ACTIONABLE ADVICE FOR FINANCIAL ADVISORS: Newsletters and Commentaries Focused on Investment Strategy

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2014-04-18 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

In a currency war, everyone loses. Should monetary policy be coordinated across countries? The International Monetary Fund is at a crossroads.

2014-04-17 A Bend in the Road is Not the End of the Road by Scott Minerd of Guggenheim Partners

Turmoil in Ukraine, growth concerns in Japan, and weakness in U.S. equity markets are giving U.S. investors a short-term case of heartburn but none of this should undermine the overall case for optimism.

2014-04-17 Investors Ignore Frightful Geopolitics by John Browne of Euro Pacific Capital

When the former Soviet Union collapsed almost 25 years ago, most global strategic forecasters assumed that the U.S. would adapt pragmatically to her new status of sole world superpower. Instead she has pursued a variety of misguided nation-building adventures and has largely shrunk from her primary responsibility of neutralizing the ambitions of petty dictators around the world. From this perspective, America's multi-generational expenditures on military personnel and equipment has become more of a stealth economic stimulus program rather than an insurance policy for global stability.

2014-04-17 Hasenstab in Ukraine, on Ukraine by Michael Hasenstab of Franklin Templeton

Ukraine is a country both rich with potential and strategically well positioned. While recent events have been very difficult for many, the people of Ukraine have shown their strength. It’s also been heartening to see the proactive support from the international community. Michael Hasenstab, chief investment officer, Global Bonds, Franklin Templeton Fixed Income Group®, shares his view on the long-term potential of this unique country after a recent visit to Kiev.

2014-04-17 Equity Outlook by Team of Osterweis Capital Management

Short term, we would not be surprised if the market took a breather after its strong gains last year. Additionally we may see volatility related to news coming out of the Middle East and Russia. But longer term, we remain very optimistic on the outlook for U.S. equities. In addition to the reasons we discussed above we believe U.S. equities are very attractive relative to the alternatives. The great bull market in bonds appears to be over. The great decades of emerging market growth appear to be behind us.

2014-04-17 Why Energy is Catching the Market\'s Eye by Frank Holmes of U.S. Global Investors

Over the last month the energy sector has outperformed the market, and as you can see in the chart below, has done so by 6.5 percent. Year-to-date the sector is beating the S&P 500 Index by over 3 percent. In a spectacularly performing market during 2013, energy lacked some of the incredible performance seen throughout the other sectors, but recently it has turned up, catching the attention of the market yet again.

2014-04-17 U.S. Financials: Investment Theme Update by James Calhoun of AdvisorShares

We reaffirm our recommendation for U.S. Banking and Financial Services as a satellite equity investment. The Federal Reserve’s "Stress Test" reinforces a constructive outlook and conservative risk profile for U.S. Banks. The positive results confirm that U.S. banks have enhanced their ability to withstand macroeconomic challenges by reducing problem assets during the past few years. Equally important, the financial sector appears to be more exposed to a key driver of the broader equity market advance over the last few years: share buyback programs and increasing dividends.

2014-04-17 Ukrainian Crisis: Should Investors Avoid the Russian Stock Market? by Philip Lawton and Noah Beck of Research Affiliates

This is neither to treat the profoundly worrisome crisis in Eastern Europe cavalierly nor to advocate profiting, however indirectly, from the distress of Ukraine, a sovereign nation whose people have suffered horribly over the last three-quarters of a century. It is merely to caution international investors that, from a strictly financial perspective, withdrawing assets from Russia might not be the right move.

2014-04-17 Three Yards and a Cloud of Dust by Sam Stewart of Wasatch Funds

Former Ohio State football coach Woody Hayes was well-known for his conservative offense-often quoted as saying, "There are only three things that can happen when you pass, and two of them are bad." The two bad outcomes are either an incompletion or an interception. Instead, Hayes favored a methodical, grind-it-out approach, running the ball directly into the line: "three yards and a cloud of dust." What Hayes’ style of play may have lacked in pizazz, it more than made up for in results. The U.S. economy today is following a similar offensive playbook, but with less satisfying results.

2014-04-16 The Wile E. Coyote Stock Market? by Jeffrey Saut of Raymond James

Last Wednesday, when the D-J Industrials were up some 180 points, I could not shake the feeling that this was the “Wile E. Coyote stock market.” The visual is when Wile runs off a cliff, but his feet keep moving, until he looks down and realizes there is nothing underneath him. The resulting fall was similar to what happened late last week to the equity markets. Indeed, I really did not understand, or trust, last Wednesday’s Dow Wow for the reasons mentioned in these missives.

2014-04-16 A Classic Barometer by Richard Bernstein of Richard Bernstein Advisors

Investors seem a bit too eager to tout emerging market equities. Much as they did with technology stocks during the early-2000s, investors today are looking for the best re-entry point. Data clearly do not support anymore the notion that emerging markets are a superior growth story, yet investors seem to be ignoring the classic warnings signs for fear of missing out. One such classic warning sign is the slope of the yield curve. Historically, steeper yield curves have been reliable forecasters of stronger overall nominal economic growth and stronger profits growth.

2014-04-16 Echo-Mania at The Fed by Cliff Draughn of Excelsia Investment Advisors

Greetings from a thawed out Savannah! Q1 of 2014 will be remembered for a number of things, but the most prominent were the erratic weather patterns and arctic-blast temperatures that most of the country experienced. I missed writing my Q1 letter for the first time in ten years due to a nasty bout with pneumonia in mid-January. For those of you who have never had pneumonia, I do not recommend it!

2014-04-16 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

And what a bad week it was. After flirting (and setting) new record highs on both the S&P and Dow, equity investors worried about the upcoming earnings reports and freaked out over the some disturbing news from China. Stocks plunged late in the week with the Nasdaq particularly hard hit, though the other indexes followed suit and gave up all of their prior gains for the year. For the most part, domestic developments remain strong but news on the global front have prompted investors to seek out the safe-haven of treasuries. Over-reaction or new trend?

2014-04-16 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks fell last week upset by the growth sectors of biotechnology and social media stocks. Energy issues and related infrastructure were largely unaffected. It is clear that hedge funds and others have become forced sellers as their macro bets on being long growth areas, but being short the bond market have blown up in their faces. Until this settles down the overall market is likely to continue its correction.

2014-04-15 Equity Market Insight by Thomas Faust, Jr. of Eaton Vance

After a powerful rally in 2013, the first quarter of 2014 saw the bull market demonstrate a measure of resilience in the face of several headwinds. In the latter half of January, stocks fell sharply on emerging-market concerns, with volatility spiking to more "normal" post-financial crisis levels. The market bounced back strongly in February and went on to record a new all-time closing high on March 7. Performance was choppy in the final few weeks of the quarter, as investors digested mixed economic reports, geopolitical issues and the latest U.S. Federal Reserve (Fed) meeting.

2014-04-15 Complacency Makes Volatility Markets a Dangerous Place by Chris Maxey, Ryan Davis of Fortigent

With a dissipation of economic stress in Europe, and a general strengthening of economic conditions in the U.S., equity market volatility has plunged to new lows. Some would argue that market intervention by central banks is acting as an unnatural dampener to market volatility, raising the question as to whether a gradual removal of those policies will cause volatility to resurface. So far, the answer is up for debate, but current positioning suggests many investors are becoming complacent and will be caught off sides if such a scenario emerges.

2014-04-15 What\'s Next for Emerging Markets? by Nathan Rowader of Forward Management

Emerging markets (EM) have been an enduring growth story, but their recent stretch of underperformance and fears of a global economic slowdown are chilling investors’ enthusiasm. Pulled between opportunity and risk avoidance, many investors have been left uncertain as to what they should do next.

2014-04-15 2016 (Part 2, The Political Situation) by Bill O'Grady of Confluence Investment Management

As we survey the political landscape for 2016, the next presidential election could be historic. In this report, we will examine the domestic political situation using four different archetypes to describe the U.S. political landscape. We will then offer a history of the interaction between these groups and address the likelihood of various policy outcomes based on the relative strengths and weaknesses of the four political groups. Unlike our usual reports, we will not conclude with market ramifications but instead discuss the transition to Part 3 of this analysis.

2014-04-14 We’re Shuffling the Cards on Our European Play by Frank Holmes of U.S. Global Investors

Did you know that over the last year the Greek stock market is up roughly 45 percent? The country that many believed would never recover from a six-year recession is now making astounding strides, recently being added to the MSCI Emerging Markets Index at the end of 2013.

2014-04-14 Uncovering Opportunities in Emerging Markets by Mark Kiesel of PIMCO

Emerging markets have underperformed expectations, but the longer-term secular outlook remains constructive for many regions. Highly negative investor sentiment and outflows have sharply reduced prices, significantly improving relative value in emerging markets. We see opportunities in emerging markets in interest rates, sovereign credit and select companies for investors with a longer-term investment horizon. ?

2014-04-12 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The Federal Reserve’s search for stability. The patterns of world trade are undergoing important changes. Greece issued debt this week: good news or bad news?

2014-04-12 Proper Perspective by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

Getting caught up in the weeds is easy in this 24-hour news cycle where everyone is looking to make a splash, but successful investing requires staying above the fray. The U.S. economy is growing and equities appear fairly valued, Europe has issues to deal with but has come a long way from the depths, Japan may be working against itself but improvement has been seen, and the threat of a Chinese debacle at this point seems minimal.

2014-04-12 Every Central Bank for Itself by John Mauldin of Millennium Wave Advisors

Whether the FOMC can actually turn the taper into a true exit strategy ultimately depends on how much longer households and businesses must deleverage and how sharply our old-age dependency ratio rises, but markets seem to believe this is the beginning of the end. For now, that’s what matters most. Under Fed Chair Janet Yellen’s leadership, the Fed continues to send a clear message to the rest of the world: Now it really is every central bank for itself.

2014-04-11 Bubble Bursting? Only for Biotech & Internet Stocks by Russ Koesterich of iShares Blog

The recent sluggish performance of U.S. stocks is leading some market watchers to question whether we’re witnessing the bursting of an equity bubble. Russ explains that while U.S. equities overall are not in a bubble, valuations have started to become an issue, particularly for certain segments of the market.

2014-04-11 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Co.

Most of the economic and market trends we’ve been discussing for the past few years remain in place. Russia’s action in the Ukraine / Crimea may have long-term implications, particularly for Europe, but the near-term economic implications are modest. It remains to be seen whether this gets added to our long-term worry list or not.

2014-04-10 The Russians Are Coming by Jeffrey Saut of Raymond James

The Russians Are Coming, The Russians Are Coming is a 1966 American comedy film directed by Norman Jewison and based on Nathaniel Benchley’s book The Off-Islanders. The movie tells the Cold War story of the comedic chaos that happens when a Soviet submarine runs aground closely offshore a small island town near New England and the crew is forced to come ashore. Last Friday, however, rumors that the “Russians are coming” swirled down the canyons of Wall Street, causing a late Friday Fade that left the S&P 500 (SPX/1865.09) down an eye-popping 24 points.

2014-04-10 "I Will Gladly Pay You Tuesday for a Hamburger Today" by Robert Mark of Castle Investment Management

In October of 2013, Robert Shiller won the Nobel Prize in economics for his research on spotting market bubbles. Shiller, an economist and professor at Yale University who accurately predicted the housing bubble, is a pioneer of behavioral finance, or the understanding of how psychology causes us to act irrationally with our money.

2014-04-10 Assuage Your Fears of Rising Rates with Global Diversification by Julie Salsbery of PIMCO

?Although PIMCO believes interest rates are fairly anchored in the near term, we think investors can position their fixed income portfolios more defensively. Global diversification across developed and emerging markets can offer a defense against rising U.S. rates by reducing the concentration of risks within a portfolio, while also potentially lowering volatility and enhancing returns.

2014-04-10 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

One quarter down; three to go. After a rough January, stocks rebounded to complete a solid quarter with the Dow Jones the lone main index still "in the red." The new week found decent numbers from manufacturing and labor and investors moved past the "bad weather" excuse, though still took profits from high-flying bio-techs and internet stocks. The late-week selling hindered the overall equity performance.

2014-04-09 Whatever It Takes 2.0? by Axel Merk of Merk Investments

If you are convincingly irrational the market may expect extreme measures and front run your bluff. It’s in this spirit that ECB President Draghi is threatening the market with another bazooka. We discuss implications for investors.

2014-04-09 Russia and the Baltics by Bill O'Grady of Confluence Investment Management

The Ukrainian crisis and the Crimean annexation have been closely watched by the Baltic countries (Estonia, Latvia and Lithuania). For many, the recent developments are bringing recollections of the start of the Soviet Union. In this week’s report, we will explore the geopolitical atmosphere in the Baltic states after the Russian annexation of the Crimea, focusing on Estonia. We will start with a brief history of the relations between Russia and its Baltic neighbors. We will then take a look at what the local press is reporting, the reports coming out of Russia and the word on the street.

2014-04-09 Reasons To Remain Optimistic In 2014 by Sandra Martin of Martin Investment Management

The equity markets have taken a respite in 2014 after returning more than 32% in 2013. Margin expansion has been the largest influence on profit growth and should continue with present low inflation expectations. We believe that mergers and share buybacks may continue to increase shareholder value for large capitalization stocks.

2014-04-08 On Cruise Control by Richard Michaud of New Frontier Advisors

The first quarter was a relatively calm start to the year. The Dow was down 0.7%, the S&P up 1.3%, and the NASDAQ up 0.5%. International equities were nearly flat as well with the MSCI ACWI ex US down 0.1%. European equities were up 1.5% and Pacific equities were moderately negative, with the MSCI Pacific down 3.3% for the quarter. Emerging market equity indices were down 0.8% for the quarter, with China down 6.7%.

2014-04-08 Avoiding Losers Is as Important as Picking Winners in High Yield Markets Today by Andrew Jessop, Hozef Arif of PIMCO

Although high yield bonds span a broad range of sectors, industries and individual credits, their yields today tend to fall within an increasingly narrow range. Narrow dispersion means portfolio decisions that target outperformance should now be guided by avoiding deteriorating credits as much as by selecting the most attractive rising stars. Strategies for picking the rising stars can extend to CCC rated credits where agency ratings lag the improvement in the underlying credit profile.

2014-04-08 Moving Forward With the Normalization of Yields by Scott Mather, Michael Story of PIMCO

One response to yield normalization is to consider retaining core bonds and diversifying the specific risk factor of concern, in this case duration. In the past, global bonds have captured most of the upside but avoided a significant amount of the downside relative to domestic-only bonds. Generating capital gains from bonds in a rising yield environment requires defining concretely what yield normalization means – where yields are going and when they will get there – and setting these expectations against forward market pricing, country by country.

2014-04-08 A Surplus of Controversy by Kenneth Rogoff of Project Syndicate

When the US Treasury recently added its voice to critics of Germany’s chronic trade surplus, it underscored the deep disagreement over what, if anything, should be done about it. It is a highly contentious debate, often informed more by ideology than facts.

2014-04-08 Cementing Europe’s Recovery by Mohamed El-Erian of Project Syndicate

Europe’s renewed sense of hope and confidence, however encouraging, is not yet sufficient to produce appreciable gains for current and future generations. A few things need to happen over the next several weeks and months if Europe is to minimize the risk of another prolonged period of under-performance and financial risk.

2014-04-05 The Lions in the Grass, Revisited by John Mauldin of Millennium Wave Advisors

Today we explore a few things we can see and then try to foresee a few things that are not quite so obvious. The simple premise is that it is not the lions we can see lounging in plain view that are the most insidious threat, but rather that in trying to avoid those we may stumble upon lions hidden in the grass.

2014-04-04 Meet "Lowflation": Deflation's Scary Pal by Peter Schiff of Euro Pacific Capital

In recent years a good part of the monetary debate has become a simple war of words, with much of the conflict focused on the definition for the word "inflation." The latest front in this campaign came this week when Bloomberg News unveiled a brand new word: "lowflation" which it defines as a situation where prices are rising, but not fast enough to offer the economic benefits that are apparently delivered by higher inflation. Although the article was printed on April Fool's Day, sadly I do not believe it was meant as a joke.

2014-04-04 What\'s Abuzz About Gold? by Frank Holmes of U.S. Global Investors

If we continue to see these large movements of the physical metal, especially from the West to the East, it would appear to be only a matter of time until these supply-and-demand factors lift the gold price.

2014-04-04 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

For the European Central Bank, actions will speak louder than words. US hiring is back on track. The debate over unemployment and wage pressure.

2014-04-03 Q2 fixed income outlook — Hitting for the cycle by Gene Tannuzzo of Columbia Management

By the middle of this year, the economic expansion in the U.S. will officially turn five years old. By comparison, the average of all business cycle expansions tracked by the National Bureau of Economic Research dating back to the mid-1800s is about three and half years. But like many five year olds, this cycle hardly seems mature. In particular, we have taken notice of three key elements of the business cycle that have distinct implications for bond investing today.

2014-04-03 VIX Exchange Traded Products...Growth and Risk Impact by Daniel Kirsch of Macro Risk Advisors

The growth of ETFs has been nothing short of tremendous. What started as a product designed to provide investors with broad equity or sector exposure in the US, the ETF landscape now includes a myriad of geographies (Europe, Asia) and asset classes (FX, rates, credit, commodities). Research consultancy firm EFTGI estimates that there are almost 5,000 ETFs globally with total AUM in excess of $2 trillion.

2014-04-03 And That\'s The Quarter That Was by Ron Brounes of Brounes & Associates

After a nightmare than was January, the quarter actually turned out pretty well (except in the Ukraine).

2014-04-02 Gain International Exposure with Small-Caps by David Nadel of The Royce Funds

Portfolio Manager and Director of International Research David Nadel discusses our attraction to international small-caps, how our investment approach translates into the international small-cap universe, how we try to avoid value traps, the effect monetary policy has had on our approach and performance, and more.

2014-04-02 A Fixer-Upper? by Team of GaveKal Capital

As noted yesterday, March was not an exceptionally positive month for European equities.

2014-04-02 4 Areas Revved Up for a Resources Boom by Brian Hicks of U.S. Global Investors

Commodity returns vary wildly, as experienced resource investors can attest and our popular periodic table illustrates. This inherent volatility can spell opportunity for the nimble investor who can look past the mainstream headlines to identify hot spots. Our global resources expert, Brian Hicks, CFA, identified four we believe are revved up for a resources boom.

2014-04-01 Equities Sag as Macro Backdrop Quiets Down by Robert Doll of Nuveen Asset Management

Last week U.S. equities struggled for direction as the S&P 500 declined 0.4%. Small cap stocks were hit harder, and macro and geopolitical issues seemed to be on the back burner. Overall, emerging markets rallied, value and contrarian plays outperformed and Japanese stocks bounced.

2014-03-31 European Rally Has Legs by Nick Kalivas of Invesco Blog

Since hitting a low on June 1, 2012, the MSCI Europe Index has rallied 64.73%. In our view, there’s room for European equity markets to advance further, supported by strong fundamentals, positive flows and a steady uptrend from the June 2012 low.

2014-03-31 Labor Market Clues for Bond Investors by Christopher Molumphy of Franklin Templeton

When the US Federal Reserve (Fed) began tapering early this year, the general assumption was that investors would flee en masse from fixed income investments. Certainly, there has been some volatility in Treasury yields, most recently after Fed Chair Janet Yellen suggested interest rates could start to rise around six months after tapering ends – which would be somewhat sooner than many were expecting.

2014-03-31 Shifting Policy at the Fed: Good for Long-Term Growth, Bad for Cyclical Bubbles by John Hussman of Hussman Funds

The Fed is wisely and palpably moving away from the idea that more QE is automatically better for the economy, and has started to correctly question the effectiveness of QE, as well as its potential to worsen economic risks rather than remove them.

2014-03-31 March Was A Tough Month for MSCI Europe by Team of GaveKal Capital

The only sector in MSCI Europe with positive performance for the month of March is Utilities, while Health Care stocks took quite a beating.

2014-03-29 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Using energy as a pawn may work to Russia’s disadvantage in the long run. China’s 2014 economic outlook is hazy. Lessons from the 2014 stress test.

2014-03-29 When Inequality Isn\'t by John Mauldin of Millennium Wave Advisors

We’ve discovered so far that income inequality is a fact; however, income mobility has remained roughly the same over the last 40 years. That is, a person’s chances of rising from a lower stratum of wealth distribution to a higher stratum is approximately the same as it was in 1975.

2014-03-28 “Mind the Gap”: Adapting to a Post-Crisis World in Transition by Virginie Maisonneuve of PIMCO

??Barring any sharp deterioration in global geopolitical risk, the medium term outlook for equities is quite positive in an environment where we see subdued growth and inflation amid healing economies. From a markets standpoint, valuations are not very expensive – they’re not cheap, but they’re not expensive versus historical standards for the market overall.

2014-03-28 What Investors Should Know About Fed Forward Guidance by Zach Pandl of Columbia Management

Last week, at Janet Yellen’s first meeting as Fed Chair, the FOMC revised its forward guidance for the funds rate, dropping its reference to 6.5% unemployment and instead stressing the committee’s qualitative assessment of the economy. The change was a symbolically important step, but did not alter the broader outlook for policy rates, in our view.

2014-03-28 Why International Now? by David Garff of AdvisorShares

One of the ongoing challenges that advisors face is determining what percentage of their clients assets should be allocated to international equities. The magnitude of this decision is often amplified when the United States has years of persistent out/under performance. US clients will inherently gauge the success of their portfolio based on the S&P 500, or similar index. The challenge for advisors is explaining why a more diversified exposure to global equities is meaningful in the long-run, despite recent years of outlandish performance.

2014-03-28 Lacking Conviction by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Investors seem to lack conviction, what will potentially push them to one side or the other.

2014-03-28 Four Areas Revved Up for a Resources Boom by Frank Holmes of U.S. Global Investors

Commodity returns vary wildly, as experienced resource investors can attest and our popular periodic table illustrates. This inherent volatility can spell opportunity for the nimble investor who can look past the mainstream headlines to identify hot spots. Our global resources expert, Brian Hicks, CFA, identified four we believe are revved up for a resources boom.

2014-03-27 A Sustainable Recovery?? by Mike Amey of PIMCO

Early signs indicate that the long awaited increase in business investment is underway. In turn, that bodes well for real income growth and the sustainability of the economic recovery. Given the improved economic prospects and the change in rhetoric at the Bank of England, the central bank could well be an early adopter of tighter monetary policy. We expect the BoE to hike rates ahead of the US Federal Reserve. While we beli?eve the British pound has already reflected the BoE’s guidance for official rates to rise by mid-2015, the bond market has yet to fully reflect the new environment. ?

2014-03-26 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

Well, apparently Janet Yellen has her own style, her own personality, her own mixed message. Just as Fed watchers had to get used to Bernanke in the aftermath of maestro Greenspan (does that name still apply after the financial crisis?), investors will need a few meeting to figure out the new Fed Chair. An early rebound was followed by a selloff which was followed by a rebound which was followed by a late-week selloff. Nicely done, Ms. Yellen (though Russia played a role as well).

2014-03-26 Understanding Gold Cost of Carry in Various Currencies by Ade Odunsi of AdvisorShares

Under normal market conditions, the term structure for the price of gold for delivery at increasing maturities (the term structure) exhibits an upward sloping curve. In futures market terminology the term structure is said to be in contango and implies that the price of gold for spot delivery is lower than the price of gold for future delivery.

2014-03-26 Europe is a Land of Opportunity in 2014 by Kevin Mahn of Hennion & Walsh

While we are forecasting a high, single-digit gain for the S&P 500 index over the course of 2014 at this time, we do still contend that U.S. stock market returns will likely be outpaced in 2014 by certain International – Developed Country stock market returns (notably Europe) as regions such as the Eurozone continue to emerge from their own recession.

2014-03-26 Unleashing Africa’s Potential by Michael Hasenstab of Franklin Templeton

Many investors who have never traveled in Africa probably have preconceived ideas about it, perhaps as a land of safaris and political strife, rich in coveted natural resources that have failed to bring widespread wealth and development to the continent. Many also might not realize how diverse the landscape, the economies and the people are on the continent, which boasts more than 1,000 languages spoken in more than 50 countries and climates ranging from hot deserts and tropical rainforests to frozen glaciers.

2014-03-25 Will Putin Stop with the Crimea? by Bill O'Grady of Confluence Investment Management

Now that the Crimean referendum has passed in favor of annexation, what will Putin do next? In other words, will he stop with the Crimea? In this report, we will look at the post-Cold War situation from Putin’s perspective. From this viewpoint, we will examine Putin’s likely next steps and how this will affect the U.S. and the rest of the developed world. As always, we will conclude with market ramifications.

2014-03-25 Int'l Mega Banks Still Ticking Time Bombs by Steve Rumsey of Optimus Advisory Group

During the past five years, following the worst financial crisis since The Great Depression, the financial media has been talking about the deleveraging process happening worldwide. We've all heard the stories of how banks to consumers to corporations have deleveraged and continue to do so. It's as if all the global financial bailouts were all orchestrated just to buy us enough time so that we could get our financial houses in order. Then, miraculously, after someone blows the "all clear" alarm we can all go back to living our normal lives once again.

2014-03-25 Higher Rates on the Horizon? Three Implications by Russ Koesterich of iShares Blog

Investors were temporarily taken aback last week by the prospect of an earlier-than-expected rate hike. While it’s not yet clear yet whether the market interpreted the Fed correctly, Russ explains that the possibility of higher rates has three implications for investors.

2014-03-24 Michael Cirami on Ukraine: It May Just Be Spring Training for Putin’s Hardball Tactics by Michael Cirami of Eaton Vance

Earlier this month, Michael Cirami, co-director of Eaton Vance’s Global Income Group, offered his views on the immediate crisis surrounding the seizure of Crimea by Russian and pro-Russian troops, having been in Kiev just two weeks prior. In this Viewpoint, he adds some perspective to how events have unfolded since and how they may going forward in the wake of that event.

2014-03-24 Stocks Rise as Economic Backdrop Slowly Improves by Bob Doll of Nuveen Asset Management

U.S. equities finished higher last week, with the S&P 500 increasing 1.4%. Ukraine seemed to be receding in investors’ minds. Despite the volatility and sharp increase in bond yields on Wednesday, the hawkish takeaways from the FOMC meeting were not a lingering overhang.

2014-03-24 Fed-Induced Speculation Does Not Create Wealth by John Hussman of Hussman Funds

Fed-induced speculation does not create wealth. It only changes the profile of returns over time. It redistributes wealth away from investors who are enticed to buy at rich valuations and hold the bag, and redistributes wealth toward the handful of investors both fortunate and wise enough to sell at rich valuations and wait for better opportunities.

2014-03-24 Is the Fed Supporting the Equity Markets? by Tom Riegert of Hatteras Funds

The Federal Reserve’s unprecedented increase in reserves purchased through its quantitative easing programs has paralleled the performance of the equity markets to a startling degree. Has the Fed’s program been supporting the equity markets? We examine the strong correlation between the Fed’s balance sheet and the performance of the S&P 500 since end-2008, and ponder the effects the Fed’s long-awaited tapering will have on market volatility. Investors facing the uncertainty ahead could well find alternative investments a welcome addition to their portfolio.

2014-03-22 China\'s Minsky Moment? by John Mauldin of Millennium Wave Advisors

In speeches and presentations since the end of last year, I have been saying that I think the biggest macro problem in the world today is China. China has run up a huge debt, and the payments are coming due. They seem to be proactive, but will it be enough? How much risk do they pose for the global system?

2014-03-22 What Makes a Slam-Dunk Portfolio? by Frank Holmes of U.S. Global Investors

As a native Canadian, hockey is in my blood, but after moving to Texas, the icy arenas changed to basketball courts, as the sole major league sports team in the city is the San Antonio Spurs.

2014-03-21 Climbing a Wall of Worry? by Norm Boersma of Franklin Templeton

One of the main questions our clients have been asking us lately revolves around worries of how strong equity markets have been over the last five years. During that period, we’ve seen markets bottoming out in February – March 2009 and basically recovering since then.2 Given the performance of the market since the trough, it’s not surprising that people are a bit concerned right now, and the market has been quite volatile in early 2014.

2014-03-19 Pockets of Opportunity in Europe, Emerging Markets by Lisa Myers of Franklin Templeton

Maintaining the right mix or balance of assets in a portfolio to achieve a desired goal can be a challenge, particularly when the markets are constantly shifting. As portfolio manager for Templeton Global Balanced Fund, Lisa Myers, executive vice president, Templeton Global Equity Group, regularly faces that task.

2014-03-19 What Rising Turmoil in Ukraine Would Mean for Stocks by Russ Koesterich of iShares Blog

How vulnerable might stocks be if turmoil in Ukraine escalates? Russ weighs in and notes which two market segments would be particularly vulnerable.

2014-03-18 Japan’s Rising Opportunity by Neil Hennessy, Masakazu Takeda of Hennessy Funds

After WWII, the Japanese economy began what is sometimes referred to as the “Economic Miracle”, a three-decade long period of growth and prosperity. Japanese firms and their management teams were studied around the world as the model of efficiency and an example for all companies and leaders to strive for. In 1989, a bubble in real estate fueled by speculators burst, and the Japanese markets crashed. Since then, the Japanese economy has been in a virtual standstill with more than two decades of stagnant growth and a deflationary environment.

2014-03-18 Can the Fed Fend Off the Ides of March? by Kristina Hooper of Allianz Global Investors

Mid-March hasn’t been associated with much good luck in Europe historically. And with Ukraine mired in conflict, this year’s no different. But investors should resist the urge to react to geopolitical uncertainty and expect steady guidance from the Fed.

2014-03-18 Currency Markets Heat Back Up, and Will Likely Remain that Way by Chris Maxey, Ryan Davis of Fortigent

Long dormant after the financial crisis, foreign exchange markets are beginning to heat up, offering ample trading opportunity for asset managers. The U.S. dollar was widely viewed as being the best long trading opportunity for 2014, but so far, that has not played out, with activity in the Euro, Chinese Yuan, and other currencies impeding dollar strength.

2014-03-18 The Paradox of Self-Determination by Bill O'Grady of Confluence Investment Management

Lost in the discussion surrounding the referendum in the Crimea is the “legal” process. Simply put, how does part of an established nation decide to secede? Are there established protocols? In this report, we will offer a short history of the self-determination issue. With this background, we will discuss President Wilson’s inclusion of self-determination in his peace plan and examine how the U.N. has dealt with this issue. From there, we will analyze how self-determination was used during the Cold War and how those practices have continued after 1990. We conclude with market ramifications.

2014-03-18 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks were buffeted last week on the outcome in Ukraine (well founded), growing concern that the world does not know what happened to that missing Malaysian airliner, and of course, the ever-present worries about the global economy - especially in light of renewed concern over China, both its economy and its banking system.

2014-03-18 Global Economic Overview - February 2014 by Team of Thomas White International

Pessimism over the sustainability of global growth this year has subsided as it is now widely acknowledged that softer data from some of the developed countries in recent months were influenced by the severe winter weather.

2014-03-17 Frontier Markets Find Footing by Mark Mobius of Franklin Templeton

Frontier markets remain in focus for the Templeton Emerging Markets Group in 2014, and my team and I have spent the early part of the year exploring potential investment opportunities in a number of them.

2014-03-17 Market Outlook by Scotty George of Alexander Capital

What's another 200 point down day (Dow) when you're having fun? The violent and excessive overreactions of the week prior were added to by Asia and Europe on Thursday/Friday past, just for good measure.

2014-03-17 Emerging Markets Equity Commentary - February 2014 by Team of Thomas White International

After a weak start to the year, emerging market equity prices recovered in February as concerns about slower than expected global expansion and a further decline in Chinese economic growth subsided.

2014-03-17 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

Remember when tiny Greece was a market mover? Well, now it’s tiny Crimea. With the growing global tensions and concerns about Crimea’s secession from the Ukraine to Russia, investors chose to take a week off (for the most part) and take some equity profits, while moving back into the safe haven of treasuries. With little news on the domestic economic calendar, investors looked abroad and didn’t care much for what they saw in China. (Still, the yuan must be better than the ruble these days.)

2014-03-17 Stocks Weighed Down by Ukraine, China and U.S. Economy by Robert Doll of Nuveen Asset Management

U.S. equities came under pressure last week as the S&P 500 declined almost 2.0%. Blame was primarily placed on the crisis in Ukraine and the growth slowdown and tight credit environment in China. Safe haven investments such as U.S. Treasuries and gold outperformed. Stocks may have already discounted the weather distortions on early 2014 data, and an overhang is expected to linger into first quarter earnings season. Cautiousness surfaced for investments that support the recovery, including banks and homebuilders.

2014-03-17 Recalibrating the Retirement Clock: Should 75 Be the New 65? by Nick Kaiser of Saturna Capital

Retirement sounds pretty sweet, doesn't it? Exotic holidays. Finally writing that novel. Never having to rely on an alarm clock to wake up early. Being your own boss. Retirement goals are as varied as people themselves.

2014-03-17 Frontier Markets: Weighing the Risks by Nathan Rowader of Forward Investing

Why would investors even think about investing in fledgling, so-called frontier economies half a world away? The quick answer is that some of the best-performing stock markets in the world can be found in places like Kenya, Bulgaria and Argentina. Annual equity returns topped 40% in all three countries in 2013 while a number of other frontier markets (FMs), including Romania, Serbia and Nigeria, experienced annual returns ranging from 25% to 35%. Although past performance is not a guarantee of future results, investors in search of portfolio growth and diversification are taking note.

2014-03-16 Inequality and Opportunity by John Mauldin of Millennium Wave Advisors

Today we will continue our thinking about income inequality, and I will respond to some of your letters, as they make good launching points for further discussion of the topic.

2014-03-15 Newsletter by Harold Evensky of Evensky & Katz

Harold Evensky's quarterly letter to his readers.

2014-03-15 Follow the Money to Asia\'s Tech Hub by Frank Holmes of U.S. Global Investors

China’s slower economic data points and a surplus in copper and iron ore drove many commodities lower this week, while gold rose. In the short term, until the copper and iron ore surplus is liquidated, or absorbed at a slower pace, the base metals market will likely be sloppy. As the second-largest economy in the world and a huge driver of commodities demand, it’s not surprising China provoked such a significant response from world markets. Interestingly, most of the media thought it was geopolitical fears from Ukraine that chopped up the market and lifted gold.

2014-03-15 Heating Up and Thawing Out by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

Concerns over growth and geopolitical issues have largely been set aside by investors in the United States, but complacency can be dangerous and another pullback in the near term could unfold if history holds. Investors should keep longer term goals in mind and remember that trying to time the market is an extremely difficult task. The weather is turning and economic data will be watched to see if recent softness was temporary or something more serious. We lean toward the former, but a retrenchment in bond yields would cause some concern about the potential for something more than weather.

2014-03-15 Like Houdini, the Markets Escape Again and Again by Stephen C. Sexauer of Allianz Global Investors

Like the great escape artist Harry Houdini, the markets have repeatedly escaped a series of potential catastrophes. Central banks around the world have coordinated policy making these escapes possible, but the end result is another trap from which we need to escape - seemingly permanent low interest rates for savers ("financial repression"), slow growth, and high asset prices. Financial repression is better than an outright debt deflation, but it causes its own problems. The outlook is for low returns.

2014-03-14 A Matter of Odds: Not Everything That’s Supposed to Work, Works All the Time by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, explores the worth of quantitative analysis versus fundamental, and examines forecasts, consensus, and valuation as three ways of looking at the market for investment.

2014-03-14 Deflationary Pressure and Tight Credit Facilities Weigh on Eurozone Recovery? by Andrew Balls of PIMCO

The eurozone is enjoying a broadly balanced resurgence in economic output and domestic demand. Deflation risk is real, and the European Central Bank’s asymmetric attitude toward its inflation target could contribute to a decline in inflation expectations. In the current climate, we continue to favour select regional credit exposure and look to generate attractive returns across European credit and asset-backed securities.

2014-03-14 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Global trade negotiations have stalled; This is a delicate time for Chinese finance; Where will Europe’s growth come from?

2014-03-12 Reflections on Ukraine by Bill O'Grady of Confluence Investment Management

Over the past five weeks there have been a number of significant events that have occurred in Ukraine. A president has fled, a revolutionary government is forming and Russia has taken de facto control over the Crimea. The events themselves are momentous but the broader effects are significant as well. In this report, we will offer three reflections—Putin’s Gambit, The U.S. Adrift and A Dangerous New World. Although any of these could be a topic in themselves, we will shorten these issues to offer a single journey through the current crisis. As always, we will conclude with market ramifications

2014-03-12 The Goldilocks Conundrum: A Market Review by Rick Vollaro of Pinnacle Advisory Group

When we decided to ride the central bank liquidity wave in 2013, we knew there was a chance the market could have a pretty good year, but like most investors we were pleasantly surprised with the gains that the U.S. stock market delivered. Including dividends, the S&P 500 Index soared by 32%, well in excess of what even the most optimistic prognosticators envisioned at the start of the year.

2014-03-11 Making Green from Gold, Palladium and Pollution by Frank Holmes of U.S. Global Investors

Gold is coming back with a vengeance, experiencing a clear recovery and grabbing the attention of market cynics. Analysts from Noruma Securities even upgraded its outlook for gold, expecting bullion to climb over the next three years, according to Barron’s.

2014-03-11 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Markets waited all week for the jobs report for February. After its release the data continued to be mixed at best.

2014-03-11 Michael Cirami on the Ukraine Crisis by Michael Cirami of Eaton Vance

Investors tend to ignore events that do not demand immediate attention. Unfortunately, this approach is no longer an option following the recent events taking place in Ukraine. Michael Cirami, co-director of Eaton Vance’s Global Income Group, was in Kiev the week before President Yanukovych was ousted. In the following interview, he shares his views on the crisis in this emerging market and its implications for investors.

2014-03-10 Positive Payroll Report Offsets Geopolitical Concerns by Bob Doll of Nuveen Asset Management

U.S. equities increased 1.1% last week after somewhat volatile trading due to heightened tension in Ukraine. Although the crisis dominated headlines, the market relegated the major geopolitical issue to the back burner. The broader macro narrative did not change, as concerns about dampened growth momentum continued to be pacified by the distortion from adverse weather.

2014-03-10 Earning Estimates Plunging Around The World by of GaveKal Capital

Earnings estimates (and sales estimates to an extent) have taken a beating over the past three months. On average, EPS growth estimates are down 5.3% for the next fiscal year during this time. Not a single industry group out of the 24 MSCI classifications have seen their earning estimates rise and only four industries have seen their sales growth estimate increase.

2014-03-10 Four Reasons to Consider Emerging Markets for the Long Term by Borge Endresen of Invesco Blog

Emerging markets are at that peculiar place where everyone likes them over the long term, but very few like them in the short term. Many well-publicized headwinds from 2013 remain going into 2014, accompanied by election uncertainty in Brazil, India, Indonesia, South Africa and Turkey. And political uncertainty keeps surfacing in such places as Thailand, Turkey and the Ukraine.

2014-03-09 The Problem with Keynesianism by John Mauldin of Millennium Wave Advisors

Keynes himself would appreciate the irony that he has become the defunct economist under whose influence the academic and bureaucratic classes now toil, slaves to what has become as much a religious belief system as it is an economic theory. Men and women who display an appropriate amount of skepticism on all manner of other topics indiscriminately funnel a wide assortment of facts and data through the filter of Keynesianism without ever questioning its basic assumptions. And then some of them go on to prescribe government policies that have profound effects upon the citizens of their nations.

2014-03-07 Cold War: Thoughts on Ukraine Based on a Month Spent in Latvia by Doug MacKay of Broadleaf Partners

I have been intensely more interested in the situation developing in Ukraine over the past few months than those that circled Greece, a country of similar size, or Libya and the Arab Spring a few years ago. For the most part, I've taken geopolitical flare-ups in stride in terms of their potential impact to the stock market and the economy. In general, this approach has been the right one.

2014-03-07 ECB Officials' Inflation Forecasts by of GaveKal Capital

The ECB announced that interest rates would be maintained at current levels earlier today, citing staff macroeconomic projections for the euro area, which foresee annual HICP inflation at 1.0% in 2014, 1.3% in 2015, and 1.5% in 2016. Though few economists predicted a rate cut, there were rumors that Europe's central bank might discontinue the sterlization of bond purchases under its Securities Markets Program (SMP)-- an action consistent with the adoption of a more accomodative and active policy.

2014-03-07 Ukraine at Crossroads by Mark Mobius of Franklin Templeton

In February, the winter Olympic Games brought athletes from around the world together in Russia, but in Ukraine, Russia's neighbor to the southwest, the story has been one of division. Violent clashes between pro-EU (European Union) protesters and government forces in the past few months have focused the eyes of the world on the former-Soviet state after (now former) President Yanukovych had refused to sign an Association Pact forging closer ties to the EU and decided instead to accept funding from Russia.

2014-03-07 Inflation Blues: Is it Time to Start Worrying? by Liz Ann Sonders of Charles Schwab

Inflation was revised higher in the latest GDP revision; while an increase in the minimum wage could push it higher still. But we remain sanguine about inflation risk as long as velocity and wage growth remain low. The key to watch near-term is bank lending, which is starting to accelerate sharply; signaling the possible return of "animal spirits."

2014-03-07 Tensions between Russia and Ukraine Worry Investors by Gene Goldman of Cetera Financial Group

Over the weekend, tensions escalated between Russia and Ukraine as Russian forces invaded and took complete operational control of the Crimean peninsula.

2014-03-07 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The fight over Ukraine is an unwelcome source of uncertainty; Hiring in the U.S. improves in February; American businesses have lots of cash to invest.

2014-03-07 Making Green from Gold, Palladium and Pollution by Frank Holmes of U.S. Global Investors

Gold is coming back with a vengeance, experiencing a clear recovery and grabbing the attention of market cynics. Analysts from Noruma Securities even upgraded its outlook for gold, expecting bullion to climb over the next three years, according to Barron's.

2014-03-06 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

February ended up being a strong month for stocks despite the growing perception of a slow economic start to the year 2014.

2014-03-06 Volatility Returns as Crisis in Ukraine Creates Uncertainty by Kevin Mahn of Hennion & Walsh

Most investors have most likely never even heard of Ukraine prior to the last two weeks. Now the future of Ukraine and potential repercussions on other countries in the region appear to be at the forefront of investor minds across the globe. Overall, Ukraine is a relatively small country in Eastern Europe with a population of about 46 million people that borders the likes of Russia, Belarus, Poland, Slovakia, Hungary, Romania and Moldova.

2014-03-06 Emerging Markets: Distinguishing Opportunities by of Manning & Napier

The recent sell-off in emerging market currencies and equities is part of a broader move that has seen the asset class heavily underperform developed markets since mid-2012. Part of the underperformance can be attributed to disappointing economic performance, as actual growth in the emerging markets (EMs) has come in much lower than broader consensus expectations.

2014-03-06 Watch and Wait by David Wismer of Flexible Plan Investments

Vladimir Putin’s and Russia’s military action in the Crimea, formally a part of the Ukraine, made it hard to focus on much else Monday. Aside from the obvious and important humanitarian concerns, the military threat carries immense global risk and potentially significant economic consequences.

2014-03-06 The Briefest Flight to Safety by Scott Minerd of Guggenheim Partners

Tensions in Ukraine and tapering speculation seem unlikely to derail rising U.S. equity markets and the positive outlook for U.S. credit.

2014-03-06 The Dollar's Long Term Decline by Axel Merk of Merk Investments

The cleanest of the dirty shirts doesn’t necessarily preserve your purchasing power. Sure, the U.S. dollar has beaten the Russian Ruble and some others of late, but when it comes to real competition, the U.S. dollar has taken a back seat. The U.S. dollar’s long-term decline may be firmly in place and investors may want to buckle up to get ready for the ride.

2014-03-05 The US Economy - Back To The Slow Lane Again by Gary Halbert of Halbert Wealth Management

Late last year, President Obama predicted that 2014 would see “breakout growth” in the US economy. His optimism was not completely unwarranted since the economy grew by a healthy 4.1% (annual rate) in the 3Q of last year, driven largely by an unexpected surge in inventory rebuilding. Then in late January, the Commerce Department reported that the economy grew by a better than expected 3.2% in the 4Q.

2014-03-05 2014: A Transition Year - Back to Fundamentals by Lorenzo Pagani of PIMCO

The past several years have seen multiple regime changes in financial markets in Europe, each dominated by different factors and requiring a distinct approach to fixed income investing. As spreads tighten to pre-2008 levels, it is now time to ask whether a shift in investment style is due. Macroeconomic developments and inflation expectations are likely to be key determining factors in whether 2014 will be a good year for European bond investors.

2014-03-05 What Areas of the Market Will Remain in the Limelight? by Frank Holmes of U.S. Global Investors

The current bull market has been five years in the making. Since the bottom on March 9, 2009, the S&P 500 Index has grown an incredible 174 percent. With this spectacular performance, investors are asking if U.S. companies will stay in the limelight or if it is time to draw the curtain on equities. While I was in Los Angeles at a leadership event for CEOs from around the world, I asked John Derrick, CFA, director of research, to shed some light on the subject.

2014-03-04 A Century of Policy Mistakes by Niels Jensen of Absolute Return Partners

A century ago Argentina ranked as one of the wealthiest countries in world. Today it is a shadow of its former self. A long string of policy errors explain the long slide from riches to rags. Europe, like Argentina 100 years ago, is facing enormous challenges - as well as potential pitfalls - and the management of those challenges will define the welfare path for many years to come. Unfortunately, the early signs are not good. Our political leaders, afraid to face public condemnation, have so far chosen to ignore them.

2014-03-03 Ukraine: Geopolitical Risk Rising For Global Markets by Francesc Balcells of PIMCO

Following Russia’s military intervention in Crimea, the situation in Ukraine remains extremely fluid. The outcome will determine to a large extent the systemic nature of the crisis and its impact on global markets, not just Europe. Russia stands to lose the most if this conflict should escalate into a full-fledged military confrontation, given the country’s financial, economic and reputational stakes.

2014-03-03 I’m Confused by Jeffrey Saut of Raymond James

In one of last week’s Morning Tacks I used this email from one of our financial advisors: “Hey Jeff, about a month ago I emailed you asking if the ~1750 low on the S&P 500 was a good buying opportunity. You emailed back saying – ‘No, not yet’ – and ever since in your remarks you claim not yet. So now that we are well above that level, clients are asking why didn’t we get in ... what’s your recommendation?”

2014-03-03 Equities Rise Despite Mixed Fundamental News by Bob Doll of Nuveen Asset Management

U.S. equities increased 1.3% last week as the S&P surpassed the key 1850 level and pushed to new record highs. One favorable dynamic of the rally was the upside leadership from retail stocks, as earnings were largely ahead of expectations. Fed Chair Janet Yellen suggested concern about softerthan-expected spending in a number of recent data releases, but the bar for adjusting the tapering process has not been lowered.

2014-03-01 Black Swans and Endogenous Uncertainty by John Mauldin of Millennium Wave Advisors

John is in Florida and feeling a bit under the weather, so this week we’re bringing back one of his most popular letters, from December 2007. In the letter he discusses the work of Professor Graciela Chichilnisky of Columbia University, one of whose key insights is that the greater the number of connections within an economic network, the more the system is at risk. Given the current macroeconomic environment, it is important to remind ourselves of how complacent we were back in 2007 and how it all fell apart so quickly, just as John outlined in this rather prescient piece.

2014-02-28 The Stock Market's Shaky Foundation by Chris Martenson of Whitney Peak

Martenson explains the headwinds that make the long-term case for lower valuations than we've seen in previous decades. But more urgently, he lays out the litany of short-term triggers likely to result in a vicious correction in stock prices this year. In fact, for the first time in years, he believes the time to actively short equities is arriving.

2014-02-28 Emerging Markets Equity Commentary: January 2014 by Team of Thomas White International

Emerging market equity prices corrected in January as investors worried about slower growth in China as well as political and economic turbulence in some the frontier economies such as Argentina and the Ukraine. Markets were also unnerved by the unexpectedly large interest rate hike in Turkey, which failed to prop up the currency.

2014-02-28 What Areas of the Market Will Remain in the Limelight? by Frank Holmes of U.S. Global Investors

The current bull market has been five years in the making. Since the bottom on March 9, 2009, the S&P 500 Index has grown an incredible 174 percent. With this spectacular performance, investors are asking if U.S. companies will stay in the limelight or if it is time to draw the curtain on equities.

2014-02-28 Bounce Back by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

US stocks have bounced and the market’s still attractive and in the midst of a secular bull market. But there are likely to be bumps along the way; notably given that this is a midterm election year; which are known for first-half pullbacks. A diversified portfolio is important and both European and Chinese stocks appear to have upside, while Japan continues to frustrate with a two-steps forward, two-steps back sort of approach. And a final reminder not to replace fixed income assets with equities in search of higher income without recognizing the risk profile of a portfolio has changed.

2014-02-27 Meanwhile, Across the Channel... by of GaveKal Capital

As we saw yesterday, Germany's Q4 GDP release was neither surprising nor very exciting. A similar look at today's release of output in the U.K. reveals a more constructive picture.

2014-02-26 What Columbus Missed: Royce Rediscovers India by David Nadel of The Royce Funds

In 1492, Italian explorer Christopher Columbus set sail to discover India. He missed his mark, however, landing in America instead. The rest, as they say, is history-with the exception that more than 500 years later India is still worthy of discovery for many Western investors.

2014-02-26 Market Perspective by CCR Wealth Management Investment Committee of CCR Wealth Management

It cost $0.32 to mail a letter, unemployment was 4.9%, O.J. Simpson was found liable in a civil suit, Hong Kong was returned to Chinese rule, Timothy McVeigh was sentenced to Death, Green Bay defeated the Patriots in the Super Bowl, Titanic came crashing into movie theatres, and Dolly, the first genetically engineered lamb was unveiled to the public; the year was 1997.

2014-02-26 EM and the Fragile Five: Separating the Wheat from the Chaff by Blaise Antin, David Loevinger, Anisha Ambardar of TCW Asset Management

The shift in capital flows triggered by former Fed Chairman Ben Bernanke’s tapering remarks in May 2013 set off a cascade of market events that continues to this day. His comments also birthed a cottage industry of emerging market doomsayers, who now predict regularly: 1) the end of growth in emerging markets (EM), given that it was, in their view, all a mirage fueled by carry and leverage; and 2) a wave of defaults of the kind last seen in the 1990s that threaten to bring down not only emerging but developed markets as well.

2014-02-25 Time to Worry About Europe Again? by Chris Maxey, Ryan Davis of Fortigent

The European sovereign debt crisis has all but faded from investors’ minds since ECB President Mario Draghi’s famous pronouncement on July 26, 2012 that he would do “whatever it takes” to save the monetary union. Since that time, equity markets in Europe rallied sharply as accumulated risk aversion fell away.

2014-02-25 The Return of Japan by Bill O'Grady of Confluence Investment Management

Two weeks ago, we discussed Germany’s apparent early steps to return to regional power status. In this week’s report, we will examine Japan’s steady evolution to regional power status.

2014-02-25 How to Profit from the Yellen Fed by Axel Merk of Merk Funds

Janet Yellen might have the most powerful job in the world, as the Federal Reserve (Fed) she now chairs controls what may be the world’s most powerful printing press. We take a closer look at what her reign might mean for investors’ portfolios.

2014-02-25 Alternative Energy Brief by Edward Guinness of Guinness Atkinson Asset Management

This month we provide our Outlook for the Alternative Energy sector in 2014.

2014-02-25 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

A quiet four days for stocks last week. Between the holiday, school vacations and winter weather; there just were not many catalysts for the stock marker.

2014-02-25 Flirting With Deflation by Andrew Bosomworth of PIMCO

Over the medium term, we see downside risks to both growth and inflation in the eurozone, unlike the ECB’s more balanced view. However, even if eurozone inflation sinks close to 1% in 2014–2015, as PIMCO forecasts, this in itself probably would not be low enough for the ECB to consider further easing. A lack of further policy action may undermine the ECB’s credibility to anchor longer-term inflation more closely to 2%.

2014-02-24 Confusing Crosscurrents Result in Trendless Market by Bob Doll of Nuveen Asset Management

U.S. equities finished mixed after the shortened holiday week.1 The broad market narrative did not change, as additional disappointing economic data was largely attributed to the impact of adverse weather. Comfort that the recovery may be gaining traction was evidenced through Fed discussions and the January FOMC minutes, with consensus expectations for tapering to continue at a measured pace. Some renewed concerns about a growth slowdown in China surfaced but had little impact.

2014-02-24 Leading Indicators Offer a Window into Europe’s Recovery by Matthew Dennis of Invesco Blog

We’re seeing signs that the recovery in Europe is progressing. I wanted to take a moment to highlight some of the positives, uncertainties and opportunities that we believe investors should consider about the region.

2014-02-23 The Worst Ten-Letter Word by John Mauldin of Mauldin Economics

A new word is achieving ubiquity. The word has always been with us and at times has been a beacon to attract the friends of liberty and opportunity. But now I’m afraid it is beginning to be used as a justification for social and economic policies that will limit the expansion of both liberty and opportunity. The word? Inequality.

2014-02-22 Going for the Gold by Frank Holmes of U.S. Global Investors

Everyone wants the gold. Around the world, athletes train for years to compete for a gold medal. In Hong Kong and China, the Love Trade seeks gold coins, bars and jewelry.

2014-02-20 The State of International Small-Cap by Francis Gannon of The Royce Funds

While some argue that domestic small-cap leadership in 2013 was a result of its heavy exposure to companies that tend to generate most of their income domestically, others contest that this greater focus on the U.S. may mean missing out on the benefits of faster-growing foreign economies. We, on the other hand, choose to focus our attentions on individual companies, particularly those in more cyclical areas of the market that are more closely tied to the global economy.

2014-02-20 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

We’re back, baby. (Well, at least, for a week.) Janet Yellen made her case to become the most revered Fed Chair (anyone even remember Maestro Greenspan?) by merely reiterating Dr. B’s prior remarks about the economy and the bond buying program. Investors felt the love this Valentine’s week as they shook off the past negativity and took the Dow to its best daily showing and back above the 16k level. Can Cupid (and Yellen) continue to work his (her) magic after Prez day and beyond?

2014-02-20 International Equity Commentary: January 2014 by Team of Thomas White International

International equity markets have started the year on a difficult note, as concerns about the robustness of economic growth in the U.S., Japan and Europe have made investors more cautious. Though the U.S. economy expanded at a faster than expected pace during the last quarter of 2013, recent data reports from the labor market have not been as healthy.

2014-02-20 Emerging Markets Equity Commentary: January 2014 by Team of Thomas White International

Emerging market equity prices corrected in January as investors worried about slower growth in China as well as political and economic turbulence in some the frontier economies such as Argentina and the Ukraine. Markets were also unnerved by the unexpectedly large interest rate hike in Turkey, which failed to prop up the currency.

2014-02-19 Checking in on Earnings by Chris Maxey, Ryan Davis of Fortigent

Earnings season is nearing its finale, and the latest results show plenty of reason to be bullish, but the longer-term trend remains an outstanding question for markets.

2014-02-18 A Time for Optimism in Europe? by Philippe Brugere-Trelat of Franklin Templeton

Volatile markets and an uneven recovery may appear to justify a cautious outlook for investing in Europe right now, while in the US the specter of higher interest rates might also be signaling a challenging market environment ahead. Philippe Brugere-Trelat believes the investment case for European equities favors a more optimistic outlook and despite a bumpy start to the year for equities globally, he still sees the market as rife with potential opportunities for selective investors, particularly undervalued segments of the market. One place where he thinks caution is likely warranted? Japan.

