Salient to Investors: The Fed’s structure has its origins in efforts to find a balance of power between politicians in Washington, representing farmers and small businesses, and Wall Street financiers. Professor Allan Meltzer said the Fed’s image problem has been there for 100 years – Congress reduced the role bankers play on
READ MORE... →Salient to Investors: Congress is nowhere near an agreement on what to do about $607 billion of tax increases and spending cuts slated to kick in at the beginning of 2013. CBO says if Congress does nothing the economy will probably fall into a recession in early 2013. The Tax Policy
READ MORE... →Salient to Investors: American exporters are preparing for a further decline in demand from Europe. U.S. exports to the European Union dropped 4.8 percent in the year ended April, the worst 12-month performance since November 2009. Predictions: Bank of America expect weaker exports over the long-term, and the trade deficit to widen to
READ MORE... →Salient to Investors: Brian Jones at Societe Generale said growth is not fast enough to bring the unemployment rate down or generate an appreciable number of jobs, yet it’s not weak enough that we’re going back into recession. Read the full article at http://www.bloomberg.com/news/2012-06-15/industrial-production-in-u-s-unexpectedly-dropped-in-may.html
READ MORE... →Salient to Investors: The plunge in global commodity supports further easing by the Fed. RBC Global Asset Management expects inflation will decelerate a little from here, but not massively. OECD reports inflation among its 34 member countries slowed to 2.5 percent in April from 3.3 percent in September. Predictions: Economists surveyed by Bloomberg
READ MORE... →The Census Bureau reports that 50 million people don’t have health coverage in the U.S., 16 percent of the population, versus 36.6 million, or 13 percent, in 2000. People covered at work declined to 55.3 percent from 65.1 percent in 2000. Intrade traders see a 68 percent chance the Supreme court will strike down
READ MORE... →Predictions: Pimco’s Neel Kashkari said the Fed will start QE3 due to worsening unemployment, lower equity prices and risk of shocks from Europe. Europe take years to solve as Greece exits from the euro region, though not necessarily after the country’s elections. BlackRock’s Robert Doll said the Fed will need to see significantly
READ MORE... →Predictions: Goldman Sachs lowered Q2 growth estimates to 1.6 percent from 1.8 percent, Morgan Stanley to 1.8 percent from 2 percent, Credit Suisse to 2.2 percent from 2.5 percent. JP Morgan’s expects more Fed action because Bernanke is far from achieving his economic mandate. Median forecast of 70 economists expects the economy to expand at
READ MORE... →Rising truck shipments show economic expansion is intact. The for-hire truck-tonnage index shows 29 months of growth – the economy has never contracted without tonnage turning negative first. The FTR’s index of U.S. truck loadings increase in April from a year earlier, the highest since 2008, shows the economy is expanding. Read the
READ MORE... →Salient to Investors: Home equity in the first quarter rose to the highest level since 2008 as homeowners refinance to pay down principal. Half the mortgages refinanced in the fourth quarter reduced loan size, a record.Predictions: About 23 percent of mortgage holders are underwater on their loans. Predictions: Median forecast
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