Salient to Investors: The Bank for International Settlements said government bonds losing their risk-free status are depriving investors of wealth-preservation opportunities while Europe’s debt crisis boosts demand for havens. The global pool of safer assets has shrunk just as demand has risen due to a flight to safety, leading to a
READ MORE... →Salient to Investors: George Soros said: A failure to produce drastic measures could spell the demise of the Euro. Europe should create a European Fiscal Authority to purchase sovereign debt in return for Italy and Spain implementing achievable budget cuts – funding to come from the sale of European Treasuries, which would
READ MORE... →Salient to Investors: Every measure of risk in the credit markets shows the banks enjoy greater confidence among investors now than before Moody’s downgrades. Richard Bove at Rochdale Securities says Moody’s downgrading the debt of companies that investors want to buy is the most obscene act he’s ever seen by a major institution. Money managers
READ MORE... →Salient to Investors: Ian Lyngen at CRT Capital Group said we are back in a risk-off mode until there is a reason not to be, and the market is stepping back from any meaningful expectation for anything from the summit. Benchmark notes are trading at almost the most expensive level ever. Treasuries beat
READ MORE... →Salient to Investors: George Soros warned that a failure by EU leaders to produce drastic measures could spell the demise of the Euro and that policy makers should create a European Fiscal Authority to purchase sovereign debt in return for Italy and Spain implementing achievable budget cuts Soros said Angela Merkel
READ MORE... →Salient to Investors: Europe’s debt crisis is pressuring global earnings. Analysts predict S&P 500 companies will report a 1.1 percent average drop in Q2 earnings, the first decline in 11 quarters and after a 6.2 percent average increase in Q1. A stronger dollar threatens earnings as U.S. exports become more expensive. Predictions: Tim Ghriskey at Solaris Group doesn’t expect
READ MORE... →Salient to Investors: Hedge funds et al raised net-long positions across 18 U.S. futures and options last week, the highest in four weeks and the first consecutive gain since the end of February. Commodities slumped into a bear market June 21. Jeffrey Sherman at DoubleLine Capital expects volatility in commodities as people
READ MORE... →Salient to Investors: The MSCI World Energy Index is down 9.6 percent in 2012, more than any other group, and is up 45 percent since the market bottom in 2009, less than any other industry with earnings tied to economic growth. U.S. energy stocks are at the cheapest levels relative to the
READ MORE... →Salient to Investors: Boston College Center for Retirement Research said pensions in Illinois, New Jersey, Indiana and Kentucky may have less than 30 percent of assets needed for promised benefits Pension fund shortfalls are estimated to be $900 billion to more than $4 trillion, depending on assumptions made. Andrew Biggs at the American Enterprise Institute said
READ MORE... →Salient to Investors: George Soros called on Europe to buy Italian and Spanish bonds, warning a failure by leaders meeting on June 28 to produce drastic measures could spell the end of the euro. Wayne Lin at Legg Mason says the EU summit won’t produce anything extraordinary, that Soros’ views are extreme, and expects more volatility.
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