raising questions about some investors’ tax-advantaged returns. Zimmerman Edelson Partner Robert Zimmerman and Bloomberg’s Peter Cook also discuss tax inversions on “Street Smart.”

Source: Bloomberg, Sept. 16 2014

Category: 401(k), Investing, Video

When and How To Exit Quantitative Easing?

Category: Federal Reserve, Think Tank

Wall Street Meddles With Restaurant Chain

Category: Food and Drink, Humor, Video

10 Wednesday PM Reads

My afternoon train reads: • Eight Lessons From Our First Year (The Reformed Broker) see also 7 Ways to Avoid Picking a Bad Advisor (Think Advisor) • Never let a politician or pundit give you investment advice (MarketWatch) • The Return of the Currency Wars (Real Time Economics) • How Often Do Stocks and Bonds Decline…Read More

Category: Financial Press

What Happens if the FOMC Gets Too Hawkish?

Source: Deutsche Bank Securities   Torsten Slok, chief international economist for Deutsche Bank AG, warns about the hawks on the Federal Open Market Committee getting too, well, hawkish. The flowchart above shows the different transmission mechanisms of monetary policy. Slok uses it to highlight the widening spread between investment-grade and high-yield junk bonds. If and…Read More

Category: Digital Media, Federal Reserve

California Teachers takes Harvard to School

For a long time, the fund managers at Yale’s endowment were the industry’s gold standard. Inevitably, as in so many things Ivy, this was noticed by rival Harvard. The so-called Yale Model, developed by David Swensen and his colleague Dean Takahashi, was rich with alternative investments, private equity, commodities and real estate and other items…Read More

Category: Asset Allocation, Investing, Really, really bad calls, Wages & Income

10 Wednesday AM Reads

Its FOMC day — perhaps the first one in a long time where the outcome is not preordained. Until 2pm, some reads to keep you informed and entertained: • A simple way to beat the market with stock splits (MarketWatch) • The Fed can takes its time, if it wants to (FT Alphaville) see also 5…Read More

Category: Financial Press

Business Cycle Index

Interesting trio of charts from Russell showing the Business Cycle Index (BCI).

The goal of the BCI is to forecast the strength of economic expansion or recession in the coming months, along with forecasts for other prominent economic measures. How well it does that is a subject of debate.

Inputs to the model include non-farm payroll, core inflation (without food and energy), the slope of the yield curve, and the yield spreads between Aaa and Baa corporate bonds and between commercial paper and Treasury bills. A different choice of financial and macroeconomic data would affect the resulting business cycle index and forecasts.




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Category: Cycles, Economy