Salient to Investors: The last two Fed tightening cycles saw gains in debt securities from Treasuries to junk bonds: between June 2004 and June 2006 when the Fed raised rates to 5.25 percent from 1 percent, and in the 7 months ended January 2000 when rates rose 1.75 percent. Paul Zemsky at Voya Investment
READ MORE... →Salient to Investors: The Russell 2000 VIX is up almost 11 percent in 2014 versus a 6.6 percent drop in the VIX and at its highest level since 2006 relative to the VIX. Russell Rhoads at CBOE’s Options Institute said the premium indicates we would get a bigger pullback in small-caps than large-caps in a market
READ MORE... →Salient to Investors: Jeremy Grantham at GMO advises: You don’t know how the important people in your life will behave under pressure. Local cultural differences can be very lasting. Even great ideas can fail. Investing is serious and should not be driven by excitement, as it is for many individual
READ MORE... →Salient to Investors: Chris Rupkey at Bank of Tokyo-Mitsubishi UFJ said we cannot keep getting payroll numbers like these and not admit that the labor market has healed. Rupkey said states with higher unemployment are seeing steep declines, and big-number declines equal big progress on putting America back to work.
READ MORE... →Salient to Investors: Jeremy Grantham said: The stock market is expensive and headed for a bubble at S&P 500 above 2250, and offers paltry returns for years to come. Expect an explosion of M&As to record numbers due to cheaper debt in this cycle, profit margins that will remain high, a still young
READ MORE... →Salient to Investors: Gary Shilling writes: Persistently slow growth will NOT be the norm for years to come. When private-sector deleveraging is completed, real GDP growth will return to its long-run trend of 3.5 percent or more. Productivity will return to 2.5 percent annual growth or more after deleveraging is
READ MORE... →Salient to Investors: Over 33% of a Bloomberg poll of international investors say the euro economy is in its worst shape in more than a year and in danger of dropping into deflation, and the ECB is not doing enough to help. Cyril Blaise at Banco Bilbao Vizcaya Argentaria said
READ MORE... →Salient to Investors: RealtyTrac said properties with a default, auction or repossession notice are at the lowest since July 2006, a month before prices peaked and then collapsed. Daren Blomquist at RealtyTrac said foreclosures are more like a troublesome gnat than a mortal threat to the housing market. Lawrence Yun
READ MORE... →Salient to Investors: Jay Morelock at FTN Financial said the ‘big recovery’ has turned out not to be, and expects a stabilization but not a crash or acceleration. Brad Hunter at Metrostudy said starts in the South may have been hurt by a shortage of buildable lots as development was
READ MORE... →Salient to Investors: Todd Lowenstein at Highmark Capital Mgmt said people are selling out of fear in a market that is really acute to geopolitical risk, given current valuations. John Canally at LPL Financial said markets have to determine if this is an escalation of the conflict. 60 percent of
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