2014-02-18 Stocks for 2014: Growth and Income For Total Return - Part 3 by Chuck Carnevale of F.A.S.T. Graphs

When investing in common stocks, there is no one strategy that fits all investors. Some investors are focused on investing for income, some for capital appreciation and others for various combinations of both. Additionally, there is the issue of risk tolerance. Some investors are willing and capable of assuming greater risk if they believe it will lead to greater returns, while others are more risk adverse. These are just but a few of the many variations that apply to the individual investor’s own unique goals and characteristics.

2014-02-18 Why Confidence Remains Low (Hint: Blame Washington) by Russ Koesterich of iShares Blog

While U.S. economic fundamentals have improved over the past year, U.S. businesses and consumers both continue to exercise caution, holding back on spending and new investment. Russ explains what’s partly behind this puzzling dilemma.

2014-02-18 After a Rocky 2013, What\'s in Store for Asia This Year? by Brent Bates of Invesco Blog

Overall, 2013 wasn’t the best year for Asian markets, however there are several trends emerging that we believe will be good for the region this year.

2014-02-18 Global Growth Expectations Push Stocks Forward Despite Weather by Bob Doll of Nuveen Asset Management

U.S. equities finished sharply higher last week with the S&P 500 increasing 2.3% and all major U.S. averages up more than 2%.1 The rapid market recovery from the January pullback is a bigger surprise than the pullback that preceded it.

2014-02-15 The Economic Singularity by John Mauldin of Millennium Wave Advisors

Today, let’s think about central banks and liquidity traps and see if we agree that central bankers are driving the car from the back seat based upon a fundamentally flawed theory of how the world works. That theory helped produce the wreck that was the Great Recession and will have its fingerprints all over the next one.

2014-02-14 Why Confidence Remains Low (Hint: Blame Washington) by Russ Koesterich of iSharesBlog

Despite some signs that economic fundamentals are improving - including an improving labor market and rising home prices - U.S. businesses and consumers continue to exercise caution, holding back on spending and new investment. What’s behind this puzzling dilemma? As I write in my new Market Perspectives paper, "The Price of Politics," uncertainty over public policy is partly to blame.

2014-02-14 Does a Down January Dog the Rest of the Year? Probably by Peter Nielsen of Saturna Capital

The bottom line for investors is that a negative January tends to herald lower (though not necessarily negative) returns for the subsequent 11 months.

2014-02-14 Arresting Disinflation Will Require Taking up the Slack by Carl Tannenbaum of Northern Trust

Arresting disinflation will require taking up the slack. Estimates of the U.S. output gap remain substantial. The U.S. achieves budget peace but still faces long-term fiscal challenges.

2014-02-14 Weather Related? by Liz Ann Sonders, Brad Sorensen & Michelle Gibley of Charles Schwab

The recent slowdown in economic data appears to be largely weather related and we believe decent growth will reassert itself. Stocks have bounced after a weak start to the year, but the threat of a further pullback remains, although our longer-term optimism has not been dented. Likewise, we believe Europe offers some attractive investment opportunities but we’re in a wait-and-see mode with Japan. Finally, we don’t see EM turmoil becoming overly contagious, but we are watching that situation closely.

2014-02-14 These Gold Charts Will Make Your Heart Beat Faster by Frank Holmes of U.S. Global Investors

So while gold may correct over the next several months as the metal enters its seasonally weak period of the year, this looks promising for gold investors.

2014-02-13 A Time for Optimism in Europe? by Philippe Brugere-Trelat of Franklin Templeton

Volatile markets and an uneven recovery may appear to justify a cautious outlook for investing in Europe right now, while in the US the specter of higher interest rates might also be signaling a challenging market environment ahead. The investment case for European equities favors a more optimistic outlook and despite a bumpy start to the year for equities globally, he still sees the market as rife with potential opportunities for selective investors, particularly undervalued segments of the market. One place where caution is likely warranted? Japan.

2014-02-12 Was the labor report positive, or negative, anyone? by Chris Maxey and Ryan Davis  of Fortigent

Stocks were modestly positive last week following three straight weeks of negative performance. Markets crawled back following an ugly Monday in which the S&P 500 suffered its worst loss in more than seven months. For the week, the S&P rose 0.9% while the Dow Jones Industrial Average added 0.7%.

2014-02-11 ‘Hot’ Money’s Fast Exit Cools Emerging Markets by of Knowledge @ Wharton

Capital flight from emerging markets has been accelerating in recent weeks ($6 billion alone in the week ending February 5). Turkey is the poster child, but the exodus is also happening in India, Indonesia, Brazil, South Africa and others – mostly from equity markets. This “hot money” is moving out over concerns that asset bubbles have built up, and that emerging market economic growth is now slowing. The slowdown is partly a result of tighter money in the wake of the Fed’s tapering plans and a decelerating economy in China, many believe. To better understand the risks to the global financial

2014-02-10 Emerging Markets Equity Commentary - December 2013 by Team of Thomas White International

Emerging market equity prices saw a modest correction for the second successive month in December, as investors remained cautious about the outlook for some of the emerging economies. Select countries such as Thailand in Asia and Turkey in Europe continue to face difficult political environments, with large demonstrations against the governments. Their currencies have reacted negatively to the latest developments, making investors fearful of a repeat of the volatile market movements seen during the third quarter of 2013.

2014-02-10 What Would a Stronger Dollar Mean for Global Markets? by Borge Endresen, Brent Bates of Invesco

As the world watches the progress of the US Federal Reserve’s tapering program, and anticipates the strengthening of the US dollar, We’re often asked how this affects our view of international markets and risk. The short answer is that it doesn’t. We’re long-term, bottom-up stock pickers , so we;re primarily concerned with currency impacts on a company-by-company basis. However, there are some broad trends that are worth noting.

2014-02-10 Growth and Policy Uncertainty Cause Choppy Markets by Bob Doll of Nuveen Asset Management

U.S. equities closed with modest gains last week, as the S&P 500 overcame Monday’s decline, the largest one-day percentage loss since June 2013. The weaker-than-expected ISM manufacturing and vehicle sales data drive the sell-off on Monday, exacerbating the focus on slowing momentum for the U.S. recovery. The impact of adverse weather complicates the picture. Also, although January non-farm payroll missed expectations, there were more upbeat indications for the household survey.

2014-02-10 What Would a Stronger Dollar Mean for Global Markets? by Borge Endresen, Brent Bates of Invesco

As the world watches the progress of the US Federal Reserve’s (Fed’s) tapering program, and anticipates the strengthening of the US dollar, we’re often asked how this affects our view of the international market and risk. The short answer is that it doesn’t. We’re long-term, bottom-up stock pickers, so we’re primarily concerned with currency impacts on a company-by-company basis. However, there are some broad trends that are worth noting.

2014-02-09 Global Economic Overview - December 2013 by Team of Thomas White International

The global economic outlook has turned brighter as several major economies are improving. Both business and consumer sentiment have become healthier across most regions, as the policy uncertainties that plagued several countries last year have faded. The U.S. economy is expected to accelerate further in 2014, while Europe and Japan are also likely to see faster growth.

2014-02-08 International Equity Commentary - December 2013 by Team of Thomas White International

International equity prices saw marginal gains in December as investors weighed the improved global economic outlook against the reduction in monetary stimulus from the U.S. Federal Reserve. Economic trends have become more positive across most regions, helped by the improving business environment and consumer sentiment in the U.S. as well as in Europe. Japan continues to see stronger export gains as demand revives in its major markets and the cheaper yen remain supportive.

2014-02-07 What\'s the Game Changer for Gold? by Frank Holmes of U.S. Global Investors

What will break gold of its losing streak? Will inflation, which is a lagging indicator, be stronger than expected? In one of my most popular posts last year, I said that based on the jobs market, the limited housing recovery and regulations slowing down the flow of money, the Fed would have no choice but to start tapering and raising rates very gradually to keep stimulating the economy.

2014-02-07 Emerging Europe: Regional Economic Review - 4Q 2013 by Team of Thomas White International

The club of emerging European economies expanded, as Morgan Stanley Capital International (MSCI) moved Greece from developed to the status of an emerging economy. The majority of the countries covered in this review, including the new entrant, had something to look up to in the New Year.

2014-02-07 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

How do you follow up some 30%-ish annual index gains in 2013...with major losses in January? Sadly, that’s what investors experienced as the Dow plunged over 5% to start the month, the worst January since 2009. Those who say "as January goes, so goes the market" are not among the most popular these days. Earnings have been lackluster at best; emerging markets are in panic mode; Bernanke is moving out to pasture; investors still have quite a few profits they can take from last year. Then again, 11 months is plenty of time to "right the ship."

2014-02-07 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Fears over emerging markets, a tightening Federal Reserve Board and a loss in momentum in the economy have combined to create a sloppy market for stocks, while the bond market continues to confound the pundits and enjoy a solid start to the New Year.

2014-02-06 Technology Leaders and Laggards by Paul Meeks of Saturna Capital

The technology sector includes several industries, such as semiconductors and semiconductor capital equipment, software and services, and technology hardware and equipment.

2014-02-06 How Fragile are Emerging Markets? by Kenneth Rogoff of Project Syndicate

Emerging-market equities and exchange rates are again under severe downward pressure, but are the underlying economies really as fragile as global traders seem to fear? The short answer, for a few, is probably "yes," but, for most, "not quite yet."

2014-02-05 2014 Market Outlook by Kevin Mahn of Hennion & Walsh

Some Bumps along the Road of Global Recovery

2014-02-05 Emerald Economic Commentary by Team of Emerald Allocation Strategies

As Yogi Berra once said, "You got to be careful if you don’t know where you’re going, because you might not get there." As we look back on 2013 and look ahead to 2014,we want to share our thoughts on the road traveled and more importantly, the possible road ahead.

2014-02-05 The Importance of Taking a Long-Term Perspective by Jeffrey Knight of Columbia Management

For asset allocation decisions, we find great value in maintaining a long-term outlook for major asset classes. Twice a year, in fact, we conduct an extensive update of our five-year return forecasts for several asset classes. The purpose of this exercise is two-fold. First, taking a longer term perspective helps us to set strategic asset allocations and design portfolios for diverse investment goals.

2014-02-04 Investors Should Focus on Wages, Not Jobs by Chris Maxey, Ryan Davis of Fortigent

This Friday investors receive the first official labor market report of 2014. Following a highly disappointing jobs figure in December, many market participants hope to see a rebound - particularly one that will help justify the Fed’s decision last week to continue tapering its asset purchases.

2014-02-04 Crisis in Ukraine by Bill O'Grady of Confluence Investment Management

Since November, Ukraine has experienced widespread civil unrest. In late November, Ukrainian President Yanukovych decided not to join an EU-sponsored trade pact. This led to protests from Ukrainians who desired closer relations with Europe. In this report, we will begin by discussing the geopolitics of the nations involved, examining how nations have adjusted their policies over time to changing conditions. We will analyze the risks to the region from current unrest, including a look at the impact on emerging markets. As always, we will conclude with potential market ramifications.

2014-02-04 Challenging the Consensus by Niels Jensen of Absolute Return Partners

Investors are overwhelmingly bearish on bonds going into 2014. In this month’s Absolute Return Letter we challenge that view and look at various reasons why the bond market may surprise most people and deliver a positive return this year.

2014-02-01 Central Banker Throwdown by John Mauldin of Millennium Wave Advisors

The Federal Reserve is signaling that it is going to end quantitative easing at some point in the future; therefore, investors are trying to find the exits before the end actually comes.

2014-01-31 Thrift, Thrift, Burning Bright by Christine Hurtsellers, Matt Toms of ING Investment Management

Does the title sound familiar? Think feral instead of frugal, and William Blake’s "Tyger, Tyger, burning bright" may start to flicker between the synapses of memory and an English lit class you once soldiered through. But even if you haven’t read "The Tyger", its theme is aptly captured in the opening line and its image of a big flaming kitty cat. Essentially, Blake saw reality in duality: To appreciate the ferocious feline in all its glory is to come face to face with the same force that created "The Lamb", another entry in the poet’s Songs of Innocence and of Experience.

2014-01-31 A Toast- To the Decade by Rick Lear of Sloan Wealth Management

This is the most common question the members of the Sloan Wealth Management (SWM) Portfolio Management Team fielded this holiday season. This common quandary is in the context of the (2010, 2011, 2012 and now 2013) bull-run in the stock market, but we can’t help but visualize the numerous parallels to an actual party. If you have read our previous year-end letters you know we were among the first to arrive at the party and have no plans of leaving any time soon - as this decade remains enticing.

2014-01-31 ProVise Bullets by Ray Ferrara of ProVise Management Group

This month, we sing happy birthday to Apple. It was 30 years ago that Apple introduced its first Mac computer. What was novel then is commonplace today and far less clunky. For those old enough to remember what that boxy looking thing was like, it’s hard to believe how far we’ve come. Carl Icahn bought another $500 million more shares of Apple stock, bringing his total investment to $3.6 billion. As an activist shareholder he is trying to force Apple to buy up to $500 million in a stock buyback program.

2014-01-31 Value-Hunting in the US by Cindy Sweeting of Franklin Templeton

With key stock indices in the US closing the year near historical highs and many pundits predicting stronger growth rates both in the US and globally going into 2014, one would think bargains would be hard to find this year. January’s volatility, however, proved just how unpredictable markets can be. The recent market gyrations may be somewhat painful for many investors in the short-term, but the silver lining is that corrections can serve up buying opportunities, particularly for long-term, value-oriented investors.

2014-01-31 The New Watchword-Deflation? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Equity markets have been shaky to start the year but we don’t believe it’s time to abandon ship. The fundamentals in the United States continue to look appealing and the recent pullback has helped to correct some sentiment and valuation concerns. We are watching the fight against deflation carefully in Europe and Japan, and believe both countries may need to do more via monetary policy stimulus. Meanwhile, some emerging economies are dealing with inflation, but we don’t believe the recent problems will morph into a widespread crisis at this point.

2014-01-30 Quarterly Review and Outlook - Fourth Quarter 2013 by Van Hoisington, Lacy Hunt of Hoisington Investment Management

In The Theory of Interest, Irving Fisher, who Nobel Laureate Milton Friedman called America’s greatest economist, created the Fisher equation, which states the nominal bond yield is equal to the real yield plus expected inflation. It serves as the pillar of macroeconomics and as the foundational relationship of the bond market. It has been reconfirmed many times by scholarly examination and by the sheer force of historical experience. Examining periods of both low and high inflation offers insight into how each variable in the Fisher equation affects the outcome.

2014-01-30 Breakthrough by Colleen Denzler of Janus Capital Group

The funny thing about crises is that we tend to feel as if they occur suddenly, on one day. For me, that day was when Lehman Brothers filed for bankruptcy protection on September 15, 2008. I remember looking at my Bloomberg screen and thinking I was witnessing the end of the financial markets.

2014-01-30 High Yield in 2014: Where Can You Look for Upside in a \'Medium Yield\' Market? by Andrew Jessop, Hozef Arif of PIMCO

Default rates and credit losses in high yield markets remain below their long-term averages, and we believe default rates will remain low in 2014 and 2015 as well. Investors should consider positioning for better convexity via exposure to sectors with favorable industry dynamics and positive event risk from M&A or equity offerings, potential upside from price recovery in high quality bonds trading below par and exposure to select new supply from former investment grade companies.

2014-01-29 Fed Responsible for EM Crisis? by Axel Merk of Merk Investments

From the bully pulpits in Sao Paulo to the blogosphere in cyberspace, the Fed is blamed for the turmoil in Emerging Markets (EM). That’s a bit like blaming McDonald’s for obesity. Blaming others won’t fix the problems in EM economies, it won’t fix investors’ portfolios and it is an unlikely way to lose weight. Investors and policy makers need to wake up and realize that they are in charge of their own destiny. Let us explain.

2014-01-29 The Future in Focus: Trade Could Aid an Aging America by Milton Ezrati of Lord Abbett

Goods and services sourced from overseas could help the United States alleviate the effects of future labor shortages - if lawmakers can resist protectionist impulses.

2014-01-29 A Few Concerns by Scott Brown of Raymond James

We’ve begun 2014 with widespread expectations that economic growth will pick up. Growth last year was restrained by tighter fiscal policy. With that out of the way and the housing sector recovering, the pace of expansion is poised to improve. However, there are a number of concerns. Weak growth in real wages may limit consumer spending, which accounts for 70% of Gross Domestic Product. Long-term interest rates could rise too rapidly, choking off the recovery in the housing sector. A continued low trend in inflation, a major concern for some Fed officials, could weaken growth.

2014-01-29 Middle East/Africa: Regional Economic Review - 4Q 2013 by Team of Thomas White International

The International Monetary Fund (IMF) anticipates weak growth in the Middle East and North Africa (MENA) region mainly due to heightened political instability. What’s more, after years of healthy performance, growth in the oil exporting nations is expected to lose pace due to lower international demand and local oil supply disruptions. Given that these countries are witnessing a population boom, the IMF emphasized the need for economic diversification by the oil exporters and job creation in private non-oil sectors.

2014-01-28 2013 - A Strong Year for ETFs by Ryan Issakainen of First Trust Advisors

US-listed ETF1 net inflows totaled $185.5 billion in 2013, setting a new record. While the largest percentage of net inflows remained concentrated among a relatively small group of the 1521 US-listed ETFs, investors broadened their horizons more in 2013 than in previous years, as 312 ETFs had net inflows exceeding $100 million.

2014-01-28 Emerging Market Issues Weigh on U.S. Equities by Bob Doll of Nuveen Asset Management

U.S. equities finished lower last week as the S&P 500 declined 2.6% and suffered the largest weekly pullback since June of 2012. U.S. stocks are down approximately 3.0% both year to date and from all-time highs. In 2014, lack of direction in the market has been a focus, and the waning influence of macroeconomic news caused a notable shift late last week.

2014-01-28 Expect Higher Volatility to Persist by Russ Koesterich of BlackRock Investment Management

Last week’s selloff can be attributed to EM turmoil, stretched valuations and mediocre earnings. Volatility is likely to move higher to levels closer to long-term averages. We suggest investors adopt overweight positions in European and Japanese stocks.

2014-01-28 Surviving Austerity by Andrew Schiff of Euro Pacific Capital

With the Standard & Poor’s 500 Index having posted a 30% gain, it’s easy to assume that U.S. stocks easily led the world in 2013. (There is more on what is behind this rally in the latest version of the Euro Pacific Capital Newsletter). But as it turns out, the stimulus-loving U.S. markets had plenty of company. Surprisingly, this includes countries supposedly saddled by the scourge of austerity.

2014-01-28 The TTIP and the TPP by Bill O'Grady of Confluence Investment Management

The Transatlantic Trade and Investment Partnership (TTIP) is a trade and investment treaty being negotiated between the European Union (EU) and the U.S. The Trans-Pacific Partnership (TPP) is a similar pact between the U.S. and various Pacific Rim nations. We will examine overall details of each, focusing on how they’re different from traditional trade agreements. From there, we will present an analysis of the controversy surrounding the proposals, followed by a look at the geopolitical aims and likelihood that these treaties will be enacted. We conclude with potential market ramificatio

2014-01-27 Broadleaf\'s 2014 Investment Playbook by Doug MacKay, Bill Hoover, Mike Czekaj of Broadleaf Partners

Most sell side firms publish their outlook for the economy and stock market at the end of December and in early January. As a buy side firm, we really aren’t under any expectation to share our outlook for the coming year and, as funny as it might sound, some of our clients don’t even care to know what we think, only that we handle what they hired us to do, which is to outperform the market indices over a full market cycle and help them attain their financial goals over time.

2014-01-27 Hasenstab: Standing One\'s Ground by Michael Hasenstab of Franklin Templeton

When the masses are against you, it’s hard to stand your ground. Going against the crowd is familiar turf for Michael Hasenstab, who manages Templeton Global Bond Fund and co-manages Templeton Global Balanced Fund, and certainly knows the virtue of patience. He has staunchly defended his investment theses over the years, tuning out the naysayers and market noise time and again.

2014-01-27 Rummaging for Yield - The Case of the Insurance Investor by Eugene Dimitriou of PIMCO

Since the height of the global financial crisis in 2008, insurance companies have faced three key challenges: First, insurance companies urgently needed to address new critical risk management issues as banking sector and peripheral sovereign credit risks significantly increased in Europe. Second, the prospects of longer-term low yields forced insurers to identify alternative sources of meaningful yield. And third, insurance companies needed to prepare for pan-European insurance regulation Solvency II.

2014-01-25 Why the Recent Lift in Junior Miners Will Likely Continue by Frank Holmes of U.S. Global Investors

Junior venture companies in Canada are finally seeing a significant lift. In early January, the S&P/TSX Venture Composite Index rose above the 200-day moving average for the first time in three years. The index is also very close to experiencing a golden cross, which is when the shorter-term 50-day moving average crosses above the 200-day moving average. Historically, traders see this cross as extremely bullish.

2014-01-25 Wealth Services at Banks Come Under Central Bank\'s Scanner by Rajat Dhar of Cogent Advisory

RBI, the central bank of India, made critical observations of way in which wealth services were being practised at banks. Also, the clear note was made with respect to the rising cases of misselling at banks. This market commentary covers the draft guidelines issued by RBi and tries to uncover the reason for the same and the way forward for the clients. This has been the first time ever that separate guidelines have come for banks and independent financial advisors or advisory firms in India; and this article covers the wealth services being offered by banks in India.

2014-01-25 Forecast 2014: The CAPEs of Hope by John Mauldin of Millennium Wave Advisors

As we will see in the pages ahead, buy-and-hold investors are clearly sailing in dangerous waters, where the strong, cold current of deleveraging converges with the warm, fast rush of quantitative easing. Not only does this clash of forces create the potential for epic storms and fateful accidents, it dramatically increases the chances for sudden loss as rogue waves crash unwary investment vehicles against the underwater demographic reef!

2014-01-24 Stocks for 2014: Growth and Income For Total Return Part 3 by Chuck Carnevale of F.A.S.T. Graphs

When investing in common stocks, there is no one strategy that fits all investors. Some investors are focused on investing for income, some for capital appreciation and others for various combinations of both. Additionally, there is the issue of risk tolerance. Some investors are willing and capable of assuming greater risk if they believe it will lead to greater returns, while others are more risk adverse. These are just but a few of the many variations that apply to the individual investor’s own unique goals and characteristics.

2014-01-23 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The year 2014 is off to an uncertain start. Earnings reports are not doing that well (see Best Buy, Citigroup & all retailers etc.), and bond prices have rallied so far in 2014 despite the fears of tapering which were expressed as last year ended.

2014-01-23 What\'s Your 2014 Market View? by Robert Horrocks of Matthews Asia

U.S. monetary policy seems likely to continue occupying center stage as people fret about interest rates. Last year was a somewhat instructive year for monetary policy theory in that it seemed to show that policies can be effective even when interest rates have no further room to be lowered. Can the nominal GDP in the U.S. grow at faster rates in 2014, and what would that mean for Asia? This month Matthews Asia’s Chief Investment Officer, Robert Horrocks, offers his insights into how reforms planned for China could be a key factor to change and what could lie ahead for the region overall

2014-01-23 Economic Growth is Likely to Improve in 2014 by Derek Hamilton of Ivy Funds Investment Management

We believe a global economic upturn is likely in 2014, although the overall growth rate will remain sluggish. We think developed countries will show the largest improvement, which in turn will help support growth rates in emerging markets.

2014-01-23 Be Selective by Jim Goff, Adam Schor of Janus Capital Group

After broad rally, focus shifts to individual company growth prospects.

2014-01-22 Crosscurrents Buffet Markets by Bob Doll of Nuveen Asset Management

U.S. equity performance was mixed last week, as the S&P 500 recovered from Monday’s sell-off that was the largest one-day decline since early November. Economic data was mostly in line or slightly better than expected, following the disappointing December unemployment report. Corporate earnings drove much of the price action. Bank earnings were fairly well received but did not always translate to good performance since the stocks ran up earlier. Negative guidance trends remain an overhang, particularly for retail.

2014-01-22 What to Expect in 2014 (And Beyond) by Jack Rivkin of Altegris

Each year, I take Alfred Lord Tennyson’s advice and "ring out the old, ring in the new" by creating a list of expectations about the markets. My list involves events that the average investor thinks have only a one-in-three-chance of happening, but which I believe have more than a 50% chance of occurring. If this approach sounds familiar, it should. It’s modeled after Byron Wien’s annual list of "surprises." Like his, my expectations are designed to provoke thought and discussion.

2014-01-21 Stocks 2014: Investing for Growth - The Power and Protection of High Compounding Earnings Growth by Chuck Carnevale of F.A.S.T. Graphs

As I become more mature (translate: gotten older), my investment philosophy has slowly evolved into a more conservative posture. When I was a younger investor I felt I had time on my side, and therefore, was willing to take on greater risk as long as I believed that greater rewards could follow. In other words, if I made a mistake by investing in an aggressive and more risky growth stock that went badly, I felt I had adequate time to overcome or recover my losses. Consequently, as a younger investor I relished a good growth stock.

2014-01-21 Achieving Escape Velocity by Mohamed El-Erian of Project Syndicate

While the prospect of faster global GDP growth in 2014 is good news, it is too early to celebrate. Indeed, there is a risk that, by tempting policymakers into complacency, this year’s economic upturn could even end up being counterproductive.

2014-01-21 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

With a few more days to digest the labor data, investors began the week on another sour note, but a sense of normalcy returned on some other better-than-expected releases. Still, the Fed’s stimulus remains atop the headlines as speculation runs amuck about how the tapering will play out. Earnings season pushes ahead and, thus far, the results are lackluster at best. Don’t forget, as January goes...

2014-01-21 The Deflation Menace by Peter Schiff of Euro Pacific Capital

Dedicated readers of The Wall Street Journal have recently been offered many dire warnings about a clear and present danger that is stalking the global economy. They are not referring to a possible looming stock or real estate bubble (the paper sees few threats there). Nor are they talking about other usual suspects such as global warming, peak oil, the Arab Spring, sovereign defaults, the breakup of the euro, Miley Cyrus, a nuclear Iran, or Obamacare.

2014-01-21 Digging for Natural Resource Opportunities in 2014 by Frederick Fromm, Stephen Land, Matthew Adams of Franklin Templeton

The natural resources sector has been through a period of transition in the past year, one which has pushed many companies toward cost reduction and greater capital discipline amid an environment of rather sluggish global economic growth. Franklin Equity Group Analysts Fred Fromm, Stephen Land and Matthew Adams think an improving economic outlook could set the stage for potentially stronger commodity demand going forward, and see healthy potential demand growth for energy in particular. They share their outlook for the natural resources sector in 2014, and where they are finding opportunities.

2014-01-18 Dialing Down the Drama by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We remain optimistic on stocks for 2014, but there will likely be bumps in the road. Investor sentiment is elevated, complacency seems to be building, and the valuation story is less compelling. But waiting for a correction can be quite detrimental to portfolio performance, evidenced by last year. QE tapering will likely continue at a very modest pace and U.S. interest rates will likely drift higher throughout the year. We remain positive on Europe and our outlook toward China is improving, while we are in at wait-and-see sort of mode with Japan.

2014-01-18 Forecast 2014: \'Mark Twain!\' by John Mauldin of Millennium Wave Advisors

The surface of the market waters looks smooth, but the data above suggest caution as we proceed. Perhaps slowing the engine and taking more frequent soundings (or putting in closer stops!) might be in order. The cry should be "Mark twain!" Let’s steam ahead but take more frequent readings and know that a course correction may soon be necessary.

2014-01-17 Digging for Natural Resource Opportunities in 2014 by Frederick Fromm, Stephen Land, Matthew Adams of Franklin Templeton

The natural resources sector has been through a period of transition in the past year, one which has pushed many companies toward cost reduction and greater capital discipline amid an environment of rather sluggish global economic growth. Franklin Equity Group Analysts Fred Fromm, Stephen Land and Matthew Adams think an improving economic outlook could set the stage for potentially stronger commodity demand going forward, and see healthy potential demand growth for energy in particular. They share their outlook for the natural resources sector in 2014, and where they are finding opportunities.

2014-01-17 The Profits Bubble by Chris Brightman of Research Affiliates

Profits are dangerously elevated by all reasonable measures. S&P 500 Index real earnings per share are far above their long-term historical trend. Industry profit margins are at or near all-time highs. Corporate profits, both as a percentage of GDP and relative to labor income, are at or near record levels. The dramatic rise in income inequality is a direct consequence of this spectacular reallocation of income to capital and away from labor.

2014-01-17 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Co.

Some of the things we’ve been talking/warning you about in recent years came to fruition in 2013. Specifically, medium- and long-term interest rates rose and commodity prices declined.

2014-01-17 What Does It Take to Be in the Top 1 Percent? Not As Much As You Think by Frank Holmes of U.S. Global Investors

You might be surprised to learn that the top 20 percent of income earners bring in a household income of just over $100,000. The top 10 percent of earners have a household income of more than $148,687. To be considered in the top 1 percent, household income is at least $521,411.

2014-01-16 Keep Optimistic and Carry On by Scott Minerd of Guggenheim Partners

This is likely to be another good year for risk-on investing, as an improving economic outlook supports stocks and bonds in an environment marked by less volatility than 2013.

2014-01-16 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Last year ended very well for us! The New Year has started slowly both because of the weather and because of the middle of the week timing of the holidays. Last Friday’s employment report for December was the 1st real piece of economic data which the financial markets could sink their teeth into, and the results have most people (not us) confused.

2014-01-16 A Disappointing Jobs Report: 3 Investing Takeaways by Russ Koesterich of iShares Blog

Last Friday’s non-farm payroll report was a huge disappointment. Russ explains what this means for investors.

2014-01-14 The Great Man or the Great Wave by Bill O'Grady of Confluence Investment Management

One of the seminal debates among historians is how the process of history develops, characterized as the "great man versus the great wave" debate. In this report, we will begin by developing this debate with relation to America’s superpower role; specifically, we will examine whether the U.S. is struggling with the superpower role because of a lack of leadership (a great man position) or because the wave of history is aligned against the U.S. keeping that role. As always, we will conclude with potential market ramifications.

2014-01-14 Merk 2014 Dollar, Currency & Gold Outlook by Axel Merk of Merk Investments

Rarely has the future been so clear. Really?? A lot of money has been lost jumping on the bandwagon. Let’s do a common sense check on the greenback to gauge where risks might be lurking and where there might be profit opportunities for investors.

2014-01-13 Stocks Rise Modestly in First Full Week of Trading by Bob Doll of Nuveen Asset Management

U.S. equities finished mostly higher for the first full week of the year, with the S&P 500 gaining approximately 0.6%. There were no meaningful directional drivers behind the price action, which is a dynamic that has been prevalent so far in 2014.

2014-01-13 3 Reasons the Dollar Should Strengthen This Year by Russ Koesterich of iShares Blog

Russ explains why the U.S. dollar is likely to strengthen in 2014, and what this means for various asset classes.

2014-01-12 Forecast 2014: The Killer Ds by John Mauldin of Millennium Wave Advisors

We’ll continue our three-part 2014 forecast series this week by looking at the significant economic macrotrends that have to be understood, as always, as the context for any short-term forecast. These are the forces that are going to inexorably shift and shape our portfolios and businesses. Each of the nine macrotrends I’ll mention deserves its own book (and I’ve written books about two of them and numerous letters on most of them), but we’ll pause to gaze briefly at each as we scan the horizon.

2014-01-10 Automation and Lean Manufacturing: Boost Profits, Squeeze Employment by Tyler Howard of Saturna Capital

Despite industrial production reaching all-time highs in August of this year, employment in the manufacturing sector remains substantially below levels witnessed before the 2008-2009 recession. When looking at longer term employment trends in manufacturing, it becomes clear that companies increasingly boost production without adding incremental labor. Profit margins, while not yet recovered to pre-recession peaks, endure at historically high levels. Several long-term changes in the manufacturing economy contribute to this divergence: outsourcing, automation, and lean manufacturing.

2014-01-10 High Yield and Bank Loan Outlook- January 2014 by Team of Guggenheim Partners

Improving U.S. macroeconomic conditions should spur additional investor demand for high-yield bonds and bank loans, particularly with defaults exceptionally low. Still, investors should monitor trends pointing to an erosion of safety in leveraged credit.

2014-01-10 2014 Economic and Investment Outlook by Team of Ivy Funds Investment Management

Although the December 2013 U.S. budget pact between House and Senate negotiators was a welcome development, partisan battles over government spending still are possible in 2014. The agreement ends a three-year budget fight and sets government spending through fall 2015, but it does not eliminate the need to raise the nation’s borrowing limit - the "debt ceiling."

2014-01-10 Macro Strategy Review by Jim Welsh of Forward Investing

Heavy emphasis on the fundamentals factors driving the U.S., European Union, China, and Emerging economies, and how the fundamentals are likely to impact markets.

2014-01-10 Spanish Banks Start the New Year on a Positive Note by Team of GaveKal Capital

Government bond yields in Europe have declined rather rapidly in the new year-- and Spain is no exception.

2014-01-10 Hasenstab: Fed Tapering Was Inevitable by Michael Hasenstab of Franklin Templeton

The US Federal Reserve (Fed) announced its decision to reduce its $85 billion monthly asset purchase program by $10 billion starting in January 2014. What might the eventual end of the Fed’s policy of aggressive money printing mean for fixed-income investors? Michael Hasenstab, Ph.D, executive vice president, chief investment officer, Global Bonds, Franklin Templeton Fixed Income Group, believes there’s no reason for investors to panic. He outlines why he thinks that’s the case, and where on the map he’s spotting fixed income opportunities.

2014-01-10 Weekly Economic Commentary: December U.S. Employment Report by Carl Tannenbaum of Northern Trust

December U.S. employment report clouded by weather-related factors. A review of the two U.S. employment surveys. The ECB reaches a critical stage.

2014-01-10 Continuing a Winning Formula for 2014 by Frank Holmes of U.S. Global Investors

We believe there’s a way that increases the odds of winning. It’s by combining a bottom-up approach with a top-down strategy: Find great, fast-growing and shareholder-focused companies and focus on the best stocks in the sectors experiencing positive momentum.

2014-01-09 The U.S. Begins an (Un)employment Experiment by Sam Wardwell of Pioneer Investments

Extended unemployment benefits stopped for 1.3 million people at year-end. This doesn’t change their employment status...they just stop getting unemployment compensation. Extended benefits (of up to 99 weeks) was part of the recession-fighting fiscal stimulus package. A question was: did this create a dis-incentive to find a job (aka "funemployment").

2014-01-08 Consumer Confidence Jumped in December, But Why? by Gary Halbert of Halbert Wealth Management

Today we’ll look at several economic reports, including a big jump in consumer confidence last month. That seems a little odd given that over 63% of Americans still believe the country is headed in the wrong direction as I reported last week.

2014-01-08 When the QE Tide Recedes, Focus on What is Revealed by Robert McConnaughey of Columbia Management

While there is fierce debate on the ultimate effectiveness of monetary stimulus surging from the central banks, one cannot dispute the boost that it has given to asset prices. While we may be seeing some "green shoots" of overall growth pick-up in the developed world, the post-crisis recovery in asset values has not been primarily driven by economic or earnings growth. Instead, we have been in a high correlation environment where the rising tide lifted most diversified investor boats as repressed "risk-free" rates pushed money out into riskier asset classes.

2014-01-07 The World of Thinking Machines by Bill O'Grady of Confluence Investment Management

The New York Times recently published an article that discussed a new version of a computer chip that will be released later this year that is expected to automate tasks that currently require direct programming. In this report, we will open with an examination of the philosophy of learning. We will then discuss the potential dangers of such machines, including the ability to perform humanlike actions without a moral sense. We will also examine the potential economic and social side effects. As always, we will conclude with potential market ramifications.

2014-01-07 A Healing Economy by Richard Michaud of New Frontier Advisors

The quarter continued the theme of the year, with U.S. equities continuing their dramatic performance. For the quarter, the Dow was up 9.6%, the S&P 9.9%, and the NASDAQ 10.7%. The year’s returns substantially exceeded last year"s "expert predictions" and much of this year’s punditry with the Dow up 26.5%, S&P up 29.6%, and NASDAQ up 38.3%.

2014-01-07 Is 2014 the Year That Alternatives Matter Again? by Chris Maxey, Ryan Davis of Fortigent

In the wake of the financial crisis of 2008, investors piled into alternative investments en masse to help insulate their portfolios from another dramatic market decline. For those who had not yet bought into the idea of improving portfolio risk-adjusted returns, the 50% drawdown in the S&P 500 provided all the convincing needed.

2014-01-07 European Sector Overview by Team of GaveKal Capital

Though we primarily use our point-and-figure methodology when assessing attributes of individual stocks, we are also able to look at broader sets of data (such as sectors) to get a quick sense of price performance.

2014-01-06 Reflections on 2013: What\'s Important, What\'s Not, and What\'s Ahead by Mike Shedlock of Sitka Pacific Capital Management

A tale of 2 halves with lingering questions characterizes what we can say was the story for housing for 2013. In the first half of the year, rates were low as the 10 year note was well under 2%. People were still refinancing, as home prices rocketed. Multiple bids were common, and pundits like Ivy Zelman cheered the improving market with praise like "Housing is in Nirvana".

2014-01-06 The Great Malaise Drags On by Joseph Stiglitz of Project Syndicate

Maybe the global economy will perform a little better in 2014 than it did in 2013, or maybe not. Seen in the broader context of the continuing Great Malaise, both years will come to be regarded as a time of wasted opportunities.

2014-01-06 Too Big to Pop by Peter Schiff of Euro Pacific Capital

Most economic observers are predicting that 2014 will be the year in which the United States finally shrugs off the persistent malaise of the Great Recession. As we embark on this sunny new chapter, we may ask what wisdom the five-year trauma has delivered.

2014-01-06 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

To say that 2013 was an interesting year would be a bit of an understatement. We learned a long time ago not to make predictions about the stock market because no matter what is predicted, it is likely to be wrong. Even if we get lucky one year, we are not likely to even get close the following year. We do try to give guidance, however. Last year we suggested that, given the late run in the market in 2012 and its 15% return, investors should be happy with a return of 8 to 10% in 2013. Obviously, investors enjoyed much better returns.

2014-01-06 2013: A Review of the Past, the Present and the Future by Ron Surz of PPCA Inc

This commentary is divided into three sections. I begin with a review of current U.S. and foreign stock markets, examining the year 2013 and the past six years, including the crash of 2008. This perspective serves as a launch point into the future, specifically 2014 and the remainder of this decade. I conclude with a review of the past 88 years of U.S. stock and bond markets.

2014-01-04 Forecast 2014: The Human Transformation Revolution by John Mauldin of Millennium Wave Advisors

It is that time of the year when we peer into our darkened crystal balls in hopes of seeing portents of the future in the shadowy mists. This year I see three distinct wisps of vapor coalescing in the coming years. Each deserves its own treatment, so this year the annual forecast issue will in fact be three separate weekly pieces.

2014-01-03 Fiat\'s Stock Rises 16% Today, After Closing a $4.35B Deal For Chrysler by Team of GaveKal Capital

While none of the European automakers manage to pass our knowledge leaders screen, today’s news prompted us to take a closer look at the group.

2014-01-03 Gold Stocks: What to Expect in the New Year by Frank Holmes of U.S. Global Investors

After three years of pain, can gold stocks break their losing streak and see a gain in 2014? History says chances are good.

2014-01-03 Six Questions for 2014 - January 3, 2014 by Carl Tannenbaum of Northern Trust

Our economic outlook for this year will be available next week. To provide a taste of what’s ahead, here are six of the key questions we’ll focus on during the coming months.

2014-01-03 2014 Outlook: The Emergence of a Global Expansion by Team of Loomis Sayles

After years of a global recovery characterized by fits and starts, we expect more synchronized global growth in 2014. Global GDP growth will accelerate modestly from 2.7% in 2013 to approximately 3.4% in 2014, primarily driven by larger advanced economies. In particular, we are optimistic that US growth will be sustainable. The fading economic drag from government policy and the ongoing housing recovery should help boost US GDP growth toward 3% as the year progresses. The UK is poised for a similar rate of expansion in 2014, and Europe will likely post positive growth in the coming year.

2014-01-02 The World Economy\'s Shifting Challenges by George Soros of Project Syndicate

As 2013 comes to a close, efforts to revive growth in the world’s most influential economies are exerting competing pressures on the global economy. Perhaps not surprisingly, while Europe and the US will continue to play an important global role, developments in Asia will determine the worldwide outlook in 2014 and beyond.

2013-12-31 2014? by Jeffrey Saut of Raymond James

Year-end letters are difficult to write because there is always a tendency to discuss the year gone by or, worse, attempt to forecast the coming year. Typically, when the media asks where the S&P 500 (SPX/1841.40) will be at the end of the new year, I tell them you might as well flip a lucky penny.

2013-12-30 Predictions for the 2014 U.S. Financial Markets by Dawn Bennett of Bennett Group Financial Services

I’ve had so many phenomenal and diverse guests on my syndicated radio show, Financial Myth Busting, this year: Steve Forbes, Mort Zuckerman, David Stockman, Michael Belkin, David Walker, Dr. Ben Carson, Marc Faber, and even Ted Nugent. This is a very eclectic group, but they all have certain opinions in common. They all share the same concerns that the U.S. economic growth remains anemic and the continued economic instability and political deadlock along with business community’s mistrust of the U.S. government will continue to destroy America’s bottom line in the future.

2013-12-27 A Look Back at 2013 Calls by Russ Koesterich of iShares Blog

It’s time again for Russ K’s annual look back at his economic and investment calls. Find out what he got right - and what he got wrong.

2013-12-27 Global Equity Outlook: Clouded by Uncertainty by Norman Boersma of Franklin Templeton

Global equity investors generally had reason to cheer in 2013, and seemed more willing to embrace risk as the year progressed. Will the bullish mood persist in 2014? Norm Boersma, Chief Investment Officer, Templeton Global Equity Group, says that while it’s clear global investors have been allocating more dollars toward equities in recent days (particularly US equities), there are still a number of unknowns that make it hard to be overly exuberant.

2013-12-27 2013: Looking Back at the Year of the Bull by Frank Holmes of U.S. Global Investors

Will stocks continue to climb in 2014? Odds are "very good," finds BCA Research. According to historical data going back to 1870, there were 30 times when annual returns in domestic stocks climbed more than 25 percent. Of these, 23 experienced an additional increase, resulting in a mean of 12 percent, says BCA. Thinking back to January 2013, investors had a very different frame of mind. While we recently talked about the year’s biggest stories in U.S. energy and gold, today, we recap our popular commentaries focused on the domestic market.

2013-12-26 A Strong Finish for 2013 by Bob Doll of Nuveen Asset Management

For our weekly subscribers, we wanted to take an opportunity to look back on the year. We began 2013 with an outlook for the prospect of improvement for the global economy and risk assets. We thought global policymaker’s unprecedented attempts to reflate global growth would show some signs of bearing fruit, especially in the United States and China. In our forecast, equity markets would continue to be choppy in light of the fiscal cliff issues, but an inevitable political compromise would reduce the economic drag.

2013-12-24 How Much Should We Pay to Emit Carbon? by Michael Edesess (Article)

Many consider emissions of greenhouse gases to be what economists call a ’negative externality,’ meaning that they are likely to impose a cost on society through climate change and ocean acidification. The cost of that externality should, in principle, be borne by the emitters, who should pay a price to emit. But what should that price be?

2013-12-24 A Surprising Way to Participate in Today\'s Tech Boom by Frank Holmes of U.S. Global Investors

If I asked you to name the biggest online shopping day of the year, what would you guess?

2013-12-20 Let\'s Get Physical: Gold Bullion and Bitcoin by John Hathaway of Tocqueville Asset Management

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX), discusses in his latest insights piece the disparity in price direction between gold bullion and Bitcoin, in spite of the strikingly similar rationale for holding the two. He notes that the "Bitcoin-Gold incongruity is explained by the fact that financial engineers have not yet discovered a way to collateralize bitcoins for leveraged trades."

2013-12-20 Celebrating Asia\'s Growth Past and Present by Taizo Ishida, Mark Headley of Matthews Asia

Today, Matthews Asia celebrates 10 remarkable years that have passed since we launched our Asia Growth strategy to U.S. investors. During this time, the region has evolved in many significant ways. In the early 2000s, only the "Asian Tiger" economies had managed to reach GDP per capita levels considered the tipping point for consumption growth. More recently, consumption has been on the rise in many of the region’s economies, laying the foundation for Asia’s ongoing prosperity.

2013-12-20 Five Resolutions for 2014 by David Kelly of J.P. Morgan Funds

Entering 2014, the global investment environment is as challenging as ever. After a super 2013 in returns, U.S. equities can no longer be considered inexpensive and yet still look attractive relative to the prospective returns on savings accounts and long-term bonds. Long-term bond yields are higher than a year ago but could still rise further as the Federal Reserve begins to reduce quantitative easing.

2013-12-20 PIMCO Cyclical Outlook for the Americas: Riding the Cross-Currents of Higher U.S. Growth and the Fed by Mohit Mittal, Lupin Rahman, Ed Devlin of PIMCO

In the U.S., lower fiscal drag and the possibility of higher consumer and corporate spending should drive growth higher in 2014. Supported by higher U.S. growth and stabilization in Europe and China, Latin America is set to grow 3%-4% on average, but with a large dispersion across countries. Canada should benefit from the U.S. recovery but will likely lag U.S. growth due to lower consumption and residential investment.

2013-12-20 A Surprising Way to Participate in Today\'s Tech Boom by Frank Holmes of U.S. Global Investors

China has become one of the best consumption stories out there, and looking over the next few years, local technology companies are almost certain to benefit. So while many U.S. investors are getting excited about the growing number of initial public offerings in the tech sector, they would be remiss if they didn’t look beyond Silicon Valley.

2013-12-20 Looking Beyond the Initial Fed Taper by Sam Wardwell of Pioneer Investments

Can the Fed be believed or trusted? Pioneer’s Sam Wardwell analyzes the tension between data dependency and forward guidance in Fed policy.

2013-12-20 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

As this will be our last weekly of the year, we thought we would offer some parting reflections on the year just past.

2013-12-19 Coal in the Fed\'s Stock-ing by Tony Crescenzi, Lupin Rahman, Ben Emons of PIMCO

Forward guidance has become an increasingly common practice among global central banks. Communicating a possible change in the policy rate could have a large effect on long-term interest rates. Capital has moved literally around the globe as a result of central bank activism in developed countries. Looking ahead, we expect 2014 to be a year of increased differentiation across emerging markets in terms of economic fundamentals, policy reactions and market outcomes.

2013-12-19 Introducing Our Annual Global Outlook for 2014 by Jeff Hussey of Russell Investments

Jeff Hussey, global CIO, introduces Russell Investments’ 2014 Annual Global Outlook and explains why it will be important for investors to focus on risk premiums and precise exposures in 2014.

2013-12-19 Market\'s Fed Frenzy Can Finally End by Scott Minerd of Guggenheim Partners

The Fed surprised many investors by announcing it will taper in January, but made clear that interest rates will remain near the zero-bound as forward guidance becomes its primary policy tool.

2013-12-19 Georgia on My Mind by Mark Mobius of Franklin Templeton

My team and I recently traveled to Georgia, a small country in the Caucasus Mountains straddling the border between Europe and Asia. Why are we interested in Georgia? One word: reform. Georgia, which can be considered a frontier market, is on the cusp of burgeoning change.

2013-12-18 PIMCO\'s Cyclical Outlook for Asia: Growth Is Stabilizing but Not Stellar by Ramin Toloui, Tomoya Masanao, Robert Mead of PIMCO

In China, near-term economic performance will be dominated by the dialing back and forth of credit conditions by policymakers, while long-term reform progresses incrementally. Japan’s GDP growth will slow in 2014 due to a consumption tax hike but will still be above the country’s potential growth as it is assisted by reflationary policies. The pace of Australia’s growth will slow due to weakness in manufacturing and mining, reflecting tempered growth in China.

2013-12-18 Three Investments that Could Return to Favor in 2014 by Jeffrey Knight of Columbia Management

When investors lose confidence in an asset class, especially one that had been popular enough to attract outsized allocations, subsequent rebalancing generally leads to prolonged periods of underperformance. Technology stocks after 1999, for example, underperformed the S&P 500 in eight of the next 10 years and by a cumulative total of more than 40 percentage points. Today, many believe that interest rate sensitive bonds might have just begun a similar era of waning investor confidence, portfolio reallocation and underperformance.

2013-12-17 Letter to the Editor by Various (Article)

A reader responds to Dan Richards’ article, How Service Screw-ups Can Create Happier Clients, and a reader responds to Patrick McVeigh’s article, Low Demand Will Depress Oil Prices, both of which appeared last week.

2013-12-17 Will 2014 Bring an End to Central Bank Intervention? by Chris Maxey, Ryan Davis of Fortigent

Nearing the final two weeks of the year, it is customary to look forward to the trends and events that will shape the coming year. A theme that may come to the fore in 2014 revolves around central bankers, specifically the diverging fates in various economies of the world.

2013-12-17 The Monster That Is Europe by John Mauldin of Millennium Wave Advisors

This week, Geert Wilders and his Party for Freedom in the Netherlands and Marine Le Pen of the Front National (FN) of France held a press conference in The Hague to announce that they will be cooperating in the elections for the European Parliament next spring and hope to form a new eurosceptic bloc.

2013-12-17 The 2014 Geopolitical Outlook by Bill O'Grady of Confluence Investment Management

As is our custom, we close out the current year with our outlook for the next one. This report is less a series of predictions as it is a list of potential geopolitical issues that we believe will dominate the international situation in the upcoming year. It is not designed to be exhaustive; instead, it focuses on the "big picture" conditions that we believe will affect policy and markets going forward. They are listed in order of importance.

2013-12-16 A Much Better Dilemma by Mike Amey of PIMCO

While the UK economy is likely to avoid reverting to growth levels of recent years, it must transition into a more durable recovery involving business investment, higher productivity and stronger real wages. However, headwinds for domestic demand look significant and the banking system appears to favour secured lending to consumers over businesses. We believe that much of the rise in bond yields is already behind us. With clearer value in shorter bonds, our preference lies in short and intermediate gilts.

2013-12-16 Absolute Return Letter: Squeaky Bum Time by Niels Jensen, Nick Rees, Tricia Ward of Absolute Return Partners

QE has led to asset price inflation. That much we established in the November Absolute Return Letter. In this month’s letter we go one step further and look at whether we are now in bubble territory. Considering the strong bull-run we have experienced in 2012-13 it is perhaps surprising to learn that, in a historical context, it is not an outsized rally, nor are equity markets - with the possible exception of the United States - particularly expensive.

2013-12-16 2014 Investment Outlook: Economic Growth Should Broaden by Bob Doll of Nuveen Asset Management

For the first time in several years, we approach the new year without big clouds on the horizon. In the United States, accommodative monetary policy has healed many of the wounds from the 2008-2009 crisis.

2013-12-13 Where Have All the Savings Gone? by Giordano Lombardo of Pioneer Investments

The last six years have witnessed the most severe financial crisis since the end of World War II, with household earning capacity and saving ability experiencing significant changes due to the downturn in the real economies. This challenging economic situation definitely affected household saving behavior, although the impact has been different in various countries - for some, the impact on household earning capacity was more intense than others.

2013-12-13 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

No one deserved a break more than investment guys/gals (except maybe politicos). Unfortunately, Thanksgiving holiday was too "short and sweet" for many and the economic week that followed was crazy. Number after number depicted an economy on solid ground with strong confirmation from the late-week labor releases. Investors took profits throughout much of the week as the final month of the year began, but the Bulls were back in force to conclude the week.

2013-12-13 Glance Back...Focus Forward by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

A great market year for stocks is about to be capped off...can the run continue into 2014?

2013-12-13 One of the Most Notable Stories of the Year: Energy Renaissance in the U.S.A. by Frank Holmes of U.S. Global Investors

Only a few years ago, we were contemplating the supply constraints facing the petroleum industry, as many major oil fields around the world were facing a decline in production. Now, with the disruptive technology in shale oil and gas, we may be looking forward to decades of drilling.

2013-12-11 What Will 2014 Bring for The Equity Markets? by Marco Pirondini of Pioneer Investments

As the year draws to a close, investors are searching for clues as to what may be in store for the economy and markets in 2014. What have we learned from the markets in the month of November? Honestly, not very much. The scenario has not changed much in the last 30 days.

2013-12-11 AdvisorShares Weekly Market Review by AdvisorShares Research of AdvisorShares

In our last commentary, we noted the slow holiday week that did not provide us with much economic fodder. This week, the unemployment rate dropped to 7% and payrolls jumped more than expected. Third quarter GDP rose more than expected, and hit its highest mark since Q1 2012. Although the status of the U.S. budget remains up in the air, many expect Janet Yellen to maintain Chairman Bernanke’s accommodative policies. With the hectic holiday schedules nearing, it is difficult to predict what we will see this month.

2013-12-11 Muddling Through: The \'Realpolitik\' of the Eurozone Crisis by Andrew Bosomworth of PIMCO

The long-term cost of Europe’s economic recovery is likely to challenge social tolerance and political will to achieve a fully integrated fiscal and political union. Although able to exploit the untapped potential of European treaties, the soon-to-be-elected 8th European Parliament looks more likely to continue to muddle through. We see low medium-term risk for government and corporate bonds with maturities of up to three years, but caution may be required for securities with longer maturities and lower down in the capital structure.

2013-12-11 Municipal Bond Outlook - Institutional Fixed-Income Sector Report by Team of Guggenheim Partners

Volatility induced by headline events has created attractive price dislocations in the municipal bond market, which may now present the best buying opportunity for investors since late 2010.

2013-12-10 Low Demand Will Depress Oil Prices by Patrick McVeigh (Article)

The U.S. - and indeed, the world as a whole - is approaching the threshold of peak oil demand, rather than peak supply. Prices will fall in the coming years, regardless of fluctuations in supply.

2013-12-10 Christmas by Jeffrey Saut of Raymond James

Well it is official, Christmas has begun. For me it began with the private wine and dinner party at Morrell, arguably the finest wine store I have ever seen, and anyone that knows me knows I have seen a lot of wine stores! Morrell is located at 1 Rockefeller Center between 5th Avenue and 6th Avenue overlooking the Christmas tree at Rockefeller Center. I had done a gig on Bloomberg radio at Morrell last Tuesday with my friends Carol Massar and Pimm Fox and got invited to the party the next evening to watch the lighting of the Christmas tree.

2013-12-10 Best Consumed Below Zero? by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

In this report, we will turn our attention to Denmark to study its decision to undertake the below-zero rate, the specifics of the situation that prompted it and the effects of the negative rate on financial conditions and the broader economy. We will then briefly look at the possibility of a below-zero rate policy for the ECB and, most importantly, the geopolitical ramifications of the decision by the world’s second largest currency block to ease into unknown consequences of negative rates to stimulate the economy.

2013-12-09 Improving Economic Data Imply Further Global Recovery by Bob Doll of Nuveen Asset Management

U.S. equities finished last week in barely negative territory, ending the positive streak for the market. Economic data concerning the post-government shutdown climate has improved. Employment data beat estimates and increased by 203,000 jobs in November, and the unemployment rate fell to 7.0%, also surpassing expectations.

