Salient to Investors: Tom Feeney at Mission Management & Trust Company writes: Global equity markets are responding first and foremost to central bank intervention, not traditional investment fundamentals. Clearly central bank stimulus has not worked so far – even a minority on the Fed argue it does not work –
READ MORE... →Salient to Investors: Jeffrey Fischer writes: Bernanke has been strategically testing the markets to gauge investors’ reactions to tapering – not the first time the Fed has given investors lip-service, and won’t be the last. Economic Indicators have improved. The Fed is not concerned much with a decline in equity
READ MORE... →Salient to Investors: Patrick J. O’Hare at Briefing.com writes: The stock market still has faith in the Fed as shown by the rebound in the face of higher interest rates, implying that the Fed will continue to help boost economic growth. The market’s obsession with monetary policy will continue. Expect Q2 GDP
READ MORE... →Salient to Investors: James Bullard at FRB St. Louis said the Fed should not taper until inflation accelerates toward its 2 percent target, and if inflation were to fall further it would have to rethink its strategy. Bullard says positive indicators include improving real-estate markets, rallying equity markets, a subdued European sovereign debt
READ MORE... →Salient to Investors: Christopher Sullivan at United Nations Federal Credit Union said Bernanke went out of his way to comfort and convince the markets that a reduction in QE is by no means to be regarded as a financial tightening, and that easing remains highly conditional. Fitch cut France’s credit ranking
READ MORE... →Salient to Investors: Marc Chandler at Brown Brothers Harriman said there is one big story and that is, of course, Bernanke, and given that his comments rattled the market a couple of times now in a short period of time, many traders will be loath to take significant positions ahead of his address
READ MORE... →Salient to Investors: Hank Smith at Haverford Trust said the story for stocks this year is about confidence replacing uncertainty and anxiety, a big driver for equity returns, and we are still far away from worrying about too much optimism or exuberance. Smith said the driver of equity returns from March
READ MORE... →Salient to Investors: JPMorgan Chase said REITs may have needed to sell about $30 billion of government-backed mortgage securities in just one week last month to maintain the amount of borrowing relative to their net worth. Bryan Whalen at TCW said REITs have been one of, if not the biggest contributors
READ MORE... →Salient to Investors: Money managers increased their net-long positions in gold and holdings of short contracts climbed to the second-highest on record. Jeffrey Sherman at DoubleLine Capital said people want to own gold for a myriad of reasons, but the lack of inflation and a strong dollar are gold headwinds
READ MORE... →Salient to Investors: Jan Loeys at JPMorgan Chase said: The worst first half of the year on record for corporate bonds may only deepen, as a whole set of new regulations means potential buyers do not have the same capacity to absorb credit risk. In the past the extra spread on corporates absorbed
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