Salient to Investors: Federal Reserve Governor Jeremy Stein says: Significant reaching-for-yield behavior in corporate credits are early signs of potentially excessive risk-taking, while not posing a threat to financial stability. A decline in the quality of debt through greater subordination or less use of protective covenants also signal reaching for yield. It
READ MORE... →Salient to Investors: Jim Rogers Says: The Age of Wall Street – which drove 25% of the US economy – is over. Tomorrow’s economy will be driven by food, energy, real goods, people who make real things. In 1958 we produced 500 MBAs, we now produce 200,000 every year. More
READ MORE... →Salient to Investors: Climbing home prices are lifting household wealth and boosting the purchasing power of consumers. Declining mortgage delinquencies and foreclosures are giving banks greater leeway to lend. Rising property-tax revenue is alleviating pressure on state and local governments to cut budgets. Mark Zandi at Moody’s Analytics said the housing
READ MORE... →Salient to Investors: First-time enrollment in graduate school has declined for 2 years in a row. Debra Stewart at the Council of Graduate Schools said undergraduates with debt are half as likely to pursue a graduate degree as those without. Mark Kantrowitz at finaid.org graduate students owe 30 percent of
READ MORE... →Salient to Investors: Treasuries are trailing stocks by the most since October 2011. Hiromasa Nakamura at Mizuho Asset Mgmt said the current rise in yields is due to Fed easing, while investors expect money to go into riskier assets, and equity markets are rising. Bill Gross at Pimco said unprecedented central
READ MORE... →Salient to Investors: These are boom times for farming and a bust for farm jobs. The Bureau of Labor Statistics said farmers, ranchers and other agricultural managers will see the steepest decline of any employment category by 2020. David Anderson at Texas A&M said one-quarter of farms have sales under $100,000 annually
READ MORE... →Salient to Investors: Ezra Klein writes: The most important piece of economic policy in 2013 is immigration reform. A tenth of the US population is foreign-born. Over 25% of US technology and engineering businesses started from 1995 to 2005 had a foreign-born owner, while half of all tech startups in Silicon Alley had
READ MORE... →Salient to Investors: A. Gary Shilling at A. Gary Shilling & Co writes: In periods of prolonged economic pain, international cooperation gives way to an every-nation-for-itself attitude, including competitive devaluations. Decreasing the value of a currency, by creating and selling unlimited quantities, is much easier than supporting it, by selling
READ MORE... →Salient to Investors: Handing monetary policy to independent central bankers appears to have worked. The Cleveland Fed says markets expect US inflation over the next 10 years to stay below 1.5 percent, while the IMF expects below 2 percent in advanced economies and 6 percent in emerging markets for the
READ MORE... →Salient to Investors: James Picerno writes: Steve Clemons and Richard Vague say the financial crisis and Great Recession were caused primarily by massive private debt. But saying debt is the main catalyst that routinely triggers recessions goes too far. The credit crunch of 1966 was not accompanied by an economic downturn. Gary Gorton
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