2013-12-09 Gauging Tapering Post November Jobs Report by Chris Maxey, Ryan Davis of Fortigent

With another month down in 2013, last week came time to dissect the latest report on employment. If the market reaction was indicative, the highly anticipated November labor report did not disappoint, sending stocks up more than 1% on Friday.

2013-12-07 Interview with Steve Forbes by John Mauldin of Millennium Wave Advisors

For whatever reason, Steve Forbes seems to bring out the passion in me. When I think about what central bank policies are doing to savers and investors, how we are screwing around with the pension system, circumventing rational market expectations because of an untested economic theory held by a relatively small number of academics, I get a little exercised. And Steve gives me the freedom to do it.

2013-12-06 Weekly Economic Commentary by Team of Northern Trust

The U.S. employment report puts taper onto the table. Don’t expect further rate cuts from the ECB or the Fed. Auto sales have been a bright spot amid sluggish consumer spending.

2013-12-06 Did the Government Shutdown Help the Economy? by Frank Holmes of U.S. Global Investors

Take the government shutdown in October, when the House and Senate fought over the debt ceiling. Economic data wasn’t released, services were halted, national parks were closed, and "non-essential government workers were told to stay home. As a result, GDP was expected to collapse. Yet, data released this week reveal a different, stronger image of the U.S. economy. I think Shakespeare would deem the media’s fear mongering tactics as Much Ado About Nothing.

2013-12-06 Going Against the Grain, Again by Cindy Sweeting of Franklin Templeton

Going against the grain is never easy, particularly when it comes to investing. But if you don’t take the risk of moving out of the crowd and taking a different path, you can’t really stand out. Templeton has focused on bottom-up value investing, which often puts it at odds with the broader market consensus. We go back in history to describe how the strategy has persevered through different market cycles, and why the Templeton team has been going against the grain by investing in Europe at a time when other investors had lost faith.

2013-12-05 A Synchronous Expansion by Scott Minerd of Guggenheim Partners

Major developed economies are all contributing to global economic growth, and this improving fundamental picture, coupled with ongoing monetary accommodation, bode well for risk assets.

2013-12-05 10 for \'14 by Richard Bernstein of Richard Bernstein Advisors

Each December we publish a list of investment themes that we feel are critical for the coming year. We continue to believe the US stock market will continue its run through one of the largest bull markets of our careers. Our positive outlook extends to the following areas: US Equities, Japanese Equities, European small cap stocks, high yield municipals.

2013-12-04 An Agenda to Save the Euro by Joseph Stiglitz of Project Syndicate

It has been three years since the outbreak of the euro crisis, and only an inveterate optimist would say that the worst is definitely over. It is not, and it won’t be unless and until the eurozone’s structure is fundamentally reformed.

2013-12-04 Emerging Asia Pacific: Regional Economic Review - Q3 2013 by Team of Thomas White International

The second half of 2013 has posed significant challenges to growth in major Emerging Asia Pacific economies. Almost all emerging Asia Pacific economies showed signs of strain arising from stubborn inflation, higher interest rates, slower consumer spending and lukewarm exports.

2013-12-03 Why Does the U.S. Have High-Cost Low-Quality Healthcare? by Michael Edesess and Kwok L. Tsui (Article)

The U.S. has worse mortality rates than virtually all other developed nations, and yet it spends twice as much per capita on health care. How on earth has the U.S. racked up such an appallingly bad health-care record, and what is the solution? A recent edition of the Journal of the American Medical Association identified many of the problems but was not persuasive in prescribing a cure.

2013-12-03 Looking Out on the Horizon for Equities by Bob Doll of Nuveen Asset Management

U.S. equities finished higher for an eighth consecutive week as the S&P 500 increased 0.1%, representing the longest positive streak since 2004. Inertia may have carried markets forward in a relatively quiet trading week without major headlines. Retail news appeared fairly positive in anticipation of a strong start to the Thanksgiving shopping weekend. Economic data was mixed.

2013-12-03 Turning Over Rocks by Herbert Abramson, Randall Abramson of Trapeze Asset Management

The S&P 500 is at a record high and we believe the markets generally are fully valued. Corporate revenue growth is anemic, profit margins are stretched, and the prospect of earnings rising meaningfully is not high. And, the outlook for the U.S. and global economy is still uncertain. Market psychology is at a level suggesting the market is overbought. Margin debt is at record levels and the current popularity of stocks by retail investors at market highs is in itself a red flag.

2013-12-03 U.S. Economy Slowly Gaining Traction - What\'s Ahead for Year-End? by Sam Wardwell of Pioneer Investments

As we enter the final month of 2013, my themes of the last several weeks continue - the capital markets, in general, remain quiet and U.S. economic data, while mixed, shows signs of steady improvement. This week, I’ll start by looking forward to some news we’ll be watching as the year closes out...

2013-11-30 Arsonists Running the Fire Brigade by John Mauldin of Millennium Wave Advisors

In the old days, central banks raised or lowered interest rates if they wanted to tighten or loosen monetary policy. In a Code Red world everything is more difficult. Policies like ZIRP, QE, LSAPs, and currency wars are immensely more complicated. Knowing how much money to print and when to undo Code Red policies will require wisdom and foresight. Putting such policies into practice is easy, almost like squeezing toothpaste. But unwinding them will be like putting the toothpaste back in the tube.

2013-11-29 ING Fixed Income Perspectives - November 2013 by Christine Hurtsellers and Matt Toms of ING Investement Management

Given rich valuations globally, we remain broadly neutral on interest rate risk with the exception of Japan.

2013-11-29 From the Taj Mahal to Westminster Abbey: Notes from a Global Investor by Frank Holmes of U.S. Global Investors

I recently returned from India, a nation where an incredible 600 million people are under the age of 25. That’s nearly double the entire population of the U.S.

2013-11-28 The Race is On by Howard Marks of Oaktree Capital

There’s a race to the bottom going on, reflecting a widespread reduction in the level of prudence on the part of investors and capital providers. No one can prove at this point that those who participate will be punished, or that their long-run performance won’t exceed that of the naysayers. But that is the usual pattern.

2013-11-27 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

This has been another quiet week for stocks which closed at their highs for the year. The Dow Jones Industrial Average even closed above 16,000 for the 1st time.

2013-11-27 Emerging Markets Equity Commentary - October 2013 by Team of Thomas White International

Equities Gain as Currencies Remain Stable and Data Trends Show Positive Signs.

2013-11-27 Global Economic Overview - October 2013 by Team of Thomas White International

Global economic trends continue to see gradual improvement, though the progress has become less steady. The developed economies remain the major drivers of global growth, but data from some of the regions have not met expectations.

2013-11-27 International Equity Commentary - October 2013 by Team of Thomas White International

Equities Advance as Global Manufacturing and Services Activity Gains Momentum

2013-11-26 Letters to the Editor by Various (Article)

A reader responds to Bob Veres’ article, Why Deficits Don’t Matter, which appeared on October 29, and a reader responds to Robert Huebscher’s article, Reflections on a Week in Cuba, which appeared on November 12.

2013-11-26 While You Were Sleeping: Asian Developments Loom for Financial Markets by Chris Maxey, Ryan Davis of Fortigent

Amid all the Fed talk dominating airwaves and headlines, a few key developments occurred overseas last week that could shape financial markets significantly in the quarters ahead.

2013-11-25 Recent Economic Trends Help Make Korea a Hidden Gem in Asia by Paul Chan and Simon Jeong of Invesco Blog

After more than two decades of financial setbacks, recent macroeconomic data is helping Korea overcome the negative economic stigma associated with its economy and equity markets.

2013-11-25 Solving the Income Puzzle by Christopher Remington, Michael Cirami, Kathleen Gaffney, Scott Page of Eaton Vance

Income needs may be as high as they’ve ever been, while the yield potential from many traditional investment classes has dwindled to generational lows. Investors who remain in high-priced, low-yielding core bond strategies could experience loss of principal (and mounting retirement shortfalls) if interest rates revert toward their mean. We advocate creating an integrated, multi-pronged income plan that may offer yield potential that meets investor needs, while managing key risks found in the typical core fixed-income allocation.

2013-11-25 An Open Letter to the FOMC: Recognizing the Valuation Bubble in Equities by John Hussman of Hussman Funds

The Fed has done enough, and perhaps dangerously more than enough. The prospect of dismal investment returns in equities is an outcome that is largely baked-in-the-cake. The only question is how much worse the outcomes will be as a result of Fed policy that has few economic mechanisms other than to encourage speculative behavior.

2013-11-25 Equities Extend Gains for the Seventh Consecutive Week by Bob Doll of Nuveen Asset Management

U.S. equities finished higher again last week as the S&P 500 increased 0.4%. The Fed continued to dominate headlines, with heightened emphasis on the distinction between tapering and tightening. Bubble speculation continued to receive attention in the press, while many articles refuted such concerns. The financial sector performed well, led by banks.

2013-11-24 Game of Thrones - European Style by John Mauldin of Millennium Wave Advisors

The Eurozone crisis is not over, and it will not end quickly or soon. Even if it seems to unfold in slow motion - like the slow build-up in a Game of Thrones storyline to violent internecine clashes followed by more slow plot developments but never any resolution, the Eurozone debacle has never really gone away. The structural imbalances have still not been fixed; politicians and central bankers have still not agreed to solve major fiscal problems; the overall economy still disintegrates; unemployment is staggeringly high in some countries and still rising; and the people are growing restless.

2013-11-22 Shifting Global Fortunes by Mark Mobius of Franklin Templeton

Most investors, particularly those who live in developed markets, probably aren’t aware of the influence emerging markets have on the global economy. I’m not just talking about China or just about governments. More and more large corporations are headquartered in emerging markets, a trend that I expect to continue. In addition, more of those companies that are located in emerging markets are also joining the ranks of the top companies in the world. In fact, some might be surprised to hear that some of the world’s largest initial public offerings (IPOs) have been in emerging m

2013-11-22 Weekly Economic Commentary by Carl Tannenbaum, Asha Bangalore of Northern Trust

The world needs to do more to stimulate spending. Moderate gains are seen for U.S. holiday sales. The Federal Reserve may change its policy mix.

2013-11-22 Understanding the Rise of China by Frank Holmes of U.S. Global Investors

If the sweeping economic reforms planned by Chinese leaders during the Third Plenum can be our guide, it looks to be a promising decade for global investors. Details released this week confirmed President Xi Jinping’s concerted efforts to move China toward a market-based economy that mirrors the West.

2013-11-21 Time to Be Bullish on Europe by Raul Elizalde of Path Financial

For the last four years US stocks outperformed European equities (and much of the world outside the US) by a large margin. Investors may conclude that investing abroad, even in the name of diversification, is nothing but a waste. But this may be a mistake. The very wide gap between US and European stocks seems overdone. US stocks have climbed to unprecedented and precarious levels while Europe has improved on many fronts without much effect on equity prices. This could be the time to diversify away from US stocks, and Europe seems to be the appropriate choice.

2013-11-21 Looking Beyond Inventories by Team of Northern Trust

Inventories have the habit of offering surprises in reports of real gross domestic product (GDP). The third quarter GDP report was one such occurrence, with inventories making an unexpectedly hefty contribution. A reversal of this event is most likely to influence the headline GDP number in the final three months of the year.

2013-11-21 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

Up, up, and away. Stocks surged for the sixth straight week, the S&P 500’s longest such streak since February 2013, as institutional investors welcomed remarked from the future Fed Chair (?) and "mom and pops" finally decided to join in the fun (better late than never). Suddenly Dow 16k, Nasdaq 4k, and, heck, even S&P 2k are well within reach. What financial debacle?

2013-11-21 Developed Asia Pacific: Regional Economic Review Q3 2013 by Team of Thomas White International

Developed Asia Pacific economies were back on their feet during the second quarter of 2013 as economic growth gained momentum, inflation fell mildly and exports climbed strongly. Most developed countries in the region such as Japan, Australia, and New Zealand reported a sharp positive swing in consumer and business confidence. Predominantly expansionary monetary and fiscal policies also helped keep the pace of economic recovery.

2013-11-21 Some Small-Caps Are More Global Than Others by Francis Gannon of The Royce Funds

How much of a contribution have overseas revenues made to this year’s dynamic domestic small-cap rally? Part of the answer lies in where portfolios invest and where they do not. Portfolio Manager and Principal Francis Gannon notes the emerging strength shown by those more economically sensitive sectors that are closely tied to global economic activity.

2013-11-21 US Stocks for a Baby Boom by Bill Smead of Smead Capital Management

As contrarians, we at Smead Capital Management frequently get questions about stocks like Gannett (GCI), Bank of America (BAC) and eBay (EBAY). To understand how excited we are to own these common stocks you need to understand how a long-duration common stock portfolio would benefit from the coming baby boom in the developed world. Thanks to wonderful research from The Bank Credit Analyst (BCA), we can understand the demographics of developed nations like the US. BCA concluded that a "baby boom" is coming in the US and in other developed nations.

2013-11-20 Yellen's Testimony Not Surprising: Fed Has More Work to Do by Sam Wardwell of Pioneer Investments

Janet Yellen’s Senate testimony in last week’s confirmation hearings was very dovish and offered no real surprises. She did not signal or hint at any change in Fed policy (it was a confirmation hearing), but suggested that the best way to achieve an exit from unconventional policy is to deliver a stronger recovery . . . and the Fed has "more work to do" to support that recovery. The risk that she will not be confirmed is considered negligible.

2013-11-20 Nuclear Deal With Iran - Don't Give Away The Store by Gary Halbert of Halbert Wealth Management

Obama administration representatives are quietly negotiating with Iran in an effort to stop its nuclear program. Under the proposed agreement, the US would relax or eliminate some of the tough sanctions that have crippled Iran’s economy. This is happening at the same time Congress is threatening to impose even tougher new sanctions on Iran.

2013-11-20 The Disinflationary Developed World: 2 Investment Implications by Russ Koesterich of iShares Blog

Inflation remains close to historic lows, not just in the United States but also in other large developed markets. Russ explains why this is the case and what it means for investors (hint: low-for-longer rates and another reason to consider underweighting Treasury-Inflation Protected Securities (TIPS)).

2013-11-19 Howard Marks: Equities are Under-owned and Un-loved by Robert Huebscher (Article)

According to Oaktree’s Howard Marks, U.S. equities are ’under-owned and un-loved, and I like to buy assets like that.’

2013-11-19 Where Will the Holiday Shopping Season Lead Us This Year? by Chris Maxey, Ryan Davis of Fortigent

The unofficial start to the holiday shopping season kicks off in a few short days. Economic uncertainty abounds, raising fears that consumers will pull back from spending, but some positive developments suggest consumers will be just fine.

2013-11-19 Breaking News! U.S. Equity Market Overvalued! by Ben Inker of GMO

In GMO’s quarterly letter to institutional clients today, co-head of asset allocation Ben Inker outlines the reasoning behind GMO implementing a new forecast methodology for the U.S. stock market. While the new methodology has slightly increased GMO’s seven-year forecast for U.S. equity returns, Ben notes, "The basic point for us remains the same -- the U.S. stock market is trading at levels that do not seem capable of supporting the type of returns that investors have gotten used to receiving from equities."

2013-11-19 Ignoble Prizes and Appointments by Jeremy Grantham of GMO

Chief investment strategist Jeremy Grantham comments on this year’s Nobel Prize in economics and "the most laughable of all assumption-based theories, the Efficient Market Hypothesis"; candidates to succeed Chairman Bernanke at the Fed; the impact of commodity price rises and the housing bubble in the crash of 2008; and prospects for the U.S. equity market.

2013-11-19 France and the Iranian Negotiations by Bill O'Grady of Confluence Investment Management

Earlier this month, negotiations between Iran and the P5+1 failed to reach an agreement despite great hopes that one was near. In this report, we will examine the reasons behind French objections to a nuclear deal with Iran. We will begin with an examination of France’s relations with the Middle East, focusing on its relations with Israel. Using this history as a guide, we will analyze why the French scotched the potential agreement. A short discussion will follow of the impact of France’s objection on the evolution of U.S. policy with Iran. As always, we conclude with market ramif

2013-11-18 The ECB Rate Cut - Too Little and Too Late by John Greenwood of Invesco Blog

The decision of the European Central Bank (ECB) last week to cut its main refinancing rate from 0.5% to 0.25% and the marginal lending facility from 1.00% to 0.75% is too little and too late -- and virtually irrelevant to financial markets. The decision came after published data showed the eurozone headline consumer price index slowing to 0.7% year-on-year in October. Of course the equity markets rallied temporarily in a knee-jerk reaction to the ECB’s move, but by the end of the day most of the gains were lost.

2013-11-18 Willing a Fiscal Win by Christine Hurtsellers, Matt Toms of ING Investment Management

Why can’t we just will our desired political outcomes the way the most fervent seemingly can impact ballgames? After watching Fenway Park packed to the rafters with Red Sox faithful exercising their sovereign and ethereal right to psychically encourage baseballs out of the yard and knowing that millions of others in Red Sox nation were doing the same in front of their televisions we’re left wondering if the fans of Team U.S.A. can apply a little of that classic Carlton Fisk mojo a few hundred miles down I-95.

2013-11-16 Gliding to Year End? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Although we remain optimistic, the path to year-end may have some potholes. US stocks are among the more attractive investment options available, but there is the risk of a pullback in the near term should sentiment conditions continue to be elevated. There is also a risk of a melt-up in stocks given recent momentum. Europe is dealing with falling inflation and weak growth, although expectations are low, leaving investment opportunities somewhat attractive. Both Japan and China appear to be at a crossroads and we are watching political and monetary developments carefully.

2013-11-15 Taper or Not, Stocks and Bonds Could Gain by Scott Minerd of Guggenheim Partners

Both bond and equity markets are well-positioned, regardless of whether the U.S. Federal Reserve tapers its asset purchase program.

2013-11-15 “Great Rotation?” How About “Selective Rotation?” by Eric Takaha of Franklin Templeton

A few months ago there was a lot of buzz about a so-called “Great Rotation,” used to describe an investor exodus from fixed income and into equities, conjuring up images of a massive herd of wildebeest on the African plain racing for greener pastures. Oftentimes, when investors react to the market with a herd mentality, they can wind up losing sight of where they are going, and why. Eric Takaha, senior vice president and portfolio manager for Franklin Strategic Income Fund, says what he’s seen is more of a “selective rotation.”

2013-11-15 Keep Your Eyes on Bonds by John Browne of Euro Pacific Capital

Last month, Americans were transfixed by the amateur theatrics undertaken by the Washington political establishment in connection with the debt ceiling crisis. The bad faith, poor tactics and wholesale avoidance of reality were offered by all players in very large doses. When the Republican leadership finally capitulated (thereby bringing down the curtain on the tawdry production), it soon became apparent that sound and fury had signified nothing except another exercise in can kicking.

2013-11-15 Dressed to the Nines with Gold by Frank Holmes of U.S. Global Investors

While paper gold is getting the cold shoulder in the West, the Love Trade buyers in the East are wrapping their arms around all the physical gold they can get their hands on.

2013-11-15 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The Federal Reserve’s policies may remain easier for longer than previously thought. What’s the best way to arrest falling labor force participation? Look for the Fed to adopt a lower unemployment target.

2013-11-15 Are You Prepared for Economic Recovery? by Nanette Abuhoff Jacobson of Hartford Funds

Nanette Abuhoff Jacobson discusses how many portfolios are out of balance today and explains why investors should consider increasing their equity exposure.

2013-11-15 The Future of the Indian Rupee Is Tied to Oil Imports by Ignatius Chithelen of Knowledge @ Wharton

The weakness or strength of the Indian rupee will continue to be largely determined by the level and costs of the country’s crude oil imports, according to Ignatius Chithelen, managing partner of Banyan Tree Capital Management.

2013-11-14 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

Data keeps coming fast and furious and (for the most part) it has been favorable. Investors remain torn between being ecstatic about the solid recovery or worried about the implications for another Fed move. Stocks were mixed throughout the week with the Dow Jones staying in record territory. Is that worth a Tweet (now that it’s public)?

2013-11-14 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

There were several news surprises to trade around last week, but when the music ended stocks were mixed as the charts above illustrate. The Dow Jones Industrial Average gained nearly 1 percent while the NASDAQ Composite was virtually flat.

2013-11-14 The Secret of the Euro\'s Survival by Milton Ezrati of Lord Abbett

Despite fiscal strains and political controversy, the common currency still enjoys broad support among member nations. Here’s why.

2013-11-13 Why I Sell the Dollar: From Dollar Strength to Dollar Weakness by Axel Merk of Merk Investments

To those that say the U.S. has the cleanest of the dirty shirts, we would like to point out that it hasn’t helped the greenback, as evidenced by the euro outperforming the dollar both so far this year, as well as last year. Yes, we have a mess in the Eurozone that won’t be resolved anytime soon. But we also have a mess in the U.S., Japan, and many other places around the globe.

2013-11-13 When Flexibility Meets Opportunity in the European Commercial Real Estate Market by Laurent Luccioni of PIMCO

The pace of asset sales by European banks has been slower than many anticipated due to the fragile economic, political and regulatory environment across the continent. A complex CRE landscape and the pervasive effects of cognitive bias, capital rigidity and the unintended consequences of regulation mean mispricing can occur frequently. Unlocking value in this environment requires a flexible approach to investing across the capital structure and the resources to source, underwrite, structure, service and operate commercial real estate assets.

2013-11-12 Markets Vacillate Between Stronger Economy and Fed Accommodation by Bob Doll of Nuveen Asset Management

U.S. equities finished mostly higher last week as the S&P 500 increased 0.6%, ending higher for the fifth straight week. The return of central bank action was a primary concern. The European Central Bank (ECB) surprised investors with a 0.25% rate cut, while the debate over the Federal Reserve’s impending tapering decision continued in earnest.

2013-11-12 Currency Markets Show Signs of Reversal by Chris Maxey, Ryan Davis of Fortigent

A mixture of surprising economic data and changing central bank policy led to sharp moves in currency markets last week. This came after several gyrations in FX markets earlier this year. Looking forward, volatility is likely to remain, but many signs point towards a strengthening U.S. dollar.

2013-11-12 New Fed Papers Foreshadow a Dovish Fed Policy Under Yellen by Sam Wardwell of Pioneer Investments

New Fed Papers Foreshadow a Dovish Fed Policy Under Yellen Two new Fed papers presented at the International Monetary Fund (IMF) argue for prompt lobbying for continued aggressive monetary policy, but suggest prompt tapering of quantitative easing (QE) and more emphasis on forward guidance. The assumption is that these papers would not have been released if Janet Yellen intended to push policy in a different direction . . . and they reinforce the message of papers released at Jackson Hole this summer, suggesting that QE wasn’t acting as effective economic stimulus.

2013-11-12 Big Ideas on Gold and Resources in the Big Easy by Frank Holmes of U.S. Global Investors

For nearly four decades, curious investors have made their way to the Big Easy for a taste of New Orleans and several helpings of advice and perspective at the New Orleans Investment Conference.

2013-11-12 Dream to Outperform the Market by Bill Smead of Smead Capital Management

If you dream about investment market outcomes which are already popular in the marketplace, your dreams can turn into nightmares. The Everly Brothers 1958 hit song, “All I have to do is Dream” tells us a great deal about the long-term posture of investors in late 2013 and how dreams can turn to nightmares. On the other hand, if you dream about an outcome which most experts aren’t expecting, the rewards can be explosive.

2013-11-11 That Was the Week That Was?! by Jeffrey Saut of Raymond James

That Was the Week That Was, informally TWTWTW or TW3, was a satirical comedy program on BBC television in 1962 and 1963. It was devised, produced, and directed by Ned Sherrin and presented by David Frost. An American version by the same name aired on NBC from 1964 to 1965, also featuring David Frost. And last week was just such a week for me.

2013-11-08 U.S. Shale Oil: A Central Banker\'s Best Friend by Charles Wilson of Thornburg Investment Management

After nearly a decade of sustained high energy prices , U.S. oil and natural gas producers responded to the market’s call for supply with newly exploitable shale resources. The fresh supply helped reduce concerns about global spare production capacity and limited upward pressure on energy prices. Central bankers around the world were able to maintain highly accommodative monetary policies for prolonged periods as a result.

2013-11-08 Manager Q&A: Tocqueville Gold Fund by John Hathaway, Doug Groh of Tocqueville Asset Management

In a new Q&A, John Hathaway and Doug Groh, the co-portfolio managers of the Tocqueville Gold Fund (TGLDX), answer questions about the price of gold, the relationship between the price of the commodity and gold miner stock prices, and industry consolidation amongst gold miners.

2013-11-08 Government Shutdown Doesn't Shut Down Markets in October by Karen Cavanaugh of ING Investment Management

The stage was set for an October selloff, but markets treated investors to another round of across-the-board gains. Headlines comparing today’s equity market with 1999 are way off; the current rally has been driven by solid corporate fundamentals, and the market remains compellingly valued. Global economic growth remains sluggish, and eventual Fed tapering is likely to introduce volatility into markets worldwide.

2013-11-08 Weekly Economic Commentary by Team of Northern Trust

The ECB’s rate cut signals concerns about deflation. The U.S. job numbers provide an upside surprise. How reliable are the U.S. employment data?

2013-11-08 Big Ideas in the Big Easy by Frank Holmes of U.S. Global Investors

This is likely a contrarian view to the folks in the White House, but I think investors benefit from being contrarian and thinking differently. In preparation for my presentations in New Orleans as well as for the Metals & Minerals Investment Conference in San Francisco and the Mines and Money in London in a few weeks, I’ve been pulling together this kind of research that we can all put to use now.

2013-11-07 Gold: Hold It or Fold It? by Peter Schiff of Euro Pacific Precious Metals

It’s starting to feel like we are part of a giant poker game against the US government, whose hand is the true condition of the American economy. The government has become so good at bluffing that most people feel compelled to watch how the biggest players in the game react to determine their own investment strategy.

2013-11-07 EM: The Growth Story That Isn't by Richard Bernstein of Richard Bernstein Advisors

We remain very concerned about emerging market stocks and bonds. The recent outperformance of EM stocks is again luring investors to once again touch the hot stove. Emerging markets seem to have some significant structural and cyclical issues about which investors seem unaware or seem to be ignoring.

2013-11-07 Global Forecast: Synchronized Growth - So Long as Governments Behave by Andrew Pease of Russell Investments

Russell Investments released its Q4 Strategists’ Outlook and Barometer report, a quarterly update to its Annual Global Outlook which helps inform the short to medium term asset allocations in Russell’s multi-asset strategies and portfolios.

2013-11-07 Upgrading Non-U.S. Equities by Jeffrey Knight of Columbia Management

Two performance trends have stood out across world markets during 2013. The first is the strong outperformance by equities over bonds. The second is the strong returns of the U.S. stock market relative to other stock markets around the world. The Table breaks down year to date performance for the S&P 500, Eurostoxx 50, FTSE 100, Topix and MSCI Emerging Market indices. Notice that as of the end of July, equity returns in the Unites States were handily outpacing all other regions except Japan.

2013-11-07 Absolute Return Letter: Euthanasia of the economy? by Niels Jensen, Nick Rees, Tricia Ward of Absolute Return Partners

QE has had two noticeable and positive effects. It has saved the world from a financial meltdown not once, but twice, and it has had an overwhelmingly positive impact on asset prices, so in that respect QE has been a success. However, there are growing signs that QE may be beginning to impair economic growth and it may even cause dis-inflation, precisely the opposite of what was widely expected. For these reasons we believe it is time to call it quits and begin to tackle the root problem a banking industry still suffocating from bad loans.

2013-11-06 The Top 10 Investor Worries Right Now by Robert Isbitts of Sungarden Investment Research

In the first of a regular series in my Informed Investing blog, let’s count down the top 10 things that give investors the willies in today’s investment environment. These are situations known to even casual investors, but may or may not be communicated to them effectively by their financial advisors.

2013-11-05 Skepticism Still Abounds by Bob Doll of Nuveen Asset Management

U.S. equities were mixed last week as the markets were broadly unchanged. The October FOMC statement was a bit more hawkish than expected, causing concern that the recent delay in tapering may have been too aggressive. Other worries appear to be tail risks surrounding a possible Fed liquidity trap and accompanying asset bubbles. Economic data were mixed as markets struggle with the trade-offs between recovery and policy normalization.

2013-11-05 Ex-US Property Bubble Peaking? by Chris Maxey, Ryan Davis of Fortigent

For several years now, a common storyline on China was the immense overcapacity in the country’s housing market. A mixture of easy credit policies and officials’ explicit economic growth plans based on capital investment yielded construction on a massive scale across the countryside. So-called ghost towns emerged as the pace of building and the migration of rural citizens into these cities fell out of sync.

2013-11-05 The Saudi Tribulation by Bill OGrady of Confluence Investment Management

In this report, we will discuss the basic history of U.S. and Saudi relations, focusing on the historical commonality of goals between the two nations. We will detail how the aims of the two nations have diverged since the Cold War ended and use this to examine America’s evolving plans for the Middle East. We will discuss how the evolution of U.S. policy is affecting Saudi Arabia and the pressures these changes are bringing to the kingdom. As always, we will conclude with market ramifications.

2013-11-05 Don't Miss This Golden Cross in Resources by Frank Holmes of U.S. Global Investors

While investors have been focusing on the strengthening U.S. market, we’ve also kept our eyes on other improving indicators happening in resources, Europe, and emerging markets. These places may not be as widely popular, but we believe investors can benefit greatly from taking a view that’s different from the ones observed by the majority.

2013-11-04 Why Wealth Taxes Are Not Enough by Kenneth Rogoff of Project Syndicate

The IMF is right on grounds of both fairness and efficiency to raise the idea of temporary wealth taxes in many countries. But, as appealing as such taxes may seem at first sight, a closer look reveals that the revenues are lower, and the costs higher, than calculations used to promote them would imply.

2013-11-04 The Great Stall of China by Steve Cao, Mark Jason of Invesco Blog

While China is without question the growth driver and the outperformer among Asian emerging markets, it’s clear the country is transitioning toward slower growth because of demographic factors and domestic rebalancing. In our view, China is entering a multiyear period of slower growth, but we consider its future growth robust and sustainable when compared with overall global gross domestic product (GDP) growth -- albeit below the annualized pace of more than 10% China experienced from 2001 to 2010.

2013-11-01 Bank Reform: Europe's Slow and Steady Progress Continues by Monty Guild, Tony Danaher of Guild Investment Management

When Spain’s real estate bubble burst in 2008, the country went into a recession. The country was returning to growth in 2010, just in time to be taken down by the continent’s emerging banking and sovereign debt crisis.

2013-11-01 Where Do Profits Go from Here? Up. Here's Why. by Joseph Tanious, Anthony Wile of J.P. Morgan Funds

After record-setting earnings in the first two quarters of 2013, the S&P 500 is on track to hit another historic high in profits for 3Q13. If this occurs, the first three quarters of this year will have been the most profitable ever in the 56-year history of the S&P 500. Future earnings growth through margin expansion seems unlikely, as an improving labor market and higher interest rates will most likely squeeze margins. However, stable revenue growth, share buybacks and the additional use of debt financing should support modest earnings gains in the year ahead.

2013-11-01 What the End of a Greek Tragedy Means for Investors by Frank Holmes of U.S. Global Investors

After six long years, Greece’s economy is finally expected to grow in 2014. GDP expectations of 0.6 percent next year is a remarkable improvement compared to a loss of 4 percent this year. In addition to rising GDP, here are a few other significant changes from Greece lately:

2013-11-01 When Small is Big by Mark Mobius of Franklin Templeton

There’s a popular saying in the US, “good things come in small packages,” which is generally a statement about gifts of jewelry. My team and I find this saying can apply to the investment world, too, as we often find companies that are small in size, but which may have big long-term potential.

2013-11-01 Emerging Markets Equity Commentary by Team of Thomas White International

Emerging market equity prices saw a robust recovery in September as investor concerns about slower capital inflows to these markets faded after the U.S. Federal Reserve unexpectedly decided to delay the tapering of bond purchases.

2013-11-01 Weekly Economic Commentary by Team of Northern Trust

The public needs to move beyond its bad feelings toward financial institutions. Should we modify the price stability mandate of central banks? The Fed offers no surprises.

2013-10-31 Global Economic Outlook by Carl Tannenbaum of Northern Trust

The United States avoided a fiscal accident after Congress struck a deal to end the partial government shutdown and bought time to resolve differences over the federal budget. Assuming political discord will not result in another standoff, the U.S. economy is projected to show steady and stronger growth in 2014 compared with 2013.

2013-10-31 A Rebound in Global Equities by Scott Minerd of Guggenheim Partners

With the U.S. economic expansion entering its fifth year and the global economic picture improving, it appears equities in Europe and Asia can still rise.

2013-10-31 The Age of Experimentation (Global Economic Outlook for Fourth Quarter 2013) by Robert Scherfke of Hartford Funds

Macroanalyst Robert Scherfke, PhD discusses the progress global economies have made since 2008 and the challenges officials face as they normalize fiscal policies.

2013-10-31 International Equity Commentary by Team of Thomas White International

International equity prices saw robust gains in September as the U.S. Federal Reserve unexpectedly refrained from reducing its bond purchase programs. In addition, the lowering of the U.S. growth forecast by the Fed lifted investor optimism that the quantitative easing is likely to be wound down at a very gradual pace.

2013-10-30 Bernanke vs. Yellen: A Spooky Outlook? by Axel Merk of Merk Investments

Fed Chair nominee Janet Yellen will take over where her predecessor Ben Bernanke leaves off. Not just operationally, but also philosophically. To understand where the Fed and the U.S. dollar may be heading, we take a closer look at where Bernanke and Yellen are coming from.

2013-10-29 Why Deficits Don’t Matter by Bob Veres (Article)

Stephanie Kelton, Associate Professor of Economics at the University of Missouri/Kansas City, believes that the root of our deficit problems can be found in a fundamental misunderstanding – shared by Democrats, Republicans and mainstream voters alike – about the government’s balance sheet. She argues, plausibly, that the whole idea that we should control the deficit at all is costing our nation trillions of dollars in lost output. The result is lost income, savings, wealth and prosperity.

2013-10-29 We Must Avoid Seeing the New Arctic through an Old World Lens by Scott Minerd of Guggenheim Partners

It would be easy to think those with a thirst for exploration were born too late - to assume that humanity has already reached every corner of the earth there is to discover. But one region - the Arctic - still contains uncharted mysteries.

2013-10-29 Only RED That You Have Seen in October... by Blaine Rollins of 361 Capital

The markets felt a bit different this week. While equities finished with another weekly gain, it was lead to new highs by a new and interesting cast of characters: the Dow Industrials, Dividend Stocks (like Utilities & Industrials), Germany, the United Kingdom, Gold & Silver, and Long Maturity Treasuries. While everyone under invested in risk is hoping for a pullback, the rest who are equal or overweight seem to be looking to buy on any pullback.

2013-10-29 Is This the New Normal'? by Sam Wardwell of Pioneer Investments

Markets Settle into a New “Normal” All sorts of economic data were released last week, but volatility has dropped: rightly or wrongly, market forecasts about the pace of quantitative easing (QE) and earnings growth in the U.S. appear to have coalesced around an outlook for “slow growth with ongoing QE”.

2013-10-29 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

Nice to have a week free of politico rhetoric and distractions for a change (don’t get used to it). With little in the way of budget battles, investors focused on earnings and generally liked what they saw. Add in some positive economic news from China and a labor picture that should prompt the Fed to stay put (for now) and you have another record for the S&P.

2013-10-29 Equities Reach All-Time HighsYet Again! by Bob Doll of Nuveen Asset Management

U.S. equities marked another all-time high last week as the S&P 500 increased 0.9%. (1) Global equities reached new cycle highs for the second week in a row. Many investors have concerns that the gains will not last since the world economy remains lackluster and the liquidity driving the current rally will eventually stop.

2013-10-28 The Grand Superstition by John Hussman of Hussman Funds

One thing that separates humans from animals is the ability to evaluate whether there is really any actual mechanistic link between cause and effect. When we stop looking for those links, and believe that one thing causes another because “it just does” we give up the benefits of human intelligence and exchange them for the reflexive impulses of lemmings, sheep, and pigeons.

2013-10-28 Crawling, Economic Impact of Stubbing Your Toe and Employment by Gregg Bienstock of Lumesis

I have to admit, I had a lot of trouble figuring out where to start this week -- unemployment from last week, post-shutdown observations, exports or sobering observations around expected growth of the US economy and expected implications. It was a Barron’s article, “Slowing to a Crawl” that pushed me to address the latter first. Why? Much of what the article focuses on hit very close to home the impact of demographics and economic data on our economies.

2013-10-26 A Code Red World by John Mauldin of Millennium Wave Advisors

The heart of this week’s letter is the introduction of my just-released new book, Code Red. It is my own take (along with co-author Jonathan Tepper) on the problems that have grown out of an unrelenting assault on monetary norms by central banks around the world.

2013-10-25 Weekly Economic Commentary by Team of Northern Trust

The upcoming check-up of eurozone banks is long overdue. Quantitative easing is having little impact on U.S. bank lending. China needs to do more to stress consumption.

2013-10-25 Why Growth is Deep in the Heart of Texas by Frank Holmes of U.S. Global Investors

TIME Magazine’s cover this week features an engaging collage of the 50 states reassembled to fit within the boundaries of Texas. With a growing number of solid-paying jobs, affordable housing, and low taxes, “the Lone Star State is America’s Future,” declares economist and writer Tyler Cowen.

2013-10-25 Quarterly Review and Outlook by Van Hoisington, Lacy Hunt of Hoisington Investment Management

When an economy is excessively over-indebted and disinflationary factors have forced central banks to make overnight interest rates as close to zero as possible, central bank policy has repeatedly proved powerless to further move inflation or growth metrics. Four considerations suggest the Fed will continue to be unsuccessful in engineering stronger growth and higher inflation with their continuation of the current program of Large Scale Asset Purchases.

2013-10-24 Risk-On Returns by Scott Minerd of Guggenheim Partners

Ultra loose U.S. monetary policy continues pushing asset values higher at home and abroad. Seasonal factors should also provide a tailwind and lift asset prices across nearly every investment class.

2013-10-24 Trying to Stop a Bull Market Has Risks by Frank Holmes of U.S. Global Investors

U.S. stocks have been on a tear. The S&P 500 Index has climbed a surprising 20 percent so far this year, as a global synchronized recovery takes shape and funds flow back to equities. As I often say, investors take risks when they try to stop a bull run, and plenty of data suggest you might regret taking that action this year.

2013-10-24 Africa's “Glass With Attitude” by Mark Mobius of Franklin Templeton

Africa has been an area of interest to our team, for many reasons. One might say Africa’s biggest asset is its youthful population. With a median age of under 20 in many countries today, that means a very high portion of Africa’s population is dependent on the adult workforce. Tomorrow, however, it means that the workforce will be massive, and the ratio of dependents to workers (the dependency ratio) could be among the lowest in the world. This huge and youthful population is a key rationale for our interest there.

2013-10-23 Singaporean Consumer Consumption and Confidence is Weak - Should Investors Worry? by Team of Manning & Napier

Singapore is the world’s 35th largest economy by nominal GDP, yet ranks 6th in the world by GDP per capita, signifying its position as an advanced and highly-productive economy. With an efficient regulatory framework, low tax rates, and a flexible labor market, Singapore has a reputation for being one of the most business-friendly countries in the world.

2013-10-23 Shifting Gears: The Fed Turns from Tapering to Tempering Expectations by Nanette Abuhoff Jacobson of Hartford Funds

Federal Reserve (Fed) Chairman Ben Bernanke surprised markets on September 18 by announcing a continuation of the Fed’s $85 billion-per-month bond purchases and more muted expectations for economic growth and inflation. With this proverbial monkey wrench thrown into the gears of financial markets, investors are now asking how the Fed’s new course changes the investment outlook.

2013-10-23 Investment Bulletin: Global Equity Strategy by Team of Bedlam Asset Management

The portfolio enjoyed another index-beating month with a gain of 0.9% versus 0.6%, so improving further the long term numbers. As noted in previous Bulletins, correlations between growth and equity market returns are low. Investors remain fixated otherwise, but some confusion is reasonable given that growth in earnings per share is also slowing. Yet strong equity markets can be justified by the Free Lunch Theory.

2013-10-23 Can Kicked Down the Road Once Again... by Blaine Rollins of 361 Capital

Donkeys 1, Elephants 0, Congress -535. The can was kicked down the road once again. We would all like to think that Congress will avoid another last minute battle in early 2014, but unfortunately we can’t put it past the current list of non-negotiators. The only thing that is certain in the future is that it will be many election cycles before a member of Congress makes it into the World Series of U.S. Presidential ballots.

2013-10-23 Economic & Capital Market Summary by Gregory Hahn of Winthrop Capital Management

It has been five years since the Financial Crisis wreaked havoc on the economy and capital markets. With equity markets trading near record highs and new issue corporate bonds coming to market regularly, the capital markets have largely recovered. However, we are concerned that the economic recovery is just an illusion that exists in spite of the efforts in Washington D.C. to kill it.

2013-10-23 Emerging Europe: Regional Economic Review - 3Q 2013 by Team of Thomas White International

In its latest World Economic Outlook, the International Monetary Fund (IMF) further trimmed its forecast for global growth. The Washington-based lender said expansion will be driven more by developed economies as emerging markets grapple with slowing growth and a tighter global financial scenario as interest rates hint of trending higher in advanced economies such as the United States. However, a reading of economic tea leaves for the Euro-zone and economies such as Russia, Turkey, Poland, Hungary, and the Czech Republic offers room for optimism.

2013-10-22 Bond Legend Dan Fuss on Rising Rates by Robert Huebscher (Article)

Having just celebrated his 80th birthday, Dan Fuss can claim a unique achievement – his tenure in the fixed income markets has spanned a full market cycle, from the great bear market that began in the early 1950s through the equally great bull market that commenced in 1981. Fuss said today’s environment most closely resembles what he confronted in the late 1950s, when long-term rates were 3% and beginning their march upwards.

2013-10-22 Inching Closer by Sponsored Content from Janus Capital Group (Article)

How is the recent flooding in Colorado related to global economies and the financial crisis of 2008? Get a unique perspective from Colleen Denzler, CFA, Janus’ Global Head of Fixed Income Strategy, on how global economies are grappling to wean themselves off government support and grow their economies from within.

2013-10-22 Washington Strikes a No-Surprise Deal - Now What? by Sam Wardwell of Pioneer Investments

Congress called a time-out in the budget/debt fight last week, striking a deal to avoid default and fund the U.S. government through January 15, 2014 and raise the debt limit through February 7, 2014. While the parties agreed to budget talks, they did not commit to reaching an agreement (technically, Paul Ryan and Patty Murray, the House and Senate budget committee chairs will begin a process of fiscal negotiations, due to wrap up by mid-December).

2013-10-22 Fixing Economy As Easy As 1-2-3 by Axel Merk of Merk Investments

With the economy stuck in first gear, a couple of common sense steps that wouldn’t cost taxpayers an arm and a leg could help the economy shift into a higher gear.

2013-10-22 ProVise Bullets by Ray Ferrara of ProVise Management Group

Last month, a Wells Fargo/Gallup survey of non-retired investors showed just how lingering the hangover is from the financial crisis five years ago. Much like the Great Depression financially scared their great grandparents and grandparents, the Great Recession is impacting investors’ expectations about the future.

2013-10-22 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

The gov is back in biz (so get back to work). Investors were pleased (for now).

2013-10-21 Fourth Quarter Investment Outlook by Bob Doll of Nuveen Asset Management

The macro theme of the fourth quarter and early 2014 is monetary reflation and global growth resynchronization. The Fed’s surprising decision to postpone tapering its QE program will likely encourage further risk-taking. In the meantime, we observe increasing signs of a synchronized improvement among the four important economies - the United States, Europe, Japan and China.

2013-10-21 Europe Turning a Corner? by Brandon Odenath of J.P. Morgan Funds

Since late last year, investors have seen periods of strong outperformance by assets from the most impacted parts of Europe, leaving many observers wondering if Europe is turning a corner. Intervention by the ECB and the ability of those liquidity injections to stop the bleeding in the economy has helped. The reduction of austerity and drag coming from fiscal policy should be the key to faster economic growth.

2013-10-20 The Damage to the US Brand by John Mauldin of Millennium Wave Advisors

There is no doubt that the image what I will refer to in this letter as the "brand" of the United States has been damaged in the past month. But what are the actual costs? And what does it matter to the average citizen? Can the US recover its tarnished image and go on about business as usual? Is the recent dysfunction in Washington DC now behind us, or is it destined to become part of a bleaker landscape?

2013-10-18 Headwinds Give Way to Bullishness by Scott Minerd of Guggenheim Partners

With the partial government shutdown and Washington gridlock behind us for now, interest rates should continue declining and conditions are pointing to a period of renewed strength across asset classes.

2013-10-18 Fall is in the Air by Christopher Singleton of Kanawha Capital Management

Autumn has arrived, and many creatures have been making dutiful preparations to survive the winter months. But not all are so inclined, particularly our political leaders. Indeed, along with crisper air temperatures and more vibrant colors, it would just not feel like fall without the annual Washington squabbles to fund the federal government and increase its borrowing authority.

2013-10-18 Trying to Stop a Bull Market Has Risks by Frank Holmes of U.S. Global Investors

U.S. stocks have been on a tear. The S&P 500 Index has climbed a surprising 20 percent so far this year, as a global synchronized recovery takes shape and funds flow back to equities. As I often say, investors take risks when they try to stop a bull run, and plenty of data suggest you might regret taking that action this year.

2013-10-18 In Other News by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

It will take some time to gauge the full impact of the government shutdown and data is likely to be somewhat skewed over the next couple of months. However, sitting on the sidelines isn\’t a great option and stocks still appear to us to be the best place to invest money for the longer term. International growth, although not robust, appears to be more supportive as we head into 2014 than it has since the financial crisis, and we favor developed over emerging markets for the time being.

2013-10-17 Fixed Income Investment Outlook by Team of Osterweis Capital Management

Last quarter we wrote about the confusion that can be created by the Federal Reserve’s (Fed’s) two official mandates: keeping inflation in check and ensuring full employment. We also pointed out that given the rather fragile economic backdrop, talk of letting the economy stand on its own two feet by reducing their bond buying might be premature. During the third quarter, it appeared most economists felt comfortable that the Fed would indeed begin “tapering” its purchase of Treasuries and mortgage securities after the September Federal Open Market Committee (FOMC) meetin

2013-10-17 Yellen to the Rescue? by Axel Merk of Merk Investments

While Democrats and Republicans fight with water pistols, the President may be readying a bazooka by nominating Janet Yellen to succeed Ben Bernanke as Fed Chair. You may want to hold on to your wallet; let me explain.

2013-10-17 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

The gov is closed for business. Nuff said. (But help may be on the wayor not?)

2013-10-17 ProVise Bullets by Ray Ferrara of ProVise Management Group

Last month, a Wells Fargo/Gallup survey of non-retired investors showed just how lingering the hangover is from the financial crisis five years ago. Much like the Great Depression financially scared their great grandparents and grandparents, the Great Recession is impacting investors’ expectations about the future. 41% indicated they were concerned about another global crisis during their retirement years, and 28% were convinced they would have a lower standard of living during retirement.

2013-10-16 Pacific Basin Market Overview - September 2013 by Team of Nomura Asset Management

North Asian markets ended higher during the quarter after comments from Federal Reserve Chairman Bernanke appeared to infer that the Fed’s asset purchase program would be extended for a while longer. On the other hand, India and the ASEAN (Association of Southeast Asian Nations) region underperformed along with weakening currencies and continued fund outflows. In China, Premier Li Keqiang’s statement that China would meet its gross domestic product (GDP) growth target this year, coupled with better-than-expected economic data, brought some relief to the equity markets.

2013-10-16 Economic Assessment Without Government Reports by Team of Northern Trust

The very near-term economic outlook is unclear and will remain so until the political impasse in Washington over the government shutdown and debt ceiling is settled. If differences are resolved in a day or two, the damage could be about 0.2 percentage points to fourth quarter real gross domestic product (GDP). A failure to raise the debt ceiling would more of a calamity, which we hope not to encounter.

2013-10-15 A Q3 client letter: Mike Tyson on Sticking to Your Plan by Dan Richards (Article)

Each quarter I post a template for a client letter, as a starting point for advisors who want to send clients an overview of the three months that just ended and the outlook for the period ahead.

2013-10-15 Bond Market Review & Outlook by Thomas Fahey of Loomis Sayles

Flip-flopping Federal Reserve (Fed) policy defined the third quarter. Last quarter, the Fed threw the markets a curve ball by announcing possible tapering of its large-scale asset purchases beginning this year. That “taper talk” set off a mini-riot in global bond markets. Many emerging market (EM) countries, like Brazil, India, Indonesia and South Africa, were the biggest victims, as their bond yields rose and their currencies crashed.

2013-10-15 Equity Markets to Congress: “What, me worry?” by Sam Wardwell of Pioneer Investments

President Obama said he was willing to have discussions, though he said he wouldn’t engage in negotiations. (Comment: I guess it depends of what the meaning of "is" is.) So far, those discussions haven’t produced a deal, but at least they’ve started talking.

2013-10-14 Equity Market Review & Outlook by Richard Skaggs of Loomis Sayles

Equities generally performed well across the board in the third quarter. The S&P 500 Index’s solid 5.24% return built on strong gains from earlier in the year. The Index has returned more than 19% through September, surpassing expectations at the start of the year. Slow but steady economic growth in the US, support from the Federal Reserve (the Fed), and more recently, signs of potentially better growth in Europe and Asia have been important positive catalysts.

2013-10-14 Me and My Horse by Jim Goff of Janus Capital Group

This is not a story about getting back on the horse that throws you. It is about just staying on the horse. It is also a market story.

2013-10-14 Can Markets Remain Resilient in Light of Political Dysfunction? by Bob Doll of Nuveen Asset Management

Equities were mixed again last week, and the markets remain focused on the budget impasse in Washington, D.C., after the second week of the partial government shutdown. The S&P 500 closed the week in positive territory, increasing 0.8%.1 It is hard to ignore headlines and market volatility, but the real issues for markets are the debt ceiling debate and third quarter corporate earnings announcements.

2013-10-12 These Could be the Most Lucrative Energy Plays by Frank Holmes of U.S. Global Investors

Sometimes the most attractive energy assets aren’t found in the ground. Rather, at times like today, they are listed on the stock exchange.

2013-10-11 Flying Blind: Forecasting with No Data or Endgame by Diane Swonk of Mesirow Financial

Everything from the government shutdown to posturing regarding the lifting of the debt ceiling has heightened uncertainty about the economic outlook. Consumer and business confidence have fallen since the threat of a shutdown emerged, while the reality has taken a toll on communities where a large number of federal workers have been furloughed. Everyone, from cab drivers to restaurant owners, small retailers and (largely) defense manufacturers, were affected in the early days of the partial shutdown of government agencies.

2013-10-10 Economic and Market Overview: Third Quarter 2013 by Team of Envestnet

The economic environment in the third quarter was one of growth, albeit at a slower pace than most economists, and the Federal Reserve (“Fed”), believe can be self-‐sustaining. The slow but steady gains the economy made were enough to buoy the stock market, but likely only because the Fed has seen it necessary to maintain its aggressive monetary policy. While employment gains were anemic during the quarter, the unemployment rate actually declined to 7.3%, largely due to a contraction in the labor force.

2013-10-09 Little Visible Progress on the Budget Shutdown, but Some Inside Baseball In Play by Sam Wardwell of Pioneer Investments

President Obama canceled his planned visit to Asia and participation in the Asia-Pacific Economic Cooperation summitciting the inconvenience caused by the government shutdown (“the difficulty in moving forward with foreign travel in the face of a shutdown), sending John Kerry in his place, and reiterating his unwillingness to negotiate with Republicans.

2013-10-09 Five Years in Limbo by Joseph Stiglitz of Project Syndicate

The US financial system may be more stable than it was five years ago, but that is a low bar it was teetering on the edge of a precipice. Those in government and the financial sector who congratulate themselves on banks’ return to profitability and mild regulatory improvements should focus on what still needs to be done.

2013-10-09 The Squeeze Play by Jerome Schneider of PIMCO

Reductions in Treasury bill and commercial paper issuance compounded by developments on the demand side mean the “squeeze play” is on for many short-term portfolios. Investors should consider the potential for substantive changes to liquidity conditions as banks contend with increases in capital requirements due to updated Basel III regulations. Active management of short-term investments is important: Don’t rely on static regulatory frameworks or traditional indexes to determine a portfolio’s unique liquidity needs.

2013-10-09 Gold Strategy Investor Letter, Q3 2013 by John Hathaway of Tocqueville Asset Management

We believe the gold market is set up for a major advance, but recognize that the timing of a turn has been elusive and frustrating. The longer current Fed policies remain in force, the greater the potential disruption to financial markets when it changes, most likely due to events yet unforeseen. Still, conventional economic commentary remains confident of Fed competence to unwind its balance sheet. When this confidence dissipates, as we expect, investment demand for gold will resurface in the most forceful manner.

2013-10-09 Getting Serious About Investing Responsibly by Luke Spajic, Josh Olazabal of PIMCO

To date, much of ESG-related investing has focused on negative screening, but we believe there is a better approach. This approach rests on three pillars: identifying and analyzing key ESG issues facing a given investment sector, engaging with the issuers of securities, and supporting the development of markets for ESG investments.

2013-10-08 Government Shutdown Masks Pending Debt Ceiling and Third Quarter Earnings by Bob Doll of Nuveen Asset Management

Equities were mixed last week as the markets were focused on the budget impasse in Washington, D.C., that forced the federal government into a partial shutdown. As with the 17 prior shutdowns, we do not anticipate a lasting impact on the economy or markets. While the shutdown makes headlines, the issues that will likely have the most impact are the debt ceiling debate and third quarter corporate earnings announcements, which could mean a bumpy ride for investors.

2013-10-08 Detente with Iran? by Bill OGrady of Confluence Investment Management

On September 28th, President Obama reportedly called Iranian President Rouhani to confer over American and Iranian relations. In addition, Iran’s nuclear program was discussed. This was a historic eventthe first documented call between a U.S. president and his counterpart in Iran in 35 years. The last time such a conversation occurred was when the Shah was in power.

2013-10-08 Maybe Mark Twain Said It Best... by Blaine Rollins of 361 Capital

President Barack Obama and his top economic officials appear to be pushing for some market unrest to exert pressure on the GOP to throw in the towel. Asked in his CNBC interview Wednesday whether Wall Street is right to remain calm over the standoff, Mr. Obama replied: “No.”

2013-10-08 And That\'s The Qaurter That Was by Ron Brounes of Brounes & Associates

An obsession with Fed policy; troubles in Syria; new concerns in DCand yet the market kept rolling (for a while).

2013-10-08 And That\'s The Week That Was by Ron Brounes of Brounes & Associates

The gov is closed for business. Nuff said. Coming up in the week ahead: ISM Fed Minutes (Wednesday) Retail Sales (Friday), PPI (Friday)or maybe not.

2013-10-08 Absolute Return Letter: Heads or tails? by Niels Jensen, Nick Rees, Tricia Ward of Absolute Return Partners

Demographics captivate me. There are around 7.1 billion of us occupying planet earth today, going to 10 billion by 2050. I often think about how good old mother earth will cope with the additional 3 billion people we are projected to produce between now and 2050. More people translate into increased pressure on already scarce resources, but that is only part of the story and a story well covered by now.

