Salient to Investors: Jay Schwister at Baird Advisors said Pimco underestimated how big the policy response would be and what type of positive impact it would have on financial markets, despite the new normal they forecast is playing out. Saumil Parikh at Pimco said policy distortions cannot continue indefinitely, so 2013
READ MORE... →Salient to Investors: Foreign investors poured a record $7.36 billion into Mexican debt securities in 2012 to take advantage of economic growth that is four times Brazil’s and yields that are still triple those for US Treasuries. Luis de la Cerda at Afore Sura said foreigners won’t leave the bonds and are here
READ MORE... →Salient to Investors: The median economist expects Australia’s government bonds to beat Treasuries for a third year in 2013 Robert Mead at Pimco said the new normal is finally catching up with the Australian economy – the RBA will keep Australian interest rates low. Mead strongly recommends Aussie bonds as an
READ MORE... →Salient to Investors: John Stephenson at First Asset Investment Mgmt said the Fed basically admitted that they don’t have what it takes to deal with the fiscal cliff, and it dimmed the idea that unlimited money printing will help commodities. Saumil Parikh at Pimco said global growth will slow to near stall speed in 2013
READ MORE... →Salient to Investors: Saumil Parikh at Pimco said: Global growth will slow to 1.3 percent to 1.8 percent from 2 percent in 2012 as the private sector isn’t healthy enough to step in and extend credit amid deleveraging. The average economist expects growth of 2.5 percent in 2013. Central banks are effective
READ MORE... →Salient to Investors: Tony Crescenzi at Pimco said Treasuries will remain in demand in 2013 because they provide good insurance against macro economic risks, and the Fed will keep rates low until 2015 or 2016. Crescenzi is avoiding or keeping a low weighting on maturities beyond 10 years because the Fed’s intent is to reflate a
READ MORE... →Salient to Investors: Bank of America Merrill Lynch’s MOVE index, which measures price swings based on options, fell to 55.6, the least since June 5, 2007. The yield gap between yields on 10-yr notes and 10-yr TIPS fell to 2.35 percent, the lowest in almost 10 weeks and versus the average 2.18 percent over the
READ MORE... →Salient to Investors: Saumil Parikh at Pimco said equities will return an annualized 4 percent to 5.1 percent over the coming 5 to 10 years verus their historical rate of almost 10 percent as the economy grows at a slower pace due to more retirees than workers and productivity decline due to less
READ MORE... →Salient to Investors: The Mexican peso has gone from the world’s strongest major currency to the weakest amid growing investor concern US demand will diminish. X-Trade Brokers Dom Maklerski expects another 3.9 percent depreciation by September and Bank of Nova Scotia recommends selling the peso. Futures traders are cutting bullish bets at
READ MORE... →Salient to Investors: Neel Kashkari at Pimco said stock-market volatility will increase by the end of the year as Congress delays reaching a resolution on extending spending and tax cuts until 2013. Kashkari sees brinkmanship like with the debt ceiling a year ago, and choppy markets up until the last second when a
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