Salient to Investors: Henry Paulson at the University of Chicago said Europe will drag on but eventually stabilize and avoid catastrophe. Europeans are committed to monetary union, but isn’t sustainable without some political union. Paulson said government policies is more to blame than banks because it encourages people to save too little and borrow too much. The root causes
READ MORE... →Predictions: RBS said it may take years before Europe finds a solution to the debt crisis as their economies struggle to implement reforms, though the euro will survive. RBS says any amount of recapitalization of banks, if the country itself is not on the right track, is a waste of time. Read the
READ MORE... →Salient to Investors: The U.S. economy may be on the cusp of a pickup in productivity that will make it more difficult for the Fed to reduce unemployment. Corporate profits rose 6.5 percent in Q1 from a year ago, the smallest year-to-year gain since the recession ended in mid-2009. Predictions: Ellen Zentner at Nomura securities
READ MORE... →Carl Pope says: Abundant, cheap fossil-fuel energy – that created the modern consumer economies of the U.S., Europe, Russia, Australia and Japan – is not viable in the 21st century due to cost. Coal is geologically more abundant than oil, but cheap coal, close to population centers, is not. Powder
READ MORE... →Salient to Investors: Bloomberg poll shows: 45 percent believe they are better off, 36 percent worse off, than at the beginning of 2009. 28 percent say their household income is higher than a year ago, 22 percent who said it is lower. 32 percent are hopeful about improvement in the economy, down
READ MORE... →Salient to Investors: Arizona building permits are close to a three-year high, creating a scarcity of framers, roofers and masons. Immigration laws add to the shortage by pushing experienced laborers out of the state. The construction jobs increase in May from a year ago was the biggest gain of any industry
READ MORE... →Salient to Investors: Moody’s raisewd Turkey’s credit rating to Ba1, one level below investment grade, on significant improvement in public finances and policies to cut the current-account deficit. Fitch Ratings ranks Turkey at BB+, one level below investment grade, Standard & Poor’s has a BB rating, two levels below investment grade. Moddy’s says Turkey’s diversification
READ MORE... →Salient to Investors: Goldman Sachs’ Jim O’Neill says a feeling of hopelessness abounds but history shows we will get out of it – there is always another future crisis we can look forward to. There is nothing like a crisis to force change. There are similarities with the Asian crisis
READ MORE... →Salient to Investors: Pimco’s Bill Gross said Spanish Bonds are unattractive. The global economy is delevering. Best to look at the entire core of the euro zone and not the falling dominos. Rates at the core are still too high – Italy and France yield is too high versus their nominal GDP growth. There
READ MORE... →Salient to Investors: Companies are delaying hiring and spending out of concern about ‘ fiscal cliff’ and economists are predicting this trend will pick up through the year. Predictions: Bank of America sees U.S. growth falling to 1.3 percent in Q3 and 1 percent in Q4. Sixty-one percent of 234 fund managers surveyed by Bank
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