2013-10-07 Angela Merkel's Pyrrhic Victory by George Soros of Project Syndicate

As far as Germany is concerned, the euro crisis is over a sentiment reflected in Chancellor Angela Merkel’s overwhelming election victory in September. In fact, the crisis has become a nightmare, inflicting tremendous suffering that could be easily avoided if the taboos that sustain it mainly Merkel’s were dispelled.

2013-10-05 Pinch Yourself. U.S. Stock Markets Have Grown 145% in Four-Plus Years by Ron Surz of PPCA

Thankfully, 2008 has become a distant memory. We’ve made back its 37% loss and a lot more. Things are good, but are they going to stay that way? We still face anemic economic growth, burgeoning debt, global social unrest and more. The S&P 500 has returned 145% in the past 55 months (4.5 years).

2013-10-04 Nowhere to Hide: Navigating Rising Rate Risk in High-Yield Markets by Gibson Smith, Colleen Denzler of Janus Capital Group

Over the past few years, investors have flocked to high-yield credit, many believing it a good way to mitigate their interest rate risk as well as capture additional yield. However, they may not realize the level of rate risk that has followed them. High-yield indices, negatively correlated to five-year Treasury bond yields over the past 15 years, have been positively correlated for the past year.

2013-10-04 The Economy, the Fed, and Politics by Richard Michaud of New Frontier Advisors

It was a good quarter to invest in equities, and despite a down second quarter, overall a good year as well. The Dow was up 1.5%, the S&P 4.7% and the NASDAQ 10.8%. Year-to-date returns were very positive with the Dow up 15.5%, S&P up 17.9%, and NASDAQ up 24.9%. International equities were also positive for the quarter and year with the MSCI ACWI ex US up 9.4% and up 7.5% year-to-date. While emerging market equity indices were up 5% for the quarter they remained negative -6.4% for the year.

2013-10-04 The Banking Sector: Better, with Room for Improvement by Russ Koesterich of iShares Blog

Russ K. explains the good news behind his recent upgrade of the global financial sectors as well as the bad news keeping his sector outlook somewhat subdued.

2013-10-04 The Debt Ceiling Drama is Heating Up by Team of Northern Trust

The debt ceiling drama is heating up. Threatening default is reckless, but long-term budget issues require attention. Measures of policy uncertainty show a link to economic performance

2013-10-04 Is the Pump Primed for Emerging Markets Investors? by Mark Mobius of Franklin Templeton

The vulnerabilitiesor rather, perceived vulnerabilitiesof emerging markets have been the focus of heightened discussions over the past few months. Concerns about the health of emerging markets came on the heels of political upheavals in Egypt, economic deceleration in China and protest demonstrations in Brazil and Turkey this summer.

2013-10-04 The Fed and Its Big Thumb by Ron Muhlenkamp of Muhlenkamp & Co.

We’ve seen what happens when prices get ahead of the economy reality. The bubbles in the dot-com’s in 2000 and the housing market in 2007 were such effects. We fear that the apparent Fed desire to continue to manipulate interest rates may engender more bubbles.

2013-10-04 Introducing the Tortoise Economy by Sam Stewart of Wasatch Funds

All things considered, large U.S. companies that operate globally appear to be particularly attractive right now. Because many of these companies are generating significant portions of their sales outside the U.S., investors are effectively getting some international exposure with what I consider to be more-quantifiable risks.

2013-10-04 The Fire Fueling Gold by Frank Holmes of U.S. Global Investors

For patient, long-term investors looking for a great portfolio diversifier, a moderate weighting in gold and gold stocks may be just the answer. And, today, when looking across the gold mining industry, you’ll find plenty of companies that have paid attractive dividends, many higher than the 5-year government yield.

2013-10-03 Third Quarter Market Commentary: Let's Reminisce by Robert Stimpson of Oak Associates

US stocks have risen each quarter of 2013, outperforming most other asset classes and emerging markets along the way. In the third quarter, the S&P 500 Index rose 5.24% and pushed the year-to-date gain to 19.79%. All sectors within the S&P 500 have produced positive returns this year, although the pro-cyclical groups have outperformed the defensive ones.

2013-10-03 Buying the Shutdown by Scott Minerd of Guggenheim Partners

Volatility from the government shutdown and other political developments in Washington D.C. will likely continue to rise. Despite this, the reduction in output from this will be short-term, and investors still have several attractive options for deploying capital across asset classes in the United States and globally.

2013-10-02 The Math is Pretty Straightforward... by Blaine Rollins of 361 Capital

Congress and the White House must be pretty fired up that D&D2 started filming last week. The new movie might be the only thing more stupid than our elected leaders failing to negotiate and reach a deal. Most everyone either wants to spend our tax dollars like drunken professional athletes or hold our economy and financial markets hostage via a government shutdown and failure to raise the debt ceiling.

2013-10-02 Countdown to a Government Shutdown (Sept. 30) by Liz Ann Sonders of Charles Schwab

Unless an 11th hour deal is struck, the government will shut down at midnight tonight. Memories are fresh from similar "fiscal follies" in the summer of 2011 and we’ll compare and contrast. The last shutdown was 17 years ago and a look at that history may also be instructive.

2013-10-02 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Financial markets have now become a function of how investors are guessing the drama in Washington DC will play out.

2013-10-01 The Eight Principles of Value Investing by Scott Clemons and Michael Kim (Article)

In any environment, but especially one characterized by uncertainty, eight principles of investing are critical. These bedrock beliefs help guide our thinking at the levels of asset allocation, security selection and identification of the third-party managers we engage to help manage our clients’ assets.

2013-10-01 Europe Pokes Its Head Out From the Shadows by Chris Maxey, Ryan Davis of Fortigent

With all the focus on affairs in the US, China and developing nations, Europe has largely been given a free pass in recent months. The lack of attention gave Europe the opportunity to fix some of its troubles, but challenges remain and are likely to surface in the weeks ahead.

2013-10-01 Putin's Gambit by Bill OGrady of Confluence Investment Management

Earlier this month, President Obama found himself in a very difficult position regarding Syria. An ill-advised comment about making the use of chemical weapons a “red line” forced a response when the weapons were clearly used in Syria. The administration began moving toward a military response. However, support for military operations was lacking both domestically and internationally. The clearest signal of this opposition was the British Parliament’s vote to prevent P.M. Cameron from authorizing military action in support of the expected U.S. military strike.

2013-10-01 The Most Predictable Economic Crisis? by Axel Merk of Merk Investments

Forget about a government shutdown. The quibbling over concessions to keep the government funded distracts from what might be the most predictable economic crisis. We have problems that may affect everything from the value of the U.S. dollar to investors’ savings, but also to national security.

2013-09-30 The Eurozone's Calm Before the Storm by Nouriel Roubini of Project Syndicate

A little more than a year ago, in the summer of 2012, the eurozone, faced with growing fears of a Greek exit and unsustainably high borrowing costs for Italy and Spain, appeared to be on the brink of collapse. Today, that risk has diminished significantly but the factors that fueled it remain largely unaddressed.

2013-09-30 The Global Sea Change Continues by Richard Bernstein of Richard Bernstein Advisors

Most investors will readily admit the global credit bubble is deflating, yet continue to favor credit-based asset classes within their portfolios. Whereas many investors still believe that the emerging markets are a growth story, the data tell us that U.S. investors can find growth in their own backyard.

2013-09-30 Investing In Corporate Bonds: The Compelling Case For Active Management by Ed Devlin, Michael Kim of PIMCO

Passive investment returns in the Canadian corporate bond market have been unimpressive because of the way corporate bond indices are constructed and factors unique to the Canadian market. Unconstrained by these limitations, active managers with global reach may provide superior returns. The current environment presents an attractive opportunity for Canadian investors to implement a wide discretion, active approach to managing corporate bonds.

2013-09-30 Investing in a Fairly Valued World by Herb Abramson, RJ Steinhoff, Randall Abramson, Anthony Visano, Jeff Sayer of Trapeze Asset Management

For several years we have been arguing that global equity markets are undervalued and represent the best investment alternative given growing corporate profits (S&P 500 Index earnings have nearly doubled in the last five years), a favorable monetary backdrop and a recovering economy.

2013-09-30 Congress Holds Equities Hostage by Bob Doll of Nuveen Asset Management

U.S. equity advances ended last week and the S&P 500 declined -1.0%.1 Markets appeared concerned about overbought conditions from a strong run up over the past three weeks and uneasy about Federal Reserve (Fed) monetary policy normalization as well as the credibility of its communication strategy. Other widespread reasons for the downturn included increased focus on the fiscal battles in Washington, D.C., heightened worries about a possible near-term government shutdown and the contentious debt ceiling debate.

2013-09-30 Fourth Quarter Outlook: A Turning Point? by Gene Goldman of Cetera Financial Group

It seems sometimes that the outlook for the global economy and the markets has been unchanged for years. Since the end of the recession, each year has commenced with forecasts that the United States economy would break out of its below-trend growth mode, only to see expectations dashed. Meanwhile, Europe has been mired in its own recession as it struggles with heavy post-crisis debt burdens. Growth has slowed in the emerging markets, ending the commodity boom of the first decade of this century.

2013-09-30 Government Shutdown Could Lead to a Buying Opportunity by Matt Lloyd of Advisors Asset Management

As we approach yet another self-induced “the sky is falling and the other guy is to blame” environment, recall that this situation is not uncommon. We have had 17 of these budget debt ceiling deadlines and yet we have unbelievably (said with extreme rolling of the eyes) been able to overcome our elected officials’ calls for the end of the world. The most recent time when the U.S. government shutdown was in November 1995 concluding in January 1996,when arguably the animosity and polarization was as pronounced as it is today.

2013-09-28 The Renminbi: Soon to Be a Reserve Currency? by John Mauldin of Millennium Wave Advisors

Contrary to the thinking of fretful dollar skeptics, my firm belief is that the US dollar is going to become even stronger and will at some point actually deserve to be the reserve currency of choice rather than merely the prettiest girl in the ugly contest the last currency standing, so to speak. But whether the Chinese RMB will become a reserve currency is an entirely different question.

2013-09-27 Global Destinations for Yield by Scott Minerd of Guggenheim Partners

While U.S. stocks are increasingly due for a consolidation, the outlook for global equities is improving. Now appears to be a good time for investors to increase allocations toward Asia and Europe.

2013-09-27 Bridging the Gap: Global Listed Infrastructure by Wilson Magee of Franklin Templeton

Simply spreading your investments across a smattering of asset classes with the idea that diversification should automatically produce a positive result is an approach that’s maybe a little too similar to a roll of the dice. For investors hunting for classes to diversify into, Wilson Magee, Director of Global Real Estate and Infrastructure Securities, Franklin Templeton Real Asset Advisors, and co-manager of Franklin Global Listed Infrastructure Fund, has one word: infrastructure.

2013-09-27 The Weekly Speculator by Michael Shaoul, Ranita Ragunathan, Timothy Brackett, Brendan Moynihan of Marketfield Asset Management

We wrote last week on the eve of the FOMC meeting which resulted in the surprising decision not to reduce the current program of treasury and mortgage security purchases. What was to our eyes equally surprising was the volume and strident tone of the commentary that was issued following this release, ranging from the arrogant to the outraged as if anything really meaningful had changed.

2013-09-27 How to Profit from a Changing China by Frank Holmes of U.S. Global Investors

We believe China’s rebalancing is positive for investors who selectively invest in its stocks. As Jim O’Neill puts it, “When a country is embarking on a significant compositional change to its economy, stock-pickers rather than index-trackers have the upper hand.”

2013-09-27 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Merkel’s win is unlikely to lead to any changes in the Eurozone. Extra lift from exports is not guaranteed. Robust growth is a challenge in India, Brazil and Indonesia.

2013-09-27 You Never Know by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Surprises come at any moment in the investing world, reinforcing the need to have both a long-term view and a balanced/diversified portfolio. We believe signs are pointing to better US and European growth, a near-term rebound in China, and some possible positive momentum building in Japan. But near-term fiscal policy risks abound. Investors that need to add to equity positions should use pullbacks to do so.

2013-09-26 One Trick Pony: Whipping the GDP Donkey into a Stallion by Cliff Draughn of Excelsia

The difficulty since 2012 has been that if you are not significantly overweight US equities, then your returns are less than stellar. Employing a diversified, risk-averse investment strategy in 2013 has in hindsight been the wrong thing to do, given that every other asset class is negative year-to-date, while US stocks are up double digits. The combination of the Fed’s Zero Interest Rate Policy and the artificial bubble in Treasury bonds has forced conservative investors into riskier positions in order to find risk-adjusted returns.

2013-09-26 PIMCO Cyclical Outlook for Europe: Near-Term Recovery, Long-Term Risks by Andrew Balls of PIMCO

While Europe has emerged out of recession, the relative tightness of monetary policy means the eurozone is still struggling to get back to potential pre-Lehman growth rates. The European Central Bank should be able to maintain stability over the cyclical horizon while policymakers continue to address outstanding issues as they look to build a less vulnerable monetary union. We are selective in our approach to regional credit and remain neutral on the euro, balancing our cyclical outlook with longer-term secular concerns on the eurozone outlook and valuations.

2013-09-25 Surprise! No Tapering and More Budget Progress than Meets the Eye by Sam Wardwell of Pioneer Investments

On Monday, Larry Summers exited the pool of candidates for the next Federal Reserve (Fed) chairman. (Only the timing was really a surprise.) On Wednesday, the Fed didn’t taper and de-emphasized several of the targets they’d set earlier. (Big surprise versus consensus - not central bank best practices). Municipal bond offerings by Puerto Rico, California, and Illinois were met with strong investor demand.

2013-09-24 William Bernstein – “Stocks for the Long Run” by Michael Edesess (Article)

William Bernstein’s reading of history is that if you want to build a nest egg and protect against the “four horsemen” that threaten it over the long term, the best thing to do is invest in a globally diversified stock portfolio.

2013-09-24 Michael Aronstein’s Warning to Fund Investors by Robert Huebscher (Article)

Fixed-income investors may think rising interest rates are their biggest worry. But bond funds face a new risk, driven by their need for liquidity to service investors’ daily redemptions, according to Michael Aronstein.

2013-09-24 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

Hail the Almighty Fed. Despite a rather hectic week on the economic calendar, investors instead focused primarily on news from the Federal Reserve. They rejoiced the end of Summer’s campaign for Chair and further rejoiced another Fed meeting with far more words than action. The week ended with profit-taking and plenty of uncertainty heading into the homestretch of the year.

2013-09-24 The U.S. Deficit Shrank, but Will It Come Back Bigger Than Ever? by Team of Knowledge@Wharton

The U.S. deficit has fallen to its lowest level since 2008. Experts weigh in on how this will affect upcoming budget negotiations.

2013-09-24 Lehman Five Years LaterLessons and Threats by Dean Curnutt of Macro Risk Advisors

The five-year anniversary of the Lehman bankruptcy and onset of financial crisis is here and so too is the raft of opinion pieces around what caused the meltdown and how it is different this time.In a recent interview with Charlie Rose, when asked about the risk of another 2008 event, Morgan Stanley CEO James Gorman said, “The probability of it happening again in our lifetime is as close to zero as I could imagine.”

2013-09-23 Seeking Global Growth: Our Outlook for Credit by James Balfour of Loomis Sayles

Global business and credit cycles are nothing new to investors. The familiar sequence of recession, recovery, expansion and slowdown plays out over time, influencing interest rates, credit availability, business climate and capital markets. It’s a time-honored process, but in practice, no two business and credit cycle pairings are exactly alike. Business and credit cycles tend to be driven by specific but varying factors that accumulate until an economic “tipping point” is reached, after which the business and credit climates deteriorate.

2013-09-23 The Euro Tug-of-War by Thomas Kressin of PIMCO

Faced with lingering economic stagnation, record unemployment and continued political strife in the region, the common consensus for a depreciation of the euro seems only natural and very much required to counter the weak cyclical position of the eurozone. The rising current account surplus in combination with net long-term capital inflows point to a stronger euro that could stay with us for an extended period; such a development could potentially undermine the fragile social consensus to continue with the necessary structural and fiscal reforms.

2013-09-23 Credit Rating Agencies: Can They Get It Right? Part 3: Five Years After the Fall by Michelle Shwarzman of Invesco Blog

This three-part series takes a critical look at the growing role of credit rating agencies (CRAs) in the global financial system. This post reports on the United Nations General Assembly (UNGA) debate about the role of CRAs in the international financial system. Part 1 focused on the involvement of CRAs in recent financial and economic crises in the US and Europe, while Part 2 described post-crises attempts to reform CRAs.

2013-09-23 Happy Anniversary? Perspectives on the Financial Crisis Five Years Later by Nanette Abuhoff Jacobson of Hartford Funds

Since 2008, there’s been slow but steady improvement in the global economypolicy makers’ unconventional tools have helped stabilize financial markets and bought time for economies to rebalance. Expectations are too low for developed-market growth and inflation, in our view. As such, we think this environment will be positive for developed-equity marketsparticularly in Europe and Japan.

2013-09-23 Fed Inaction Lengthens Reflationary Economy by Bob Doll of Nuveen Asset Management

U.S. equities advanced last week as the S&P 500 increased 1.32%.1 The Federal Reserve (Fed) delivered a big surprise by leaving intact the current $85 billion monthly purchase program. The Committee appears nervous about the resiliency of the economy. Chairman Bernanke pointed to three factors for postponing tapering: 1) the need for more labor market data to be confident in the outlook, 2) a desire to assess the degree to which tighter financial conditions, particularly mortgage rates, are affecting the real economy and 3) an interest in gaining clarity on “upcoming fiscal debates.̶

2013-09-23 Aberdeen Global Investment Outlook: September 2013 by Mike Turner of Aberdeen Asset Management

The point of maximum policy accommodation may now be in sight: Markets volatile as investors forced to contemplate U.S. Federal Reserve (Fed) exit strategy. Slowing growth in China is putting pressure on Asian and emerging markets to develop domestic led demand. This time really could be different for Japan - however reflating the economy was never going to be easy.

2013-09-21 Rich City, Poor City by John Mauldin of Millennium Wave Advisors

This week we will conclude our look at pension plans for the nonce with a 30,000-foot overview of the states and then take a deeper dive into one city: mine. This will give you at least one version of how to do your own homework about your own hometown. But fair warning, depending on your locale, you may need medical help or significant quantities of an adult beverage after you finish your research.

2013-09-21 Fifty Shades of Gold by Frank Holmes of U.S. Global Investors

Unlike many commodities, there are many shades to gold, such as the Love Trade’s buying gold for loved ones and the Fear Trade’s purchasing gold as a store of value. An additional “shade” investors need to be aware of is how the Fed interprets the recovery of the U.S. economy.

2013-09-20 Will Europe's Improving Economy Push Interest Rates Higher by Giordano Lombardo of Pioneer Investments

Gross Domestic Product (GDP) increased in the second quarter after six straight declines. Data expectations were on the optimistic side, but investors appeared to become more confident before the release, thanks to encouraging evidence from supposedly reliable forward-looking indicators.

2013-09-20 U.S. Commercial Real Estate: Will the Good Times Last? by Devin Chen of PIMCO

The CRE market has experienced a gradual recovery in asset pricing since the 2008 financial crisis. Despite the duration of the recovery, there continues to be dislocation in the CRE market that astute investors can capitalize on. We believe certain properties in non-major markets look attractive for acquisition, and have been acquiring residential land on an opportunistic basis.

2013-09-20 Growth and Rising Stars by Mark Kiesel of PIMCO

While developed market growth in several regions is picking up cyclically from low levels, overall global economic growth should remain subdued over the next several years. We believe credit spread tightening and rating upgrades are most likely for specific companies in industries and areas with strong growth. We see these "rising star" companies in the U.S. and European auto sector, the gaming, energy and chemical industries and in sectors tied to the U.S. housing market.

2013-09-20 Investment Bulletin: Global Income Strategy by Team of Bedlam Asset Management

The Global Income equity strategy is unconstrained by geography, sector or stock, and is committed to achieving the target yield based on the opening NAV at the beginning of each financial year of 4.5%, payable in equal quarterly dividends with any excess paid out at the end of the year. It may only invest in companies with an historic dividend yield of at least 2.5% based on the price at the date of purchase. There is a bar on using derivatives or options to achieve the target yield and it must invest in a company on its merits rather than rotational dividend stripping.

2013-09-19 Expect Business as Usual After the German Election by Darren Williams of AllianceBernstein

Many pundits believe the German federal election on September 22 will prove a turning point in the sovereign debt-crisis. We are less convinced. Barring a massive shock, Angela Merkel is set to be endorsed as Chancellor for another four years. If this is the case, Germany is unlikely to depart much from the playbook that has served it well in recent years and which may now be delivering positive results.

2013-09-19 A Fine Balance in the Global Profits Cycle by Saumil Parikh of PIMCO

In the U.S., we expect growth to accelerate over the cyclical horizon, but to disappoint elevated consensus expectations. In Europe, we also expect growth to accelerate, but just barely, and also below consensus. In Japan, we expect growth to remain heavily reliant on aggressive fiscal and monetary policies. And in emerging markets, we expect a stabilization in growth assisted by central banks regaining control of currency and financial market conditions. The outlook for global corporate profits is a key measure of success in determining the handoff to self-sustaining growth going forward.

2013-09-18 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks rallied last week as military options in Syria no longer look likely given the disapproval of the American people and Congress. Additionally, this embarrassing agreement reached with Russia is an admission that the USA will not intervene.

2013-09-18 Larry Summers Helps Clarify the Future Path of Fed Policy by Sam Wardwell of Pioneer Investments

Last Monday, at a London press conference, U.S. Secretary of State John Kerry responded to a reporter’s question about what might avoid a military move against Syria by ad-libbing that Assad could give up his chemical weapons. As you probably know, Russia promptly endorsed the idea and Assad promptly agreed. The long-term implications of this development are unknowable; what matters now is that the risk of a U.S strike declined sharply last Monday. Over the most recent weekend, the U.S. and Russia have apparently agreed on key details, further reducing the probability of an attack.

2013-09-18 The End Times for Strategic Ambiguity by Bill O'Grady of Confluence Investment Management

Strategic ambiguity is defined as a condition where various parties say something similar but believe something entirely different. A good example of this is U.S. and Chinese policy toward Taiwan. Both nations say Taiwan is part of China. The U.S. believes that Taiwan’s democratic government should become the model for the mainland, whereas China believes Taiwan should be part of its nation as it is currently structured. Because both nations say the same thing, the policy difference is not publicly obvious and thus not a problem, at least as long as the ambiguity lasts.

2013-09-17 Charles de Vaulx: “We Have Never Been as Cautiously Positioned” by Robert Huebscher (Article)

Charles de Vaulx is the chief investment officer and a portfolio manager at International Value Advisers. In this interview, he discusses his outlook for the market and the economy, and why his fund has never been as cautiously positioned as it is today.

2013-09-17 Gundlach – Where to Expect the Next Crisis by Robert Huebscher (Article)

Unless there is a crisis, don’t expect a major decline in interest rates, according to Jeffrey Gundlach. And if such a crisis occurs, Gundlach warned, it will most likely take place in this emerging market.

2013-09-16 Russia is Tough to Love, Easier to Hate, Hard for Investors to Ignore. Here\'s Why by Frank Holmes of U.S. Global Investors

Russian President Vladimir Putin created a stir recently when he shared his thoughts with Americans in an op-ed printed in The New York Times. According to The Times, very few pieces written by heads of state have been published by the paper and very few received the attention Putin attracted.

2013-09-16 Europe's Fragile Recovery by Tucker Scott of Franklin Templeton Investments

Investors have tentatively begun to buy into the European recovery story, but remain fearful of the region’s fragility. A few bits of upbeat economic data recently have provided grounds for optimism, and the European Central Bank’s continued commitment to holding the Eurozone together has boosted confidence. Tucker Scott, portfolio manager forTempleton Foreign Fund, still sees a few economic roadblocks in Europe but also plenty of progress. He shares where he’s finding signs of strength and investment opportunities.

2013-09-16 Opportunities in Uncertainty by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

Uncertainty and volatility are elevated, which we believe provides opportunities for investors.

2013-09-14 Nothing But Bad Choices by John Mauldin of Mauldin Economics

Crises in government funding don’t simply arrive on the doorstep unannounced. Their progress toward the eventual Bang! moment is there for all the world to see. The root cause is almost always the same: debt. And whether that debt is actually borrowed or is merely promised to the populace, when the market becomes worried that the ability of the government to fund its promises is suspect, then the end is near. Last week we began a series on what I think is an impending crisis in the unfunded pension liabilities of state and local governments in the United States.

2013-09-13 Pacific Basin Market Overview August 2013 by Team of Nomura Asset Management

Asian equity markets ended lower in August, chiefly due to concerns about currency weakness in India and Indonesia, while improved macroeconomic data from China contributed to this market’s outperformance. The MSCI AC Asia Pacific Free Index including Japan fell by 1.3% while the MSCI AC Asia Pacific ex Japan Free Index closed 0.71% lower during the month. (All performance figures are based on MSCI indices in U.S. dollar terms with dividends included unless otherwise stated.)

2013-09-13 What's Developing in Emerging Markets by Gene Goldman of Cetera Financial Group

Despite strong returns in United States equity markets, a different story has played out in the emerging markets. The MSCI Emerging Market Index, a proxy for emerging market equity returns, has fallen 9.94 percent year-to-date through Aug. 31, 2013. In contrast, the S&P 500, a proxy for U.S. equity markets, has risen 16.15 percent over that same span.

2013-09-13 Waiting for Clarity From the Fed and Congress by Team of Northern Trust

U.S. economic growth averaged roughly 2.0% in the first half of the year and the average gain of real gross domestic product (GDP) during the entire 16-quarter economic recovery is 2.2%. Real GDP is projected to grow close to this trend in the second half of the year.

2013-09-13 Invest In Stocks With A Margin of Safety To Reduce Risk And Enhance Returns by Chuck Carnevale of F.A.S.T. Graphs

Of all of the many sound investing principles that legendary teacher and investor Ben Graham put forward, he believed that his concept of “margin of safety” was the most important of all. This investment lesson was so deeply ingrained into the mind of Ben Graham’s most famous student, Warren Buffett, that he created his two most important rules of sound investing. Rule number one: Never lose money. Rule number two: Never forget rule number one. Clearly, both of these renowned sages understood the importance of minimizing risk, especially when investing in equities.

2013-09-13 What's Happening to Bonds and Why? by Mohamed El-Erian of PIMCO

To say that bonds are under pressure would be an understatement. Over the last few months, sentiment about fixed income has flipped dramatically: from a favored investment destination that is deemed to benefit from exceptional support from central banks, to an asset class experiencing large outflows, negative returns and reduced standing as an anchor of a well-diversified asset allocation.

2013-09-13 September Investment Bulletin: Global Equity Strategy by Team of Bedlam Asset Management

Year-to-date end-August the strategy performed well with a gain of 22.2% vs. 14.6% for the benchmark. During the month, the index “tumbled” 3.9%, partly out of fear of foreign military action in Syria and partly that central banks would cease printing money to hold down interest rates commonly known as tapering. Even so, the portfolio held up in August, with a much lesser 2.4% fall, thereby further widening outperformance over the index to 760 basis points so far in 2013.

2013-09-13 The View from Here - September 13, 2013: Five Years After by Carl Tannenbaum of Northern Trust

How much have we recovered from the global financial crisis?

2013-09-12 Approaching a Turning Point by Scott Minerd of Guggenheim Partners

Higher interest rates continue to negatively affect the real economy, increasing the susceptibility of risk assets to downside risk.

2013-09-12 Brave New World by Christine Hurtsellers, Matt Toms of ING Investment Management

If the monotony of high school lulled you into a catatonic state the semester you were supposed to read Brave New World, here’s the CliffsNotes summary of what you missed. Aldous Huxley imagined a futuristic utopia in which the government promotes economic and emotional stability through the plentiful use of a soporific opiate called “soma”. Soma allows the mind to take a holiday from worldly problems via a gram, or two or three. Imagine the chaos into which this fictional world would descend were the government to abandon its role as pharmacist to the masses.

2013-09-12 2 Unresolved Issues Challenging the Case for European Stocks by Russ Koesterich of iShares Blog

Russ explains the two key unresolved issues that are keeping his view of European stocks somewhat cautious, and he gives the next signposts to watch to gauge whether any near-term resolutions are likely.

2013-09-11 Absolute Return Letter: A Case of Broken BRICS? by Niels Jensen, Nick Rees, Tricia Ward of Absolute Return Partners

EM currencies, stocks and bonds have struggled since the Fed signalled its intent to change course in late May. This has seemingly triggered an exodus of speculative capital from emerging markets but, as is always the case, there is more to the story than that. EM countries (ex. China) no longer run a current account surplus with the rest of the world, and this hurts global liquidity. It is not yet a re-run of the 1997-98 Asian crisis, but it has the potential to become one with all sorts of consequences for bond yields in developed markets, currency wars, etc.

2013-09-10 QE Tapering: Why Whether' or When' Doesn't Really Matter by Sam Wardwell of Pioneer Investments

We didn’t go to war last week what will happen is highly uncertain but the perceived probability of an imminent U.S. attack on Syria seemed to drop as the week proceeded.

2013-09-10 Investor Anxiety + Uncertainty = More Volatility Ahead by Russ Koesterich of iShares Blog

As Russ expected, both equity and bond market volatility have risen in recent weeks. Russ explains why this rocky road is likely to continue, and he provides two ideas for potentially insulating portfolios amid volatility.

2013-09-09 Moving On - Five Years After Lehman by John Petrides (Article)

This month marks the fifth anniversary of the Lehman Brothers failure and the start of worst financial crisis in American history since the Great Depression, and yet to some investors, it seems like only yesterday. Investors still hold onto that period of volatility as if it will happen again tomorrow, paralyzing and confusing their investment decisions. Consequently, many investors have watched from the sidelines as the stock market has recovered solidly year after year.

2013-09-09 Reasons for Optimism in a Sloppy Third Quarter by Ron Sloan of Invesco Blog

Investors are anticipating the day that we transition from a market dominated by monetary stimulus to an earnings-driven market. The problem is that earnings aren’t cooperating yet. In my view, we’ve still got a sloppy third and maybe fourth quarter to get through, but I think 2014 will likely be a much better earnings market.

2013-09-09 Equities Advance Despite Concerns Over Weak Employment and Growth by Bob Doll of Nuveen Asset Management

U.S. equities moved higher last week, with the S&P 500 advancing 1.40%.1 In the face of another disappointing employment report, positive recovery expectations provided tailwinds. Key manufacturing and service sector data surprised to the upside, and improved corporate confidence was highlighted by merger and acquisition activity. Developments outside the U.S. supported recovery and reform, and emerging market fears lessened. A potential U.S. military strike on Syria was an overhang as President Obama’s decision to seek congressional approval raised concerns about other looming battles.

2013-09-09 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

A couple of holidays during the week prompted some light volume and volatility as investors were forced to digest a slew of key economic releases and some potentially concerning geopolitical developments on a limited work schedule. In the end, investors took advantage of bargains leftover from a poor August, but many still maintain the same uncertainties that caused the pullback in the first place. Syria and the Fedthe headlines should be around for the foreseeable future.

2013-09-09 Market Technicals Signal Trouble Ahead by Chris Maxey, Ryan Davis of Fortigent

Bear market enthusiasts have so far been disappointed in September after the sudden market rally last week. With equities up more than 1% on the month, many bears pointed to the historically poor performance of equity markets during this month as a reason to remain cautious. Bear enthusiasts need not fear, as markets appear to be converging toward an inflection point right around the Fed meeting in the middle of the month.

2013-09-06 The Emerging Markets Debt Evolution by Giordano Lombardo of Pioneer Investments

My colleagues Mauro Ratto, Head of Emerging Markets, and Yerlan Syzdykov, Head of Emerging Markets Bond & High Yield, offered these thoughts on emerging markets.

2013-09-06 The Good, The Bad and The Ugly by Douglas Cote of ING Investment Management

“Good” economic news in developed markets has been overshadowed lately by the “bad” (burgeoning Asian currency crisis) and the “ugly” (Syria). Unwinding central bank support from the markets will be arduous; it is already contributing to destabilization of certain emerging market currencies. News out of Washington this autumn tapering, Fed leadership and the debt ceiling has the potential to add volatility and uncertainty. The U.S. equity market has been the place to be this year, but diversification remains key.

2013-09-06 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Manufacturing surveys are upbeat, but should we trust them? The August employment report leaves lots of room for improvement.

2013-09-06 Will Gold Follow Its Seasonal Pattern This Year? by Frank Holmes of U.S. Global Investors

There are factors beyond Syria this week driving gold. That’s the Love Trade. This group gives gold as gifts for loved ones during important holidays and festivals. This is the time of the year that we are in the midst of right now. Historically, September has been gold’s best month of the year. Looking at more than four decades of monthly returns, the precious metal has seen its biggest increase this month, averaging 2.3 percent.

2013-09-05 Dividends Matter by Mark Mobius of Franklin Templeton Investments

Many people think of emerging market stocks as pure growth plays, and may not realize that there is a separate potential benefitdividendsthat can also be available to investors in these markets. A prolonged period of easy monetary policies in many developed nations (particularly the US) has left income-seeking investors searching for alternatives to traditional fixed income, including dividend-paying stocks. Many investors may not realize dividends aren’t just a developed-market phenomenon.

2013-09-04 Fixed Income - Where to Now? by Chris Maxey, Ryan Davis of Fortigent

Since the end of the Global Financial Crisis (GFC), investors moved aggressively into fixed income asset classes. They were quickly rewarded in the years following the crisis with a combination of falling interest rates and tighter credit spreads, which led to positive absolute returns. The easy money in fixed income is gone, however, and now is the time for careful asset class selection.

2013-09-04 How Syria Could Spark New Middle East War by Gary Halbert of Halbert Wealth Management

What does the stand-off in Syria have to do with the investment markets? Potentially, a lot. As I have argued in recent weeks, if the Middle East devolves into another military quagmire, it could be quite bearish for the US stock and bond markets going forward. That’s why we will talk about the implications today.

2013-09-04 The Vultures' Victory by Joseph Stiglitz of Project Syndicate

The recent decision against Argentina by a United States appeals court threatens to upend global sovereign-debt markets. Indeed, a basic principle of modern capitalism that when debtors cannot pay back creditors, a fresh start is needed has been overturned.

2013-09-04 Abe Wins - Does Japan Benefit? by Milton Ezrati of Lord Abbett

The Japanese seem willing to give Abe room to reform when he decides to act.

2013-09-03 Did Steve Jobs Really Build That? by Michael Edesess (Article)

The conventional wisdom is that only the private sector can marshal the entrepreneurial energy to create innovation and growth, while government can do little more than shift around the wealth that the private sector creates. But is that really true?

2013-09-03 Our Views as We Head into Autumn by Charles Lieberman (Article)

Economic growth prospects for the U.S. are slowly improving, implying that the unemployment rate will continue to work its way lower and corporate profits will keep rising. We expect the Fed to start tapering of its bond buying program in September. Interest rates should revert to more normal, higher levels, but stocks should also work their way higher. Nonetheless, investors will be focused on events surrounding Syria, at least over the near term.

2013-09-03 So Step Right Up, Pick Your Favorites... by Blaine Rollins of 361 Capital

So with the backing of The White House, the State Department, the Senate & The Economist, the United States is going to launch Tomahawks on Syrian targets. The President did say that he will let Congress vote on a strike, but both he, Secretary Kerry and Senator Reid let it be known that they will be lighting fuses soon. So as a refresher as to who is supporting whom in Syria, the chart below will both assist and thoroughly confuse you...

2013-09-03 Momentum in Europe by Janus Equity Investment Team of Janus Capital Group

We think now is a good time to be investing in Europe. European equity valuations are at the lowest level in more than 40 years, by some measures, and we are seeing green shoots in the region’s downtrodden economy. Meanwhile, European companies in several industries have right-sized their cost structures or refocused their businesses, setting them up to be more competitive on a global scale.

2013-08-30 Look for these European Stocks to Exert a Lot of Horsepower by Frank Holmes of U.S. Global Investors

The Wall Street Journal recently published an article, “Emerging Europe is a Haven in Selloff,” highlighting the region’s recent success in “rising above the storm” that other developing markets have not been able to avoid. Dark clouds have been swirling around emerging markets, with the MSCI Emerging Markets Index falling about 12 percent on a year-to-date basis.

2013-08-30 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Global policy-makers increasingly at odds with one another. Foreign exchange reserves may hold key to stabilizing emerging markets. Geopolitics weigh heavily on energy markets.

2013-08-30 An American Energy Revolution by Frank Holmes of U.S. Global Investors

In Texas these days, there’s a feeling of absolute and unwavering confidence in the concept of an American energy revolution. From the depths of reserves to the richness of the energy, an incredible transformation is taking place.

2013-08-29 Monthly Investment Commentary by Litman Gregory Research Team of Litman Gregory

U.S. stocks resumed their positive streak in July (after a slightly negative June). Large-cap stocks rose in three out of the four weeks and were up 5% for the month. Smaller companies generally outperformed their larger-cap counterparts. After Federal Reserve comments regarding the timing of its stimulus withdrawal upset markets in May and June (particularly the bond market), investors seemed to take comfort in the Fed’s more recent comments. Among other points, Chairman Bernanke reiterated that a decision to taper bond purchases is different from raising the federal funds rate

2013-08-29 More Evidence of Pressure on Housing by Scott Minerd of Guggenheim Partners

The slowdown in housing due to higher mortgage rates is becoming more evident in the data for that market. This comes during a time when the Fed is making a crucial decision about tapering quantitative easing, which is causing market uncertainty to rise further.

2013-08-29 Don't Lose Your Balance by Jeffrey Knight of Columbia Management

Last year in a white paper called “Engineering a better retirement portfolio”1, we demonstrated the long term benefits of investing with a balanced risk profile. Exhibit 1 shows the trailing Sharpe ratios reported in that paper for the S&P 500, a “traditional balanced” domestic 60/40 portfolio, and a “risk balanced” strategy invested to equalize the risk contribution from stocks, bonds and commodities. The message from that chart is clear: Better balance leads to more efficient portfolio performance over time.

2013-08-29 Earnings: Just Good Enough by Milton Ezrati of Lord Abbett

Corporate profits aren’t exactly setting the world on fire, but the rate of growth should be sufficient to support further equity market gains.

2013-08-28 On Tapering, All Signs Point to “Maybe” by Scott Brown of Raymond James

Investors looking to the July 30-31 Fed policy meeting minutes for clear clues on future moves were left disappointed. Nearly all senior Fed officials expect that a reduction in the pace of asset sales is likely to be warranted by the end of the year. However, they appear evenly divided on whether that will be sooner (September) or later (December). The economic data remained mixed, suggesting that the decision will be a close call.

2013-08-28 ING Fixed Income Perspectives August 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

While it’s been said that a picture is worth a thousand words, some pictures are just not that complicated. Take the current U.S. yield curve, for example, our interpretation of which can be boiled down to just a handful of syllables: “zero interest rate policy” and “taper”.

2013-08-27 The Price Clients Pay for Worst-Case Forecasts by Bob Veres (Article)

Clients and the world at large give inordinate attention to downside scenarios, and nobody is calling our attention to the much larger upside of our business and investment landscape. The human brain amplifies this effect, because it is hardwired to notice threats much more than opportunities. I recently spoke with Dennis Stearns – an advisor who happens to be an expert in scenario planning – about the role planners need to play to counteract media-driven negativity.

2013-08-27 Why Bad Decisions Happen to Good People: An Introduction to Behavioral Finance by Scott Clemons (Article)

Cognitive biases frequently cause even skilled investors to make irrational decisions. Thankfully, irrationality is fairly predictable. Here are four behavioral biases that investors face and techniques for recognizing and overcoming them.

2013-08-27 Will Rate Rise Derail Housing Recovery? by Chris Maxey, Ryan Davis of Fortigent

As the Federal Reserve grapples with when and how to unwind quantitative easing, interest rates climbed more than a point since the end of 2012. This caused mortgage rates to increase to their highest levels in two years last week, with the average conforming 30-year loan jumping to 4.58% from 4.40% the week prior. Rising financing costs is presenting a headwind for one of the biggest bright spots in the US economy over the past 12 months.

2013-08-27 Greece Highlights Germany\'s EU Dilemma by John Browne of Euro Pacific Capital

On August 11th, German media got hold of and published an internal Bundesbank report which maintained that Greece would likely need further relaxation of the terms of its rescue bailouts. The report contained revelations that could be deeply embarrassing to the government of Angela Merkel that has maintained forcefully that German taxpayers would face no further commitments. The revelations could potentially be a potent weapon for her political opposition in the upcoming election. More broadly, the revelations reveal a wide gap between economic reality and the sunny face of EU optimism.

2013-08-27 Emerging Markets Feel the Ripples of Fed Tapering by Sam Wardwell of Pioneer Investments

Many Emerging Market currencies (notably those of India, Brazil and Indonesia) have been weak since the beginning of May. The declines accelerated sharply in recent weeks, leading to something approaching panic in several markets last week.

2013-08-27 Choose Your Door Wisely.. by Blaine Rollins of 361 Capital

If I was being forced to choose a side for year end 2013 performance, I would have to agree with Mr. Plant. While September is historically a difficult month for the markets, we also know that the Q4 tends to reward the equity markets.

2013-08-26 Equities Relatively Flat as Crosscurrents Remain by Bob Doll of Nuveen Asset Management

U.S. equities finished mostly higher last week, and the S&P 500 advanced 0.50%.1 The Dow Jones Industrial Average was the only the only major U.S. index to falter last week.1 Market sentiment was dominated by the notion that the market had become too bearish in the wake of the prior week’s sell-off in equities and credit. Continued improvement in global recovery sentiment seemed to provide a notable tailwind. The Fed dominated headlines markets appear obsessed with policy normalization and succession issues.

2013-08-25 France: On the Edge of the Periphery by John Mauldin of Millennium Wave Advisors

Charles de Gaulle said that "France cannot be France without greatness." The current path that France is on will not take it to renewed greatness but rather to insolvency and turmoil. Is France destined to be grouped with its Mediterranean peripheral cousins, or to be seen as part of the solid North Atlantic core? The world is far better off with a great France, but France can achieve greatness only by its own actions.

2013-08-24 Revisiting the USD Bull Market by Paresh Upadhyaya of Pioneer Investments

The USD bull market has begun with signs that the USD is transitioning to a cyclical currency. Monetary policy divergences in G4, slowing in USD diversification and a dramatic turnaround in the twin deficits, provide a strong fundamental underpinning to a USD rally going forward.

2013-08-23 Why We Still Like China by Philippe Brugere-Trelat, Andrew Sleeman of Franklin Templeton Investments

When China, the world’s second-largest economy and an engine of global growth, sneezes many other markets catch colds. A spike in the country’s short-term lending rate in June gave some investors the sniffles at least temporarily, while others have turned bearish on China amid concerns growth rates this year could be under the weather. However, many investors may be overlooking some powerful macro-economic long-term shifts taking place in the economy that could ultimately improve China’s bill of health.

2013-08-23 Why it's Time to Reconsider European Equities by Russ Koesterich of iShares Blog

Given recent signs that the eurozone economy is stabilizing, is it time to consider European equities again? Russ explains why his answer is a qualified yes.

2013-08-23 5 China Charts That Look Bullish for Commodities by Frank Holmes of U.S. Global Investors

Over the past few months, investors have seen better economic data coming out of Europe. Consumer confidence in the continent has been rising, manufacturing data is improving and the fiscal situation is on the mend. Now, China appears to be strengthening as well, which could signal better times ahead. Below are five charts that look bullish for China and commodities. While not meant to be comprehensive, they do point to areas where investors might want to pay close attention.

2013-08-23 Embrace Bottom Up by Herbert and Randall Abramson of Trapeze Asset Management

With all the conflicting macro news, some good, some not, and with the S&P 500 and the Dow at new highs while many sectors languish, it is preferable to focus on the little picture not the big one. The big one may currently be more unpredictable than the small one, being bottom up investment in undervalued securities. Those may currently be less popular, but we value investors are naturally driven to buy investments low, that are neglected and unpopular, with the view of selling them high when their popularity is enhanced. Buy low and sell high. Not buy high and sell higher as is now in vogue.

2013-08-23 Buckle Up by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Caution is warranted near-term. For investors that have a solid strategy of dollar-cost averaging into the market, we don’t recommend deviating from that path. However, for investors who are more tactical, better entry points are likely yet to come. Longer-term, we remain bullish on US equities and prefer developed international markets over emerging markets.

2013-08-22 Active ETF Market Share Update & Weekly Market Review by AdvisorShares Research of AdvisorShares

Last week, total AUM in all active ETFs fell by over $60.5 million. AUM in the “Global Bond” category fell by nearly $89 million both because of falling values for ETFs in the category and redemptions in certain ETFs. The “Foreign Bond” category had another bad week, ending almost $36 million below where it began. As in previous weeks, assets in “Short Term Bond” active ETFs increased, this time by almost $36.5 million.

2013-08-21 Trickle-Up Economics by Bill Smead of Smead Capital Management

Major magazines have a history of putting a topic on their cover at the end of a long-term trend. For example, “The Death of Equities” was a Business Week cover in late 1979, near the end of a miserable stretch in the US stock market. Time’s recent cover story, “The Childfree Life”, got us wondering about the economics of childbearing in the US? Does Time’s cover mark the end of a trend? Can the US economy succeed without homegrown population increases? Will economic success driven by the current demographics in the US trickle down to unemployed blue collar

2013-08-21 Asia Brief: On Economic Evolution in Cambodia by Edmund Harriss, James Weir of Guinness Atkinson Asset Management

Cambodia’s recent national Assembly elections offer hope that the country may be able to achieve a peaceful political transition in the coming years. The country’s political turmoil has held it back behind its neighbors, but tourism and gar- ment assembly are driving an acceleration in economic output growth. However, Cambodia is at risk from inflation through imported petroleum, and its youthful population will want to see improving GDP per capita feeding through into higher living standards, rather than a higher hydrocarbon bill.

2013-08-20 Change is Coming by Chris Maxey, Ryan Davis of Fortigent

The summer months brought a period of calm to global markets and economies. Nearing the move to autumn, it is time to look ahead and see what resides on the horizon. Investors could be due for a renewed bout of volatility based on any number of events set to happen before year-end.

2013-08-20 The Embassy Closings by Bill O'Grady of Confluence Investment Management

In the first week of August, the Obama administration announced the closing of 22 embassies and consulates across the Middle East and North Africa. In this report, we will discuss the role of the embassy for a superpower, the return of al Qaeda, including its strengths and weaknesses, the nature of the terrorist group’s intelligence and an examination of other actions that may be behind activities in Yemen.As always, we will conclude with potential market ramifications.

2013-08-20 A Lot Of Action In What Was Expected To Be A Quiet Week by Sam Wardwell of Pioneer Investments

Most of the U.S. economic data released last week was rather ho-hum, consistent with continuing slow growth, but markets weren’t boring. Maybe markets are thin because it’s August, but the U.S. Treasury market had one of its worst weeks in a long time, and the selling spilled over into the U.S. stock market.

2013-08-20 August Monthly Investment Bulletins by Team of Bedlam Asset Management

For the first seven months of the year the portfolio rose by 25.2% vs. 19.3% for the index. During the month, the 6.4% gain was 150 basis points ahead. Three trends continued: the gradual increase in fund flows into equity markets relative to other asset classes, slightly improving economic data across most developed countries, and a mild deterioration in many developing nations.

2013-08-20 Epic Climb Up and to the Right... by Blaine Rollins of 361 Capital

Interest rates continue to make an epic climb up and to the right...

2013-08-19 Equity Fatigue Continues with Headwinds from Bond Sell-off by Bob Doll of Nuveen Asset Management

U.S. equities finished lower for the second straight week as the S&P 500 declined 2.04%, narrowly escaping its worst week of the year. A specific catalyst behind the pullback was not identified by us or market analysts.

2013-08-19 What Triggers Would Make Japanese Equities Attractive? by Mark Jason of Invesco Blog

Through the second quarter of 2013, Japan remained Invesco International Growth Fund’s largest underweight versus the Custom International Growth Index because our EQV (earnings, quality and valuation) discipline criteria drive us toward high-quality companies at reasonable valuations, and those are scarce in Japan. Why? Because Prime Minister Shinzo Abe’s success is being priced in, and overcoming two decades lost to stagnation is difficult.

2013-08-17 Signs of the Top by John Mauldin of Millennium Wave Advisors

The investment media seems obsessed with the question of whether the Fed will taper. The real question should be not about "tapering" but about credibility. What happens when fundamentals become the narrative as opposed to what the central bank is doing? What happens if the Federal Reserve throws a liquidity party and nobody comes? Today we look at some of the fundamentals. The market is in fact overvalued, but that doesn’t mean it can’t become more overvalued. Is this August 1987 or August 1999?

2013-08-16 Pacific Basin Market Overview July 2013 by Team of Nomura Asset Management

Asian markets ended higher in July after comments from Federal Reserve Chairman Bernanke appeared to infer that the Fed’s asset purchase program would be extended for a while longer. In China, Premier Li Keqiang stated that China would meet its gross domestic product (GDP) growth target this year, which brought some cheer to the markets. The MSCI AC Asia Pacific Free Index including Japan gained 1.5% while the MSCI AC Asia Pacific ex Japan Free Index closed 2.0% higher during the quarter.

2013-08-16 The Case for Global Dividends: Valuations and the Impact of Rising Rates by Ehren Stanhope of O'Shaughnessy Asset Management

The S&P 500 Index has risen over 150 percent since March 9, 2009 in what could arguably be deemed the most hated equity rally of all time. The MSCI All Country World Index, one of the broadest global indices, has risen “just” 110 percent since its March 2009 nadir. Evidence indicates that United States (U.S.) investors have not participated in this rallya truly sad state of affairs. It is worthy of noting that over the last several years a number of well known market pundits have viscerally rejected the equity rally due to macroeconomic concerns.

2013-08-16 The Telecommunications Services Sector Untethered and Poised to Grow by Chuck Carnevale of F.A.S.T. Graphs

Suffice it to say that the Telecommunications Services sector of today is not your grandfather’s Telecommunications Services sector. The explosion, and rapidly becoming ubiquitous implementation, of wireless technologies have been disruptive and game changing. As a result, the very nature of the established stalwarts within this industry have gone through an extraordinary metamorphosis.

2013-08-16 Weekly Economic Commentary by Team of Northern Trust

The speculation about Fed leadership has gone too far. Eurozone growth should be placed in perspective. The velocity of money may turn around soon.

2013-08-16 What Happens When You Tell Indians to Stop Buying Gold by Frank Holmes of U.S. Global Investors

With the government in India raising its import tax for gold to 10 percent this week, I firmly believe Indians will continue indulging in gold, even if they have to smuggle it in.

2013-08-15 Once-a-Generation European Opportunity? by Cindy Sweeting of Franklin Templeton Investments

Sir John’s contrarian conviction was so strong, that in 1939 when WWII had investors fleeing the markets, he bought every stock on the New York Stock Exchange trading under a dollar. Cindy Sweeting, Director of Portfolio Management at Templeton Global Equity Group, espouses Sir John’s contrarian approach, although as a more selective bottom-up stock-picker today. As the markets have bumped along recently she has also echoed his money-where-your-mouth-is action, avoiding the same trend plays everyone else is making by the doing the far more difficult work of going against the grain.

2013-08-15 Correlation and Portfolio Construction by Dean Curnutt of Macro Risk Advisors

We review recent periods of financial market stress, which bring about elevated levels of asset volatility and during which investors are vulnerable to incurring substantial loss of capital. We illustrate that risk is determined both by the volatility of individual investments in a portfolio and the degree to which they are correlated. Often overlooked, correlation is a critical factor. Because assets become more correlated at the same time they become more volatile, we argue that the benefits of diversification often are difficult to achieve when they are most needed.

2013-08-14 Middle East Is A Looming Tinderbox - Think Egypt by Gary Halbert of Halbert Wealth Management

We begin today by looking into the latest unprecedented embassy closures across the Middle East and North Africa. Did President Obama take the appropriate actions, or were the closures a sign of weakness to our enemies in the region? From there, we turn our attention to the worsening political tensions in Egypt. There is a real threat that Egypt could deteriorate into a full-scale civil war in the months ahead.

2013-08-14 Active ETF Market Share Update & Weekly Market Review by AdvisorShares Research of AdvisorShares

Overall the total AUM in all active ETFs declined by $1.2 million last week, an insignificant amount for the $14.4 billion space. “Short Term Bond” increased by almost $29.3 million, while “Global Bond” fell by around $15.8 million. “Foreign Bond” had another bad week, ending almost $34 million lower than where it began, as did the “Currency” category which declined by more than $8.7 million.

2013-08-14 Focused Only on the US? Here's What You're Missing by Russ Koesterich of iShares Blog

Many investors remain fixated on what’s happening in the United States -- and particularly on what the Federal Reserve will do -- but Russ explains why they shouldn’t lose sight of what’s happening abroad.

2013-08-14 What Role for Emerging Markets After the Sell-Off? by Ramin Toloui of PIMCO

While history suggests that the sell-off in emerging market bonds could ultimately offer attractive buying opportunities, it is important to anchor investment decisions firmly within a forward-looking economic and market outlook. Continuing vulnerabilities in global growth suggest there is fundamental value in EM bond yields at present valuations, as interest rate hikes priced into EM yield curves are unlikely to materialize in an environment of tentative growth.

2013-08-14 Macro View...In Microwave Time (Part 2 of 2) by Rob Isbitts of Sungarden Investment Research

Today’s blog post picks up where last week’s left off by updating the 13 key points for investors I laid out in an article in RIABiz.com on January 14 of this year. These were and are the most significant data and forces for investors to track today, to pursue long-term growth and sidestep major losses. As I did last week, I will also note whether I think each point is a positive or negative (or other) for investors now that we are about 3/5 of the way through 2013. The six areas covered last week were generally positive. Let’s see about the final seven on the list

2013-08-13 Envisioning the Planning Firm of the Future by Bob Veres (Article)

Virtually all advisors operate with a value proposition built on bettering their clients’ financial future through management of their assets. But trends in the workforce and capital markets will force advisors to rethink those assumptions and, if Richie Lee is right, the planning firm of the future will adapt a four-factor service model that places much greater emphasis on helping clients maximize their human capital.

2013-08-13 Why Clients Don’t Give You Credit for Your Hard Work – And What to do About it by Dan Richards (Article)

Advisors work incredibly hard, but clients take that effort for granted. How can advisors get credit for all they do for clients?

2013-08-13 China Struggles to Fight the Trend by Chris Maxey, Ryan Davis of Fortigent

Prior to the global financial crisis, decoupling’ was the word du jour. In the years since the crisis began, however, decoupling has vanished from the everyday lexicon. In recent weeks, the financial media noticed a new form of decoupling, one that shows improving growth prospects in the developed world but slower growth in developing economies. Rightly or otherwise, much of that slowdown is pinned on China and recent data continues to suggest a slower pace of growth than investors became accustomed to in prior decades.

2013-08-13 Emerging Asia Pacific: Regional Economic Review - Q2 2013 by Team of Thomas White International

Asia’s emerging nations, the darling of the world economy since the 2000s, uncharacteristically slowed in the first quarter of 2013. After a decade of robust growth, many of Asia’s fast-growing economies are coming to terms with structural changes. Asian currencies, which had appreciated quite a bit over the past few years thanks to ultra-loose monetary policy in the developed world, came tumbling down at the first talk of a slowdown in the supply of cheap money.

