Ben Stein says: The US is borrowing 40 cents for every dollar it spends, a terrible situation. The government has been living beyond its means for years, is spending too much money and heading for default – a real doomsday scenario. The US will have a $20 trillion deficit within 36
READ MORE... →Salient to Investors: David Kostin at Goldman Sachs said volatility – the drawdown risk – will deter investors from moving into stocks from bonds in 2013 even as dividend returns exceed fixed-income yields. Kostin said most investors will sell US government bonds if losses push the 10-yr Treasury yield to 3 percent from 1.85
READ MORE... →Salient to Investors: Sydney is the most unaffordable housing market in the English-speaking world. Demographia report Australian homes cost 6.7 times the gross annual median household income in Q3 2011 versus 3.1 times in the US and 5 times in the UK. Apartment ownership is rising as more are being buyers priced out of the
READ MORE... →Salient to Investors: Morgan Stanley said leverage among equity managers climbed to the highest level to start any year since at least 2004. Margin debt at NYSE firms rose in November to the highest since February 2008. James Dunigan at PNC Wealth Mgmt said leverage is increasing among hedge-funds. Gross leverage at hedge
READ MORE... →Salient to Investors: Hedge funds et al trimmed net-long positions to the lowest since June 19, and gold holdings fell to the lowest since August. The S&P GSCI index of 24 raw materials has climbed for 5 consecutive weeks. Quincy Krosby at Prudential Financial said data out of China and the US shows we are
READ MORE... →Salient to Investors: Coalition Ltd say investment banks are cutting jobs in equities faster than any other division. Tabb Group says trades that require human involvement cost 2.05 cents per share versus 1.08 cent for those done by computer. Mike Di Iorio at Barclays Capital says the way the business has been run will
READ MORE... →Salient to Investors: James Paulsen at Wells Capital Mgmt said Apple is the story for the market and proxy for other companies and industries. James Cordwell at Atlantic Equities Service said IPhone sales are slowing because smartphones have saturated developed markets. Almost 80 percent of the 28 S&P 500 companies so far
READ MORE... →Salient to Investors: Charles Plosser at FRB of Philadelphia said: The latest stimulus steps do little to boost growth and the record stimulus risks a surge in inflation, and may not speed up the economy but actually prolong it. Low interest rates reduce returns for savers and do little to encourage businesses to
READ MORE... →Salient to Investors: Australian study finds China’s one-child policy has produced adults that with personality traits unsuited for starting businesses or managing companies. Those born after the 1979 one-child policy were more pessimistic, nervous, less conscientious, less competitive, more risk averse, and 23 percent less prone to choose an occupation with
READ MORE... →Salient to Investors: Goldman Sachs expects hedge funds to return an average of 4 percent to 5 percent over the next 5 years amid low interest rates. Hedge funds trailed global stocks in 2012 for the fifth time in 7 years: a 6.7 percent gain versus 17 percent for the MSCI All-Country
READ MORE... →