Salient to Investors: Only 3 emerging-market stock pickers avoided losing money in half1 by making prescient currency bets and buying companies insulated from economic swings and government interference. They recommend Philippine retailers, Chinese Internet companies and Indian drugmakers. Lewis Kaufman Thornburg Developing World Fund said there are many going wrong. Kaufman is overweight
READ MORE... →Salient to Investors: Matt Dalton at Belle Haven Investments said: Demand for munis may rebound in July as investors deploy cash from principal and interest payments and this year’s outflows will push yields high enough. The muni market has been brutal, but will turn around in the next few weeks.
READ MORE... →Salient to Investors: William Pesek writes: The world believes that China’s leaders are masterful stewards of their economy, steering brilliantly around the 2008 financial crisis, with near-double-digit growth. But the Chinese economy is a giant and powerful creature born of unorthodox experiments, and its makers are increasingly losing control. Over the past decade, China’s
READ MORE... →Salient to Investors: 10-year Treasuries yield 2.61 percent versus the S&P 500 aggregate earnings yield of 6.4 percent – more than double the average spread of 1.9 points since 2000. Investors are avoiding longer-term Treasuries, concerned that returns will be depressed for years, and money managers foresee the end of a rally that
READ MORE... →Salient to Investors: Ethan Anderson at Rehmann Financial said investors have been shaken by the concept of rising interest rates, a reduction in Fed stimulus, and uncertainty about the Chinese central banking system. Goldman Sachs cut its 2013 forecast for China’s economy and said the cash squeeze is hurting growth. Vasu Menon
READ MORE... →Salient to Investors: Nouriel Roubini writes: Gold spikes in times of serious economic, financial and geopolitical risks, but that does not make it such a safe investment – cf sharp falls in gold prices during crisis periods of 2008 and 2009. Gold performs best in times of high inflationary risks
READ MORE... →Salient to Investors: Nouriel Roubini writes: Exiting too fast from QE will crash the real economy, while exiting too slowly will first create a huge bubble and then crash the financial system. If the exit cannot be navigated successfully, a dovish Fed is more likely to blow bubbles. Read the
READ MORE... →Salient to Investors: Fareed Zakaria said: Japan desperately needs real reforms that open up the economy and make it more friendly for business. The Economist says a Japanese company has to actually go out of business to be able fire any of its workers. Japan is 134th out of 144
READ MORE... →Salient to Investors: William D. Cohan writes: What caused the financial crisis remains unheeded and serious trouble is brewing. The debt markets have once again mispriced risk when junk bonds yield a mere 5 percent. Wall Street still suffers from inadequate risk management and improper incentives. Until these problems are
READ MORE... →Salient to Investors: Jim O’Neill writes: Emerging-market gloom is overdone. I disagree with the view that as the US recovers, the global cost of capital will rise, holding back investment, that avoiding the next crisis is the best that most emerging economies can do. India could teach the pessimists a lesson. India
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