2013-08-13 Developed Asia Pacific: Regional Economic Review Q2 2013 by Team of Thomas White International

Many developed economies in the Asia Pacific region rebounded during the second quarter of 2013 to post a healthy set of growth and inflation numbers. Turning on the monetary spigots during the past one year provided a major fillip to many developed Asian economies. Countries that fumbled in the wake of natural disasters in the recent past, showed marked improvement. Even those countries that were said to be suffering from structural deficiencies, too, responded well to the monetary medicine administered by their various central banks.

2013-08-13 The Gordon Dilemma by Bill O'Grady of Confluence Investment Management

In this report, we will discuss Professor Gordon’s thesis, examine the geopolitical impact if he is correct and offer some criticisms of his thesis. We will conclude with potential market ramifications.

2013-08-13 Dog Days of Summer Are Upon Us by Blaine Rollins of 361 Capital

Hopefully you are reading this from the beach, because there is so little news happening in the markets that those of us in the office are about to start making news up to justify stock price movements. But while news and volumes are at August lows, here are some thoughts that might ring a bell to help you to either make some money or to set down your smartphone and get back to the water.

2013-08-13 China's Government Can't Stop the Bust by Bill Smead of Smead Capital Management

On a recent trip to Europe we participated in a forum in Milan of five stock picking organizations. Two were from Brazil, one was from Malaysia and one was picking stocks inside China via the Shanghai Stock Exchange. We believe what they said was an enticement to investors for the purpose of getting them excited about stocks in their country. To us, this reveals a great deal about where prices in emerging stock markets and commodities are headed over the next five to seven years.

2013-08-13 Europe\'s Queasy Status Quo by Milton Ezrati of Lord Abbett

The eurozone’s weaker members continue to falter, but the currency union will likely hang together. Make no mistake, though: Europe remains at the edge of crisis.

2013-08-10 We Can't Take the Chance by John Mauldin of Millennium Wave Advisors

What would it have been like to be a central banker in the midst of the crisis in 2008-09? You’d know that you won’t have the luxury of going back and making better decisions five years later. Instead, you have to act on the torrent of information that’s coming at you, and none of it is good. Major banks are literally collapsing, the interbank market is nonexistent and there is panic in the air. Perhaps you feel that panic in the pit of your stomach. This week we’ll perform a little thought experiment to see if we can extrapolate what is likely to happen in when the nex

2013-08-09 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The global productivity "bust" is largely cyclical. The Bank of England tries forward guidance. Will low labor force participation keep the Fed from tapering?

2013-08-09 A Surprising Way to Play a Europe Rally by Frank Holmes of U.S. Global Investors

After a lengthy period of stagnant growth and lackluster results, the gradual crescendo of improving economic data that’s been coming out of Europe lately certainly commands attention.

2013-08-09 The Calm Before the Storm? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Record highs in US equities have resulted thus far in only modestly elevated investor sentiment and it appears retail investors are returning to the market, which could fuel further gains. However, volatility is likely to increase with political and Fed issues on the horizon. Europe remains attractive, along with Japan, but we are watching the potential consumption tax increase closely, while China’s valuations are improved but concerns remain.

2013-08-08 Absolute Strategies Fund Portfolio Commentary by Jay Compson of Absolute Investment Advisers

In our last quarter commentary we posed a simple question: "Why does the economy need so much stimulus and quantitative easing for so little growth?" Over the last two years or so, we feel that we have identified and explained the structural issues and risks very clearly. But in the second quarter, the equity and credit markets may have done a better job offering investors a true glimpse of the realities facing global markets.

2013-08-08 Not an Entry Point for U.S. Stocks by Scott Minerd of Guggenheim Partners

My long-term view of U.S. equities remains bullish, but a number of indicators, as well as near-term macro challenges, point to a pause in the run-up of that asset class.

2013-08-08 Quarterly Letter by Team of Grey Owl Capital Management

To begin, let us state that we are tired of writing about macroeconomic issues. We suspect you are tired of reading about them. We would like nothing more than to send out a quarterly letter full of updates on the companies we own and the rationale for individual buy and sell decisions. Nevertheless, we must address the market action following Federal Reserve Chairman Ben Bernanke’s May 22nd testimony before Congress, where he merely floated the idea of “tapering” the Fed’s quantitative easing efforts.

2013-08-08 Investment Advice Technology and How to Lose Money in the Coming Years by Kendall Anderson of Anderson Griggs

Adventures are good for my soul. They create wonderful memories, both of where I have been and all the effort it took to get there. All of us have memories, both good and not so good. I am a bit worried about the near term future.

2013-08-08 Coming Soon: September Volatility by Russ Koesterich of iShares Blog

Since spiking earlier this summer, market volatility is now back to spring lows. Investors, however, shouldn’t expect this calm to continue come September. Russ has four reasons why.

2013-08-08 The Role of Confidence by Howard Marks of Oaktree Capital

The so-called wealth effect plays an important and well recognized part in the functioning of an economy. When assets appreciate in value, the owners translate their increased wealth into increased spending. While at first glance this is unsurprising, it should be noted that this is true even if the appreciation is unrealized, and thus the increased wealth exists solely on paper. The relationship can be stated as follows: the richer people feel, the more they spend. Changes in confidence have an impact on behavior similar to the wealth effect. That’s what this memo is about.

2013-08-07 Adapt or Die... by Blaine Rollins of 361 Capital

Bond king Bill Grosss $261.7 billion Total Return Fund at Pacific Investment Management Co. suffered a $7.5 billion net outflow last month, according to data from fund tracker Morningstar Inc. on Friday. It is the third straight monthly outflow for the Fund, on the heels of nearly $10 billion in redemptions in June. Clients have yanked $15.6 billion from Gross’s Fund in 2013 through July. Jeffrey Gundlach’s $37.9 billion DoubleLine Total Return Bond Fund suffered $580 million net outflow in July, according to Morningstar.

2013-08-07 Japan The Land of the Rising Stock Market by Richard Bernstein of Richard Bernstein Advisors

We have been ardent bulls on the Japanese stock market since last Fall. Our thesis has been a simple one: For the first time in the history of our data, Japan began running consecutive monthly current account deficits.

2013-08-07 Weekly Market Commentary by Team of Tuttle Tactical Management

As I write this the S&P 500 futures are indicating a down open setting us up for possibly three down days in a row. If you watch the financial media someone will undoubtedly talk about how the sky is falling.

2013-08-06 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

After a week like this, everyone needs a vacation. Big Oil led the earnings trail and the results were not pretty. Europe and China both expressed nice signs for their previously weaker manufacturing sectors. At home, the labor results were mixed, manufacturing looked solid, the consumer remained active, and Michael delayed the vote yet again.

2013-08-06 We Shale Rise by Janus Equity Investment team of Janus Capital Group

The U.S. oil and gas boom largely underpinned the country’s economic recovery, but this is only the beginning. Don’t underestimate what cheap oil and natural gas means for the U.S. economy, or how long this advantage could last.

2013-08-06 The Changing of the Monetary Guard by Joseph Stiglitz of Project Syndicate

With leadership transitions at many central banks under way, many of those who were partly responsible for creating the global crisis that erupted in 2008 are departing to mixed reviews. The main question now is the extent to which those reviews influence their successors’ behavior.

2013-08-06 Equities Grind Higher as the Economy Continues to Muddle Through by Bob Doll of Nuveen Asset Management

U.S. equities advanced last week, with the S&P 500 increasing 1.10%.1 For the month of July, the S&P gained 5.09%, and equities have increased 21.33% year to date. Second quarter earnings season is nearly complete, and there has not been a material change in estimated earnings for the balance of the year or 2014. Revenues were slightly ahead of expectations, and earnings per share were approximately 3% higher than expected, annualizing at about $110 per S&P 500 share.

2013-08-06 China's Slowdown by Bill O'Grady of Confluence Investment Management

Over the past three decades, China has seen its economy grow significantly.

2013-08-06 Will Soft Q2 GDP and Jobs Data Influence Fed Tapering? by Sam Wardwell of Pioneer Investments

As I said mid week, the “fiscal cliff” tax increases were squeezing consumers’ disposable income and spending growth was coming at the cost of a lower savings rate. Suspending the “social security tax” was expected to stimulate the economy, so it’s only logical that it would work in reverse, too.

2013-08-06 The ABCs of ABS: Identifying Opportunities in Asset-Backed Securities by Scott Minerd of Guggenheim Partners

In the search for yield, ABS offers an opportunity to generate higher returns through rigorous analysis, unaccompanied by additional credit or interest-rate risk.

2013-08-06 Europe's Fake Normal by Mohamed El-Erian of Project Syndicate

This summer’s sense of economic normality in Europe is neither natural nor necessarily tenable in the long term, because it reflects temporary and potentially reversible factors. If Europe does not return to addressing its economic challenges in a more comprehensive manner, the current calm may quickly give way to renewed turmoil.

2013-08-05 Two Charts Illustrate How to “Follow the Money” by Frank Holmes of U.S. Global Investors

Too often investors get caught up in their political allegiance or parties, focus on the negative and lose confidence in stocks. As a result, they can miss great bull markets. I believe when it comes to finding investment opportunities, it’s not about the political party, it’s about the policies, both monetary and fiscal.

2013-08-01 Lack of US Economic Growth May Slow Fed Tapering by Kevin Mahn of Hennion & Walsh Asset Management

While we are encouraged that the U.S. economy has been growing, as measured by Gross Domestic Product (GDP) growth, for 15 consecutive quarters starting in the third quarter of 2009, we are concerned that the growth rate has been below that of previous economic recoveries and the economy appears to be stalling and struggling to get back above a 2% growth rate thus far in 2013.

2013-08-01 Alternatives for Today's and Tomorrow's Market Challenges by Jennifer Bridwell, Sabrina Callin of PIMCO

Investors should consider alternative investment strategies, which could enhance diversification and the potential for alpha, or risk-adjusted returns, because returns from traditional asset classes in coming years may be lower and more volatile than those realized historically.

2013-08-01 Active ETF Market Share Update & Weekly Market Review by AdvisorShares Research of AdvisorShares

Last week total AUM in all Active ETFs fell by almost $20 million. This was almost entirely due to redemptions in “Foreign Bond” Active ETFs. The “Short Term Bond” category continues to gain assets and increased by $38 million just last week. Total AUM in this category could possibly surpass the “Global Bond” category in the coming months in trends continue.

2013-07-31 Still High Time for High Yield? by Team of Rainier Funds

Given recent strong performance and yields hovering at historic lows, a current topic of debate has been whether the high yield bond market has become an asset bubble and how much of a risk is the potential end to the Federal Reserve’s accommodative monetary policy to high yield investors. While we at Rainier acknowledge there are current risks in the fixed income market, we believe these concerns are not unique to high yield bonds.

2013-07-30 Conflicting Crosscurrents Move Equities Sideways by Bob Doll of Nuveen Asset Management

U.S. equities finished last week narrowly mixed, with the S&P 500 falling -0.02%.1 While the second quarter earnings per share growth continues to move higher, revenue growth remains below trend. The economic calendar is focused on this week’s release of the July employment report. Global macro headlines generated more uncertainty than direction for the markets.

2013-07-30 Earnings Take a Back Seat to Policy by Chris Maxey, Ryan Davis of Fortigent

Although it was a quiet week on the economic front, there were a few notable indicators to digest.

2013-07-30 Economic & Capital Market Summary by Gregory Hahn of Winthrop Capital Management

We are approaching the five year anniversary of the beginning of the Financial Crisis. By this time in 2008 we had already experienced the complete seizure of the Auction Rate Preferred securities market and the takeover of Bear Stearns by JP Morgan Chase. In August of 2008, we would see the collapse of Lehman Brothers and the government takeover of AIG. We stand here today, shoulders slumped, and heads bowed mourning the lack of real progress in addressing the structural problems that are impeding sustained economic growth and private credit expansion.

2013-07-30 FPA Crescent: Steve Romick\'s Quarterly Commentary by Steven Romick of FPA Funds

FPA Crescent Fund has released its quarterly commentary examining the state of the fund and its investments as well as an outlook on the greater economy. Portfolio manager Steve Romick feels that the economic “recovery has been disappointing and largely engineered by central bank policy” and worries “that low interest rates and novel and theoretical Fed policy could lead to unintended consequences.”

2013-07-30 The U.S. Energy Revolution by Bill O'Grady of Confluence Investment Management

In March 1971, the Texas Railroad Commission (TRC), which allocated oil production for the state of Texas, announced that producers in the state would be allowed a “full allocation.” This was the first time the TRC had allowed Texas producers to supply an unlimited amount of crude oil since WWII.

2013-07-30 Who Let the Ferrari Out of the Garage? by Blaine Rollins of 361 Capital

With just three trading days left in the month, July is in the running for the title of least volatile month of the year, with the Standard & Poor’s 500-stock index averaging moves of just 0.39% this month through Thursday’s close. That is lower than the 0.41% and 0.42% averages of January and March, respectively, when stocks were grinding slowly, but steadily higher.

2013-07-30 Pennies from Heaven, Irrationality, and “Dys-information” by Chris Richey of Neosho Capital

If QE4 holds to course, ending, not just tapering, sometime in mid-2014, the U.S. will have spent 4+ years out of the past 6 living on monetary stimulus, all the while continuing to pile up ever more claims against future prosperity.

2013-07-30 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stock averages were nearly unchanged last week as earnings reports are being reported mostly in line albeit with the usual concerns about the pace of economic activity. This is reflected once again by a lack of revenue growth for many industries.

2013-07-30 Royal Babies and Economic Growth by Bill Smead of Smead Capital Management

On a recent business trip to Europe, we noticedanecdotallya lack of hope in the economic future of Europe. There is a good reason for the lack of hope. Hope, we believe, comes in the form of new life. When all of the austerity being practiced in developed nations around the world is pretty much done, something else needs to happen for economic growth to take hold. At Smead Capital Management, we believe developed economies need rebirth and the birth last week of a son to the Royal family is a watershed event.

2013-07-29 Driftingbut for How Long? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

Equities have drifted higher during a decent earnings season with few surprises, while yields have calmed and volatility has plunged. Typical lackluster summer action may prevail for the next month, but action is likely to heat up as the weather begins to cool.

2013-07-29 Global Economic Outlook by Team of Northern Trust

Growth is expected to improve in the United States and the United Kingdom while disappointing in Europe.

2013-07-26 Emerging Markets Equity Commentary June 2013 by Team of Thomas White International

Emerging market equity prices declined appreciably on heightened investor concerns over an early withdrawal of the monetary stimulus measures in the developed world. The most recent policy statement issued by the U.S. Federal Reserve, which was more optimistic about the growth prospects for the U.S. economy, and comments by Fed officials seemed to suggest that the central bank is preparing to wind down its bond purchase program.

2013-07-26 Wedding Bells in Romania by Mark Mobius of Franklin Templeton Investments

I was invited to attend the wedding of one of our Romanian staff in June, and I jumped at the opportunity to celebrate with the happy couple, visit a different part of Romania, and talk to locals about life there. The celebration represented a microcosm of the juxtaposition of old and new in Romania, and this is similar for investors there as progress continues toward market reform.

2013-07-26 Is Europe Ready to Take Off? by Frank Holmes of U.S. Global Investors

After the U.S.’s huge run, is it possible the country will be handing off the baton across the Atlantic for the next leg of the relay race? Here are a few areas of strength that could send European stocks higher.

2013-07-25 A Midyear Update: Getting Back to “Normal” by Douglas Cote of ING Investment Management

Though markets were whipsawed by the announcement, the Fed’s plan to step aside and allow normalization is a good thing. Today, the primary risk for investors to hedge is economic growth and the strong equity returns it tends to produce not financial Armageddon. While risks in Europe and China persist, U.S. fundamentals look relatively strong. Two consecutive quarters of S&P 500 earnings growth prompts a forecast update.

2013-07-25 A One-Pillar Economy by Scott Minerd of Guggenheim Partners

Despite blockbuster new home sales, higher interest rates have put downward pressure on housing activity. This is highly worrisome given the importance of housing to the health of the U.S. economy.

2013-07-25 Perspective by Jim McDonald of Northern Trust

Investors have faced a torrent of central bank actions and communications during the last month, and markets continue to differentiate among economies and companies a welcome maturation from the markets’ prior regime of “risk on/risk off.” We believe the Federal Reserve has moved from an easing bias to one of tightening but at an elongated pace that will remain data dependent. Joining in this parsimony are some key emerging-market central banks, including the People’s Bank of China, which is working to control credit risk in the Chinese economy.

2013-07-25 How Far is Gold Off Course? by Frank Holmes of U.S. Global Investors

Gold has been in extremely oversold territory lately despite drivers for the metal remaining in place.

2013-07-25 ECB's Attitude to Portugal Raises Questions about Bond-Purchase Programme by Darren Williams of AllianceBernstein

Political upheaval in Portugal has thrown the spotlight on the European Central Bank’s (ECB’s) bond-purchase programme, known as Outright Monetary Transactions (OMTs). Many are asking whether the ECB is ready to support the market if yields rise further. And if not, why not?

2013-07-24 Average Gas Price Could Hit $4 by Labor Day... Or Not by Gary Halbert of Halbert Wealth Management

With the recent jump in gasoline prices, several energy analysts are forecasting that prices at the pump will top $4 a gallon (national average) later this summer. On the other hand, some analysts feel that gas prices will only go up another 5-10 cents a gallon just ahead, and then move lower in the fall. Of course, no one knows for sure. Today, we’ll take a look at what’s driving gas prices higher.

2013-07-24 Stocks and Bonds Both Again Rally as Bernanke Soothes by Sam Wardwell of Pioneer Investments

Fed Chairman Ben Bernanke’s congressional testimony got more headlines, but Detroit’s long-anticipated formal filing for Chapter 9 bankruptcy was by far the more important development. Billions of dollars of losses will be imposed on general obligation bondholders and/or retired employees.

2013-07-24 Bursting of the Bond Bubble by Clyde Kendzierski of Financial Solutions Group

Our April newsletter focused on the extreme overvaluation in the bond market. I argued that money market funds (or cash) were likely to outperform bonds and bond funds over the next decade. In May I applied the same logic to US stock prices and the inherent fallacy in the prevailing TINA (“there is no alternative” to stocks) hypothesis. Although stocks are likely to outperform bonds over the next decade, both asset classes remain seriously overvalued. In a world of overvalued assets, zero return looks much better than large potential losses even when that means foregoing transitory

2013-07-24 Earnings Acceleration Likely Needed for Next Upturn in Stocks by Bob Doll of Nuveen Asset Management

U.S. equities finished mostly higher last week. For a fourth straight week, the S&P 500 and Dow Jones Industrials were up (returning 0.73% and 0.57% respectively for the week), while the NASDAQ underperformed at -0.34%. It was a busy start for second quarter earnings. More than 70% of the 100 S&P 500 companies that have reported earnings have beaten consensus earnings per share expectations by approximately 3% in aggregate.

2013-07-24 Blather, Rinse, Repeat by Scott Brown of Raymond James

As expected, Federal Reserve Chairman Ben Bernanke repeated recent themes in his monetary policy testimony to Congress. However, he appeared to make a clearer distinction between the Fed’s two current policies, emphasizing that short-term interest rates will remain low for a long time. Even though there wasn’t anything new in Bernanke’s testimony, the markets took it as “dovish.” Importantly, the Fed isn’t the only central bank placing an emphasis on forward guidance.

2013-07-23 Fantasy versus Factors by Michael Nairne (Article)

Investors who wish to earn market-beating returns have a choice. They can indulge in the fantastical quest for “alpha” via high-cost active managers or they can construct factor tilts in their equity allocations via low-cost exchange traded or enhanced index funds. It doesn’t take a PhD in mathematics to determine which route is more likely to take an investor to higher performance.

2013-07-23 Emerging Europe: Regional Economic Review Q2 2013 by Team of Thomas White International

Trimming its forecast for global growth, the International Monetary Fund’s mid-year assessment of the world economy highlighted the slowdown in emerging economies such as Russia and recessionary conditions in the Euro-zone. Still, the recent surge in factory production and rise in new orders brought a whiff of optimism to emerging European markets such as Poland, the Czech Republic, and Hungary, which have been reeling under a prolonged downturn due to weak demand from the Euro-zone.

2013-07-23 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

Well, at least, the Tigers are leading the AL Central. The city of Detroit filed for Chapter 9 bankruptcy protection this week and pension owners and creditors are lining up to ask for pennies on the dollars on unpaid moneys owed. Detroit officially becomes the largest city in US history to file for such protection as it continues to suffer from a falling tax base after losing 250k residents between 2000 and 2010.

2013-07-23 You Thought It Was Hot Outside... by Blaine Rollins of 361 Capital

You thought it was hot outside? Wait until you see the weekly cash inflows into U.S. Equities... Funds that hold only U.S. stocks gained $15.58 billion in new cash, the most since June 2008. ETFs that hold domestic equities attracted $12.45 billion of those gains.

2013-07-23 Risk Communicates Signals that Something Important is at Stake by Robert Mark of Castle Investment Management

The equity markets hit new all-time highs again this past quarter. However, we believe this rally is largely due to Ben Bernanke’s policy of Quantitative Easing (QE) which presently equates to the purchase of $85 billion in U.S. government debt every month. Through the Federal Reserve’s policies our government has effectively printed trillions of dollars since the financial crisis began, arguably inflating a host of asset prices including the stock market.

2013-07-22 Trouble in Emerging-Market Paradise by Nouriel Roubini of Project Syndicate

Some of the better-managed emerging-market economies will continue to experience rapid growth and asset outperformance in the coming decade. But many BRICS countries and a few other emerging markets may hit a thick wall, with growth and financial markets taking a serious beating.

2013-07-22 A Tale from A Land Afar Comes Home, How Strong is This Recovery? by Gregg Bienstock of Lumesis

A break from our recent practice of tidbits. There’s a story you should read the similarities just might make you take notice. From there, I delve into the “recovery” and provide a bit more around our recently introduced Geo Score.

2013-07-22 Middle East/Africa: Regional Economic Review Q2 2013 by Team of Thomas White International

Moderate growth is anticipated in Middle-East and North Africa (MENA) region as the International Monetary Fund (IMF) notes that economic expansion in the oil exporting countries has slowed down due to subdued global oil demand. While oil importing countries are expected to make a slight recovery, nations in transition are facing complex socio-political issues, which could further delay their recovery.

2013-07-22 Can China Give Credit Where It's Due? by Milton Ezrati of Lord Abbett

June was a rough month for China’s economy and its financial markets. Old concerns about sustainable growth came to the fore, as reports surfaced and resurfaced, recounting liquidity shortages, misdirected and excessive credit growth, gyrating interest rates, and signs of weakness in manufacturing. Commentators and analysts alike voiced fears of a Chinese collapse on a par with America’s subprime crisis. For the second time in as many years, several in the global financial community have prophesized a “hard” landing for China’s economy.

2013-07-22 The Purgatory of Low Returns by James Montier of GMO

This might just be the cruelest time to be an asset allocator. Normally we find ourselves in situations in which at least something is cheap; for instance when large swathes of risk assets have been expensive, safe haven assets have generally been cheap, or at least reasonable (and vice versa). This was typified by the opportunity set we witnessed in 2007.

2013-07-20 Any Bonds Today? by John Mauldin of Millennium Wave Advisors

Given the acknowledged limitations of the CPI, we nevertheless use it in myriad ways. It governs cost-of-living adjustments for Social Security beneficiaries, government employees, and many labor union members. CPI is baked into the general cake, even though we know it is an imperfect fit in almost every situation.

2013-07-19 Fixed Income Outlook by Team of Osterweis Capital Management

The question we keep asking is “Will the real Fed mandate, please stand up?” The Federal Reserve (the Fed) traditionally is charged with keeping inflation in check, but it also has a second mandate to ensure full employment. This dual mandate can occasionally create general confusion as to what is the best policy at a given time and which policy goal the Fed is trying to achieve. Today, we are at a juncture where the Fed’s mandates may not clearly align with stated future monetary actions.

2013-07-19 Did Bernanke's Dovish Comments Please the Markets? by Sam Wardwell of Pioneer Investments

The key phrase: “About half of these participants indicated that it likely would be appropriate to end asset purchases late this year. Many other participants indicated that it likely would be appropriate to continue purchases into 2014.” Bonds rallied, suggesting that the sell-off of the past few weeks had exhausted itself or overshot (at least for now).

2013-07-19 China's Slowing Growth Who's In the Driver's Seat? by Anastasia Amoroso of J.P. Morgan Funds

After three decades of double-digit GDP growth, China has recently been expanding at a rate much closer to its five-year plan’s established target of 7%. As the pace of growth has changed, so has its composition and trajectory. The focus is shifting away from growth at all costs to a preference for quality over quantity that increases the wellbeing of an average Chinese consumer. The government is intent on rebalancing the economy away from commodity intensive infrastructure spending and towards supporting the middle class by increasing urbanization, private consumption and affordable ho

2013-07-19 European Equities: Beyond the Headlines by Philippe Brugere-Trelat of Franklin Templeton Investments

It’s fairly easy for investors to find reasons to shun European equities. While struggles in some Eurozone “periphery” countries continue to make eye-catching headlines, the broader story of Europe is far less fatalistic, according to Mutual Series Executive Vice President Philippe Brugere-Trelat, who manages the Mutual European Fund, Mutual Global Discovery Fund and Mutual International Fund. When it comes to Europe, he says one shouldn’t throw out the baby with the bathwater, so to speak.

2013-07-19 7 Things Investors Should Know Now by Russ Koesterich of iShares Blog

Can stocks move higher? What are the best opportunities now in stocks and fixed income? Russ answers these questions and others in an update to his mid-year outlook.

2013-07-19 Weekly Economic Commentary by Team of Northern Trust

The year’s first half included some big surprises. U.S. wage and salary growth sets the stage for stronger consumption. Don’t be discouraged by the most recent housing report.

2013-07-19 Challenging a Long-Held Assumption about Commodities by Frank Holmes of U.S. Global Investors

It is widely accepted that China spurred higher commodity prices in the past decade. And if the country was the force behind the boom, then the assumption is that China’s lower, but still healthy growth will be a drag on commodity prices. But recent research challenges this assumption.

2013-07-19 Opportunity in Europe by Team of Neuberger Berman

A striking feature of this year’s global stock market rally is that international markets have significantly trailed U.S. stocks. Nevertheless, Neuberger Berman’s Asset Allocation Committee (AAC) recently made the contrarian call of upgrading its view for international developed markets, particularly Europe. In this Strategic Spotlight, we provide an update on the European economy and lay out some reasons for optimism despite the dour growth outlook.

2013-07-18 ASEANSeeking Further Integration by In-Bok Song of Matthews Asia

Southeast Asia is pushing ahead with an economic initiative analogous to the E.U. called the ASEAN Economic Community (AEC). The 10-member bloc is striving to make this partnershipwhich envisions creating a single market and production base and developing closer economic ties both within the region and the broader global economya reality by 2015. In-Bok Song, takes a look at the benefits and hurdles that may be expected in this lengthy process for further integration of such aspects as liberalized trade, investment, skilled labor and free flow of capital.

2013-07-18 Second Quarter 2013 Financial Market Commentary by Andrew Zimmerman of DT Investment Partners

To taper, or not to taper, that is the question that investors are currently grappling with.

2013-07-18 What's Next for the U.S. Dollar? by Nic Pifer of Columbia Management

Global government bonds have performed poorly so far this year. Year to date through July 13, the Barclays Global Treasury Index, which covers 30 investment grade domestic government bond markets, is down 5.5% in unhedged U.S. dollar terms. The same index hedged back to U.S. dollars is down 0.6% year to date. This difference in returns highlights a key point.

2013-07-17 The Bernanke Guessing Game by David Wismer of Flexible Plan Investments

There can be little doubt that US equity markets have become more dependent than ever, at least in the short-term, on the every utterance of Fed Chairman Ben Bernanke and his fellow FOMC members.

2013-07-17 Canadian Secular View: Into Darkness? by Ed Devlin of PIMCO

Many investors are buying Canadian federal government bonds, shorting Canadian bank stocks and selling Canadian dollars in anticipation of a prolonged downturn. While significant risks are clearly facing the Canadian economy, our baseline forecast does not justify positioning our portfolios for a prolonged Canadian downturn.

2013-07-16 Herbert Huebscher (1926-2013) by Robert Huebscher (Article)

My dad passed away on July 8. My eulogy is below.

2013-07-16 Investment Bulletin: Global Equity Strategy July by Team of Bedlam Asset Management

For the first half of the year, the 17.7% gain by the portfolio was 390 basis points better than the index; during June, market panic over potential changes in Fed policy resulted in a 3.0% fall in the index, with the portfolio down by a similar amount. US bond funds suffered a record $58 billion outflow during the month, 2%of their assets.

2013-07-16 The Great Rotation Continues Forward... by Blaine Rollins of 361 Capital

Fed Chairman Ben Bernanke grabbed the mic on Wednesday and gave a performance that garnered a standing ovation from Stock, Bond, and Commodity investors. Only U.S. Dollar longs went home dragging their programs and spilling their popcorn. As a result, U.S. equity markets ended the week at all-time highs as stocks remained the darlings of the asset classes.

2013-07-16 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks got a boost last week from Fed Chairman Bernanke who decided (as predicted here) he needed to reset market expectations about the economy and Fed policy.

2013-07-15 Beneath the Noise, a Resilient Demand Trend and Clear Fed Plan by Alan Levenson of T. Rowe Price

Available data point to real GDP growth of less than 1% in the second quarter, yet we are looking through the dip: core demand data have been firmer (watch June retail sales on Monday), and a Q2 inventory correction will likely be followed by current quarter re-stocking. The sharp upward adjustment in mortgage rates will not derail the housing recovery. The FOMC has provided substantial clarity, in our view, regarding the monetary policy path that it intends to follow if the economy evolves in line with its expectations.

2013-07-15 Investment Bulletin: Emerging Markets Equity by Team of Bedlam Asset Management

For the half year to end June the index was buffeted, falling 3.1%. In contrast, the portfolio managed a gain of 8.3%, more than 1,000 basis points better. During the month of June, the Emerging Market index was whacked by 6.4%; the portfolio’s value also fell, but by a lesser 6.2%. The relative year-to-date and longer term falls in some of the regional indices have been grim (Chart 1, p.4): for example, in the first six months of 2013, EM equities underperformed those in developed markets on a total return basis by 16%, and by 14% over the last 12 months.

2013-07-15 The Egyptian C#@P by Bill O'Grady of Confluence Investment Management

From June into early July, the government of Egyptian President Mohamed Morsi was under pressure from widespread civil unrest. On July 3rd, the military, after warning the president that he had 48 hours to make changes or face an ouster, made good on their promise. The title of our report is “tongue in cheek” as the Obama administration and other officials are going to Orwellian lengths to say this isn’t a coup.

2013-07-15 Detroit, Addicted to Fed $$ by Gregg Bienstock of Lumesis

Last week, I left you with a hint that the July 8 commentary was to be a collector’s edition. After reading this week’s you will know why (hint: it is in the title). I start this week with a guest commentary from Kate McDonough who takes a look at the Detroit Emergency Manager’s Proposal for Creditors. I then take a look at just how reliant we are on the Federal Government for revenue (beyond what the Federal Reserve is doing).

2013-07-15 Rock-A-Bye Baby by John Hussman of Hussman Funds

I’ve always thought that singing “Rock-a-bye baby” offers a bizarre lesson to our young, encouraging them to be lulled gently to sleep by describing a scene that should have them wide-eyed with terror.

2013-07-13 The Bang! Moment Shock by John Mauldin of Millennium Wave Advisors

This week we resume our musings about Cyprus, to see what that tiny island can teach us about our own personal need to engage in ongoing critical analysis of our lives and investment portfolios. Cyprus is not Greece or France or Spain or Japan or the US or (pick a country). I get that. No two situations are the same, but there may be a rhyme or two here that is instructive.

2013-07-12 China\'s Very Relative Malaise by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, looks at “China’s Very Relative Malaise”, an observation which he describes as “a vaguely uneasy feeling that seemed to be shared by most (Chinese) but not always for the same reasons.”

2013-07-12 Hasenstab: Emerging Out of the Consensus Trade by Michael Hasenstab of Franklin Templeton Investments

Just when is a potential long-term reward worth the short-term risk? Investors are often most focused on the short-term pain of a particular event (hard to blame them), losing sight of possible outcomes farther out into the future. That could partially explain what’s going on in the emerging markets right now, at least according to Michael Hasenstab, co-director of the International Bond Department, Franklin Templeton Fixed Income Group.

2013-07-12 Making Sense of the Bond Market by Phelps McIlvaine of Saturna Capital

The great challenge for investors and advisers today is to forecast where interest rates and bond prices will be once the influence of radical central bank intervention dissipates. Measures of inflation expectations are declining, and deflation remains the dominant influence on interest rates. In assessing whether to trim bond allocations, it is important to revisit the reasons for selecting a particular asset allocation before modifying or abandoning it.

2013-07-12 Weekly Economic Commentary by Team of Northern Trust

The view of Spain’s economy from the ground is no prettier than it is from distance. Not all forward guidance is created equal. China’s suspension of key economic data raises, not quells, concern.

2013-07-12 Commodities 2013 Halftime Report: A Time to Mine for Opportunity? by Frank Holmes of U.S. Global Investors

It was a challenging first half of the year for most commodities, with only two resources we track on our Periodic Table of Commodities Returns rising in value. Natural gas and oil rose 6.5 percent and 5 percent, respectively, while silver lost a third of its value and gold lost a quarter of its price from the beginning of the year.

2013-07-12 Calming Downand Changing Focus by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Markets are calming and investors seem to be focusing on fundamentals againa nice change from recent history. The bar is relatively low for earnings season but focus will be on the commentary surrounding releases. We believe more sideways movement in both US equities and Treasury yields could prevail over the next couple of months, with summer months muting action; but remain optimistic about stocks longer-term. Likewise, Japan could tread water until new elections are held, but we believe the eurozone provides opportunities that should be looked into at the expense of investments in China.

2013-07-11 The Capital Flight from Safety: It is Not About Tapering it is About Growth by Scott Colyer of Advisors Asset Management

Since Ben Bernanke’s comments seemed to unleash the bond vigilantes on June 19, we have seen a reversal in money flows that have used the U.S. Treasury market and the gold market as a “flight to safety trade.”

2013-07-11 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company

While the economic trends of the past couple of years continue, we’ve just seen an important change in interest rates and the bond markets.

2013-07-11 The Taper by Richard Bernstein of Richard Bernstein Advisors

If SNL’s Emily Litella worked on Wall Street, she’d probably be asking “What’s all this hubbub about the Fed’s tapir? After all, it’s a fine animal that never hurt anyone on Wall Street.” It would then be pointed out to her that the word was “taper” and not “tapir”. She would politely end her commentary with her famous “Never mind.”

2013-07-10 Market Perspectives Q2 2013: Fed Fears by Richard Michaud of New Frontier Advisors

Investors have been hypersensitive to the inevitable reversal of the Federal Reserve’s bond purchasing economic stimulus program known as QE3. Signs of sustainable economic recovery have been closely monitored as a harbinger of a likely end of the program.

2013-07-10 3 Risks that Could Derail the Market Rally by Russ Koesterich of iShares Blog

Stocks can withstand moderate rate increases, as we saw last Friday when they rallied despite a sell-off in bonds. But Russ K warns that they may not withstand these three other scenarios.

2013-07-09 A Mid-Year Letter to Clients: A Positive Outlook on America by Dan Richards (Article)

Each quarter I’ve posted templates to serve as a starting point for advisors looking to send clients an overview of the three months that just ended and the outlook for the period ahead. This quarter’s letter focuses on why the U.S. is expected to be the leader among global economies.

2013-07-09 U.S. Stocks Continue to Dominate – What’s Next? by Ron Surz (Article)

U.S. stocks earned 2.5% in the second quarter, bringing the year-to-date return up to a lofty 14%. By contrast, the EAFE index lost 1% in the quarter, bringing its year-to-date return down to 4%. In fact, as shown in the following graph, no other asset class comes even close to the return on U.S. stocks so far this year.

2013-07-09 The Germans Deserve Credit for Extending Credit by Sam Wardwell of Pioneer Investments

Germany’s government agreed to (indirectly, via guarantees) provide Spain’s government-run ICO development banks with the funding to make up to 800 million of low-interest loans to small and medium-sized businesses.

2013-07-09 High Yield Munis: Risky Business by Ryan Davis, Jingwei Lei of Fortigent

We shine a spotlight on the obscure market of high yield municipals this week. In the current fixed income selloff, the market has been among the worst performing with a drawdown of 6.1%. Investors could not get enough of the sector in 2012 as they chased yield; the Barclays high yield muni index returned over 18%. Investor sentiment has turned sharply, however, on this asset class. Funds experienced significant outflows over the last couple of months, which is especially troubling for a small and retail dominated market. Why did this onetime darling asset turn into a pariah so abruptly?

2013-07-09 So the Bulls Returned... by Blaine Rollins of 361 Capital

So the Bulls returned to Equities on a holiday shortened week with plenty of news and data to outrun. The Egyptians threw out their President and the Portuguese gave a thumbs down to their government. But dovish comments out of Draghi/ECB, strong data out of Japan, and a 3rd strong month of Non-Farm Payroll growth pushed the Russell 2000 to all-time highs as the rest of the market jumped into its slipstream.

2013-07-09 The Fed\'s Bind: Tapering, Timetables and Turmoil by Scott Minerd of Guggenheim Partners

There are striking parallels between the dramatic recent sell-off in U.S. Treasuries and the Great Bond Crash of 1994. But the summer of volatility now facing financial markets is no doomsday scenario. Instead, it puts the U.S. Federal Reserve in a bind. Higher interest rates will reduce housing affordability, which is especially troublesome since housing is the primary locomotive of U.S. economic growth.

2013-07-09 The G8: Sorry, Maybe Next Time by Milton Ezrati of Lord Abbett

While the recent gathering of the Group of 8 industrialized nations addressed worthy topics such as Syria and tax avoidance, it failed to tackle essential economic and fiscal issues.

2013-07-09 Jobs, the Fed, and Long-Term Interest Rates by Scott Brown of Raymond James

The June Employment report showed a labor market that is far from fully recovered, but appears to be well on its way. Federal Reserve policymakers are not going to react to any one report, but the trend in nonfarm payrolls has remained strong. Is that enough to ease up on the gas pedal? Perhaps. However, it should still be some time before the Fed has to hit the brakes.

2013-07-08 Widening the Search for Income: Beyond Traditional Bonds by Team of Forward Management

Multisector bond market strategies may provide an opportunity to capitalize on differences in relative value. A more refined and global approach may generate yield with dividend-paying stocks. Emerging market (EM) corporate bonds feature attractive fundamentals and have increased in popularity as an asset class.

2013-07-08 Absolute Return Letter: Much Ado about Nothing by Niels Jensen, Nick Rees,Tricia Ward of Absolute Return Partners

A 300 bps rise in bond yields across the term structure would, according to their calculations, do substantial damage to financial institutions’ balance sheets. Holders of U.S. Treasuries alone would lose in excess of $1 trillion on such a move in rates, equal to 8% of U.S. GDP. Other countries would fare even worse. Losses on JGBs would equal 35% of the Japanese GDP, effectively wiping out its banking industry in the process. Holders of U.K. bonds wouldn’t do much better, losing the equivalent of 25% of U.K. GDP.

2013-07-08 Deflationary Boom? by John Hussman of Hussman Funds

Taken together, the financial markets have priced a wide range of assets on the assumption that the U.S. is on the verge of a deflationary boom. Most likely, part of this scenario is wrong.

2013-07-05 Accessing Myanmar\\\'s Growth by Frank Holmes of U.S. Global Investors

Did you know that in the first half of the last century, Myanmar had twice the GDP per capita of China? What a difference a few decades and government policies make, as China is ten-fold the size of Myanmar today, according to UBS Research. The change in wealth between the two nations is a prime example of how government policies can have a tremendous effect on a country’s growth.

2013-07-05 The Asian Giant Stampeding into Gold by Frank Holmes of U.S. Global Investors

In this environment, gold should remain attractive. However, as the West flees the precious metal, another set of gold buyers has come forward with the aim to preserve wealth. Take a look at the chart below which shows total gold production compared to the gold deliveries on the COMEX and the Shanghai Gold Exchange.

2013-07-05 A Venture Investor from Bell Labs Channels the Noise and the Knowledge by John Mauldin of Millennium Wave Advisors

Alpha is found on the edges, away from common knowledge. It is in new technologies, and it can surely be found there, although there are different risks at the edge. But there are other sources of alpha, which can be found not by looking at what has happened but at what is likely to happen, not just in technology but in markets and the actions and reactions of those who would try to move markets.

2013-07-04 The Free-Trade Charade by Joseph E. Stiglitz of Project Syndicate

The negotiations to create a free-trade area between the US and Europe, and another between the US and much of the Pacific (except for China), are not about establishing a true free-trade system. Instead, the goal is a managed trade regime managed, that is, to serve the special interests that have long dominated trade policy in the West.

2013-07-03 Alternative Energy Brief: EU Solar Tariffs “a big mistake.” by Edward Guinness, Matthew Page of Guinness Atkinson Asset Management

This month we explore the impact of recent EU solar module tariffs.

2013-07-03 Getting Back to “Normal” by Douglas Cote of ING Investment Management

Though markets were whipsawed by the announcement, the Fed’s plan to step aside and allow normalization is a good thing. The primary risk to hedge is now economic growth and the strong equity returns it tends to produce not financial Armageddon. While risks in Europe and China persist, U.S. fundamentals look relatively strong. It’s not too late for investors to move away from defensive positioning and back toward a standard allocation.

2013-07-03 A Roadmap for Rates by Scott Minerd of Guggenheim Partners

Uncertainty over the Federal Reserve’s timeline for tapering quantitative easing has resulted in increased volatility in fixed income markets. While the coming months could see the 10-year Treasury yield climb as high as 3.5 percent, the resulting economic slowdown will keep rates subdued in the medium-term.

2013-07-03 AdvisorShares Weekly Market Review by AdvisorShares Research of AdvisorShares

Markets went higher last week after central bankers around the world reassured investors that they would not kill the economic recovery with higher interest rates. More volatile small and mid-cap stock indices performed even better than the S&P 500.

2013-07-03 Investment Bulletin: Emerging Markets Equity by Team of Bedlam Asset Management

The portfolio performed very well in May, taking the year to date net gain to 15.0%, vs. 3.5% for the index. There were two causes for the good numbers: stock selection i.e. ignoring index weightings - and the avoidance of countries with deteriorating balance of payments and budget deficits, and with high government debt to GDP ratios, such as Hungary, Poland, India, Turkey and South Africa.

2013-07-02 Recent Volatility – Noise, not Signal by Keith C. Goddard, CFA (Article)

This spasm of volatility is a normal side effect when market participants adjust their positions to a new expectation for the future of monetary policy. Even though the policy adjustment being discussed at the Fed is minor – i.e., a gradual tapering of quantitative easing (QE) – the timing of the change was sooner than many investors expected, so trading volume jumped.

2013-07-02 Bullish on Quality and Active Management Over the Long Term by Chuck Royce of The Royce Funds

While solid on an absolute basis, quality stocksas measured by returns on invested capitalhave lagged their lower-quality peers. Chuck Royce explains why shifts in Fed policy should help to complete a reversal that’s already begun.

2013-07-02 The 2013 Mid-Year Geopolitical Update by Bill O'Grady of Confluence Investment Management

At mid-year, we customarily publish our geopolitical outlook for the second half of the year. This list is not designed to be exhaustive. As is often the case, a myriad of potential problems in the world could become issues in the second half of the year. The lineup listed below details, in our opinion, the issues most likely to have the greatest impact on the world. However, we do recognize the potential for surprises which we will discuss throughout the year in upcoming weekly reports.

2013-07-02 Investors Gear Up for Earnings Post-Taper by Chris Maxey, Ryan Davis of Fortigent

Following a few weeks of FOMC-induced turmoil, investors are looking forward to getting back to the fundamentals.Second quarter earnings season are set to kick off July 8 with Alcoa, in what will mark an important reporting period for financial markets.Given the now much telegraphed intentions of the Fed, investors are scrutinizing whether the US economy and corporate sector is ready to stand on its own feet.

2013-07-02 Stay the Course as Mixed Signals Move Markets by Frank Holmes of U.S. Global Investors

Traders stampeded out of gold, emerging markets and bonds this month, setting record monthly outflows in June. Ever since the Federal Reserve hinted in May that signs of a stronger economy could allow for a slowdown of stimulus, markets have protested the news.

2013-07-01 \"This Country is Different\" by John Mauldin of Millennium Wave Advisors

Cyprus is a very small country, some 800,000 people. Among the leadership, everyone knows everyone. There is much to admire, as we will see. But Cyprus has had a gut-wrenching crisis, proportionately more dire than any in other European countries recently; and precedents are being established here for how future problems will be dealt with in the Eurozone and elsewhere.

2013-07-01 All of the Above by John Hussman of Hussman Funds

Market internals remain broken here. That may change, and it might even change soon. Until it does, we would be inclined to tread carefully, because this may be the highest level investors will see on the S&P 500 for quite some time. Choosing between potential catalysts - credit strains in China, the risk of disappointing earnings, or economic weakness, the incoming data is consistent with one conclusion: all of the above.

2013-07-01 On the Radar: An Energy Boost for Stocks? by Milton Ezrati of Lord Abbett

This is the third in a series on longer-term market influences. Each has considered what developments could help or hurt the equity rally after some 1824 months, when, in all likelihood, stocks will fully realize their still attractive existing valuations and feel the last effects of the ongoing flood of liquidity provided by the Federal Reserve. The first number in this series took up monetary policy and the second fiscal reform. This last discussion looks at the prospect of energy abundance, due to fracking, among other sources.

2013-06-28 Investment Bulletin: Global Equity Strategy by Team of Bedlam Asset Management

For the first five months of the year the global portfolio enjoyed a net gain of 21.0%, 350 basis points better than the index, edging ahead further in May. Recent smoke signals from the Federal Reserve Bank implying - subject to a wide range of get-out clauses that less money might be put into the system, have caused market hysterics. Bond investors have rightly been stampeding out, ending a 32-year old bull market. Its longevity had caused dangerous complacency and overexposure, especially to illiquid and expensive emerging market debt through open-ended vehicles.

2013-06-28 Weekly Economic Commentary by Team of Northern Trust

Small businesses may hold the key to better economic growth. Chinese officials are trying to curb financial excess. There are a number of ways to reach 7% U.S. unemployment.

2013-06-28 Reviewing the Dividend Sell-Off by Jeff Middleswart of Ranger International

Higher yielding stocks outperformed for much of this year, but fell sharply with the pop in interest rates.

2013-06-28 Stay the Course As Mixed Signals Move Markets by Frank Holmes of U.S. Global Investors

We maintain that gold is in extremely oversold territory and mathematically due for a reversal toward the mean. Yet when gold prices plummet, fear takes over and some investors forget the fundamental reasons to own gold: Gold is a portfolio diversifier and a store of value. It is a finite resource with increasing global demand.

2013-06-28 Riding Out Recent Volatility by Michael Hasenstab of Franklin Templeton

Major central bank policy turns are naturally going to cause some market dislocations. Hasenstab says it’s pretty clear the Fed couldn’t continue printing money forever, and while some investors are panicking about what the end of the Fed’s easy money policy will mean, Fed tapering doesn’t equate to Fed tightening.

2013-06-28 The New, Old Normal by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We believe the recent volatility will be relatively short lived and provides an opportunity for investors who need to adjust their portfolios to do sowith long-term goals in mind. The risks associated with fixed income have been illustrated over the past couple of weeks and rising yields have caused equity volatility and a pullback. But we remain optimistic about US equities as well as developed international markets; particularly relative to emerging markets.

2013-06-27 The Global Insider Country Focus: Turkey by Accuvest Global Advisors of AdvisorShares

As the antigovernment protests in Turkey continue, what’s next economically for a country that relies heavily on foreign investors and tourism, especially with summer approaching, the traditional tourist high season? Accuvest Global Advisors, a firm founded on the principle of thinking globally and investing globally, has prepared the following focused country review on Turkey, which analyzes current risks with Turkey and potential next steps in the crisis.

2013-06-27 Policy-Induced Volatility Continues by Scott Minerd of Guggenheim Partners

The recent bond market collapse is reminiscent of the Great Crash of 1994. Further pressure on the economy due to rising interest rates could cause the Fed to revisit its timetable for QE.

2013-06-27 Currency Wars: A Case for the U.S. Dollar by Gibson Smith, Chris Diaz of Janus Capital Group

In recent years, the U.S. dollar has tended to lose value when the global economy improves, as investors are more willing to take risks. We believe that pattern has changed and that the U.S. dollar will outperform the Japanese yen, the euro and the British pound over the medium term, even if the global economy continues to improve. In our view, current conditions justify a material deviation in currency exposure compared with certain global fixed income benchmarks, such as the Barclays Global Aggregate Bond Index.

2013-06-27 Turmoil Shouldn't Derail Turkey by Carlos von Hardenberg of Franklin Templeton Investments

In 2012, Turkey’s stock market rose more than 50%, posting one of the strongest performances of any global equity market last year. However, recent news of protests sweeping the nation has started scaring off some investors, at least in the short term. We consider turmoil to often be a natural part of change and development, and these short-term political disturbances likely won’t be the last. I’ve invited my colleague Carlos von Hardenberg, Managing Director, Turkey, based in Istanbul, to share some local insight.

2013-06-26 The Fed\'s Dirty Little Secret: QE Does Not Work by Gary Halbert of Halbert Wealth Management

Today I hope to dispel the myth that the Fed’s massive quantitative easing (QE) policy has driven long-term interest rates lower. I will argue that the opposite is true and demonstrate that the yield on the 10-year Treasury note has actually risen during QE-1, QE-2 and QE-3. This flies in the face of most market commentators.

2013-06-26 June 2013 Float Shrink Review by TrimTabs Asset Management of AdvisorShares

Sharing some commentary from our friends at TrimTabs, which summarizes a few changes in the investment landscape that may give you an indication of what to expect following May’s “sell in May and go away” trading adage. TrimTabs research focuses on fund flows and float shrink. They believe the market is heavily influenced by what people and institutions are doing with their dollars. You can read more about the research behind float shrink at AdvisorShares.com.

2013-06-26 Trampled By the Crowd? Logic Briefly Abandoned Creates Opportunity by Scott Colyer of Advisors Asset Management

The past two week slide in asset prices has caused a resurgence of doomsday pundits warning of impending calamity. The negative interpretation of Fed Chairman Bernanke’s comments regarding the U.S.economy’s future upgraded prospects is simply not logical. A careful review of what Bernanke said at his press conference was entirely consistent with what the Fed has said and done in the past.

2013-06-26 2 Ways to Play the US Energy Boom by Russ Koesterich of iShares Blog

Russ offers two ideas one perhaps obvious and one perhaps not for investors looking to potentially benefit from the US energy renaissance.

2013-06-25 The Great Debate on Inequality: Stiglitz versus Krugman by Michael Edesess (Article)

Economics Nobel laureate Joseph Stiglitz is the chief alarmist warning that income and wealth inequality in the U.S. is a very serious threat to the economy. So it comes as a surprise that his fellow Nobelist Paul Krugman – Stiglitz’s intellectual comrade-in-arms – disagrees with him. Their disagreement goes to the heart of today’s economic problem.

2013-06-25 Is Fixed Income the New Equity? by Chris Maxey, Ryan Davis of Fortigent

After several decades of positive returns, fixed income investors are being treated to a rude awakening in the last six weeks. Recent comments from Federal Reserve officials suggest a sooner than anticipated exit from quantitative easing, raising the prospect of higher interest rates. Throughout the universe of fixed income assets, investors are questioning the future return potential, leading many to wonder, what now?

2013-06-25 How Not to Invest in Dividend Stocks: Seven Mistakes Investors Commonly Make by David Ruff of Forward Management

While investors may assume that dividend investing is relatively straightforward, they commonly make mistakes that may undercut the potential income and total return of their investments.

2013-06-25 The Iranian Surprise by Bill O'Grady of Confluence Investment Management

On June 14, Iranian voters went to the polls and overwhelmingly supported Hassan Rouhani. Pre-election handicapping did not give Rouhani much of a chance but a series of events led to his unexpected crushing victory. Rouhani won just under 51% of the vote, eliminating the need for a runoff (presidential candidates must secure a majority to win). The next closest candidate was Mohammad Baqer Qalibaf, with 17%. The supposed front runner (and favorite of Ayatollah Khamenei), Saeed Jalili, secured a disappointing 11%.

2013-06-25 Reframing Expectations by Aaron Reynolds of Baird Advisors

Even facing headwinds, bonds still serve important roles in a portfolio, including diversification and downside protection potential. As the heavy burden of total return falls on interest income, investors are being pulled toward higher-yield, higher-risk bond types. Investors can still benefit from the segmented bond market and the various strategies that are available. Expectations need to be reframed given the current environment of low yields and potential interest rate increases.

2013-06-25 Rates, Dividends and The Laws of Gravity by Don Taylor of Franklin Templeton Investments

The laws of gravity may dictate that what goes up must come down, but interest rates seem to have their own converse course of action what goes down eventually will go up. Although it seems like interest rates can stay stuck in low gear for years, (decades even, in the case of Japan) eventually they will creep higher, and talk is heating up about the timing and magnitude of such creep in the US. As the portfolio manager of Franklin Rising Dividends Fund, Don Taylor was quick to comment that higher interest rates don’t mean all dividend-paying stocks are doomed.

2013-06-24 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

What is the Fed actually saying? The economy is recovering; the labor market is improving; short-term interest rates should remain low until at least 2015; the bond buying program will continue in its current form; any “winding down” (tapering) of purchases will be contingent on steady growth; the policymakers would be prepared to ramp up buying if conditions warrant. What have many investors been hearing/thinking?

2013-06-24 The Fed Unintentionally Lays an Egg by Bob Doll of Nuveen Asset Management

U.S. equities declined last week as the S&P 500 ended down 2.09%.1 The S&P suffered the first back-to-back one-day declines of more than 1% since last November. Global equities and bonds were also hit hard, with large sell-offs in emerging market assets, commodities and commodity currencies. Concerns about the fallout from dampened Fed policy accommodation are driving the weakness.

2013-06-21 Asia Brief: China's Energy Demand by Edmund Harriss, James Weir of Guinness Atkinson Asset Management

China has the world’s largest unconventional gas reserves, but these so far remain untapped despite its growing demand for energy. China is now trying to follow the example of the US, and the government has set aggressive targets for unconventional gas production. As the demand for transportation fuels grow over the next decade, this gas could be a major contributor to meeting that need.

2013-06-21 Outlook for the Global Bond Market by Nic Pifer of Columbia Management

The global economy continues to expand, but seems stuck on a moderate, below-trend trajectory. Lately, the story seems to be more about a growth rotation across regions than a clear-cut acceleration or deceleration at the global level. Looking to 2014, however, we still expect the global economy to accelerate to a more trend-like pace.

2013-06-21 The Fear Factor in US Equities by Grant Bowers of Franklin Templeton Investments

Fear is a powerful motivator. Whether it’s a saber-toothed tiger or investment risks, it’s hard to stay calm when confronted with a perceived threat. Fear of a 2008 2009 downturn repeat, even in spite of strong performance in the US equity market in the first half of the year, has kept many investors sidelined. Grant Bowers believes fear itself could be the biggest issue holding back many investors right now, noting that in his view, short-term volatility aside, the recent US market rally is based on supportive fundamentals which he thinks should have staying power.

2013-06-21 Weekly Economic Commentary by Team of Northern Trust

Today, the relative health of banks around the world goes a long way toward explaining differences in economic fortunes. As policy-makers seek ways to improve growth, addressing structural issues in their financial systems may be more effective than monetary or fiscal stimulus.

2013-06-21 Austerity is a Four-Letter French Word by John Mauldin of Millennium Wave Advisors

The France that I see as I look out from the bullet train today is far different from the France I see when I survey the economic data. Going from Marseilles to Paris, the countryside is magnificent. The farms are laid out as if by a landscape artist this is not the hurly-burly no-nonsense look of the Texas landscape. The mountains and forests that we glide through are glorious. It is a weekend of special music all over France, and last night in Marseilles the stages were alive and the crowds out in force.

2013-06-21 What\'s an Investor to do in Markets like These? by Frank Holmes of U.S. Global Investors

What should an investor do after a day like yesterday? Stay calm and invest on, as I believe there is opportunity in picking up what the bears left behind. Here are a few ideas to ponder.

2013-06-19 Changes in our Asset Allocation by Gregory Hahn of Winthrop Capital Management

We believe that valuations in publicly traded securities are stretched, and, although we have seen a move higher in interest rates and stocks have sold off from their high levels, investors are faced with choices that offer generally lower expected returns based on historic measures of return. Today, with the S&P 500 hitting 1650 and the yield on the 10 year US Treasury Note moving abruptly from 1.70% to 2.15%, there are generally two schools of thought on the minds of investors.

2013-06-19 3 Reasons to Consider Spanish Stocks by Russ Koesterich of iShares Blog

While Europe is not out of the woods yet, Russ is less concerned about the Spanish market.

2013-06-18 GMO’s Montier on Why to Hold Cash by Robert Huebscher (Article)

Central bank policies have distorted markets to such a degree that investors are devoid of any buy-and-hold asset classes, according to James Montier. But according to Richard Bernstein, the flood of liquidity unleashed through quantitative easing (QE) now offers investors compelling opportunities.

2013-06-18 Help Clients Fill the Income Void by Sponsored Content from Legg Mason Global Income Survey (Article)

Affluent investors all over the world just aren’t getting what they want from their income investments, according to Legg Mason’s recently released Global Income Survey. Yet there is good news: most say they want to become more knowledgeable about income investing, and they’re eager for financial professionals to point out fresh opportunities.

2013-06-18 Three Time Bombs that Threaten Retirement Plans by Dan Richards (Article)

Three poorly understood developments threaten secure retirements – without wishing to be alarmist, I will call them time bombs. These developments will change the retirement dynamic for many Americans: increasing lifespans, escalating medical costs as people age and safe withdrawal rates on savings dropping from historical levels.

2013-06-18 Newsletter June 2013 by Harold Evensky of Evensky & Katz

Do you remember hiding under the sheets listening to radio when your parents thought you were asleep? If so, I have an unbelievable collection of all the old-time radio shows we listened to when we were kids, if you have about six months’ spare time. Find your favorite, click on it, and it lists literally hundreds of episodes you can re-live.

2013-06-18 The Snowden Affair by Bill O'Grady of Confluence Investment Management

Over the past two weeks, revelations published in The Guardian and the Washington Post reported on a massive data gathering program that the National Security Agency (NSA) has been operating since 2001. The NSA, created during the Truman administration, mostly monitors signal intelligence and is the primary cryptographer for the U.S. government.

2013-06-18 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stock prices came under pressure last week over the strength of the Japanese Yen versus the dollar which led to a large decline in stock prices there as well as the misplaced fears domestically that the Federal Reserve Board will pull forward its timetable for “tapering” its quantitative easing policy.

2013-06-18 Fed Zombification by Cliff Draughn of Excelsia Investment Advisors

The enthusiasm of our culture for Zombies is estimated to contribute a tidy $5 billion dollar a year to GDP, and that doesn’t even include the too-big-to-die zombie banks. In my opinion, the acute interest in zombies and horror (and escapism in general) says something about our country’s mental health.

2013-06-17 Recent Volatility in the Foreign Exchange Market and the Strengthening Yen by Team of Nomura Asset Management

There are two issues underlying the increased currency market volatility; depreciation of the Yen may have resulted in worldwide competitive devaluation and concern about early tapering of quantitative easing (QE) in the U.S. appears to have triggered currency depreciation for countries that are running current account deficits.

2013-06-17 Sloppy Markets Continue by Bob Doll of Nuveen Asset Management

Last week the S&P 500 declined 0.97%,1 while many global equity averages fell for the fourth week in a row. Early in the week, discussion of tapering by the Federal Reserve was a big headwind, as discomfort over a slower pace of policy accommodation rippled through global markets. Thursday’s rally was driven by thoughts that tapering fears may be overdone. Markets were also helped by better employment and consumption data.

2013-06-17 On the Radar: Bernanke\'s Balancing Act by Milton Ezrati of Lord Abbett

A recent analysis in this space made the case for equities. Pointing to the continued flood of liquidity from the Federal Reserve and still-attractive stock valuations, I argued that the rally would continue, despite the subpar economic recovery and continued policy muddles in Washington and Europe. In this column, I will take up one of those fundamental, longer-term considerations: Fed policy. The columns that follow will discuss two other major issues: fiscal policy and energy.

2013-06-17 Equities: As Companies Reinvest, the Long-Term View Turns Bullish by Ron Sloan of Invesco

This is the third in a three-part series on the economy, earnings and equities. The first two posts examined the US Federal Reserve’s gross domestic product (GDP) goals and how they set the stage for businesses to increase their capital expenditures. This post discusses the US manufacturing resurgence and the outlook for equities.

2013-06-15 Economists Are (Still) Clueless by John Mauldin of Millennium Wave Advisors

The economic forecasts of mainstream economists are quite positive, if not enirely optimistic, reflecting the current data. Should we not take heart from that? Alas, no. This week we look at some of our recent musings on that topic, triggered by a letter from a very serious economist who took umbrage when I wrote disparagingly about economists and forecasting a couple months ago.

2013-06-14 The Evolution of Emerging Market Corporate Bonds for U.S. High-Grade Fixed-Income Investors by Todd Kurisu, Thomas Brennan of William Blair

Emerging market (EM) investment-grade corporate bonds are an important and growing segment of the core fixed-income universe. These bonds have evolved to be more like U.S. investment-grade corporate bonds than high-yield or traditional emerging market debt (EMD) securities. This sector has demonstrated favorable risk, return, and diversification benefits in the context of a broad market fixed-income portfolio. Today’s fixed-income investors must have a framework for evaluating new opportunities subject to prudent risk management

2013-06-14 Looking for Growth? Go Small and Global by Liliana Castillo Dearth, Bruce Aronow of AllianceBernstein

In the hunt for growth in today’s low-growth world, up-and-coming small- and mid-sized companies are a good place to start. But you need to look everywhere, from Indiana to Indonesia.

2013-06-14 The Sustainability of Managed Futures Returns by Robert Keck of 6800 Capital

Many investors have begun to question the efficacy of an investment in managed futures given the most recent two years of negative performance for the industry as a whole at a time when U.S. equity prices have been achieving multi‐year highs. The concern is not so much the magnitude of the losses incurred by the managed futures industry during this period; in many cases they are relatively small in comparison to the size of the drawdowns experienced by many other asset classes such as equities, real estate, fixed income, etc., during peak periods of market stress.

2013-06-14 Global Small Cap Investing: Unconstrained Opportunities by Blake Pontius of William Blair

Equity asset allocations have become more global in recent years as investors have sought to reduce the long standing home country bias in their portfolios. Further propelling this trend has been the growing aversion to traditional asset class structures and indeed, conventional asset class definitions, in the aftermath of the 2008-2009 global fi nancial crisis. Against this backdrop, global equity strategies have continued to garner asset fl ows in Europe and have slowly begun to gain traction in the U.S. after years of tepid demand.

2013-06-14 A Sweet Find on an African Adventure by Frank Holmes of U.S. Global Investors

The heart of Africa has been beating strong in recent years due to elevated commodity prices and resilient domestic demand, despite the global economic slowdown. Among the sub-Saharan African countries, Sierra Leone was the fastest growing country last year, according to the World Bank. Its economy experienced growth that is as rare today as Fancy Red diamonds. GDP increased a whopping 18 percent.

2013-06-14 Changing Picture by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We could be in the beginning stages of an adjustment toward a more "normal" monetary policy environment, with attendant volatility. This once again illustrates the importance of diversification and focusing on long-term goals when investing. We continue to believe the US equity markets are an attractive place for assets and recommend buying on pullbacks to the extent that you need to add to equity exposure. Additionally, continue to exercise caution around fixed income allocations and focus more on the developed markets vs. EM.

2013-06-13 Pacific Basin Market Overview May 2013 by Team of Nomura Asset Management

After a positive start, many Pacific Basin Markets ended the month lower amid concerns that the Federal Reserve (Fed) will soon begin to gradually scale back its quantitative easing measures by reducing the pace of central bank asset purchases. The MSCI AC Asia Pacific Free Index including Japan decreased by 4.8% while the MSCI AC Asia Pacific ex Japan Free Index closed 4.3% lower in May. (All performance figures are based on MSCI indices in U.S. dollar terms with dividends included unless otherwise stated.)

2013-06-12 Who Is Your Daddy and What Does He Do? by Cole Smead of Smead Capital Management

In the 1990 movie Kindergarten Cop, Arnold Schwarzenegger portrayed a police officer who goes undercover as John Kimble, a kindergarten teacher in Astoria, OR. Early in the movie, Mr. Kimble tells his class they are going to play a game called “Who is your daddy and what does he do?” After a myriad of answers, one of the children asks him if his ensuing headache is a tumor. Kimble replies “It’s not a tumor.” We at Smead Capital Management believe this was not only one of the more comical moments of Kindergarten Cop, but also a great question to ponder in today&rs

2013-06-12 Cyclical Stocks Appeal After Defensive-Led Rally by Vadim Zlotnikov of AllianceBernstein

This year’s equity market rally was initially led by defensive stocks, as macroeconomic concerns persisted despite improved risk appetite. With valuations in these sectors looking stretched and cyclically oriented stocks starting to rebound in May, is a bigger shift starting to unfold?

2013-06-12 5 Reasons Not to Flee Non-US Dividend Stocks by Russ Koesterich of iShares Blog

“As bond yields rise, is it time to flee dividend stocks?” Russ explains why the answer is, no, at least when it comes to international dividend payers.

2013-06-12 Bond Realities: The Changing Landscape for Fixed Income and the Death of the Agg' by Andrew Johnson of Neuberger Berman

Earlier this year Andrew A. Johnson, Neuberger Berman’s Chief Investment Officer for Investment Grade Fixed Income, led a series of discussions with institutional clients about the state of the fixed income market and key ideas in approaching opportunistic fixed income investing in the current environment. Here, Mr. Johnson has adapted, and elaborated on, the concepts described at those meetings.

2013-06-11 Gundlach – Don’t Sell Your Bonds by Robert Huebscher (Article)

Don’t sell your bonds just yet, according to Jeffrey Gundlach. Global economic growth is slowing, he said, and the U.S. will be competing for a larger slice of a shrinking worldwide pie. A weaker economy dims the prospects for higher interest rates. The benchmark 10-year Treasury yield – currently 2.08% – will be 1.70% by the end of the year, according to Gundlach, providing profits for holders of long-term bonds.

2013-06-11 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The last few weeks have seen volatility emerge as concerns about the Fed’s policy of quantitative easing and the timing of changing it have taken center stage.

2013-06-11 May Flowers Bring Best Equity Market Since 1997 as Bonds Wilt by Douglas Cote of ING Investment Management

The S&P 500 has opened 2013 with its best year-through-May return since 1997. U.S. Treasury prices, in contrast, plunged last month on talks of Fed “tapering”. Don’t expect the reflation in bond yields to continue in the near term, as the Fed continues to struggle in its current war against deflation. Fundamental business activity not quantitative easing is the wellspring of sustained economic growth, creating lasting sales and profits. For investors, the two biggest self-defeating fears continue to be 1) the fear of buying equities and 2) the fear of buying bonds.

2013-06-11 Risk Parity - New Thinking or New Packaging? by Chris Maxey, Ryan Davis of Fortigent

Ever since Harry Markowitz brought forth the notion of mean-variance optimization in 1952, academics and practitioners alike have sought ways to build more robust asset allocation methodologies. Recently, the most talked about approach in the institutional world is risk parity, which seeks to focus on risk as its primary input. Risk parity is intuitively appealing, but suffers many pitfalls that investors need to consider.

2013-06-11 Crushing the Middle Class by John Browne of Euro Pacific Capital

Like a carefully memorized religious incantation, politicians and central bankers continually stress how their stimulus policies are designed to promote the interests and prosperity of the middle class. Cynical observers may note that this brave political stance may have something to do with gaining the support of the vast majority of voters who identify themselves as "middle class." However, the cumulative effect of their economic programs has achieved the opposite.

2013-06-07 Never on a Friday by Jeffrey Saut of Raymond James

Over the past 10 years there have been many Hindenburg Omens triggered, but to my knowledge only one of them has actually worked (The Wall Street Journal 8/23/2010 article states the accuracy is only 25%, looking at the period from 1985). Actually, the last Hindenburg signal (December 2012) proved to be an exceptionally good point to buy stocks. I expect this “Omen” will prove to be yet another false signal because the McClellan Oscillator is just about as oversold as it ever gets.

2013-06-07 Why It Pays to Invest in Emerging Market Dividend-Payers by Frank Holmes of U.S. Global Investors

An unexpected change of heart happened in May that you might not have heard about. After years of resisting any path other than its rigorous course, Germany announced it is backing off from pure austerity and is now planning to spend billions of euros to stimulate the economies of Europe.

2013-06-07 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The change at the top of the Bank of England comes at a delicate time. The May U.S. employment report will not sway the Fed either way. Eurozone and China PMI reports - interpret with caution.

2013-06-07 As Economy Heats Up, Will Commodities? by Frank Holmes of U.S. Global Investors

Don’t wait for the Fed to officially raise rates, as research shows that investors get the most benefit from materials and energy stocks by getting in now

2013-06-06 But We Want Goldilocks-Like Growth by Blaine Rollins of 361 Capital

While the equity markets would enjoy a bit of the great rotation out of the 20+ year outperformance in bonds and into equities, the move in May has been too much, too quick for even equity investors to stomach. So while the Long Treasury ETF (TLT) fell -6.8% in May, the size of the move even scared investors in REITs (IYR), Junk Bonds (JNK/HYG), and Utilities (XLU).

2013-06-06 The REAL Great Rotation by Richard Bernstein of Richard Bernstein Advisors

The phrase "Great Rotation" has come to mean a sizeable shift in asset allocation from bonds to stocks. We, too, believe that stocks are likely to secularly outperform bonds, but we don’t think that is the "great rotation" about which investors should be concerned.

2013-06-06 The Fed's Dilemma by Scott Minerd of Guggenheim Partners

Market volatility is rising as the Fed continues with its asset purchase program. The economy also appears increasingly vulnerable to a rise in interest rates, which would have an adverse effect on housing in particular.

2013-06-06 The Wisdom of Crowds by Niels Jensen, Nick Rees,Tricia Ward of Absolute Return Partners

Are markets efficient? This is a debate that has been on-going for decades. In one corner you have the proponents of the Efficient Markets Hypothesis. In their world alpha does not exist, or at the very least it is not sustainable. In the other corner you have the supporters of behavioural finance who see investors as being mostly irrational and suffering from all sorts of behavioural biases which create alpha opportunities galore. Out of this long lasting stand-off a new paradigm is emerging called the Adaptive Markets Hypothesis which aims to reconcile the two.

2013-06-06 June Economic Update by Justin Anderson of Cambridge Advisors

Stocks sold off on the last day of the month but still managed to finish higher in May with the large-cap S&P 500 index up 2.2% and the small-cap Russell 2000 up 4.0%. International stocks finished the month lower with the MSCI EAFE index down -2.9%. Bond prices came under significant pressure as yields rose after Fed Chairman Ben Bernanke hinted that Quantitative Easing may be tapered off sooner than the market expected. The 10-Year US Treasury Yield rose sharply to end the month at 2.16%.

2013-06-05 Broader Use of Bail-Ins Could Spur a Revival of Asset-Backed Securities in Europe by Felix Blomenkamp of PIMCO

We believe ABS issuance will likely increase in Europe as eurozone developments and possible future bail-ins potentially result in higher risk premiums and funding costs for European banks. Although regulators are playing catch-up, capital markets are making room for a more credit-intensive product, helping to lead the way for a resurgence in ABS. Due to concerns over the security of bank deposits, investors may look to the ABS sector, which offers collateralized bonds that are free of bail-in risk.

2013-06-05 Will Green Shoots Flourish in U.S. and Latin America? by Josh Thimons, Lupin Rahman of PIMCO

The US economy is much further along the road to repair relative to its developed market peers, but it is still dealing with an unsustainable fiscal situation. Latin America is closely coupled to the rest of the world. What happens in the U.S., China and Europe over the secular horizon is especially critical. Our secular investment outlook calls for a more defensive posture toward risk. In U.S. fixed income, this suggests positioning for alpha rather than capital appreciation.

2013-06-04 Woody Brock’s Challenge to Krugman and the Keynesians by Bob Veres (Article)

A polarizing choice confronts policymakers. Either they side with Paul Krugman and the Keynesians, and advocate for aggressive fiscal measures to stimulate America’s economic growth rate, or they align themselves with the so-called austerians, who argue that budget cutbacks are necessary to eliminate deficits. A third option is rarely discussed. Its most outspoken proponent, Horace “Woody” Brock, says that America should continue to borrow, but spend wisely – and develop new policy instruments that would eliminate asset bubbles and stimulate economic activity.

2013-06-04 An Advisor’s Perspective on Prophets and Profits by Gary Moore (Article)

More than 30 years on Wall Street have proven to me that many advisors could do more business – and do more good for our clients, profession and the world – if we considered the moral views of investors, whether we agree with those views or not.

2013-06-04 The Gold Bull vs The Paper Tiger by Peter Schiff of Euro Pacific Precious Metals

That’s all, folks. One look at the headlines will tell you the gold bull market is officially over: the stock market is booming, a modest recovery of the US economy is underway, and the dollar is dominating the forex. Time to sell your bullion and get back into US stocks!

2013-06-04 Wounded Heart by Bill Gross of PIMCO

Joseph Schumpeter, the originator of the phrase “creative destruction,” authored a less well-known corollary at some point in the 1930s. “Profit,” he wrote, “is temporary by nature: It will vanish in the subsequent process of competition and adaptation.” And so it has, certainly at the micro level for which his remark was obviously intended. Once proud, seemingly indestructible capitalistic giants have seen their profits fall short of “everlasting” and exhibited a far more ephemeral character.

2013-06-04 Stocks: How Long Will the Bull Run? by Milton Ezrati of Lord Abbett

Conditions appear favorable for the next 12 to 24 months. What could change the market’s prospects in the longer term? Here’s a look.

2013-06-04 Caught Between Slow Growth and the End of Easy Money by Russ Koesterich of iShares Blog

Two contradictory investor concerns are to blame for a recent pickup in market volatility. Russ explains which of the concerns is premature and what that means for investors.

2013-06-04 Finding Healthy Stocks in Europe's Troubled Landscape by Tawhid Ali of AllianceBernstein

European equity markets continue to face severe stress as the continent struggles to contain fallout from the sovereign-debt crisis. Yet this seemingly toxic environment is creating some exceptional investment opportunities in relatively healthy companies that can control their own destinies.

2013-06-03 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

And the streak continues. (The monthly winning streak that is.) While stocks have drifted lower each of the past two weeks, the Dow has surged for six straight months and the S&P 500 now stands at seven and counting. In fact, much of the week’s losses came in the final hour(s) of trading as investors took profits for the month and positioned their portfolios for the summer. No news from the Fed yet, but the bond debates continue. Housing remains strong on the economic front, but next week’s data will go a long way toward setting the tone for the future.

2013-06-03 Is Volatility Dead? Hardly. by Paresh Upadhyaya, Michael Temple of Pioneer Investments

Certain pundits suggest we have entered a new volatility regime that volatility has been tamed by the massive amount of liquidity injected into worldwide capital markets by very accommodative central banks. We take a different view. While volatility has been declining across many asset classes, it is creeping into several that may have escaped some investors’ attention.

2013-06-03 Does Sector Shift Spell A Continued Rally? by Chris Maxey, Ryan Davis of Fortigent

Unlike most robust equity rallies, however, 2013 performance was initially led by traditionally defensive sectors, such as health care, utilities, and consumer staples. Through the first quarter, those three sectors posted an average return of 14.5%, while traditional cyclicals averaged just 9%. While some speculated this trend was due to investors’ reach for yield amid a frothy fixed income environment, the magnitude of this sector leadership (in an up move) was certainly unusual.

2013-06-01 Central Bankers Gone Wild by John Mauldin of Millennium Wave Advisors

For the last two weeks we have focused on the problems facing Japan, and such is the importance of Japan to the world economy that this week we will once again turn to the Land of the Rising Sun. I will try to summarize the situation facing the Japanese. This is critical to understand, because they are determined to share their problems with the world, and we will have no choice but to deal with them. Japan is going to affect your economy and your investments, no matter where you live; Japan is that important.

2013-05-31 Austerity and Demoralization by Robert Shiller of Project Syndicate

Austerity, according to some of its promoters, is supposed to improve morale. But the kind of fiscal austerity that is being practiced now has the immediate effect of rendering people jobless and filling their lives with nothing but a sense of rejection and exclusion.

2013-05-31 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Is central bank communication clarifying or confusing? The European Central Bank should focus its efforts on small business lending. A look beneath the surface of housing proves revealing.

2013-05-31 What\'s the Answer to Unprecedented Policies and Ultralow Rates? by Frank Holmes of U.S. Global Investors

So what’s the answer to unprecedented central bank policies that have been driving stocks higher and ultralow rates? I believe investors need to stick to a strategy that includes dividend-paying stocks that offer the opportunity for both income and growth.

2013-05-30 UK Secular Outlook - Morphing into the Carney Era by Mike Amey of PIMCO

The UK remains in a “stable disequilibrium”, one that needs to either transform into growing economy with narrowing income differentials or risk a more aggressive policy response. Financial repression, protection of real purchasing power, tail risks of accelerated currency weakness and price sensitivity will likely dominate UK markets over the secular horizon. Investors may consider progressively reducing exposure to assets susceptible to tail risks. Higher quality short-dated income-generating, inflation-hedging and non-sterling assets remain attractive.

2013-05-30 Are We There Yet? by Vitaliy Katsenelson of Investment Management Associates

I started writing my first book, Active Value Investing: Making Money in Range-Bound Markets, in 2005; finished it in 2007; and published the second, an abridged version of the first (The Little Book of Sideways Markets), in 2010. In both books I made the case that there is a very high probability that we are in the midst of a secular sideways market a market that goes up and down, with a lot of cyclical volatility, but ends up going nowhere for a long time.

2013-05-30 Morning in a New Europe by Scott Minerd of Guggenheim Partners

The pace of policy reforms is accelerating and economic recovery appears to be on the horizon for the European Union.

2013-05-29 Is This the End of the World As We Know It? by Massimo Tosato of Schroders Investment Management

After five turbulent years of decline and unrelenting economic doom there are signs that change could be afoot.

2013-05-29 Weekly Market Commentary by Team of Tuttle Tactical Management

Last week we talked about the market being overbought in the short term, so the three day selloff (Wednesday-Friday) was to be expected. The media will blame the Fed but they didn’t tell us anything we didn’t already know. Bottom line, when the market gets extremely overbought traders will use anything and everything as an excuse to take profits. Interestingly, last week was the first streak of three down days this year. The S&P 500 seemed to find some support at 1640.

2013-05-28 Economic Climate Change & the Long-Term View on Yields by Sponsored Content from Loomis Sayles (Article)

Will rates rise? It’s a logical question. US Treasury yields have been in a secular downward trend since the 1980s and almost frozen at historic lows for the last several months. While recent cyclical improvements suggest the US economy is heating up, we do not expect interest rates to start soaring to record highs. The interest rate environment will eventually undergo climate change, but the process will be gradual. There are secular headwinds cooling rates, and we expect them to persist for years to come.

2013-05-28 Is Austerity a Bad Idea? by Michael Edesess (Article)

There are strong arguments for and against both austerity and Keynesianism. However, some recent writings should make us remember to question the terms of the argument itself. While evidence-based economics is important, it can also mislead.

2013-05-28 Europe's Crossroads: The End of the Muddle Through? by Andrew Balls of PIMCO

The eurozone may be nearing a critical junction, owing to its weak growth, weak institutions, debt dynamics and domestic and cross-border political challenges. The German government may take a more active leadership role after its national election, but it is more likely it will continue with piecemeal measures. Considering the current low yield environment and ample central bank liquidity, it is important to focus on absolute yield levels and returns, and consider global alternatives such as emerging market securities and currency exposure.

2013-05-28 Corrections Remain Modest by Charles Lieberman (Article)

Many investors are waiting for the proverbial market correction, so they have an opportunity to get into the market rally. Many investors are holding back because they don’t want to buy at a market top after such a major run. This approach has been a disaster, since the market has given them no such buying windows so far. A correction must eventually occur of course, but quite possibly only from higher levels. Stocks remain the place to be.

2013-05-28 Eurozone: Why a Breakup Is Still in the Cards by John Greenwood of Invesco

I was recently asked whether I still hold the view that the eurozone will fragment, or whether I have moved from that position. Simply put, I am sticking with my position. I think that eventually one or more smaller countries will defect from the eurozone. Cyprus came close to it, and I think Greece may still exit.

2013-05-28 Rock, Paper, Scissors by John Hussman of Hussman Funds

There’s a sort of rock-paper-scissors relationship to financial indicators. Trend following factors typically trump valuations alone, while overvalued, overbought, overbullish syndromes trump trend-following and monetary considerations. Monetary factors tend to be most effective as confirmation of other measures, particularly of trend-following factors, but only in the absence of overvalued, overbought, overbullish syndromes.

2013-05-28 Taking Stock by Bob Doll of Nuveen Asset Management

U.S. and global equities were under pressure last week, with all major U.S. indices lower for only the fourth time this year. With discussion of the Fed tapering its stimulus, market uncertainty gained momentum. The S&P 500 was down 1.0% for the week.1 We consider the market pullback technical in nature since the mention of a Fed quantitative easing exit likely created a natural point to take profits after the recent rally.

2013-05-25 The Mother of All Painted-In Corners by John Mauldin of Millennium Wave Advisors

Japan has painted itself into the mother all corners. There will be no clean or easy exit. There is going to be massive economic pain as they the Japanese try and find a way out of their problems, and sadly, the pain will not be confined to Japan. This will be the true test of the theories of neo-Keynesianism writ large. Japan is going to print and monetize and spend more than almost any observer can currently imagine. You like what Paul Krugman prescribes? You think he makes sense? You (we all!) are going to be participants in a real-world experiment on how that works out.

2013-05-24 4 Market Risks Worth Worrying About by Russ Koesterich of iShares Blog

The risk of a US slowdown Not discounted in US valuations. While US valuations currently look reasonable, they’re predicated on a US economy growing at around 2% to 2.5%. The risk of slower growth is not priced into the market. If US economic data continues to disappoint, and we get a growth hiccup in the second or third quarter, then we’re likely to see some US market weakness.

2013-05-24 The Love Trade for Gold is Still On! by Frank Holmes of U.S. Global Investors

The more important demand for gold, in my opinion, comes from the enduring Love Trade, as countries like China and India buy the precious metal out of love and tradition.

2013-05-24 Bifurcation Blues by Herbert and Randall Abramson of Trapeze Asset Management

Bifurcation. A very technical sounding word. It merely means “a division into two parts”, which is what we are witnessing in many areas related to investment, both macro and micro. And it is exhibiting to value investors those areas to avoid and the most attractive to embrace. And giving rise to a wide range of disparate opinions among economic and investment professionals as to what outcomes are likely. Needless to say, we have our own strong views.

2013-05-24 Remarkable Resilience by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We saw how the prospect of a sooner pullback in purchases in bonds by the Fed rattled the market both in the US and globally, but the picture, to us, has not changed to any great degree. A very gradual pullback, not even going to zero, in quantitative easing due to an improved economic situation doesn’t spell disaster to us. We continue to urge investors to pay attention to both sides of the risk equation when making decisions and to keep the longer-term perspective in mind. Short-term swings are inevitable, but should not be the basis for sound decision making.

2013-05-23 QE from 35,000 Feet by Scott Minerd of Guggenheim Partners

Quantitative easing has benefited from global macro events and appears likely to continue for the rest of the year. Markets, though, will continue to anticipate how the current policies will eventually be unwound.

2013-05-23 ING Fixed Income Perspectives May 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

How do you like them apples? By pointing out some Excel blunders in the data of Harvard economists Reinhart and Rogoff, a UMass-Amherst grad student appears to have gotten their number and in the process discredited their seminal work touting the merits of austerity. Though Good Will Hunting fans may be amused to see a couple of Harvardians get their comeuppance, you don’t need the titular character’s wicked smarts to deduce that harsh government spending cuts may not be the best way to pick up your economy.

2013-05-23 Europe's Lost Keynesians by Kenneth Rogoff of Project Syndicate

There is no magic Keynesian bullet for the eurozone’s woes, despite what many commentators and much of the public seem to believe. The eurozone’s difficulties stem from European financial and monetary integration having gotten too far ahead of actual political, fiscal, and banking union not exactly a problem that Keynes tried to address.

2013-05-22 If You Didn\'t Buy That Powerball Ticket... by Blaine Rollins of 361 Capital

So onward and upward. What signals should Bulls be on the lookout for? Change in breadth (Up v. Down Volumes, Advancers v. Decliners), Signs of distribution (Sharp down days accompanied by large % increases in trading volumes), Change in leadership away from RISKON sectors (don’t want SmallCaps, Financials, Industrials, Transports or Housing to lag)...

2013-05-22 Cyprus and the Eurozone...Still Stuck in the Middle by Gregory Hahn of Winthrop Capital Management

The debt crisis in the Eurozone turned another chapter as Cyprus finally reached the point of requiring a bailout from the European Union. The wisdom of Gerry Rafferty’s hit song “Stuck in the Middle with You” which was written in 1973, rings true today as we watch the EU and the European Central Bank navigate the mess in Europe. With each attempt at containment, there appears some plot twist, the proposed Cyprus bank bailout is no exception. While the bailout of Cyprus and its banks is not large in size, only 10 billion, relative to the Cyprus economy, it is significant.

2013-05-22 Waiting for the Great Rotation: Why Interest Rates Could Stay Low Even Longer by Nanette Abuhoff Jacobson of Hartford Funds

The number-one question I get from investors is, “When will rates go up?” While this concern has been top of mind for the last few years, investors’ anxiety and sense of risk has intensified amid the threat of the “Great Rotation”the anticipated en masse reallocation out of bonds into equities. But so far, rates have yet to rise, leaving many people to wonder where we stand now and what may happen next. To answer these questions, I’d like to make three points.

2013-05-22 Asia Brief: China's Car Fleet The Largest in the World? by Edmund Harriss, James Weir of Guinness Atkinson Asset Management

Car sales in China have grown rapidly since 2009 and it is on course to outstrip the US in terms of the size of its car fleet by the end of this decade. This presents a major challenge to the Chinese government, which must balance its people’s happiness and political stability with economic development in an environment which has already been compromised. The momentum of demand for new passenger vehicles is likely to make air quality worse and Beijing has introduced emissions and efficiency standards to address the problem.

2013-05-22 How to Turn the ECB Straggler into a Central Bank Pacemaker by Myles Bradshaw of PIMCO

In our opinion, the ECB will be most effective if it can design a programme that helps banks deleverage more quickly to stimulate growth in the real economy. To have a meaningful impact on Europe’s broken transmission mechanism, any ECB programme needs to not only lower the cost of credit, but also be regionally tailored or big enough to be effective. Long-term investors should remain focused on the quality of issuers’ balance sheets rather than simply taking more risk because of lower prospective returns.

2013-05-22 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

Four times a charm. Despite lackluster earnings and economic data that raises some concerns, investors continue to play the game of “how high can we go” and stocks climbed for the fourth straight week With 15k (Dow) and 1600 (S&P) well in the rearview mirror, investors seem to have their targets set on bigger and better things. Some bullish comments by a hedge manager; a solid consumer sentiment reading; a reason for the Fed to hold off on tapering its bond buying stimulusand it’s off to the races for equities (again).

2013-05-22 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Once again stock prices moved higher last week despite mostly poor economic data and a background in Washington DC of multiple scandals. The latter begging the question as to whether substantive policy actions are now off the table for the year.

2013-05-22 Making Investment Grade Is Only the Beginning for Turkey by Frank Holmes of U.S. Global Investors

It’s been a few months since I was in Istanbul and wrote about Turkey’s exciting cultural and economic transformation, and the country is still making headlines. The Emerging Europe Fund’s (EUROX) portfolio manager, Tim Steinle, has been very bullish on Turkey for multiple reasons, including its young growing demographic, its fiscal and monetary policies geared toward growth, and its entrepreneurial mindset and pro-business policies, to name just a few.

2013-05-22 The Benefits of Diversifying the Funding of a Gold Position by Team of AdvisorShares

The recent sell off in gold has sharpened the focus of even the most committed gold bugs, and has highlighted one of the key risks that many investors face when they access the gold market. Do you purchase Gold in dollar terms or something else? How do you look at Gold, as a currency or something else? For the purposes of this analysis, Treesdale Partners took a look at a gold transaction in foreign exchange terms.

2013-05-21 (Yawn)...As Equities Advance Another 2% by Bob Doll of Nuveen Asset Management

U.S. equities advanced again last week, with the S&P 500 increasing 2.1%. Global stocks are reaching new highs in this cycle and the U.S. market is at an all-time high. Bonds were hurt in the move, dragging credit down, while commodities fell slightly on weaker manufacturing data. The unrelenting equity rally and an environment without positive news about earnings and the economy is making many investors uncomfortable.

2013-05-21 Developed Europe: Regional Economic Review 1Q 2013 by Team of Thomas White International

After withdrawing into the background in late 2012, the Euro-zone sovereign debt crisis resurfaced in the first quarter with the Italian elections and Cyprus’ banking crisis. In late February, Italy’s national elections resulted in a fractured mandate, and Italians voted out the incumbent, the main architect of the country’s austerity and reforms agenda.

2013-05-21 Capitalism and Democracy by Bill O'Grady of Confluence Investment Management

In the Italian elections, the party that showed the strongest results was the Five Star Movement, led by the comedian Beppe Grillo. Despite this strong showing, the party failed to form a government and refused to participate in any coalitions. This decision not to participate in the political process has been exhibited by other protest groups, such as Occupy Wall Street, the Israeli Tent Movement, and the Spanish “Indignant” movement.

2013-05-21 Are Equity Investors Pushing the Gas Pedal Too Hard? by Norman Boersma of Franklin Templeton Investments

Whatever previous reticence investors may have had about equities last year seems to have evaporated and, with remarkable speed, turned into fear over having missed the equity rally. Some major market averages have accelerated at a pace some say is reckless, so as we head toward the mid-point of the year, Norm Boersma, CFA, chief investment officer of Templeton Global Equity Group, takes a look at reasons investors might continue to push the gas pedalor tap the brakes.

2013-05-21 General Electric Looks Like It's Becoming The Shareholder-Friendly Company It Once Was by Chuck Carnevale of F.A.S.T. Graphs

General Electric (GE) was once revered as one of the bluest of all blue-chip companies in the world. During its glory days, GE was respected as an industrial conglomerate that manufactured some of the world’s best jet engines, locomotives, appliances and even the highly regarded General Electric light bulb. However, as best I can determine, the roots of General Electric’s ultimate demise were established in 1930 when the company, responding to the great depression, formed GE Finance in order to help their customers finance GE appliances over time.

2013-05-20 Global Real Estate Is Hot Again, but Where Are the Best Opportunities? by Joe Rodriguez of Invesco

In this low interest rate environment, yield-hungry investors have been moving out of bonds, and many are opting for real estate investment opportunities. Combine that with a structural undersupply of institutional quality real estate in many key cities across the globe, and an attractive case for investment starts to emerge. Here’s where we see the most attractive and promising opportunities by region this year.

2013-05-20 Abenomics for Europe by Scott Minerd of Guggenheim Partners

The devaluation of the Japanese yen may lead EU policymakers to implement measures that will help the economic situation in the single currency zone.

2013-05-20 A European Vacation from Austerity? by Milton Ezrati of Lord Abbett

Recession-wracked governments in the eurozone are rethinking fiscal constraints.

2013-05-20 Alpha, Beta! by Jeffrey Saut of Raymond James

I had a somewhat lengthy conversation with Rich Bernstein last Friday. I have been on TV with Rich over the years, but have never really had a one-on-one talk with him. Recall that Richard Bernstein was the Chief U.S. Strategist at Merrill Lynch for years before becoming the eponymous captain of Richard Bernstein Advisors (RBA). I was speaking with Rich because I have developed an interest in a few of the funds he manages for various entities. Rich began by stating he is extremely bullish, believing we are in one of the biggest “bull markets” ever.

2013-05-20 Still Bullish by Brian Wesbury, Bob Stein of First Trust Advisors

Like Rip Van Winkle, imagine you went to sleep on October 9, 2007 and didn’t wake up until yesterday. On 10/9/2007, equities were at record highs: 14,165 for the Dow Jones Industrial Average and 1,565 for the S&P 500.

2013-05-18 All Japan, All the Time by John Mauldin of Millennium Wave Advisors

This week we again focus on Japan. Their stock market has been on a tear, and their economy grew 3.5% last quarter. Is Abenomics really the answer to all their problems? Is it just a matter of turning the monetary dial a little higher and voila, there is growth? Why doesn’t everyone try that? And what would happen if they did?

2013-05-17 Finding Opportunity Far and Near by Frank Holmes of U.S. Global Investors

Would it surprise you to learn that a vast majority of equity valuation models state that stocks should head much higher over the next five years?

2013-05-16 Investors Living in Emerging Markets are a Bullish Bunch! by Mark Mobius of Franklin Templeton Investments

Part of my job involves putting myself out on a limb at times, and I have taken the risk of being subject to contrary (sometimes enthusiastically so) viewpoints. I’ve even been accused of being too optimistic about emerging markets, perhaps partly because my views often represent a stark contrast to dramatic news headlines. So when I took a look at the findings of Franklin Templeton Investments’ 2013 Global Investor Sentiment Survey (GISS),1 I was pleased to discover my longstanding optimism about emerging markets seems to be spreading among investors.

2013-05-15 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks moved higher again last week as the data continues to reflect an economy that continues to trudge along to the consternation of many.

2013-05-15 Speaking of a Great Week... by Blaine Rollins of 361 Capital

I left the office each day thinking that I just saw another walk off game winning home run by the S&P500. The bears were given their chance in April with the weak economic data and slightly less than exciting earnings, but they just couldn’t break it. In return, the employment data was a bit better, the global central banks came out swinging (ECB, Australia, and South Korea), then the markets broke the Yen, Bonds, and Gold, and the Bulls absolutely skinned the Bears.

2013-05-15 Pacific Basin Market Overview by Team of Nomura Asset Management

Pacific Basin equity markets continued to rally in April, led by Japan where the central bank announced that it intends to double the monetary base and inject liquidity into the markets. The MSCI AC Asia Pacific Free Index including Japan gained 4.9% while the MSCI AC Asia Pacific ex Japan Free Index closed 2.6% higher in April. (All performance figures are based on MSCI indices in U.S. dollar terms with dividends included unless otherwise stated.)

2013-05-14 Is Kyle Bass Wrong About Japan? by Robert Huebscher (Article)

It’s standard practice for short sellers to kick dirt on their targets, and Kyle Bass is doing just that by asserting that Japan’s economy is on the verge of a financial crisis. In a talk on May 3, he said that Japan’s demise is imminent. So far, though, Bass has been wrong – and he has his detractors, who are far less certain of Japan’s destiny.

2013-05-14 Nouriel Roubini: Four Reasons Investors Should be Worried by Robert Huebscher (Article)

Despite a modest recovery from the nadir of the financial crisis, the global economy still faces tail risks, according to Nouriel Roubini. Roubini’s forecast is not as gloomy as the one that earned the moniker “Doctor Doom,” when he correctly predicted the housing market collapse and the ensuing global recession. But, in a talk May 1, he identified today’s biggest danger points in Europe, the U.S., China and geopolitics which he said threaten to destabilize the global economy.

2013-05-14 Mohamed El-Erian: The Three-Speed Global Economy by Robert Huebscher (Article)

The global economy is operating at three distinct speeds, according to Mohamed El-Erian, and investors need to understand the implications of the divergent paths that key countries are following. Japan and most European countries are going backward, he said, and could continue in that direction for decades. The U.S. is “healing,” but not quickly enough to get to “escape velocity.” Certain emerging markets, meanwhile, are adapting technology and innovation and are growing rapidly.

2013-05-14 Guide to Working with Monetary Napalm by Scott Colyer of Advisors Asset Management

Napalm is a highly incendiary form of jellied fuel. It was used extensively in the Vietnam War to quickly ignite massive fires over large areas of land. In the world of financial incendiaries, the Fed’s overwhelming monetary stimulus has ignited asset prices in the United States with the force and effectiveness of napalm. Is the fire short lived? Are the gains in asset prices temporary or can they be believed? Are the housing and stock markets on fire just because of the Fed’s quantitative easing (QE) or could there be a much more fundamental reason?

2013-05-14 New Normal ... Morphing by Mohamed El-Erian of PIMCO

The New Normal has morphed to include consequential elements of a "stable disequilibrium." In the midst of notable multi-speed dynamics, the global economy as a whole is muddling along a road that will give way over the next three to five years to one of two stark alternatives: either sustainable global growth, institutional and political renewal in the West and safe deleveraging; or growth shortfalls that cause financial instability, fuel greater social tensions, accentuate political dysfunctions and complicate debt traps.

2013-05-14 The Resistible Fall of Europe: An Interview with George Soros by George Soros of Project Syndicate

The politics of the eurozone countries is European politics, and European politics is not serving these countries well. In an extended interview, George Soros explains why and what should be done about it.

2013-05-13 Skills, Education, and Employment by John Mauldin of Millennium Wave Advisors

It is graduation time, and this morning finds me swimming in a sea of fresh young faces as a young friend graduates, along with a thousand classmates. But to what? I concluded my final formal education efforts in late 1974, in the midst of a stagflationary recession, so it was not the best of times to be looking for work. It turned out that I had a far different future ahead of me than I envisioned then. But I would trade places with any of those kids who graduated today, as my vision of the next 40 years is actually very optimistic.

2013-05-13 Investment Bulletin: Global Equity Strategy by Team of Bedlam Asset Management

Equity markets remained strong and the portfolio continued to outperform well, with a monthly gain of 3.2% vs 0.6% for the index. After two decades of policy torpor, Japan’s government has rapidly adopted a trio of policies to kick start the economy: monetary and fiscal stimulus, plus a weak yen. This is shock and awe’ relative to GDP, being far greater than any experiment in any developed country since the Second World War.

2013-05-13 Closing Arguments: Nothing Further, Your Honor by John Hussman of Hussman Funds

Nothing further, your honor. I am resting my case.

2013-05-13 Tenuous Times? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

US stocks continue to make new highs, yet commodities have struggled and Treasury yields remain low, albeit up from recent near-record lows. Although not the standard playbook, we remain optimistic but acknowledge an equity pullback can occur at any time. Manufacturing data has been soft, the employment picture is mixed, and housing continues to improve. The European Central Bank (ECB) has joined the easing arty, illustrating the continued disappointments coming out of the eurozone.

2013-05-13 Americas: Regional Economic Review 1Q 2013 by Team of Thomas White International

Weaker global demand and prices for energy and commodities, as well as softer than expected domestic consumption have restricted the growth outlook for most economies in the Americas region during the first three months of the year. Fewer monthly job additions in the U.S. have dented consumer confidence, and growth for the current year is now forecast to be moderately lower than earlier expectations.

2013-05-10 A Tale of Two Markets: Equity Bulls and Bond Bears by Douglas Cote of ING Investment Management

Surging equity markets absent an accompanying rate rally is a red flag, as Treasury yields remain well below “normal”. While investors’ renewed enthusiasm for equities is warranted, they must be careful to avoid the “folly of gaming diversification”. Corporate earnings have impressed, though revenue has struggled due in part to a moribund Europe. Divergent markets mean investors should stay broadly diversified in equities and real bonds not near-cash and ever alert to the fundamentals.

2013-05-10 2013 US Financial Markets: Part 2 - The TINA Hypothesis by Clyde Kendzierski of Financial Solutions Group

Contrary to the “Bernanke Illusion” (money market funds are a zero return investment), history indicates that money market funds are likely to provide investors with returns approximating inflation over the next decade. As I pointed out in our last letter, the markets are pricing in inflation levels significantly higher than the prospective total returns of 10 year TBonds. The small additional return achieved by corporate bonds or US stocks (at current prices) is unlikely to compensate a buy and hold investor with sufficient gains to justify the interim risks.

2013-05-09 Make Way for the MIPS by Scott Minerd of Guggenheim Partners

Emerging markets still provide excellent opportunities for outperformance in equities, with Malaysia, Indonesia, the Philippines and Singapore being among the best positioned for the decade ahead.

2013-05-09 The Effect of Negative Interest Rates in Europe by Zach Pandl of Columbia Management

In his press conference last week, European Central Bank (ECB) President Mario Draghi signaled that policymakers may be more open to a cut in the central bank’s deposit rate. Although Mr. Draghi acknowledged this move could have negative side effects, he added “we will be able to deal with the negative consequences we will look at this with an open mind.” Several major central banks considered negative deposit facility rates during and after the financial crisis, but so far, all have determined that the idea did not pass the cost/benefit test.

2013-05-08 Europe (and Italy's Rivals) Appear on Road to Recovery by Par Rostom of Franklin Templeton Investments

When Europe’s debt disease spread to Cyprus, accompanied by bank runs and public unrest, some doubted the European Central Bank’s (ECB) ability to contain the contagion. And, even more recently, Slovenia turned up sick, warning of escalating debt problems and faltering banks. But with the setbacks have come some surprising steps forward, too, including progress in Italy, which recently formed a new coalition government.

2013-05-08 Germany Under Pressure To Create Money by John Browne of Euro Pacific Capital

Currently, central banks around the world are walking in lock step down a dangerous path of money creation. Led by the Federal Reserve and the Bank of Japan, economic policy is driven by the idea that printed money can be the true basis of growth. The result is an unprecedented global orgy of currency creation. The only holdout to this open ended commitment has been the hard money bias of the German-dominated European Central Bank. However, growing political pressure from around the world, and growing dissatisfaction among domestic voters have shaken, and perhaps cracked, the German resolve.

2013-05-08 Deflation Is OverPlease Come Out by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

A blooper reel of 20th century history would likely include a feature on Japanese soldier Hiro Onoda. Posted to a small island in the Philippines during the waning days of World War II, when Onoda’s mission proved unsuccessful he was ultimately forced to flee into the woods, where he survived on a steady diet of coconuts and bananasfor almost 30 years after the end of the war.

2013-05-08 Are Investors Breathing a Sigh of Relief? by Bob Doll of Nuveen Asset Management

Last week U.S. equities delivered another gain as the S&P 500 increased by 2.0%.1 On Friday, the U.S. jobs report offered relief from fears of an accelerating weakness caused by prior softness during this time in each of the last three years. However, the full set of economic data for the week supports our view of a slower second quarter in a post-sequestration environment.

2013-05-08 US Economy Should be \"Good Enough\" for Stocks by Russ Koesterich of BlackRock Investment Management

The April employment report confirms that the US is on a slow-but-positive course of economic growth. This environment should be conducive to further gains in equity prices. Europe, in contrast, continues to struggle and investors should approach that region with caution.

2013-05-08 6.7 Million “Missing Workers” Where Did They Go? by Gary Halbert of Halbert Wealth Management

Today we will touch several bases. We begin with last Friday’s unemployment report which was hailed by the mainstream media, but had a lot of bad news to go with the good. From there we look at the estimated 6.7 million “missing workers” in this economy and ponder if they’re permanently gone from the employment rolls.

2013-05-08 Absolute Return Letter: In the Long Run We Are All in Trouble by Niels Jensen, Nick Rees,Tricia Ward of Absolute Return Partners

In the long run we are all dead, said Keynes. Maybe so, but we could be in trouble long before then. Investors appear preoccupied with central bank policy. We argue that investors are quite right in keeping their eye on the ball but, to us, it looks as if they are focusing on the wrong ball. The real worries for the long term are demographics and negative real interest rates and the effect these factors may have on equity returns.

2013-05-07 Niall Ferguson: Four Reasons Why the U.S. is Failing by Robert Huebscher (Article)

Niall Ferguson is the champion of anti-Keynesian economists. Last week, he explained why America’s pursuit of Keynesian policies is leading to disastrous consequences.

2013-05-07 Mutual Fund Companies Need to Prepare for a Changing Environment Fund Industry Turbulence Ahead by Paul Franchi (Article)

The mutual fund industry grew explosively from the 1980s on a rare tonic of a low-inflation credit expansion powered indirectly by international trade flows. That run reached a peak in 2008 when the application of quantitative easing (QE) served to prevent industry collapse with a softer form of transition, which continues today but must end when inflation returns.

2013-05-07 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

The trend is your friend (and the current trend is a “friend with benefits” for investors). After a record-setting first quarter for stocks, analysts were skeptical that the “party” would continue. And yet, the Dow Jones enjoyed a fifth straight month of gains in April, while the S&P 500 and Nasdaq one-upped the Blue Chips with six month winning streaks.

2013-05-07 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Financial markets got the news they wanted last week as Europe cut interest rates, while here at home the Federal Reserve hinted they might do even more when it comes to money printing. To top it off, Friday’s employment report showed improvement from March although the details caused most to discount the excitement.

2013-05-07 Central Banks Steal the Spotlight Once Again by Chris Maxey, Brian Payne of Fortigent

Central banks around the world continue to provide increased stimulus to their respective economies. Increased conviction over pro-stimulus policies comes in light of recent flaws found in the Reinhart, Rogoff January 2010 paper, which suggested that government debt of more than 90% of GDP is detrimental to economic growth. The latest week brought another round of news in the world of central banking, although it seems the number of options left on the table is running short. What central bankers hope for now is that economies will finally enter recovery mode.

2013-05-07 Syria and the Red Line by Bill O'Grady of Confluence Investment Management

On Thursday, April 25, Secretary of Defense Hagel acknowledged that evidence that chemical weapons exposure occurred in Syria was probably accurate. This news dominated the Sunday talk shows, mostly because President Obama had indicated that Syrian military use of chemical weapons would be a “game changer” and a “red line” that would trigger a U.S. and international response. Now that it appears that somehow chemical weapons exposure did occur, the world awaits to see what exactly the president meant by a “response.”

2013-05-07 Soros versus Sinn: The German Question by George Soros, et al. of Project Syndicate

The ongoing euro crisis has been a source of increasingly heated debate worldwide. Now, George Soros and Hans-Werner Sinn, two regular Project Syndicate contributors and leading figures in the discussion, debate the cause of Europe’s crisis and how to overcome it.

2013-05-07 Global Bonds: A Flexible Solution for an Uncertain Market by Olivia Albrecht, Michael Story of PIMCO

The recent rallies in both safe-haven and risk assets have left many investors in a quandary. We believe alpha, or above-market return, will have to play a greater role for investors seeking to meet return targets. In our view, the current environment affords many opportunities for generating alpha.

2013-05-07 Investing for Income and Capital Appreciation by Giorgio Caputo, Rob Hordon, Ed Meigs, Sean Slein of First Eagle Investment Management

A Q&A with First Eagle Investment Management’s senior members and their market views and strategic insights.

2013-05-07 Bail-Ins, Bernanke, and Buyouts: Assessing Key Event Risks for Fixed-Income Investors by Team of Hartford Funds

While the eventual shift to less accommodative central-bank policy and a rise in global interest rates are perhaps the greatest focuses of concern today for bond investors, other risks also merit scrutiny. European sovereign debt worries have resurfaced as the tiny nation of Cyprus, representing just 0.3% of euro-area gross domestic product (GDP), joined the list of bailout recipients. Recent rhetoric from the Fed has prompted investors to consider the impact of an eventual winding down of its asset purchases.

2013-05-07 Quarterly Letter by Team of Grey Owl Capital Management

In his April 2013 commentary, PIMCO’s Bill Gross wrote, “PIMCO’s epoch1, Berkshire Hathaway’s epoch, Peter Lynch’s epoch, all occurred or have occurred within an epoch of credit expansion What if an epoch changes? What if perpetual credit expansion and its fertilization of asset prices and returns are substantially altered? What if a future epoch favors lower than index carry or continual bouts of 2008 Lehmanesque volatility ?”

2013-05-06 Sell in May But Stick Around by Christian Thwaites of Sentinel Investments

A bit odd, perhaps, to worry about deflation as the S&P hits all time highs. But the whiff of deflation is in the air. The YOY PCE core (the one the Fed likes) came in at 1.1% which is the lowest it has ever been.

2013-05-04 Don't Sell in May: Here are Reasons to Extend Your Stay by Frank Holmes of U.S. Global Investors

During the first week of May every year, the maxim, “Sell in May and Go Away,” gets taken out, dusted off and powered up as a reason to sell stocks. The rhyme is more than just a catchy urban legend: June, July, August and September have historically been the weakest months of the year for the S&P 500 Index.

2013-05-04 The QE Sandpile by John Mauldin of Millennium Wave Advisors

Sell in May and go away? What about "risk off?" And ever more QE? Today’s letter is a quick note and a reprise of a popular letter from yesteryear (with a bit of new slant), as I am at my conference in Carlsbad.

2013-05-03 Job Creation May Be More Robust Than Official Statistics Suggest. by Team of Northern Trust

Job creation may be more robust than official statistics suggest; U.S. employment situation; Central bank meetings

2013-05-02 Europe at a Minimum Speed by Scott Minerd of Guggenheim Partners

Market forces are correcting the growth dichotomy between the European Union’s core and periphery, thus improving the outlook for the region.

2013-05-02 The Great Gold Redemption by Peter Schiff of Euro Pacific Precious Metals

The most puzzling part of the investment business is seeing how the vast and largely economically illiterate masses interpret any given piece of news. Take the recent gold selloff: many large players were motivated to sell by news that Cyprus will have to liquidate its gold stockpiles to pay off acute debt obligations. But just a moment’s reflection shows this reaction to be knee-jerk. The real story behind Cyprus’ deal has much more profound ramifications - and they are positive for gold.

2013-05-02 Disconnect: Why Stocks and Economy Often Move in Opposite Directions by Liz Ann Sonders of Charles Schwab

The stock market hit all-time highs during the first quarter, yet the economy again underperformed expectations. Is the disconnect an aberration or the norm?

2013-05-02 In Treasuries, the Risks Outweigh the Rewards by Russ Koesterich of BlackRock Investment Management

The 1Q GDP report was mixed, but the lack of income growth remains troubling. Oil prices are likely to remain range-bound, but that should be good enough to help energy stocks. While yields could decline further in the near-term, Treasuries look quite unappealing.

2013-05-01 While the Bears Fight... by Blaine Rollins of 361 Capital

While corporate earnings outlooks and released economic data remained soft, the world moved to declare Austerity a failure and quickly assumed that the ECB could ease further at this week’s meetings. The recent collapse in commodity prices and slowdown in China does put a high card in their hand. With these new thoughts, European equities and bonds both surged on the week...

2013-05-01 Emerging Asia Pacific: Regional Economic Review by Team of Thomas White International

Major emerging Asia Pacific economies, which picked up growth momentum during the latter half of 2012, struggled to carry forward the economic pace during the initial months of 2013. China, India, and Indonesia, some of the most populous countries in the region and in the world, faced significant headwinds to growth as key engines of the economy investment, consumption, and exports came under strain.

2013-05-01 Weekly Market Review Notes by Team of Tuttle Tactical Management

he mixed economic numbers we have been seeing lately----higher than expected consumer confidence and home prices vs. lower than expected Chicago PMI---might be confusing to some. One number shows the economy improving while another shows the economy contracting. However, for investors this is actually good news as the data continues to confirm that we are in a Goldilocks economy, not too hot, not too cold.

2013-05-01 There Will Be Haircuts by Bill Gross of PIMCO

It has been the objective of the Fed over the past few years to make even more innovative forms of money by supporting stock and bond prices at cost on an ever ascending scale, thereby assuring holders via a “Bernanke put” that they might just as well own stocks as the cash in their purses. Gosh, a decade or so ago a house almost became a money substitute. MEW or mortgage equity withdrawal could be liquefied instantaneously based on a “never go down” housing market. You could equitize your home and go sailing off into the sunset on a new 28-foot skiff on any day but S

2013-05-01 Likely Rate Cut from the European Central Bank Will Be No Magic Wand by Darren Williams of AllianceBernstein

Disappointing April data suggest that the ECB is set to cut the refinancing rate at Thursday’s Council meeting. This is likely to have limited economic impact but could encourage expectations of more creative policy action later, helping to take some upward pressure off the euro.

2013-04-30 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks rebounded from the previous week. Earnings were not bad, and investors now appear to be focusing on this week’s Federal Reserve and European Central Bank meetings.

2013-04-30 The Boston Marathon Bombing by Bill O'Grady of Confluence Investment Management

In this report, given the extensive media coverage of the event, we will not go into much detail on the attack itself except to illustrate points about the origins of the act. We will discuss why we think the Boston Marathon Bombing was the work of grassroots amateurs and what that means for the nation’s security. We will touch on how humans become radicalized and how managing that condition challenges democracies. As always, we will examine the ramifications of this event on the financial and commodity markets.

2013-04-29 New Highs Bring New Worries by Richard Golod of Invesco

The sustainability of the rallies in US and Japanese equities this year so far is looking uncertain amid slowing year-over-year earnings growth and mixed global economic signals. European and emerging market shares have traded lower year to date and seem likely to continue lagging in the near term. However, on balance, I remain optimistic about global equities, seeking yield opportunities and investments with an actively managed, more selective approach.

2013-04-29 Employment Trending the Right Way and the DC Two-Step by Gregg Bienstock of Lumesis

Spring is in the air and it has nothing to do with the lovely weather we are experiencing here on the east coast. Congress both houses have done something for the American public. FAA, sequester, flight delays we can fix that! While I would usually take a cynical swipe at Congress (something like, “did they act because they, too, were impacted by their own stubbornness”), I’ll let well enough alone and simply pass on a heartfelt thanks. Perhaps this is the start of something.

2013-04-29 Developed Asia Pacific: Regional Economic Review by Team of Thomas White International

After facing subdued economic conditions for the most part of 2012, developed Asia Pacific economies started 2013 on a cautious note. While most countries opined that downside risk to GDP growth declined substantially, challenges to growth arose from a recessionary scenario in key developed economies, especially from the European Union.

2013-04-29 Economic Slowdown Has Not Weakened Share Prices by Bob Doll of Nuveen Asset Management

U.S. equities rebounded last week as the S&P 500 increased by nearly 1.8%,1 despite continued weak economic data. We believe recent data is not yet weak enough to change forecasts. The relative stability of data and forecasts - supported by stimulative monetary policies, an improving U.S. housing market and fading political polarization in the U.S. and Europe - sends a message of reasonably low volatility and manageable downside risks.

2013-04-29 When Rich Valuations Meet Poor Economic Data by John Hussman of Hussman Funds

Given the full set of market conditions that we observe, including the persistent overvalued, overbought, overbullish syndrome that has developed in recent months, our concerns about stocks are not dependent on the direction of the economy over the coming quarters. An economic downturn would simply add immediacy to those concerns.

2013-04-27 The Cashless Society by John Mauldin of Millennium Wave Advisors

A cashless future might be farther off than we either fear or hope. Not only is it farther away than some think, we are actually seeing an increase in the use of cash all over the world (and this is not just a US phenomenon). We will look at some interesting factoids that make for thought-provoking discussions, but when we couple them with research on the rise of the unreported economy (aka the underground economy) and the number of people who get some form of government assistance, we may find problematic consequences resulting from hidden incentives that work in unintended ways.

2013-04-26 The Return of the Asian Tigers: Guinness Atkinson Asset Management Asia Brief by Edmund Harriss, James Weir of Guinness Atkinson Asset Management

Often overlooked by international investors, South East Asia encompasses some of the world’s best performing equity markets in recent years, putting the more established emerging markets in the shade. This performance is backed by good economic results and the favourable demographics of some of these countries, with youthful populations ready to improve productivity and increase consumption. One catalyst for future growth is the Association of Southeast Asian Nations (ASEAN) free trade area, which will bring down trade barriers between the South East Asian nations.

2013-04-26 An Update on the Global Business Cycle by Investment Strategy Group of Neuberger Berman

Understanding where we are in the an important aspect of investing, as the behavior of asset classes may vary throughout that cycle. Recent data indicate that the U.S. remains in its fourth year of expansion, but payroll and retail numbers have disappointed. Outside the U.S., Europe continues to be mired in recession while China’s growth rebound recently has appeared to sputter. In this edition of Strategic Spotlight, we review what these developments mean for the global business cycle and how to position portfolios accordingly.

2013-04-26 Asia\'s Reverse Innovation Trend by Beini Zhou of Matthews Asia

In recent years, the rate of acquisitions of local Asian firms by multinational companies has generally increased, particularly in China. This has happened across many industries such as industrials, medical devices and consumer staples. In many cases, if the multinational firms are not acquiring an entire company outright, they are taking a controlling stake, rather than a minority stake as a passive shareholder.

2013-04-26 A Funny Thing Happened on the Way to Equilibrium by Ben Inker of GMO

The bedrock of GMO’s investment philosophy is reversion to the mean. We believe that capitalism should cause the return on capital to be in line with the cost of capital, and that assets that embody similar risks should offer similar long-term returns. These beliefs, in turn, guide our assumptions that equities should trade at replacement cost, that the long-term return to equities should be approximately the same as their normalized earnings yield, and that assets without long return histories should have similar valuations and equilibrium returns as related assets with longer histories

2013-04-26 The Yin and the Yang of Commodity Price Trends by Team of Northern Trust

In recent weeks, financial press headlines have centered on the sharp drop in the price of gold. Of greater importance, however, are the significant price declines of oil, wheat, corn and copper. The S&P Goldman Sachs Commodity Index is down 6.1% year-to-date after a nearly steady reading in 2012 and gains exceeding 20% in both 2010 and 2011. It is essential to recognize the different nuances buried in these commodities’ price trends. First we will focus on the implications of declining commodity price trends and then discuss gold specifically in more depth.

2013-04-26 No Escape by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Global economic growth has weakened, while the US economy hasn’t reached "escape velocity." US stocks have held up relatively well. With few other attractive alternatives, domestic equities appear to be the best house in a rough neighborhood. With the Fed committed to easing, housing improving, and valuations reasonable, the trend should continue. Risks remain and diversification and some hedging strategies are recommended.

2013-04-26 Why Demographics Will Keep the U.S. Ahead by Randall McLaughlin of Baird Investment Management

The aging of the developed world does give us some powerful information about which industries might do well in the future. The increased use of healthcare services as a population ages is well-documented. In addition, as people age, they transition from accumulating possessions to using their wealth to buy experiences. Travel companies are examples of companies that could benefit. The favorable demographic profile of the United States supports our manufacturing renaissance thesis as companies tend to want to locate manufacturing close to the end client.

2013-04-26 A Playbook for Investors: How to Shoot, Score, Win by Frank Holmes of U.S. Global Investors

So, in the competitive spirit of the NBA playoff season, I’ve gathered a series of plays that investors can use to shoot, score and win during this year’s market. I’m happy to say they include all the elements of an exciting game, including a comeback kid, an upset and an underdog.

2013-04-26 Financial Repression: Why It Matters by Shane Sheperd of Research Affiliates

Financial repression refers to a set of governmental policies that keep real interest rates low or negative, with the unstated intention of generating cheap funding for government spending. The ramifications of these policies will be measured in decades, not years.

2013-04-25 Questioning Quantitative Easing by Scott Minerd of Guggenheim Partners

Speculation over the reduction or expansion of quantitative easing largely amounts to market noise.

2013-04-25 Murkier Prospects for Merkel by Milton Ezrati of Lord Abbett

An anxious German electorate may make it harder for the chancellor to continue her pro-cooperation approach to Europe’s fiscal crisis.

2013-04-25 The End of “Expansionary Austerity?” by Scott Brown of Raymond James

A few years ago, an economic paper by Harvard professors Carmen Reinhart and Kenneth Rogoff helped fuel the push for austerity. It was met with some criticism from economists, but was widely embraced by the press and by politicians on both sides of the Atlantic. The study has now been demonstrated to have had serious flaws, but will those in power fold? Or will they double down on bad economic policy?

2013-04-25 Surf's Up! by Jeffrey Saut of Raymond James

Last month I was reminded of “Surf’s Up!” while rereading said report from my departed friend Stan Salvigsen of Comstock Partners fame. While that is the organization Stan, Michael Aronstein, and Charles Minter formed in the late 1980s, Stan’s investment career actually began in 1964 as an analyst with the Value Line Investment Survey. Subsequently, he was an equity strategist at a succession of firms, including Dreyfus, Oppenheimer, C. J. Lawrence, and Merrill Lynch.

2013-04-25 Q1 2013 Market Commentary by John Prichard of Knightsbridge Asset Management

The country now in the news is tiny Cyprus, which received a bailout for its banks from the European Union (EU), but only after agreeing to steep losses for those banks’ large depositors. Hitting up bank deposits represents a new dimension to the European debt crisis and illustrates how in a crisis, leaders can and often will resort to whatever means are necessary. When the Cypriots first requested a bailout from the EU and were told their depositors had to suffer, they balked and said that was unacceptable...

2013-04-25 Living in Lake Wobegon by Jim Goff of Janus Capital Group

Are we normal? For many quarters, I have counseled investors that we are going through extreme market conditions and that patience was the best strategy. As the panic fades in the rear-view mirror and the road ahead looks less bumpy, I stand by the advice. But I don’t need to repeat it.

2013-04-24 The 2030 Non-state World by Bill O'Grady of Confluence Investment Management

Several weeks ago we started looking at the alternative world scenarios as projected by the National Intelligence Council (NIC). The NIC issues a long-term strategic outlook every five years and projects a forecast from this analysis for the following 15-20 years. In the most recent report, Global Trends 2030, the NIC proposes four alternative world scenarios. We are now turning to the last projected outlook, the Non-state World. Under this scenario non-state actors aided by emerging technologies will have increasing influence, as the importance of traditional nation-states decays.

2013-04-24 Will Abenomics' Ensure Japan's Revival? by Team of Thomas White International

According to a World Bank (WB) report, global growth in 2013 will remain sluggish as economic recovery in the developed nations is likely to be slow. Lower business and consumer confidence, government spending cuts, as well as high rates of unemployment may delay the recovery, the report says. The report has also noted that developing nations may experience slower growth due to structural and monetary policy challenges.

2013-04-24 Europe's Sovereign Debt Problem: A Call for a Clear Destination by Andrew Bosomworth, John Henning Fock of PIMCO

Without political commitment to a common fiscal destination, the long-term instability and market distortions within Europe’s capital markets are likely to intensify. To preserve the euro, the eurozone must develop federal fiscal policies that tackle significant economic, cultural and societal differences and define a credible roadmap to achieving structural reforms, a banking union, political union and fiscal union. Historical precedents in Europe may help guide the way.

2013-04-24 Weekly Market Review Notes by Team of Tuttle Tactical Management

Bulls and Bears continue to fight it out around the S&P 500 record high. There is a lot to worry about at this point----earnings and economic numbers have been somewhat disappointing, terrorism fears are back (Boston Marathon, Canada, fake Twitter posts, etc), and we continue to see a divergence between riskier areas of the market and less risky areas. On the plus side there is still nowhere else to go except for stocks. As we have said before, volatility around an all time high is normal and to be expected.

2013-04-24 Market Observations, Deflation Fears by John Rothe of Riverbend Investment Management

Last week, the S&P 500 took a quick dive down toward the 50-day moving average as investors became worried about continued poor economic data. While some investors are quick to point to the Boston Marathon attack as the reason for the decline, there was in fact a large decline in the market before the tragedy in Boston occurred.

2013-04-23 The New Challenges to Reinhart and Rogoff by Robert Huebscher (Article)

Advocates for debt reduction and austerity have had no more authoritative sources than Carmen Reinhart and Ken Rogoff. But last week, these two professors had to defend claims that errors in their research – ranging from a typo in a spreadsheet to the failure to include data from New Zealand – invalidated their much-acclaimed findings.

2013-04-23 Looking Back at Peak Oil: The Coming Crisis in Energy Supplies by Richard E Vodra, JD, CFP® (Article)

Peak Oil – the maximum sustainable rate of global oil production – happened in 2012. That’s one of the main conclusions of a new report, Fossil and Nuclear Fuels – The Supply Outlook, released in March 2013 by the Energy Watch Group. This event will have profound long-term implications for how advisors should manage clients’ portfolios, and how clients should plan their future expenses.

2013-04-23 Letters to the Editor by Various (Article)

A reader responds to Michael Edesess’ article, Will Germany Lead the World’s Energy Revolution?, and a reader responds to Robert Huebscher’s article, Michael Pettis - Can China Save Itself?, both of which appeared last week.

2013-04-23 Middle East/Africa: Regional Economic Review by Team of Thomas White International

According to a World Bank (WB) report, global growth in 2013 will remain sluggish as economic recovery in the developed nations is likely to be slow. Lower business and consumer confidence, government spending cuts, as well as high rates of unemployment may delay the recovery, the report says. The report has also noted that developing nations may experience slower growth due to structural and monetary policy challenges.

2013-04-23 Enhancing Credit Returns in 2013 by Andreas Berndt, Ryan Blute of PIMCO

While credit achieved exceptional returns in 2012, achieving such returns in 2013 will be challenging in light of less upside potential and limited spread compression. Challenged by continued loose central bank monetary policies, alpha generation plays an increasingly significant role in seeking attractive total returns within credit portfolios. Encouraging investors to provide managers with a variety of innovative approaches and flexibility may enhance the return potential of a European corporate bond portfolio without materially changing overall credit or interest rate risks.

2013-04-23 Dividend Growth and Stock Returns by Peter Nielsen of Saturna Capital

The compounding impacts of dividends have historically been significant in terms of market returns for long-term investors. The importance of these cash flows to investor returns can be seen across countries and industries.

2013-04-23 The Next Steps For the Euro: What Is Needed to Ensure Its Survival? by Keith Wade of Schroders Investment Management

The near term outlook for the Eurozone remains bleak, with the latest International Monetary Fund (IMF) forecasts showing 2013 as another year of falling output for the region. Better growth is desperately needed and there is a case for more cyclical support through easier monetary policy, but there are also structural obstacles to stronger growth. Unless these are addressed, any pick-up in growth will ultimately flounder. In this Talking Point I look beyond the near term cyclical challenges and consider what the Eurozone needs to do to ensure its long term viability.

2013-04-22 Strategy for a Second Gear Economy by David Kelly of J.P. Morgan Funds

American investors could be forgiven for feeling just a little confused. One week after the stock market posted its strongest first-quarter gains since 1998, the Bureau of Labor Statistics announced the weakest monthly job growth in nine months. Real GDP growth was just 0.4% in the fourth quarter but appears to have been much stronger in the first. So is the economy getting stronger or weaker, how is the Federal Reserve likely to react to it and what, if anything, should investors do about it?

2013-04-22 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

The end to another tax season; a hectic week on the earnings calendar; a number of key domestic economic releases; and ongoing developments on the global economic frontand yet, much of the country (and world for that matter) was focused on the events in Boston and the aftermath of the bombing that led to a massive manhunt and a shootout with police. Early in the week, the celebrated Boston Marathon came to an abrupt halt as terror again reigned throughout the country and nearby residents were sent into lockdown mode.

2013-04-22 Emerging Europe: Regional Economic Review by Team of Thomas White International

The European Bank for Reconstruction and Development (EBRD) was established in 1992 to help Russia and former communist states such as Poland, Hungary, and Czech Republic among others in their transition to market-based economies. In its January forecast, the London-headquartered bank sounded optimistic over the economic prospects of most of the countries covered in this review, which also include Turkey.

2013-04-22 Will Emerging-Market Stocks Close Gap with Global Equities? by Morgan Harting of AllianceBernstein

Companies in emerging markets are more profitable and less debt burdened than their developed-market peers, and their shares trade at a deep discount. So when will emerging-market stocks close the gap with global equity markets?

2013-04-22 Is There a Silver Lining to the Gold Price Plunge? by Jon Ruff of AllianceBernstein

It’s been a volatile week for gold prices, which tumbled by the most in 30 years. Although gold is still not obviously undervalued, we think the recent market moves make stock prices of gold miners look attractive when compared with prices of the precious metal.

2013-04-22 Gold Strategy Update by John Hathaway of Tocqueville Asset Management

Gold bullion prices have been subjected to a cleverly orchestrated bear raid in our opinion. Selling of paper Comex contracts on Friday, April 12th , and Monday, April 15th, totaled 1 million contracts, exceeding global annual gold production by 12%. The attack succeeded when the technical support in the low $1500’s/oz. easily gave way and led to waves of forced selling. The volume is without precedent and has all the characteristics of a panic liquidation driven by naked short selling.

2013-04-20 Austerity is a Consequence, not a Punishment by John Mauldin of Millennium Wave Advisors

Austerity is a consequence, not a punishment. A country loses access to cheap borrowed money as a consequence of running up too much debt and losing the confidence of lenders that the debt can be repaid. Lenders don’t sit around in clubs and discuss how to “punish” a country by requiring austerity; they simply decide not to lend. Austerity is a result of a country’s trying to entice lenders into believing that the country will change and make an effort to restore confidence.

2013-04-19 Equity Investment Outlook by Team of Osterweis Capital Management

Every so often we write an Investment Outlook with conclusions that prove to be both accurate and worth repeating. Such is the case with our prior outlook issued in January 2013. In it we stated that “At the risk of sounding complacent, we believe that the fundamental trends that produced such favorable results in 2012 are still in place and should support another good year in 2013. We are not blind to the challenges and uncertainties that still face us, nor do we believe that the year ahead will be devoid of volatility.

2013-04-19 Fixed Income Investment Outlook by Team of Osterweis Capital Management

Based on the nearly 2,500-point rise in the Dow Jones Industrial Average since last June, it appears that Mr. Bernanke has been successful in increasing demand for risk assets and creating some exuberance in the stock market. Short-term volatility in the markets may be driven by questions about the Fed’s eventual exit strategy and how effectively the politicians will deal with U.S. fiscal issues. The good news is that that the U.S. economy is growing, albeit slowly, unemployment is falling, again slowly, and consumer confidence is improving.

2013-04-19 Quarterly Review and Outlook by Van Hoisington, Lacy Hunt of Hoisington Investment Management

“The Federal Reserve is printing money”. No statement could be less truthful. The Federal Reserve is not, and has not been, “printing money” as defined as an acceleration in M2 or money supply. A review of post-war economic history would lead to a logical assumption that the money supply would respond upward to this massive infusion of reserves into the banking system. The reality is just the opposite. Printing money? No.

2013-04-19 Global Economic Overview - March 2013 by Team of Thomas White International

Global economic trends turned softer during the month of March as indicators from Europe showed further declines and U.S. consumer sentiment moderated on labor market uncertainties, government spending cuts, and tax increases. Continuing weakness in European demand has somewhat dulled the export outlook for emerging economies, while government policies to prevent excessive asset price inflation have led to concerns about domestic consumption growth in these countries.

2013-04-19 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks moved up nicely last week despite poor economic data and a huge decline in precious metals and other commodities.

2013-04-19 F.I.R.S.T.: Bond Market Outlook by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Amid heightened political uncertainty in Europe and subdued global growth expectations, global investors owe Hiroki Kuroda a big domo arigato for his pledge to inject about $1.4 trillion into the moribund Japanese economy by the end of 2014. The newly appointed BOJ governor’s unprecedented plan to buy Japanese government bonds,

2013-04-19 The Pharaoh's Dream by Andrew Bosomworth of PIMCO

As yields on assets decline, central banks’ ultra-loose monetary policies are effectively forcing investors further out the concentric circles into lower quality, more illiquid sectors in search of positive yielding assets after deducting inflation. In order to achieve 6%-7% returns in the future, investors may be required to take on more risk. Allocating part of a portfolio away from “middle circle” asset classes into assets with higher return potential as well as assets offering liquidity is the right strategy in our opinion.

2013-04-19 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The world’s public debt is much larger than it may appear. The lines have been drawn in the U.S. budget debate. Rates of disability are affecting labor force participation.

2013-04-19 First Quarter Investment Commentary by Team of Litman Gregory

Looking ahead, significant uncertainty surrounds fiscal and monetary policy in terms of what policies will be adopted and their ultimate economic and financial market impacts. More broadly, still-high global debt levels pose an economic headwind. Against this backdrop, our outlook for stocks has not improved. If anything, given the sharp run-up in stock prices, we are getting closer to reducing our U.S. equity exposure further than we are to increasing it.

2013-04-19 Gold Buyers Get Physical As Coin and Jewelry Sales Surge by Frank Holmes of U.S. Global Investors

Even with the gold price dropping, why are gold coins selling at a premium? It’s Economics 101: The coin supply is limited and the demand is high. This buying trend isn’t only occurring in the U.S. In Bangkok, Thailand, for example, crowds of buyers were filling stores, eagerly waiting in multiple lines to purchase gold jewelry and coins.

2013-04-18 Emerging Markets Investment Bulletin by Team of Bedlam Asset Management

The benefits of focusing on attractively priced, well managed and growing businesses, irrespective of their inclusion in an index, continued to aid fund performance. Thus it was virtually flat in March, capping a strong quarter in absolute and relative terms with a gain of over 10%, again beating the 5% gain by the index. These - achieved through a combination of a valuation discipline that sets the entry and exit prices and the focus on quality businesses. Not surprisingly, stock selection has been a consistent factor behind the outperformance, both this year and previously.

2013-04-18 After Boston: Why the US Market is Vulnerable by Russ Koesterich of iShares Blog

The events in Boston were a tragic reminder that markets still face risks from terrorism and geopolitics. In fact, the US market is especially vulnerable to such exogenous shocks right now given that there isn’t much bad news discounted into prices.

2013-04-18 Fortune's Formula by Jeffrey Saut of Raymond James

I reflected on mathematics, probabilities, and odds over the weekend after again reading the book “Fortune’s Formula: The Untold Story of the Scientific Betting System That Beat the Casinos and Wall Street,” by William Poundstone. The book centers on Claude Shannon, who in the late 1940s had the idea computers should compute using the now familiar binary digits 0s and 1s such that 1 means “on” and 0 means “off.”

2013-04-17 In the Category of Sign Spinners by Blaine Rollins of 361 Capital

If you thought the plunge in Gold prices was tough on those long the precious metal, wait until you see the upcoming hit to the April Non-Farm Payrolls in the category of Sign Spinners...

2013-04-17 U.S. GDP: After Some First-Quarter Flurry, a Slowdown? by Ken Taubes of Pioneer Investments

We had a little flush of activity in the first quarter, which we believe will lead to much better GDP potentially well over 3% than people anticipated in the beginning of the year. We look at this activity as a little bit of a catch-up, for a couple of reasons.

2013-04-17 Signs of a Correction by Scott Minerd of Guggenheim Partners

Although the long-term economic picture remains sanguine, a number of global risks and economic results point to a temporary period of consolidation in equity markets.

2013-04-17 What\'s Driving Emerging Markets? by James McDonald, Daniel Phillips, Phillip Grant of Northern Trust

Emerging market (EM) equities have historically outperformed as the global economy gained momentum, as shown in Exhibit 1. After a great catch-up rally in the second half of 2012, the stocks finished the year as global outperformers only to lose that momentum in the first quarter of 2013. What is behind the recent underperformance, and what does it say about the outlook? Our research points to a number of contributors to the recent weakness.

2013-04-17 Emerging Markets Equity Commentary by Team of Thomas White International

Emerging market equities corrected for the second successive month in March, on concerns that continuing weakness in European demand could hurt export growth for several countries in Asia and Latin America. These economies had seen a revival in their export fortunes during the second half of last year as U.S. consumer demand turned healthier. However, the moderation in U.S. consumer sentiment during March has somewhat dulled the optimism.

2013-04-16 Will Germany Lead the World’s Energy Revolution? by Michael Edesess (Article)

Germany’s energy plans lie between Scylla and Charybdis: fossil fuel-generated carbon dioxide emissions on the one hand and potentially catastrophic nuclear energy on the other. With strong motivation to avoid both, Germany has been left with only one alternative. The direction of energy policy in the U.S. – and the rest of the world – may rest on whether Germany succeeds in its ambitious plan to embrace renewable sources.

2013-04-16 High Yield Market Overview by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index, was up 1.03% for the month of March, as the high yield market continued to benefit from stable U.S. economic growth and steady asset reflation driven by the Fed and global central banks.

2013-04-16 The Asian Economic Crisis and the IMF by Bill O'Grady of Confluence Investment Management

In May 1997, a speculative run against the Thai baht became the first clear signal that a problem was developing in Asia. Over the next three years, Asia and other emerging markets, including Russia and Brazil, were rocked by a historic financial crisis. These nations recovered strongly in the following eight years and generally made it through the 2007-09 global financial crisis in relatively good shape. However, the impact of the Asian economic crisis remains a major factor in the behavior of these emerging nations.

2013-04-16 2013 US Financial Markets by Clyde Kendzierski of Financial Solutions Group

In the fall of 2012 the S&P 500 came close to our forecast high (S&P- 1500) Last year we suggested that not only was the S&P likely to reach 1500, but also speculated that renewed bullish sentiment could take us back to the old highs of 1565. When the S&P touched 1563 a couple weeks ago, I started getting client calls complimenting my prescient forecast.

2013-04-16 All That Glitters by Jerry Wagner of Flexible Plan Investments

Gold prices officially fell into bear market territory on Friday. With a 4% decline that day, the current drop in the price of gold from its August 22, 2011 top crossed the negative 20% mark. Today as I write this, the precious metal is down another 10% plus.

2013-04-15 The (Up) Beat Goes On, Part II by Bob Doll of Nuveen Asset Management

We wrote Part I of this theme on February 11 during the first quarter rally, when the S&P 500 closed the week at 1518. This past week the S&P ended at 1589, after increasing 2.3%. Global stock prices continue to push to new highs and thus provide support for a pro-equity bias. One nuance is that the composition of the equity rally has been abnormally defensive.

2013-04-12 Asia\'s E-Commerce Evolution by Michael Oh of Matthews Asia

Korea and Japan have been trailblazers in terms of making the virtual marketplace platform, through which merchants and manufacturers of all sizes can sell goods to consumers, an e-commerce model in Asia. Unlike in the U.S. and Europe, where many retailers sell directly to customers from their own websites and handle the details of commerce themselves, most Asian e-commerce takes place on “megasites” or virtual markets.

2013-04-12 How a Landslide Shifts Copper Supply by Frank Holmes of U.S. Global Investors

The U.S. mining industry was dealt a devastating blow as Kennecott Utah Copper’s Bingham Canyon Mine experienced a pit wall failure causing a massive landslide with rocks and dirt covering the bottom of the mine pit. It’s a miracle no one was hurt due to the vigilance of its owner, Rio Tinto. The landslide is just one example of how quickly and unexpectedly the supply and demand factors facing the red metal can shift, which underscores the need for nimble active management.

2013-04-12 Everyone Wants More Financial Stability, But at What Cost? by Carl Tannenbaum of Northern Trust

For all the good intentions, there is no guarantee that the rush to re-regulate will be successful. The next crisis may look nothing like the one just past, and the political will to take tough preventative steps during good times cannot be taken for granted.

2013-04-12 Soft Patch - Part Four? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Stocks continue to trade at all-time highs, but concerns are rising over a possible pullback and downturn in economic growth. A consolidation of gains is likely, but trying to trade around a pullback can be quite difficult. A potential tapering of Fed asset purchases continues to be discussed, but the Fed also appears nervous over the potential for a spring downturn. Cooler heads appear to be gaining traction in Washington and at least some marginal progress is being made. Economic improvement is gaining traction in Japan, raising hopes of sustainable change, while Europe continues to suffer.

2013-04-11 The Ripple Effect of Abenomics by Scott Minerd of Guggenheim Partners

Monetary policy in Japan will continue to drive investors in that country to overseas markets, which will affect global asset prices and bond yields.

2013-04-11 Global Investing in 2013: Policy Dominance, Active Management and a New Paradigm in Currencies by Scott Mather of PIMCO

We expect that the impact of ongoing global policy experimentalism on real economic growth and financial markets will likely vary substantially from country to country, creating both risks and opportunities. With flexible, active global strategies investors can potentially benefit from a broader opportunity set and the ability to go off benchmark in an effort to both avoid risks and tap opportunities.

2013-04-11 Emerging-Market Debt: Pure High-Yield Strategies Come of Age by Marco Santamaria of AllianceBernstein

We believe investors should be thinking about emerging-market debt in terms of credit quality buckets (investment grade or high yield) rather than sectors (sovereign or corporate). For some types of investor, pure high-yield strategies can offer significant advantages.

2013-04-10 Economic Slowdown Halts Equity Rally by Bob Doll of Nuveen Asset Management

The latest softness in economic indicators probably means that more consolidation in the equity markets is required before we can advance beyond the recent all-time highs. During March, nearly all of the activity for the S&P 500 was within 1% of 1550. Equities may move lower due to deteriorating technical conditions and the possibility of weak first quarter earnings reports.

2013-04-10 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks were slightly lower last week as the troubles in Europe, Asia (Japan & North Korea) dovetailed with a really lousy employment report here at home on Friday.

2013-04-10 Surprising Surge!! by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

Momentum from 2012’s surprisingly strong performance continued into the first quarter of 2013 with stocks rising sharply. Our portfolios did well but lagged behind our benchmarks in the quarter. Taking a little longer view, over the trailing 12 and 36 months we mostly matched the double-digit gains of our benchmarks, which we are very pleased with since we usually underperform during strong market advances. So far this year small- & mid-capitalization, value, and domestic stocks were the market leaders, while international, growth, commodity stocks and Apple were laggards.

2013-04-10 Looking for Warm Milk and a Blanket by Blaine Rollins of 361 Capital

Conspiracy theory economists would say that the Government fudged the data weaker so that it could help sell $60-70 billion in U.S. debt this week. Whatever the outcome, last week we had a perfect storm of high expectations for the data + very below average March weather + the payroll tax hike impact + the upcoming sequester worry. Economic data will move violently from month to month, but unfortunately last week, it was mostly in the WEAKER THAN EXPECTED direction and investors did not hesitate to bring pain on risk assets.

2013-04-10 Pacific Basin Market Overview by Team of Nomura Asset Management

Supportive U.S. economic data drove most markets higher during the first quarter of 2013. China underperformed the region amid concerns that the economic recovery may not be as robust as previously expected, while the National People’s Congress in March failed to provide any incentives to the equity market given the absence of pro-growth policies. The MSCI AC Asia Pacific Free Index including Japan gained 5.5% while the MSCI AC Asia Pacific ex Japan Free Index closed 2.0% higher during the quarter.

2013-04-10 Time to Flee Equities for Bonds...and Japan? by John Rothe of Riverbend Investment Management

Last week’s string of bad economic data may finally be the tipping point we have been waiting for. For the past few weeks, I have become more and more bearish on the US economy and stock market. Payroll tax hikes, sequestration, and slowing global growth mixed with a euphoria for a rising stock market have pushed the markets into a high risk environment.

2013-04-10 Germany's Choice by George Soros of Project Syndicate

Contrary to popular opinion in Germany and elsewhere, the euro crisis for which Germany is disproportionately responsible, owing to its dominant position is far from over. Despite the complex political and economic origins of Europe’s current malaise, the solution can be summed up in one word: Eurobonds.

2013-04-10 Weekly Market Review Notes by Team of Tuttle Tactical Management

The market continues to experience volatility around the new record high. Again, this is to be expected as this is a very psychologically important level so we shouldn’t expect the market to blow through this and never look back. There is still a lot of background "noise" in the markets. Last week’s jobs numbers were disappointing, we have had some weaker economic numbers, Cyprus, etc. None of this looks like it can change the fact that money has nowhere else to go but stocks at this point, but the economic numbers bear watching.

2013-04-09 MLPs: Winning Streak Broken, Growth Story Intact by Sponsored Content from Legg Mason ClearBridge
by Chris Eades, Portfolio Manager (Article)

After an off year clouded by investors’ concerns about future tax policy, ClearBridge’s outlook for MLPs is again brightening. Oil and natural gas production are both ahead of estimates and the resulting infrastructure build-out is continuing.

2013-04-09 Labor Markets Stumble in March by Ryan Davis, Chris Maxey of Fortigent

In an unexpected development, labor markets fell flat during March. Following several months of healthy job growth, the economy was only able to muster 88,000 new jobs in March, well below economists’ expectations for nearly 200,000 jobs.

2013-04-09 Investment Bulletin: Global Equity Strategy by Team of Bedlam Asset Management

Another good month and a strong quarter, with the portfolio gaining by 3.5% and 15.2% (net) respectively, outperforming the rises in the index of 1.8% and 14.0%. Conspiracy theorists could be forgiven for believing that most political/central bank action is designed to support equity prices. The Cyprus fiasco is an example: whatever the legal frameworks, from government guarantees of bank deposits to the repayment of sovereign bonds, all are merely non-binding statements of intent, thus a wake-up call to buy real, income-producing assets.

2013-04-09 PIMCO Cyclical Outlook for Asia: How Leadership Changes Are Shaping Asia's Outlook by Q&A with Ramin Toloui, Tomoya Masanao and Robert Mead of PIMCO

For Asia, “slow but not slowing” global growth will likely keep external demand neutral, and policy developments will therefore help shape the economic outlook. In Japan, we see a significant boost to aggregate demand coming from the concerted monetary and fiscal expansion of the new Abe government. In China, concerns about inflation, housing market excesses, and long-term financial stability are prompting policy restraint that should keep growth below 8% this year.

2013-04-09 The Return of the Ottomans by Bill O'Grady of Confluence Investment Management

Over the past two weeks, Turkey has taken two significant actions. First, while President Obama was visiting the region, Israeli PM Netanyahu offered Turkey an apology for the 2010 commando raid on the MV Mavi Mamara, a Turkish ship that was delivering aid to the Gaza Strip. The vessel was trying to run an Israeli blockade, which was put in place to prevent the region from receiving arms shipments. In the raid, nine people on the Turkish ship died, including eight Turks and one American. Ten Israeli commandos were wounded.

2013-04-09 Morning in Japan by Christian Thwaites of Sentinel Investments

There were two very important central bank meetings last week, one from the Bank of Japan the other the ECB. Bank of Japan press conferences have been soporific affairs for years with a few QE programs not leading to much and no changes to inflation targets. Deflation, a declining workforce and falling aggregate demand have been pretty much the unbroken story for the best part of two decades.

2013-04-08 The Theology of Inflation by John Mauldin of Millennium Wave Advisors

We begin this week with a simple pop quiz. Is inflation good or bad? Answer quickly. I’m sorry your answer is wrong. Or rather, we can’t know if your answer is right or wrong because we are not sure what is meant by the question. We may think we know and we may be right but we can’t be sure, because the word inflation has different meanings for different people in different places and different times. In fact, even the same people in the same place and time can’t agree on a precise definition.

2013-04-08 Europe Stumbles to a Cyprus Solution by Milton Ezrati of Lord Abbett

After several late-night meetings and considerable angst, the members of the eurozone have settled on something for Cyprus that looks very much like a typical bankruptcy. It is comical in a way that people worked so hard to arrive at an already widely known, well-established process. Still, this result may have value. Because Europe through these four years of crisis has strived to tailor settlements for each new challenge, it has always left people in doubt about each outcome, particularly where the pain would fall.

2013-04-08 Cypriot Chaos Assists EU Centralization by John Browne of Euro Pacific Capital

Remarks by members of the European Union’s elite suggesting that banking deposit seizures may become standard practice appear to have heightened the risk of a European bank run and perhaps even a catastrophic collapse of the euro. Any threat to the euro is a threat to the European public’s conception of the Union’s manifest destiny. As such, I believe members of the EU elite may be purposefully leveraging the crisis to push for a centralized European banking system to cement the political framework of an EU superstate.

2013-04-05 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company, Inc.

For two years or more, we’ve been discussing Europe, China, and U.S. politics as drivers for the financial markets. These drivers continue.

2013-04-05 What's Next for U.S. and European Markets? by Mike Temple of Pioneer Investments

I was asked recently to provide some color around the state of global fixed income markets as we close out the first quarter of 2013. Of course, one of the more watched situations in the global markets has been Cyprus’s banking crisis. I won’t go into too much depth on the subject here, as my colleague, Cosimo Marasciulo, has recently provided a comprehensive analysis.

2013-04-05 Could Consumers Change Japan\'s Tide? by Team of Matthews Asia

This year, investor attention has focused on Japan and its macroeconomic policy with hopes that rising inflation expectations might spur businesses to invest and consumers to spend. Since Prime Minister Shinzo Abe and Japan’s ruling Liberal Democratic Party (LDP) regained power late last year and proposed more aggressive monetary policies, including an ambitious inflation target, the yen has weakened more than 20% against the U.S. dollar and more than 15% against the euro.

2013-04-05 The Promise of Abenomics by Joseph Stiglitz of Project Syndicate

Japanese Prime Minister Shinzo Abe is doing what many economists have been calling for in the US and Europe: a comprehensive program entailing monetary, fiscal, and structural policies. As many Japanese rightly sense, Abenomics, with its focus on monetary, fiscal, and structural policies, can only help the country’s recovery.

2013-04-05 This Week's Central Bank Meetings Revealed a Range of Behavior by Team of Northern Trust

This week’s central bank meeting revealed a range of behavior. The U.S. employment report fell well short of expectations. Does China have a property bubble?

2013-04-05 Every Gold Coin Has Two Sides by Frank Holmes of U.S. Global Investors

Just as every coin has two sides, every data point that doesn’t meet expectations usually has an upside somewhere. For instance, although the gold price has fallen with the strengthening U.S. dollar, the yellow metal is appreciating in Japanese yen. So when negative news about the economy came out this week, along with the U.S. Labor Department reporting that the country added only 88,000 jobs in March, investors found reasons to be encouraged.

2013-04-04 Sound Fundamentals but Fatigue in the Markets by Scott Minerd of Guggenheim Partners

Although economic fundamentals continue to strengthen, the run-up in asset prices that has unfolded over the past half-year appears to be at risk of a temporary set-back.

2013-04-04 Absolute Return Letter: The Need for Wholesale Change by Niels Jensen, Nick Rees,Tricia Ward of Absolute Return Partners

The seeds of the next crisis have probably already been sown as a consequence of the lax monetary policy currently being pursued. Frustrated with the lack of direction from political leaders, most recently witnessed in the handling of the crisis in Cyprus which was a complete farce, central bankers from around the world are likely to demand change, but politicians will have to be pushed into a corner before they will respond to any such pressure. Hence nothing decisive will happen before the next major crisis erupts.

2013-04-04 Teachings from Recovered Markets by Richard Michaud of New Frontier Advisors

Domestic indices’ all-time record highs indicate that U.S. domestic equity markets have largely recovered from the 2008 Great Recession. It may have taken four years but it still seems a remarkable achievement given the Dow’s low of 6620 in March 2009. It is worth noting that prior highs were attained in an era with a poor savings rate and wide use of levered strategies. The last four years were widely characterized by a “low return” market mantra and fear of equities stoked by many doomsayers, pundits, and strategists who greeted every upturn with pessimism.

2013-04-03 First Quarter Recap by Bob Doll of Nuveen Asset Management

This past month marked the fourth anniversary of the global equity market bottom on March 9, 2009. U.S. stocks have clawed back all of the losses from the Great Recession and are near historical highs. Most other major markets are still well below their 2007 peaks, but have rebounded sharply since last June and look increasingly resilient. However, there is tremendous anxiety about the economic outlook, and many investors fear equities and other risk assets are floating on a sea of liquidity rather than solid fundamentals. We are more constructive and maintain a pro-growth investment stance.

2013-04-03 Minor Crisis...Not Too Many Hurt by Christian Thwaites of Sentinel Investments

Cyprus proved, over the last two weeks, that markets often overlook the small stuff. Very few commentators we follow saw any of it coming and the theories that sprang up in the interim (Cyprus as vassal state to Russia, return to the Cypriot pound, imminent EU break up, twin euros in circulation, utter disaster for the economy, German intransigence and Schrecklichkeit) were absurd.

2013-04-03 Surprise! 2013 Rally Pales in Comparison to 2012 “Stealth” Rally by Douglas Cote of ING Investment Management

Despite the hoopla over first quarter market performance, it paled in comparison to the first three months of 2012. Driven in part by an extremely accommodative Fed, the U.S. economy is gaining traction, but Europe continues to flounder. After their first negative print in three years during the third quarter, S&P 500 companies returned to positive earnings growth in the fourth. A broad, globally diversified portfolio is the best way to balance the desire for wealth accumulation with an appreciation of volatility.

2013-04-03 Why This Economic \"Recovery\" is So Weak by Gary Halbert of Halbert Wealth Management

We start today with an excellent editorial I read last week written by Mort Zuckerman, Editor-In-Chief of U.S. News & World Report. My goal every week is to do a lot of reading and summarize what I’ve learned in these pages week in and week out. But every now and then I run across something so good that it just makes sense to reprint it in its entirety, even if it’s not my own work. Not many of my contemporaries are willing to do that, as they think it makes them look less scholarly. I don’t have that problem.

2013-04-03 Weekly Market Review Notes by Team of Tuttle Tactical Management

After hitting a record close last week the market is showing some warning signs, which is to be expected. You don’t typically break through an important resistance point without testing it and re-testing it so some volatility around a record high is normal. We are also slightly concerned that small and mid cap stocks have drastically underperformed the S&P 500 over the past two days.

2013-04-03 A Man in the Mirror by Bill Gross of PIMCO

Am I a great investor? No, not yet. To paraphrase Ernest Hemingway’s “Jake” in The Sun Also Rises, “wouldn’t it be pretty to think so?” But the thinking so and the reality are often miles apart. When looking in the mirror, the average human sees a six-plus or a seven reflection on a scale of one to ten. The big nose or weak chin is masked by brighter eyes or near picture perfect teeth. And when the public is consulted, the vocal compliments as opposed to the near silent/ whispered critiques are taken as a supermajority vote for good looks.

2013-04-02 Bernanke’s Motives Behind Quantitative Easing by Paul Franchi (Article)

We are at a turning point: away from one global monetary standard, to a yet-to-be-determined new form.

2013-04-02 A Q1 Letter to Clients: Why Warren Buffett is Bullish on Stocks by Dan Richards (Article)

Since 2008, I have posted templates to serve as a starting point for advisors looking to send clients an overview of the year that just ended and the outlook for the period ahead. This quarter’s letter draws on Warren Buffett’s most recent letter to shareholders, and why he is bullish on the US equity market.

2013-04-02 Is the Vix Still an Adequate Measure of Risk? by Chris Maxey, Ryan Davis of Fortigent

The 30-day implied volatility index for the S&P 500 calculated by the Chicago Board of Options Exchange (CBOE), known as VIX, has long been used as an indicator of market sentiment. Commonly referred to as the “fear index,” the VIX often portends periods of stress in equity markets, as options traders price in higher volatility in the future. The shape of the VIX futures curve, in particular, has historically been used as an indicator of future volatility levels.

2013-04-02 Flying High on Borrowed Wings by Peter Schiff of Euro Pacific Capital

After selling off an astounding 56% between October of 2007 and March 2009, the S&P 500 has staged a rally for the ages, surging 120% and recovering all of its lost ground too. This stunning turnaround certainly qualifies as one of the more memorable, and unusual, stock market rallies in history. The problem is that the rally has been underwritten by the Federal Reserve’s unconventional monetary policies But for some reason, this belief has not weakened the celebration.

2013-04-02 The Crisis in Cyprus by Bill O'Grady of Confluence Investment Management

Over the weekend of March 16, Cyprus announced it was taxing deposits in order to recapitalize its banking system. The proposal, which levied a tax of 9.9% for deposits under 100k and 12.5% for amounts over that level, caused a severe political backlash. The Cypriot legislature would not approve the measure. In the days following, a banking holiday was put in place to prevent banking runs. The Troika (the EU, the IMF and ECB), who approve bailouts for the Eurozone, negotiated into late Sunday, March 24, before reaching a deal.

2013-04-02 ProVise Bullets by Ray Ferrara of ProVise Management Group

As we began 2013 America was looking ahead to President Obama’s second term, the passage of a tax bill that raised government revenue significantly, discovering that fourth quarter growth was virtually flat, corporate earnings that had only a few mild surprises to the upside and several to the downside, and finally, an increase in Social Security taxes of 2%. Then the sequester kicked in in early March, a band aid was used to patch the government together until the end of September, and we saw the nervousness the European markets, highlighted by Cyprus.

2013-04-02 Cypriots In The Streets by Peter Schiff of Euro Pacific Precious Metals

The news of the month comes from the large Mediterranean island of Cyprus, where Keynesian economic planning left the economy facing complete bankruptcy. The result was an unprecedented step forward in the financial collapse of the West: direct forfeiture of bank deposits. Despite official protestations to the contrary, this fallout will spread to a bank near you.

2013-04-02 Finally by Jerry Wagner of Flexible Plan Investments

With a headline like that, I could be talking about my Law School Alma Mater, the University of Michigan, making it back into the Final Four for the first time since 1993 by beating the University of Florida in the NCAA South Regional basketball Finals yesterday. Or it could be the exclamation of most Michiganders with the first sunshine-filled days this weekend since spring had sprung earlier in March (yes, the ice also finished melting on our lake this weekfinally).

2013-04-01 The Global Economy on the Fly by Nouriel Roubini of Project Syndicate

In a fragile global environment, has America become a beacon of hope? While the US is experiencing several positive economic trends, Europe continues to stagnate, and China will be vulnerable to a hard landing in 2014 unless its new leaders accelerate the pace of reform.

2013-04-01 A Fresh Milestone by Jeffrey Saut of Raymond James

Last Thursday the S&P 500 (SPX/1569.19) notched a new all-time causing Ms. Scaggs to pen the aforementioned story in Friday’s Wall Street Journal. I was particularly interested in a sentence further down in the article that read, “The rally in stocks comes as investors warm up to stocks for the first time in years.” That prose sparked memories of an era gone by.

2013-03-29 Learnings From the Cyprus Saga by Carl Tannenbaum of Northern Trust

There are important differences between the situation in Cyprus and the challenges other southern European nations face that should limit the transfer of financial trauma. The hope remains that the ECB’s promise to do whatever it takes to solve the sovereign debt crisis will ultimately settle markets. But access to certain types of ECB support requires reaching agreement on restructuring with the same European officials who have handled the situation in Cyprus so maladroitly.

2013-03-29 Market Resilience by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

After a stellar first quarter performance from US stock markets, which showed impressive resilience to continued headwinds, a pullback is certainly possible but we don’t suggest investors who need to add to allocations wait. In a relative world, the US stock market continues to look like an attractive place to invest, although there may also be opportunities in Japan and Europe as well. The upcoming earnings season could tell the story for the market over the next couple of months, but we continue to advocate a long-term point of view and maintaining a diversified portfolio.

2013-03-28 Emerging Markets Investment Bulletin by Team of Bedlam Asset Management

The increases in the portfolio’s net asset value continue easily to beat the hardly exacting returns from the index. The fund has gained 10.4% gross for the year to date (to 22 March), vs. a 3.0% rise for the MSCI Emerging Index. This outperformance (replicated over rolling 1- and 3-year periods) has been achieved by choosing investments irrespective of index country or sector weightings or where they are listed, so long as they derive the majority of income and profits from developing countries.

2013-03-28 What Will Drive the Market? by Charlie Dreifus of The Royce Funds

The sequester adds to the economic headwinds caused by ending the payroll tax holiday and the boost in tax rates. However, even with the sequester, total federal government outlays will rise this fiscal year. Finally, after more than a month of daily increases for a gallon of unleaded gasoline, prices are now declining. This has been of concern as rising oil and gasoline prices were yet another headwind facing the U.S. economy. (Oil prices have also declined.)

2013-03-28 What Maslow and Rand Would Tell Investors Today by Frank Holmes of U.S. Global Investors

While gold’s performance in the short term has been counterintuitive, I plan to stick to my own advice. I simply feel safer with a small weighting in gold as insurance.

2013-03-27 Weekly Market Review Notes by Team of Tuttle Tactical Management

The continuing mess in Cyprus and the S&P 500 nearing a record close dominated the news this week. As I said last week, Cyprus is insignificant, the only important aspects of what is going on is timing. If the crisis hit the news during a time when the market was oversold and due for a rally then it would have little, if any, impact. The fact that that market has rallied this year without much of a selloff gives traders an excuse to use something like this to take profits.

2013-03-27 What Happened to That Export-Led Recovery? by Mike Amey of PIMCO

With nearly 50% of the UK’s total exports going to Europe, an economic area constantly flirting with its own recession, it is no surprise to see that UK trade performance has been challenged.As the US continues to re-heal, and trade becomes more geographically diversified, we should see exports start to grow once more, albeit off a modest base. The easing in sterling is undoubtedly welcome and will improve prospects for exports, but it is unlikely to be a “game changer”.

2013-03-27 You Can't Be Serious by John Mauldin of Millennium Wave Advisors

I admit to being surprised by Cyprus. Oh, not the banking crisis or the sovereign debt crisis or the fact that its banks were eight times larger than the country itself or even the fact that the banks were bloated with Greek debt that had been written down. I wrote about all that a long time ago. What surprised me was that all the above was apparently a surprise to European leaders.

2013-03-26 A Cry for Help from Income Investors by Legg Mason Global Income Survey (Article)

Confronted with the stark realities of income investing now, affluent investors all over the world are rethinking their approach, notes Legg Mason’s just-released Global Income Survey. Yet the Survey also found income investors hungry for more knowledge and ideas -- creating opportunities for savvy financial advisors.

2013-03-26 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks were flat last week as investors were mesmerized by the goings on in Cypress and the European Union.

2013-03-26 Austerity's Children by Simon Johnson of Project Syndicate

Economists typically frame “fiscal adjustment” as an abstract and complex goal, though the issue boils down to deciding who will bear the brunt of measures to reduce the budget deficit. In America, that distributional choice has now been made: poor children must pay.

2013-03-26 Currencies in a Race to Debase by Chris Maxey, Ryan Davis of Fortigent

Since the start of the year, investors have seen rapid shifts of sentiment in currency markets. The debasement that for so long was assumed to be a purely Western phenomenon is beginning to impact countries globally, driving changes in expected returns and growth prospects.

2013-03-26 North Korea's Problem by Bill O'Grady of Confluence Investment Management

In December, North Korea launched a satellite into orbit, which was a violation of U.N. resolutions against ballistic missile tests. Last month, it carried out its third nuclear test, which was apparently more successful than the previous two attempts. The U.N., with Chinese approval, approved additional sanctions on the regime.

2013-03-26 Throw the Book at Him by Jerry Wagner of Flexible Plan Investments

On February 2, Ground Hog Day, Punxsutawney Phil failed to see his shadow forecasting, and as legend has it an early spring. Yet on the first day of spring, I looked out my back window at a lake still more than half frozen with my view partially obscured by a wicked little snow flurry. So much for forecasts!

2013-03-26 In Gold, Not Cyprus, We Trust by Frank Holmes of U.S. Global Investors

Global investors had to muster the courage to keep calm as news of Cyprus’ proposed partial theft of all bank deposits took Wall Street by surprise, closed the country’s banks and drove the price of gold higher.

2013-03-26 The Real Worry in Europe (Hint: It's Not Cyprus) by Russ Koesterich of iShares Blog

Investors have enjoyed six months of relative quiet in Europe, but the situation has flared up again over Cyprus. While many investors are wondering why they should care about such a tiny part of Europe, Russ says the answer is because it is indicative of a bigger concern.

2013-03-25 Cyprus Averts Disaster, but the Price is High by Darren Williams of AllianceBernstein

The European Union’s last-minute deal with Cyprus has headed off bankruptcy for now, but comes at a heavy price for uninsured bank depositors. Meanwhile, the move to impose losses on private creditors and growing complacency among policymakers could be storing up trouble for the future.

2013-03-25 The Hook by John Hussman of Hussman Funds

At the 2000 peak, Richard Russell observed "Every bull and bear market needs a hook.’ The hook in a bear market is whatever the bear serves to keep investors and traders thinking that everything is going to be all right. There is always a hook."

2013-03-25 Energy: Perilous Present, Promising Future by Milton Ezrati of Lord Abbett

For oil and gas, an era of abundant supplies and lower prices awaits. But investors will have to weather a tricky geopolitical situation before it arrives.

2013-03-25 Fed Outlook: Cautiously Optimistic or Just Hopeful? by Scott Brown of Raymond James

The Federal Open Market Committee’s latest policy meeting generated few surprises. The FOMC maintained its forward guidance on the federal funds rate target, which is still not expected to start rising until 2015, and did not alter its asset purchases plans ($40 billion per month in agency mortgage-backed securities and $45 billion in longer-term Treasuries). However, in his press briefing, Bernanke indicated that the pace of asset purchases could be varied as progress is made toward the Fed’s goals or if the assessment of the benefits and potential costs of the program were to cha

2013-03-25 Still Bullish by Richard Golod of Invesco

Global equities (as measured by the MSCI All Country World Index) fell modestly in February amid reignited fears about the euro’s future, signs of distress in China’s economy and the looming sequester deadline in the US. Nevertheless, I believe the US, Japan and emerging markets may offer compelling opportunities, while Europe requires a more selective approach.

2013-03-22 Cyprus Lifts the Curtain by Peter Schiff of Euro Pacific Capital

This week financial analysts, economists, politicians, and bank depositors from around the world were outraged that European leaders, more specifically the Germans, currently calling many of the shots in Brussels and Frankfurt, could be so politically reckless, economically ignorant, and emotionally callous as to violate the sanctity of bank deposits in order to fund a bailout of Cyprus.

2013-03-22 ING Fixed Income Perspectives March 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Developed sovereigns are still broadly unattractive, but global central banks appear poised to ease. We prefer EM currencies that will continue to benefit from positive global growth and tolerate further upward pressure on the U.S.

2013-03-22 Happy Clients; Terrified Prospects by David Edwards of Heron Financial Group

Four years ago, on March 9th, 2009, US stocks collapsed to a 12 year low. A financial crisis rooted in overleveraged purchases of junk (or even fraudulent) securities claimed, in quick succession, Bear Stearns, Lehman Brother, Merrill Lynch (forced into a shotgun marriage with Bank of America) and AIG. Investors panicked, selling good securities at deep discounts to fair value.

2013-03-22 Power of Positive Screening: Pursuing Strength of Social and Financial Returns by Chat Reynders, Patrick McVeigh of Reynders, McVeigh Capital Management

Market volatility and sweeping changes to mainstream views of investing are catalyzing acceptance of tactics that combine fundamentals with a progressive outlook on social issues. Positive screening brings balanced companies to the fore of the investment landscape: this practice isolates sound equities that demonstrate strength of balance sheet, dependability of management, and a commitment to act as part of a global community focused on positive change.

2013-03-22 Is Plan B for Cyprus an Exit from the Euro? by Michelle Gibley of Charles Schwab

Having rejected an initial bailout package that would have imposed a levy on bank deposits, Cyprus now faces some difficult choices in exchange for continued emergency bank funding.

2013-03-22 US Stocks: Third Time’s the Charm by Seth Masters of AllianceBernstein

At 1550, the S&P 500 has regained the peak it reached in March of 2000 (when the tech bubble burst) and again in October of 2007 (before the credit crunch hit). But we think the third time’s the charm: We think the stock market still has room to rise because equities are now more attractively valued and of higher quality than they were at previous peaks.

2013-03-22 Deep Value Diving in the Eurozone by Katrina Dudley of Franklin Templeton Investments

Greece’s tale of financial woe may well go down as a modern Greek tragedy, with people in power falling prey to a tragic flaw which brings about their catastrophic reversal of fortune. It’s all quite dramatic and dire, but if the real life Greek financial system stays true to the classical formula, the conclusion means recognition of that tragic flaw and potential course correction. For those hardy and/or contrarian souls who suspect opportunity may be sprouting from Greece’s great mess, this would be good news.

2013-03-22 The Importance of Women Leaders: From Margaret Thatcher to Sheryl Sandberg to Park Geun-hye by Frank Holmes of U.S. Global Investors

I have always admired former British Prime Minister Margaret Thatcher, whose strong leadership and perseverance made her one of the most influential and respected political figures in recent history. She once said of her ability to persevere that she has the “woman’s ability to stick to a job and get on with it when everyone else walks off and leaves it.”

2013-03-22 The Success of Central Bank Policy Is Not Measured By The Revenue It Generates by Team of Northern Trust

The success of central bank policy is not measured by the revenue it generates. Cyprus is a small country that could cast a long shadow. The U.S. dollar’s fortune is changing

2013-03-22 In Gold We Trust by Frank Holmes of U.S. Global Investors

Poorly thought out government policies hurt the formation of capital and destroy people’s trust in paper money. Leaders may have good intentions, but some of their actions show disrespect for private property and individualism. This only reemphasizes gold as an important asset class.

2013-03-21 Will the Real Unemployed Please Raise Your Hands? by John Mauldin of Millennium Wave Advisors

This week’s letter will be a very short part of a book I am writing with Bill Dunkelberg (the Chief Economist of the National Federation of Independent Businesses) on the future of employment. It has taken longer to write than I initially anticipated, for a host of reasons, chief among which is that the future is not as obvious as I originally thought. Diving into the data has brought a few surprises.

2013-03-21 Cyprus as a Pandora’s Box by Scott Minerd of Guggenheim Partners

The attempt to levy a deposit tax on Cypriot accounts has the potential to further destabilize the European Union, with contagion risk elevating for other peripheral member states.

2013-03-21 Goldilocks Roars by Team of Bedlam Asset Management

Equity markets are producing supra-normal returns. To March 18th, the portfolio is up over 15% year-to-date, over 100 basis points ahead of the index. Many investors would be happy with such a gain over a full year rather than a mere twelve weeks, so are puzzled, the more so as respected pundits agree that the data makes for easy stories of rampant inflation, collapsing government credit and a prolonged global recession. Equity markets, however, are stubbornly refusing to follow the script.

2013-03-20 Weekly Market Review Notes by Team of Tuttle Tactical Management

The banking crisis in Cyprus dominated the news this week as the market sold off 3 days in a row after being up 10 days in a row. The selloff was blamed on what was going on in Cyprus but that was not the real story. Globally Cyprus is pretty insignificant, most people probably don’t even know where it is. The real story is that markets just don’t go up for 10 straight days without needing a breather from time to time, Cyprus was just an excuse to take some profits.

2013-03-20 Playing with Fire in Cyprus by Fred Copper of Columbia Management

Early Saturday morning, after 10 hours of negotiations, it was announced that Euro Area (EA) finance ministers had agreed upon a bailout package for the government and banking system of Cyprus. The total financing needs of Cyprus are 17 billion euros ($22 billion), which equates to approximately 100% of Cypriot gross domestic product (GDP), making this by far the largest bailout relative to the size of the economy yet in the EA.

2013-03-20 Global Real Estate StocksTime to Get Out? by Eric Franco of AllianceBernstein

Real estate stocks have now rebounded from the crash during the global financial crisis. But we think valuations are still reasonable, especially as property fundamentals continue to improve in key markets.

2013-03-20 Investors Need to Pivot by William Benz of PIMCO

Fixed income investors need to think differently in the current environment. Investors may want to consider pivoting to strategies that are less focused on traditional benchmarks and more oriented to generating income and providing greater flexibility to hedge against rising rates, widening credit spreads or higher inflation.

2013-03-19 Paul Matlack from Delaware Investments on the Direction of the Bond Market by Robert Huebscher (Article)

Paul Matlack is senior vice president, senior portfolio manager and fixed income strategist for Delaware Investments. His firm oversees $145 billion in fixed-income strategies, and in this interview Matlack discusses his outlook for the economy and the bond market, and how advisors should be positioning client portfolios.

2013-03-19 The Eurozone Crisis: Time for a Reset by Giles Conway-Gordon of Cogo Wolf Asset Management

The crisis in the Eurozone (EZ) has reached a dangerously unstable condition, politically, socially, financially and economically. Without a return to growth in the peripheral economies a disorderly outcome is becoming probable as the debtor countries approach the 100% debt-to-GDP default horizon. They will not return to growth while they share a currency with Germany. It is time for a reset.

2013-03-19 Rising Political Risk and Ongoing Economic Weakness Challenge a Difficult Journey to Recovery by Andrew Balls of PIMCO

Looking ahead, it will continue to be a very bumpy journey as we anticipate economic contraction in the eurozone by -0.75% to -1.25% over the next year, hampered by growing political risk and fiscal tightening. Although we expect the pace of contraction in the eurozone to diminish over 2013, the duration of the recession is likely to be longer than consensus forecasts.

2013-03-19 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks had a very quiet week with volumes reaching levels that one associates with holiday trading.

2013-03-19 A Tired Equity Market Crawls Higher by Bob Doll of Nuveen Asset Management

U.S. equities rose again last week as the S&P 500 increased 0.66%, with an overall gain for the year of 9.96%.1 The remarkable resilience of the U.S. economy against fiscal cliff headwinds has boosted equity investor sentiment. The U.S. macroeconomic outperformance has also helped U.S. equities outperform global counterparts. Investor preference toward the U.S. has largely been confirmed by rising flows into U.S. equities.

2013-03-19 Why Are Emerging Markets Struggling in 2013? by Ryan Davis of Fortigent

Despite one of the sharpest rallies in US equities in recent memory, emerging market equities have been left curiously behind in 2013. Through last Friday, the market segment was down 1.0%, compared to an S&P 500 index that was up 10.0%. This seems to violate the regime that investors have gotten used to over the past 10 years, whereby the emerging markets equity index served as a high beta proxy for the US equity market.

2013-03-19 The Dow Marches On by Gene Peroni of Advisors Asset Management

The stock market has demonstrated tireless resiliency in the face of challenging headline news and geopolitical events since its bottom in March 2009. Now, some four years later, the burden of some of these once gripping issues has been lifted.

2013-03-18 And That’s the Week That Was by Ron Brounes of Brounes & Associates

Move over Dow Jones, here comes the S&P. What few thought possible a year ago is coming to fruition as the major indexes continue to push toward record territory. The S&P 500 is close (but no cigar) to besting its personal high set in late 2007, before this whole banking mess emerged and sent equities into a tailspin. Confident investors seemed to be overlooking the numerous concerns (budget/sequester, payroll taxes, Europe, China) so they can participate in the record run.

2013-03-18 M&A and Dividends Likely Drivers of the Market by Charlie Dreifus of The Royce Funds

The sequester adds to the economic headwinds caused by ending the payroll tax holiday and the boost in tax rates. However, even with the sequester, total federal government outlays will rise this fiscal year. Finally, after more than a month of daily increases for a gallon of unleaded gasoline, prices are now declining. This has been of concern as rising oil and gasoline prices were yet another headwind facing the U.S. economy. (Oil prices have also declined.)

2013-03-18 Finding the Sweet Spot by Mark Kiesel of PIMCO

Where is the investment “sweet spot” in today’s global financial markets? The uneven global growth outlook means there are opportunities and risks for both credit and equity investors.

2013-03-18 Investment, Speculation, Valuation, and Tinker Bell by John Hussman of Hussman Funds

The most important questions investors should be asking are these: what do they know that can be demonstrated to be true; and what do they believe that can be demonstrated to be untrue. It is best to make these distinctions deliberately, lest the financial markets clarify these distinctions for investors later, against investors’ will, and at great cost.

2013-03-18 Currencies: A 1970s Flashback? by Milton Ezrati of Lord Abbett

Four decades ago, a currency war and significant Fed easing were followed by a bout of high inflation. Now investors are worried that history could repeat itself.

2013-03-18 UK Budget: No Fiscal Consolidation, but Looser Money Ahead by Darren Williams of AllianceBernstein

We expect little change in UK fiscal policy in Wednesday’s budget. Instead the Chancellor George Osborne may try to nudge the Bank of England towards more aggressive monetary easing, putting further pressure on the pound.

2013-03-18 5 Reasons to Still Like (but not Love) Stocks by David Kelly of JP Morgan Funds

While investors have been justifiably worried that the combination of the big tax hikes of January and the Sequester in March could lead to an economic slump, so far the numbers are reassuring.

2013-03-15 Emerging Markets Equity Commentary by Team of Thomas White International

Emerging market equities saw a moderate correction in February, broadly similar to the rest of the world. Prices reacted negatively to renewed concerns of a worsening European fiscal crisis as the results of the recent Italian elections turned out to be inconclusive.

2013-03-15 Waiting on Weakness? by Mike Boyle of Advisors Asset Management

On Tuesday, March 5, The Dow Jones Industrial Average (DJIA) set a new record close at a level of 14,253.8 (old record of 14,164.5 was set on 10/09/07). Since then it has gone on to set four more consecutive record-closing highs. The S&P 500, at a closing level of 1556.2 on 3/11/13, is still about nine points shy of its record high of 1565.2 (also set on 10/09/07), but it is up seven days in a row and the odds of that occurring are about 1.17%.

2013-03-15 High Yield Market Overview by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index, posted a positive total return of 0.46% in February, as the high yield market finished on a positive note, after experiencing heightened volatility throughout the month.

2013-03-15 Global Economic Overview by Team of Thomas White International

Global economic trends largely remained positive during February, though the stalemate after the Italian elections and the failure by policymakers to reach a deal to avoid the U.S. sequester heightened the political and policy risks. The U.S. GDP figure for the last quarter of 2012 was revised higher, showing the world’s largest economy managed to avoid a decline.

2013-03-15 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

Despite exceptionally easy monetary policy, inflation risk remains low. Record stock market levels are boosting consumer spending. U.S. capital spending is poised to be a bright spot this year.

2013-03-15 China\’s Next Stop by Frank Holmes of U.S. Global Investors

Would it surprise you to discover that China is planning to add 800 miles to its subway system over the next two years? That’s the distance equivalent to building a network from Dallas to Chicago in less time than the U.S. Congress can resolve a budget!

2013-03-15 Finally!! Now What? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Surprise! We don’t know what’s going to happen in stocks over the next few weeks. But we are seeing an environment that we believe can foster further gains in the US as economic data remains generally positive, the Fed maintains its accommodative stance, and small progress is being made in the fiscal realm. Investors concerned about a pullback may want to hedge their portfolios, but maintain adequate exposure to equities.

2013-03-14 Weekly Market Review Notes by Team of Tuttle Tactical Management

The Dow continues to make new highs but the rate of climb has slowed considerably this week. This is normal as markets have to take a breather after large moves.

2013-03-14 Excess Liquidity Finds a Home by Scott Minerd of Guggenheim Partners

U.S. home prices appear likely to continue to rise as the Federal Reserve injects more liquidity into the system. Given housing’s unique characteristics, this will have positive effects for consumption and growth.

2013-03-14 Newsletter by Harold Evensky of Evensky & Katz

In the latest edition of his client newsletter, Harold Evensky highlights a number of interesting bits of news, including a must-see destination for your friends, your kids and your grandkids, some advice from Warren Buffett, a tip from Albert Einstein and the latest data on hedge fund performance.

2013-03-14 DC Plan Sponsors: Now's the Time to Get More From Bonds by Stacy Schaus of PIMCO

Long on equities and light on bonds, today’s DC plan lineups may expose participants to extreme market risks. Plan sponsors could potentially improve retirement outcomes by trimming choices for stocks and considering additional options for bonds. The inclusion of active fixed income strategies with global exposure or additional income opportunities could help participants reach their retirement goals.

2013-03-14 Global Currency Battles: A Waiting Disaster or a Win for All? by Team of Knowledge @ Wharton

To many, Japan’s recent moves to devalue the yen looked like the spark that could ignite a global currency war -- a series of competitive devaluations that, last century, helped plunge the world into the Great Depression. Until now, central bankers have been resisting the urge to politicize exchange rates. However, while currency skirmishes can be dangerous and require monitoring, they are also necessary for establishing equilibrium in markets and will help in the global economic recovery, some experts say.

2013-03-13 Argentina on Sale by John Mauldin of Millennium Wave Advisors

(From Cafayate, Argentina) There are some who worry whether the path that Argentina has taken to monetary ruin on multiple occasions (and that it seems intent on taking again) is one that the US may also find itself on. That worry has crossed my mind a few times, I must confess. Today we will look at Argentina more in depth. From a monetary perspective, it deserves attention. And once again there will be opportunity.

2013-03-12 Gundlach: Investors are asking the Wrong Question by Robert Huebscher (Article)

If you're trying to assess the Federal Reserve's so-called exit strategy from quantitative easing, then you're asking the wrong question, according to Doubleline's Jeffrey Gundlach. Quantitative easing is a permanent policy tool, he said, and investors should be asking what that means for their investment strategy.

2013-03-12 Finally, a Jobs Report Worth Reading by Chris Maxey, Ryan Davis of Fortigent

Surprisingly, the February employment report showed a labor market growing at a reasonably healthy rate. Concerns that the sequester would spill into the broader economy have yet to materialize and if recent trends hold, the economy may finally be approaching a point of robust and sustainable job growth.

2013-03-12 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks rose each day last week as the notion of a ho-hum global economy was reassuring to those who fear either a recession or a surge in economic activity.

2013-03-12 Pacific Basin Market Overview February 2013 by Team of Nomura Asset Management

Monthly returns for February 2013 were somewhat mixed, but the Pacific Basin regional markets generally ended in positive territory this month. Outside of Asia, political instability in Italy and concerns that the Federal Reserve might begin to scale back its monetary stimulus in the U.S. led to weaker investor sentiment. Economic data from China was weak, largely due to the effect of the Chinese New Year.

2013-03-12 We Made It. Now What? by Christian Thwaites of Sentinel Investments

What looks like a fairly settled policy in Europe is fast becoming a very dangerous situation, according to Christian Thwaites in his latest "Thought of the Week" -- "We Made It. Now What?" -- adding that the outlook for the world's second largest economic bloc is pretty week.

2013-03-12 U.S. Dominates World Markets for the Trifecta by Douglas Cote of ING Investment Management

While large-cap indices get all the headlines, mid and small caps have continued to excel. Frontier markets have picked up the slack as major emerging markets stumble. Global risks persist, though U.S. fundamentals appear solid. The move toward U.S. energy independence should soon result in a trade surplus, boosting GDP.

2013-03-12 The 2030 Increasing Inequality Scenario by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

Last month we started looking at the 2030 alternative world development scenarios as laid out by the National Intelligence Council (NIC). The NIC forecasts the likely paths that are either currently underway or are forecast to occur in the future. In its most recent report, the NIC projects four possible global political and economic states based on expected trends. Last time, we presented the most likely best case scenario. This week, we will explore the third scenario, under which the world gets wealthier as a whole, but inequalities increase.

2013-03-11 Two Myths and a Legend by John Hussman of Hussman Funds

The present market euphoria appears to be driven by two myths and a legend. Make no mistake. When investors cannot possibly think of any reason why stocks could decline, and are convinced that universally recognized factors are sufficient to drive prices perpetually higher, euphoria is the proper term.

2013-03-11 And That's the Week That Was by Ron Brounes of Brounes & Associates

Stocks moved to record highs (Dow Jones) early in the week and never looked back. Some favorable economic data, particularly from labor, renewed investors' confidence and others jumped on as the week progressed to participate in the friendly trend. Even with the spending cuts from sequester threatening to weaken the economy, investors focused more on the present than the future. Though naysayers scoff at the recent moves and claim the economic strength is at least partially artificially Fed induced, their voices have been silenced for now.

2013-03-11 Italy: Welcome to the Bungle by Milton Ezrati of Lord Abbett

Results of the recent election increase the likelihood of a eurozone breakupand disruptions to financial markets.

2013-03-11 Spring is in the Air, Who's Buying Fixed Income and Exports by Gregg Bienstock of Lumesis

This week we start with a look at some bizarre coincidences that have us wondering if it is Spring that is the cause. We next look at who is buying so much debt and to contemplate the implications for the muni market. We conclude with a look at Exports and a reminder that the world really is a small place.

2013-03-08 Spasmodic Stupidity: The Wile E. Coyote Congress by Cliff Draughn of Excelsia Investment Advisors

I predict the Ides of March will find us in a continued sequestration, and Congress will use the time between now and the debt ceiling deadline on March 27th to debate the merits of true tax reform as opposed to governing by crisis. In the end, though, the reform conversation will revert to governance by crisis, with another stop-gap measure to avoid government shutdown during Holy Week and Easter, which will tide us over to the elections of 2014. Do you expect any different?

2013-03-08 How to Keep Calm and Invest On by Frank Holmes of U.S. Global Investors

The market noise of today will not be going away. However, investors can gain confidence in the following wisdom of the crowd. As famous investor Benjamin Graham said, "The individual investor should act consistently as an investor and not as a speculator. Keep calm and invest on.

2013-03-07 Weekly Market Review Notes by Team of Tuttle Tactical Management

Yesterday saw a new record close on the Dow Jones Industrial Average and a renewal of the panic buying we saw earlier in the year. While it is great to see that the Dow has retraced all of the losses from the 2008 decline I am concerned about what message will be directed towards individual investors. The asset allocation/buy and hold crowd will use this milestone to "prove" that markets always come back so that their approach is still valid. This is true, but it ignores the fact that it took the market almost 6 years to come back and the lost opportunity cost associated with that.

2013-03-07 Gentlemen, Start Your Presses by John Browne of Euro Pacific Capital

In his Congressional testimony last week in Washington, Fed Chairman Ben Bernanke took time to downplay the significance of the few dissenting voices on the Fed's Open Market Committee (FOMC). Those statements, combined with an even more dovish statement by Fed Vice Chairman Janet Yellen earlier this week, clearly reaffirm the Fed's indefinite commitment to $85 billion of monthly quantitative easing.

2013-03-07 80's Bull Redux by Richard Bernstein of Richard Bernstein Advisors

We have thought for some time that the current bull market might be one of the strongest of our careers, and could potentially rival the 1980s bull market. Although this current cycles construction is quite different from the 1980s bull market, there are many aspects of this market that are curiously similar.

2013-03-07 Transatlantic Trade's Transformative Potential by Mohamed El-Erian of Project Syndicate

A "Transatlantic Trade and Investment Partnership" between the US and Europe has the potential to transform global trade and multilateral organizations to the benefit of all. But this opportunity could be squandered, owing to the short-term mindset that now encumbers the West and the multilateral organizations that it dominates.

2013-03-07 Freewheeling? by Dimitri Balatsos of Tesseract Partners

Ignoring threatening clouds in the distant horizon, the financial markets are wrapped in a blanket of complacency. Consider the following. The Dow Jones Index has been flirting with the 2007 record peak. Implied stock market volatility, as measured by the VIX Index, is in the basement. Junk bond yields are at record lows, compressing spreads to within shouting distance of risk-free Treasuries. Securitization is back from the dead, while the drought in M&A activity is now getting plenty of rainfall.

2013-03-07 New Highs by Team of Janus Capital Group

The Dow Jones Industrial Average closed at a new record high the first week of March, breaking its previous closing high reached in October of 2007. The new record is symbolic more than anything else, but it still has some positive implications for equity markets.

2013-03-07 A New Chapter for Turkey? by Frank Holmes of U.S. Global Investors

In 2012, Turkey was the best performer among the emerging markets we track on our Periodic Table showing a decade of returns. All developing countries rose last year, but stocks in Turkey climbed an astounding 56 percent.

2013-03-07 After the Dow Record Close: What Comes Next? by Russ Koesterich of iShares Blog

After Tuesday's record setting Dow Industrials close, are US stocks still cheap? Can the market move higher? Russ answers these questions and more.

2013-03-06 U.S. Sequester: How Significant is it for the Global Economy? by Team of Thomas White International

Since the U.S. has been one of the brightest spots in the current global economic environment, any negative development that restricts activity in the U.S. could have a magnified impact on the economic prospects for the rest of the world.

2013-03-06 How Big a Problem will the Sequester be for the U.S. Economy? by Sam Wardwell of Pioneer Investments

Having dodged the fiscal cliff and postponed the debt ceiling deadline, Congress decided to let the spending sequesters happen. Will the result be to throw the economy into recession or cause an economic catastrophe? We don't think so, and neither does Congress.

2013-03-06 An Infinite Amount of Money by John Mauldin of Millennium Wave Advisors

The three major blocs of the developed world are careening toward a debt-fueled denouement that will play out over years rather than in a single moment. And contrary to some opinion, there is no certain ending. There are multiple paths still available to Europe and especially the US, though admittedly none of them are bright and carefree.

2013-03-05 What Economists can Learn from Downton Abbey by Robert Huebscher (Article)

Economists warn that the U.S. economy could be heading toward one of two catastrophes: the two-decade long stagnation that has befallen Japan, or the hyperinflation that struck Zimbabwe and the Weimar Republic. Such cautionary tales alert policymakers to the failed efforts of their predecessors. But the most relevant comparison is rarely cited – to Great Britain in the 1920s, as depicted in the highly popular PBS series Downton Abbey.

2013-03-05 Weave a Circle Round Us Thrice by Christian Thwaites of Sentinel Investments

There was plenty of news to threaten the recent market rallies but, as of writing, we're within a whisper of all time highs in US stocks and managing to have a very orderly consolidation in bonds. This is surprising because the political process has once again taken careful aim and shot itself in the foot. The sequester has become the dumb answer to difficult questions and will initiate, mostly indiscriminate, across-the-board cuts.

2013-03-05 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks drifted last week, buffeted by concerns over Europe due to the Italian elections and worries here at home as the "dreaded" sequester begins to take effect.

2013-03-05 Currencies: The Winds of War by Milton Ezrati of Lord Abbett

In this conflict, the collateral damage could include asset bubbles and accelerating inflation.

2013-03-04 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

The sky is falling. The sky is falling. It's the millennium all over again. (How did those fears work out?) With politicos unable to reach any agreement on the budget (taxes), the "dumb, arbitrary" spending cuts began to take effect to the tune of $85 billion this year. (So much for a military preparedness.) Though the impact on the economy will not be felt overnight, some areas will begin to suffer sooner than others and biz/consumer confidence could become an issue in the near future.

2013-03-04 Out On A Limb - An Investor's Guide to X-treme Monetary and Fiscal Conditions by John Hussman of Hussman Funds

Massive policy responses, directed toward ineffective ends, are scarcely better than no policy response at all. A look at the current monetary and fiscal policy environment, as well as more effective policy initiatives, and why they make sense.

2013-03-04 What is Italy Saying? by Joseph Stiglitz of Project Syndicate

The outcome of the Italian elections should send a clear message to Europe's leaders: the austerity policies that they have pursued are being rejected by voters. Indeed, it will take a decade or more to recover the losses that austerity has wrought.

2013-03-01 Wait for Your Pitch in Today's Market by John West of Research Affiliates

Great hitting in baseball depends in part on waiting for the right pitch. In today's market, most asset classescoming off their impressive 2012 recordare "high and outside" the valuations necessary for future big league returns. Patience is the name of the game today.

2013-03-01 Seeking a Fixed Income Fix by Team of Franklin Templeton Investments

While governments worldwide continue to struggle with debt and budget issues, for the most part, corporations have turned lemons into lemonade and have become lean and mean. While not without risk, corporate credit actually looks to be in fairly good shape, according to Eric Takaha who, as senior vice president and portfolio manager of Franklin Strategic Income Fund spends a good deal of time analyzing the space.

2013-03-01 There Are More Sellers Than Buyers in the World Economy. by Team of Northern Trust

There are more sellers than buyers in the world economy. The recent Italian election may usher in renewed instability. US bank lending is finally expanding, but not everyone is happy about it.

2013-03-01 3 Reasons Market Volatility Has Returned by Russ Koesterich of iShares Blog

In the last week, stocks have pulled back and volatility has once again spiked. Russ outlines the 3 factors that hindered the rally and explains the implications for investors.

2013-03-01 Critical Juncture? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Headwinds have reemerged and investor concern is heightened yet again. We still believe stocks can run further, but a pullback is more likely in the near-term. The sequestration is now in affect but that doesn't necessarily mean it's here to stay and more budget fights loom, particularly in advance of the potential government shutdown on March 27. Meanwhile, some members of the Fed are in favor of scaling back its quantitative easing (QE) program, rattling markets a bit.

2013-03-01 Greetings from Istanbul! by Frank Holmes of U.S. Global Investors

As I travel around Turkey, I am reminded how vital good government policies are to the health of a nation. Following a decade of fiscally responsible actions, Turkey is the picture of a growing prosperity. Perhaps Americas elected officials could take a tip from this vibrant country overseas.

2013-02-28 An Ephemeral Swoon by Scott Minerd of Guggenheim Partners

Although volatility is likely to stay relatively high going forward, the recent move in the markets to risk-off mode appears to be a temporary condition.

2013-02-28 What Italy's Election Result May Mean for the Markets and Your Investment Portfolio? by Team of Thomas White International

Global equity and bond markets have reacted sharply to the outcome of Italy's elections on February 24-25. The poll result is inconclusive, with no clear winner. And apparently, Italians have voted against the austerity measures and reforms that are widely believed to have improved international confidence in Italy last year.

2013-02-28 Jeremy Siegel on Why Stocks Are -- and Will Remain -- the Best Bet by Team of Knowledge @ Wharton

Though stock market volatility continues to rattle investors' nerves, the future looks bright for equities in the U.S. and many emerging markets, according to Wharton finance professor Jeremy Siegel. That's not so for bonds, which could become money-losing investments as rising interest rates drive bond prices down. In an interview with Knowledge@Wharton, Siegel says that investors should think about reducing their bond holdings, buying more stocks and keeping just enough cash for a rainy day and other liquidity needs, since interest rates on cash are near zero.

2013-02-27 Understanding the Sequester by David Kelly, David Lebovitz of J.P. Morgan Funds

A recent survey conducted by The Hill found that only 36% of likely voters even knew what the term "sequester" meant. For the record, sequester in our current fiscal lexicon, refers to the $1.2 trillion of spending cuts spread out over the next 10 years that are set to commence on March 1, 2013. These cuts have the potential to impact both the markets and the economy. Although time still remains for a deal to be reached, it seems increasingly unlikely that this will actually occur, making it more likely that the effect of these spending cuts will be felt, at least temporarily.

2013-02-27 Impending Decline in Stock Prices by Charles Lieberman (Article)

It is a popular view that stocks have run up excessively, rising more than 125% off the March 9 2009 low, and are now highly vulnerable to a sizable retrenchment. This is a sexy idea, but also quite contentious. Nonetheless, it is worth considering seriously.

2013-02-27 The Difficult Transition to Democracy by Bill O'Grady of Confluence Investment Management

The Arab Spring has turned into something of a disappointment. In Tunisia, the recent assassination of Shokri Belaid, a secularist opposition leader, has increased tensions. S&P recently downgraded the countrys sovereign risk due to rising political turmoil. In Egypt, protests have returned, this time against the Muslim Brotherhood-led government. Yemen remains in chaos. Syria is essentially in a civil war. Unrest continues in Bahrain but the minority Sunni leadership remains entrenched, mostly due to military support from Saudi Arabia.

2013-02-27 Potential Threats to Equity Rally by Chris Maxey, Ryan Davis of Fortigent

Equity markets started a third consecutive year in rather impressive fashion, gaining more than 6% to date. With so much optimism in the investment community, it is always worth keeping an eye open for risks possibly overlooked. By now, it is apparent that investors are increasing their exposure towards equities with arms wide open. Data from the Investment Company Institute (ICI) estimates $39 billion flowed into equity mutual funds this year through February 13. Following outflows of $153 billion in 2012, the sudden reversal has been impressive.

2013-02-27 ING Fixed Income Perspectives February 2013 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

Despite its diminutive size, February has been a whirlwind. Eat and drink too much on Fat Tuesday, be reminded of our corporeal nature on Ash Wednesday, receive a sappy Hallmark card on Thursday, and cap it all off with a memorial for a bunch of ex-presidents on Monday. Unfortunately, the next several weeks don't appear to offer any relief from this calendar whiplash.

2013-02-27 The Great Migration by Herbert Abramson, Randall Abramson of Trapeze Asset Management

We are value investors dedicated to creating portfolios for clients, whether growth (equities), income or a balanced blend of both, of undervalued securities with meaningful upside potential and a margin of safety to guard against permanent loss. For us, the bottom-up factors are the most compelling, but we are also mindful that we need to take account of the top-down macro factors. We know how the Crash of ꞌ08 and the accompanying recession created havoc for investors, including us, no matter how undervalued stocks were.

2013-02-27 Love, Money or Disappointment: What Will Asian Credit Investors Find in Their Red Envelopes? by Robert Mead, Raja Mukherji of PIMCO

Our cyclical economic outlook for Asia in 2013 is unusually dependent on breakthroughs in structural policies. Although we continue to favor select opportunities in key sectors, in general Asian credit spreads are trading historically tight. Bottom-up research is critical, along with careful top-down views on shifting economic conditions, and investors need adequate compensation for taking credit risk. Some sectors and companies can grow significantly faster than their respective economies.

2013-02-27 Weekly Market Review Notes by Team of Tuttle Tactical Management

For a while it was obvious that the market had become overbought and was due for a selloff, all traders needed was an excuse, this past week they got two of them. First, the Fed hinted that QE might end and then Italian elections sparked uncertainty in Europe. Add those things in with the looming sequester and you have all the ingredients for a profit taking selloff. At this point this is all part of normal market machinations. The market doesn't go up in a straight line and it doesn't go down in a straight line.

2013-02-27 Singapore A Wise Owl Among Currency Snakes by John Browne of Euro Pacific Capital

As China enters the "Year of the Snake," Singapore stands as a beacon of sound currency in a world gone mad. China's renminbi remains pegged to the US dollar, while even steadfast Switzerland has followed the US, UK, EU, and Japan into an impoverishing strategy of currency debasement. Singapore, alone, has been able to sustain genuine economic growth in the context of a strong national currency.

2013-02-26 What a 29-Year Old Can Teach You about Referrals by Dan Richards (Article)

It all started with a simple request that, as it turned out, was not so simple. The resulting encounter with a 29-year old account manager at a leading bank provided important lessons for advisors.

2013-02-26 Global Investment Review First Quarter 2013 by Team of Bedlam Asset Management

At the beginning of last year the prospects for capital markets were grim yet the results surprisingly good: positive returns and modest economic growth. The cause was central banks in developed countries acting as a backstop for sovereign and other large debts, through direct purchasing funded by accelerated money printing. This also ensured low interest rates. Subsequently, mountainous debt problems are slowly being tackled, even as they appear to increase.

2013-02-26 Looking For A Reason To Sell-Off by Christian W. Thwaites of Sentinel Investments

Markets were looking for a reason to correct. Risk assets had outpaced themselves since mid November and in the first seven weeks the S&P[1] had outperformed the US Treasury 10-year note by 12% and the 30-year bond by 15%. The markets will lumber through the sequester and face the next test on the debt ceiling and first quarter results. Below the surface, the outlook is mildly optimistic. Why the qualifier? Because everything, in Europe, US and Japan, must be set in the context of the asset deflation and deleveraging going on and that will go on for some years.

2013-02-25 We Expect High-Yield Defaults to Remain Low by Jeff Skoglund of AllianceBernstein

High-yield bond defaults are historically low today, even for troubled companies. Despite the worries we hear in some corners about looming high-yield defaults, we think default rates will stay low for at least the next few years. In the wake of the 2008 financial meltdown, US companies did the responsible thing and got leaner, reducing head count and overhead costs aggressively. When the recovery gained traction, they held the line on expensesand profit margins are at historic highs today.

2013-02-25 Dodging the bullets by Team of Bedlam Asset Management

Although the year is barely a month old there are already signs that the long-awaited rotation out of the perceived safety of bonds and into inflation-proofed equities may have begun. Given the dismally low yields on offer it seems likely that, at the very least, it is the beginning of the end of the bond market bubble. Some of the biggest bubbles in the bond market, and thus most at risk from a sell-off, are in high yield and emerging market debt.

2013-02-22 Emerging Markets Outlook: Will Emerging Markets Continue Their Run in 2013? by Scott Klimo of Saturna Capital

A number of times we have been asked whether emerging markets will continue their run in 2013. Our response typically begins with the following clarification: "Emerging markets" may be a handy way to refer to the countries that constitute a generally recognized asset class, but this group is far from monolithic. Widely differing levels of development, economic drivers, opportunities to invest, and returns exist under the emerging markets umbrella. For this reason it's not entirely correct to imply that "emerging markets" had a run in 2012.

2013-02-22 Muscle Memory or Muscle Training by Bill Smead of Smead Capital Management

Interest rates have gone down on US Treasury bonds off and on for 31 years. This means that the coupon you are being paid has been joined by significant capital gains. Jim Grant argues that the only thing going for bonds is how well handlers of money have done on them; Warren Buffett calls it "rear-view mirror investing".

2013-02-22 Frontier Markets: Today's Models of Fiscal Prudence by Paul Herber of Forward Management

Say you are evaluating the markets of two countries in a search for investment growth opportunities. One country's sovereign debt is 120% of its gross domestic product (GDP), while the other has outstanding sovereign debt that represents only 11% of its GDP. Saddled with sovereign debt, the first country faces painful fiscal austerity measures, inflationary ones, or bothany of which will no doubt stifle economic growth.

2013-02-22 Finding What's Real in Real Estate by Team of Franklin Templeton Investments

The U.S. financial crisis in 2008-2009 left many investors with a reluctance to take investment risks, particularly those related to any of the world's wilted housing markets. However, as your local real estate agent would likely tell you, the market in one location can be vastly different than it is in another. Wilson Magee, co-manager of Franklin Global Real Estate Fund would agree that the adage "location, location, location" applies not only to individual home buyers and sellers, but to investors seeking opportunities in the commercial real estate sector, too.

2013-02-22 Is it Time to Review Your European Investment Strategy? by Team of Thomas White International

A sharp equity and bond market reaction is likely expected in response to the outcome of Italy's February 24-25 general elections, several media sources such as THE GLOBE AND MAIL have reported. While the poll result is uncertain, these reports indicate that in the event of a clear victory for Silvio Berlusconi's political party, buying interest in equities and lower-quality debt may be affected.

2013-02-22 A Test of Strength for Gold by Frank Holmes of U.S. Global Investors

This week, we saw the gold bears growling louder and gaining strength, as the worlds largest gold-backed ETF, the SPDR Gold Trust, experienced its largest one-day outflows since August 2011. The Fear Trade fled the sector following the Federal Reserves meeting that revealed a growing dissension among some of its members over the central banks bond-buying program.

2013-02-22 Understanding the Sequester by David Kelly, David Lebovitz of J.P. Morgan Funds

A recent survey conducted by The Hill found that only 36% of likely voters even knew what the term sequester meant1. For the record, sequester in our current fiscal lexicon, refers to the $1.2 trillion of spending cuts spread out over the next 10 years that are set to commence on March 1, 2013. These cuts have the potential to impact both the markets and the economy. Although time still remains for a deal to be reached, it seems increasingly unlikely that this will actually occur, making it more likely that the effect of these spending cuts will be felt, at least temporarily.

2013-02-21 Cracks Appear in the French Economic Model by Darren Williams of AllianceBernstein

Today's PMI data point to a deepening recession in France at a time when Germany is showing tentative signs of life. Is the euro crisis exposing the weaknesses of the French economic model?

2013-02-20 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

Tick Tick Tick. The President has plans for improving life in America. Tick Tick Tick. Republicans want to fix the middle class (and restricting taxes on the upper class may help). Tick Tick Tick. Earnings reports look good, but forecasts for the current quarter have been lowered. Tick Tick Tick. Weekly jobless claims keep falling, but major corporations are announcing layoffs. Tick Tick Tick. Sales figures show growth, but Wal-Mart and others are worried. Tick Tick Tick.

2013-02-20 Event Driven Investors Receive Their Wish by Chris Maxey, Ryan Davis of Fortigent

For several years, investors have wondered why M&A activity has been so benign.Corporate management teams cited uncertainty about the economic outlook as a primary reason for the depressed activity.With the latest round of tax increases and revenue cuts determined, companies finally appear willing to free their animal spirits and embark on the path of acquisition.

2013-02-20 Taxes: Living Off the VAT of the Land? by Milton Ezrati of Lord Abbett

The country has renewed its conversation about the way it should tax itself, whether to rely on income taxes or replace them with sales taxes. This latest buzz springs from plans by several Republican governors to reduce or eliminate their state income taxes. It has extended to talk about change at the federal level, including speculation about the introduction of a value-added tax (VAT) in addition to existing federal income taxes. Similar proposals surfaced in the 1990s and earlier in this century.

2013-02-20 The 2030 Most Likely Best Case Scenario by Bill O'Grady Kaisa Stucke of Confluence Investment Management

Two weeks ago we started looking at the 2030 alternative world development scenarios as laid out by the National Intelligence Council (NIC). The NIC forecasts the likely paths that are either currently underway or are forecast to occur in the future. In its most recent report, the NIC projects four possible global political and economic states based on these expected trends. Last time, we presented the most likely worst case scenario. This week, we will explore the most likely best case scenario.

2013-02-20 Weekly Market Review Notes by Team of Tuttle Tactical Management

Markets continued to move up this week in spite of looming Fiscal Cliff budget cuts. Everyone still expects a selloff but money continues to flow into the market as it has nowhere else to go.

2013-02-20 Two New Country Views for a Two-Speed Global Economy by Russ Koesterich of iShares Blog

The global economy is stuck in a two-speed regime: Developed markets like Europe, Japan and the United States are stalling, while China is re-accelerating. Russ explains what this divergent growth landscape means for his country outlooks.

2013-02-20 Whatever It Takes by John Mauldin of Millennium Wave Advisors

Was it only a few years ago I visited the Emerald Isle of Ireland? The collapse of its largest banks foreshadowed the demise of many other European banks that had borrowed money from British, German, and other European banks to lend against homes and property. The Irish government had to guarantee deposits and bond holders in order to prevent a bank run. I think I am correct when I state that the Central Bank of Ireland was the first central bank to avail itself of large-scale use of the Emergency Liquidity Assistance (ELA) provision of the European Central Bank.

2013-02-19 Alan Greenspan on the Market and the Global Economy by Adam Jared Apt (Article)

During his six-decade-long career in financial services, Alan Greenspan was a central figure in seminal events that drove investment markets, from the savings-and-loan crisis to the dot-com bubble to the housing crisis. Now, nearing 87, he rarely speaks in public. But he did so last week, offering his forecasts for the U.S. and European economies.

2013-02-19 Ketchup vs Cash by John Petrides (Article)

Last week Warren Buffet’s Berkshire Hathaway, along with 3G Capital, bought Heinz (ticker HNZ) for $28 billion, paying a 20% premium to the prior trading day’s closing price (as well as Buffet rewarding himself with preferred stock yielding 9%). Heinz is a mature company trying to reestablish growth by selling ketchup and other condiments in developing countries. However, Heinz is a classic "steady-eddy."

2013-02-19 A Technical Look At The Current Market by John Rothe of Riverbend Investment Management

The S&P 500 Index has been rising consistently this year, leading many to wonder if this is the start of a new long-term bull market. Volatility has been low and market commentary from the financial media continues to be positive. Everything looks great right? Unfortunately, when we dig deeper into the underlying components of the market, we are actually in a high risk environment that may potentially harm investors who are too bullish.

2013-02-19 The Pound Gets Pounded by Peter Schiff of Euro Pacific Capital

As the global currency war intensifies, the majority of attention has been paid to the 17% fall of the Japanese yen against the U.S. dollar over the past few months. The implosion has given cover to the sad performance of another once mighty currency: the British pound sterling. But in many ways the travails of the pound is far more instructive to those pondering the fate of the U.S. currency.

2013-02-19 All is Not Well Down Under by Russ Koesterich of iShares Blog

Though Russ continues to like Australian equities for the longer term, he explains why he may downgrade his near-term view of the Australian market soon.

2013-02-19 Too Great Expectations by Richard Golod of Invesco

Global investors entered the year with newfound enthusiasm. Across the board, global equities traded higher in January, and retail money flows into global equities were the best in 17 years. Media reports about a "Great Rotation" from fixed income into equities are raising expectations about the possibility of a new secular bull market. However, I believe a little perspective is in order.

2013-02-19 On Competitive Devaluations by Scott Brown of Raymond James

Aggressive monetary policy moves in recent years have been accompanied by a growing fear of a currency war. In a currency war, or competitive devaluation, countries attempt to weaken their currencies to boost exports, but each devaluation leads to counter devaluations. That's not what's going on now. However, whether a country is purposely devaluing its currency or is merely pursuing accommodative monetary policy is irrelevant, the consequences are the same. The recent meeting of G-20 finance ministers and central bankers highlights the lack of coherent policies to boost growth.

2013-02-16 Seeing the Forest by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Equity markets continue to be resilient and investor confidence is elevated in various sentiment indices, suggesting a near-term pullback is possible. But there are longer-term trends developing that give us hope that the US economy's expansion and market's rally are sustainable. Federal spending cuts via the "sequestration" appear sure to happen, but there will continue to be debates about the nature and size of the cuts. Similarly, questions are increasing as to the potential unwinding of current Fed policy with regard to timing and rapidity.

2013-02-16 When It Comes to Gold, Stick to the Facts by Frank Holmes of U.S. Global Investors

During short-term gold corrections, its much more important to focus on the facts, including the fact that gold is increasingly viewed as a currency. Rather than buying real estate, lumber or diamonds, central banks around the world are buying gold. According to the World Gold Council (WGC), over 2012, central bank demand totaled 534 tons, a level we have not seen in nearly 50 years.

2013-02-16 The Squeeze: Reassessing the Japan/Korea/China Manufacturing Nexus by John Longhurst of PIMCO

If the yen settles between 95 and 100 to the dollar, it could be a game changer for Japanese companies which have restructured to become profitable at 75 yen to the dollar. Some Korean companies, especially those in heavy industry, may be squeezed by intensified Japanese and Chinese competition. We expect Korean firms to fish in profit pools in businesses related to their core competencies, chiefly to the detriment of Asian and European competitors.

2013-02-16 Euro Relief: The Epic Fail That Wasnt by Team of Franklin Templeton

What a difference a year makes! Early in 2012, the eurozone appeared to be on life support and market prognosticators were busy weighing the odds of a breakup. At the time, the proposition that European stocks would actually post a positive performance for the year seemed almost absurd, but of course thats just the sort of fertile environment value-hunters such as Philippe Brugere-Trelat like. Brugere-Trelat found select opportunities in Europe that were ripe for the picking. While the debt crisis in Europe is far from over, he thinks the picture looks brighter for Europe this year.

2013-02-16 Weekly Economic Commentary by Carl Tannenbaum of Northern Trust

The recent energy dividend is not likely to last. Crafting a single monetary policy for Europe is challenging.

2013-02-15 Latest OECD Data Shows Global Economy in State of Flux by Steve Rumsey of Optimus Advisory Group

According to the OECD ("Organisation for Economic Co-operation and Development"), the US economy managed to stage a leading indicator "rally" into the most favorable northeast quadrant. The red six month lagging tail on the graph clearly shows the economic leading indicators moving from expansion to slowdown, only to move back to the expansion quadrant in late 2012.

2013-02-15 International Equity Commentary January 2013 by Team of Thomas White International

International equity prices sustained the uptrend in January, helped by data releases that supported the growing optimism over healthier global economic growth. Though the U.S. and U.K. economies declined unexpectedly during the fourth quarter of last year, the pace of growth improved in several Asian countries, including China, during the period.

2013-02-15 All is Not Well Down Under by Russ Koesterich of iShares Blog

Though Russ continues to like Australian equities for the longer term, he explains why he may downgrade his near-term view of the Australian market soon.

2013-02-15 Thailand: Land of the Smiles by Mark Mobius of Franklin Templeton Investments

China and India may be Asia's largest economies, but they aren't the only countries with growth potential on the continent. Southeast Asian countries can also offer compelling investment opportunities. Thailand, known as the land of the smiles because of the expression its natural beauty and friendly people inspire, is a country where we believe the economic prospects could give investors reasons to smile too.

2013-02-15 Hyperinflations, Hysteria, and False Memories by James Montier of GMO

In the past, Ive admitted to macroeconomics being one of my dark, guilty pleasures. To some value investors this seems like heresy, as Marty Whitman1 once wrote, Graham and Dodd view macro factors...as crucial to the analysis of a corporate security. Value investors, however, believe that macro factors are irrelevant. I am clearly a Graham and Doddite on this measure (and most others as well).

2013-02-14 Is Inflation Around the Next Corner? Then What? by Pete Sorrentino of Huntington Funds

As the Federal Reserve Board reiterates its intention to keep interest rates near zero into 2015, it appears that the markets and many investors are growing complacent about inflation. Ever since the Financial Crisis of 2007-08, "headline inflation," as measured by the Consumer Price Index (CPI), has stayed low so far. Although it has threatened to break out at times, economic weakness has restrained the price growth that underlies inflation.

2013-02-14 Pacific Basin Market Overview January 2013 by Team of Nomura Asset Management

Improving expectations for global economic growth underpinned a solid start to 2013 for the Asia Pacific equity markets. In Asia, interest focused on China, as economic data showed further signs of recovery. On the other hand, the depreciating Japanese yen drew concerns that Asia's main exporters, which include Korea and Taiwan, will become relatively less competitive. The MSCI AC Asia Pacific Free Index including Japan gained 3.0% while the MSCI AC Asia Pacific ex Japan Free Index closed 2.6% higher during the month.

2013-02-14 When Politics Trump Economics by Scott Minerd of Guggenheim Partners

The U.S. economic expansion continues, but increasing attention to political risks, and currency wars, in particular, indicate a period of heightened volatility could be ahead.

2013-02-14 A Bold New Direction for Japan\'s Economy by Team of Knowledge @ Wharton

Newly elected Prime Minister Shinzo Abe wants to take Japan's economy in a daring new direction to end 20 years of stagnation and deflation. His policies resemble past efforts -- but with far more firepower behind them. That means even looser monetary policies and a sharp rise in government spending to boost demand. Some analysts say it's just the medicine Japan needs and, on the spending side at least, the opposite of what Europe and the U.S. are doing.

2013-02-14 Quarterly Commentary by Robert Sanborn of Sanborn Kilcollin Partners

In the macro sense, 2012 was the ultimate "kick the can"/"keep the lid on" year. The US elections validated the status quo, as prediction markets such as Intrade indicated they would throughout the entire year. In Europe, the most important event of the year was ECB head Mario Draghi's July statement that the ECB would do "whatever it takes" to keep the Euro-zone together, and the second half of the year was relatively quiet on that front.

2013-02-14 Emerging Markets Consolidate After Last Year's Gains by Team of Thomas White International

After the strong relative performance towards the end of last year, emerging market equities settled with moderate gains during the month of January as global investor sentiment remained optimistic. Global economic data continue to be mostly positive, sustaining the trend from the second half of last year.

2013-02-13 Concerned by Recent Economic Data? Look Closer by Marco Pirondini of Pioneer Investments

We've seen a lot of GDP data recently that, at first look, may seem a bit concerning. But if we take a moment for analysis, much of the news is actually good for the economy and the markets.

2013-02-13 Global Economic Overview January 2013 by Team of Thomas White International

Global economic trends continued the moderate positive momentum from earlier months and helped sustain investor sentiment in January. The unexpected decline in U.S. economic output for the fourth quarter of last year was mostly due to a sharp fall in government spending and a smaller inventory buildup, while consumer and business spending exceeded forecasts. Also, recent data suggest that U.S. labor market gains during last year were better than earlier estimates.

2013-02-13 Weekly Market Review Notes by Team of Tuttle Tactical Management

After a decent selloff earlier in the month the market has continued to move up, but in very small increments. Most people seem convinced that we are due for another selloff, which seems to be tempering upside enthusiasm. On the other hand, there also doesn't seem to be any enthusiasm to sell.

2013-02-12 The Milton Friedman Centenary: One Hundred Years of Surprisingly Little Solitude by Laurence B. Siegel (Article)

Milton Friedman was once a lonely voice for capitalism in a collectivist era, and seemed doomed to a hundred years of solitude. Instead, he arguably became the preeminent public intellectual of the hundred years that followed his 1912 birth.

2013-02-12 Consumers Less Enthused to Bail Out the Economy by Chris Maxey, Ryan Davis of Fortigent

Following recent recessions, it was commonplace to rely on American consumers to bail out the economy. The reliance on the American consumer was widely understood as the best remedy for an ailing economy. We are not as fortunate this time around and our dependence on consumers is one reason for the sluggish rate of recovery since 2008.

2013-02-12 Iran's Blues by Bill O'Grady of Confluence Investment Management

When the last U.S. troops officially left Iraq on December 17, 2011, it seemed Iran was the big winner. Iraq was being ruled by a Shiite coalition. Its military was weak and no longer a threat to Iran. Along with its ally in Syria and its proxy Hezbollah in Lebanon, there was growing talk of a "Shiite Arc" that ran from Iran to the Mediterranean Sea. Although Western sanctions were in place, Iran had become adept in working around them.

2013-02-12 Sticking to a Long-Term Plan The Folly of a Short-Term Focus by John Buckingham of AFAM

It was an up and down week, though it managed to end in the black for just about all of the major market averages, save for the Dow Jones Industrial Average. Of course, the big headline on CNBC.com after Friday’s close was, "Dow Logs First Weekly Loss in 2013." That’s fine by us, as we were happy with the 0.5% or so gains posted for the week across our four newsletter portfolios!

2013-02-12 Macroeconomic Risk? That's So 2012 by Tom West of Columbia Management

Fourth quarter earnings are modestly beating expectations, albeit by less than the amount expectations were lowered during the quarter. And while every sector and industry is different, the market seemed to give companies (even with their cautious outlook for 2013) the benefit of the doubt they can manage through a tough demand environment. This may be based on a general belief that the risk of extreme events is dropping.

2013-02-12 Currency Wars? What Currency Wars? by Christian Thwaites of Sentinel Investments

There's much talk of currency wars right now. We think they're way overblown. The source of the problem lies with Japan, which has made explicit a strategy to lower the yen, increase domestic demand and increase inflation. It needs to do all three. The twenty year old balance sheet recession and deflation in Japan has been a costly error in targeting inflation and not much else.

2013-02-12 Is Love in the Air? by Jerry Wagner of Flexible Plan Investments

This week includes Valentine's Day, the day millions worldwide exchange cards, letters, candy, flowers and other gifts with the center of their affection. Surely there must be a study of Valentine's Day. But search as I might, I could not find a single study of the influence of this fabled day on our financial markets. I did find one in Australia that dared to show that the chances for an up or down day in their stock market were, what else, 50-50. Could it truly be that we had finally found a seasonal event that was dare I say it random?

2013-02-11 Stocks: Why "Risk On" Rules by Milton Ezrati of Lord Abbett

Investors appear to believe the equity market will muddle through its many challenges.

2013-02-11 There the Bears Go Again by Brian Wesbury, Bob Stein of First Trust Advisors

The S&P 500 is up 6% since the start of the year and 12% from a year ago. On cue, the bears have started to claim this run-up in stocks is just plain crazy, based on unreasonable euphoria or "it's just technical." It cant possibly last because "the fundamentals are bad."

2013-02-11 And That's the Week That Was by Ron Brounes of Brounes & Associates

With folks in the Northeast finally returning to normalcy following Superstorm Sandy's impact in October, a "potentially historic" blizzard threatened the region with predicted disruptions to businesses, schools, travel, etc. Though New England is expected to catch the brunt of the damage, forecasters are calling for up to 20 inches of snow in New York City. For now, NYSE Euronext does not anticipate anything but "business as usual" at the NY Stock Exchange as contingency plans are well in place.

2013-02-11 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Earnings continued to roll in which combined with higher dividends in many cases continued to support stock prices.

2013-02-08 High-Yield Bonds: Tackling the Tough Questions by Ivan Rudolph-Shabinsky of AllianceBernstein

With high-yield bonds at record high prices and interest rates so low they're barely visible in some parts, investors have a lot of anxious questions. Our opinion: we think high-yield bonds still offer more income and fare better in rising rate environments than other bond types.

2013-02-08 The Year in Review: 2012 by Richard Bernstein of Richard Bernstein Advisors

Politicians crave the spotlight, but it is unfortunate that investors watch the show. 2012, like 2011, was another year in which Washington theatrics scared investors. As a result, investors largely missed out on above average equity returns. Corporate profits and valuations, and not Washington, continue to be the primary drivers of equity returns. We think there are several important points to consider when reviewing 2012 performance, and when structuring portfolios for 2013.

2013-02-08 World War C: Neosho Capital On The Currency War by Chris Richey of Neosho Capital

This summer, Brad Pitt will star in a new film called "World War Z", an action-horror film about a post-zombie apocalypse Earth, hence the "Z" in the title. Zombie films are not our cup of tea at Neosho (we thought the genre was dead), so it is debatable whether we will see this film, but one thing is clear to us, we are perched on the precipice of "World War C", where "C" stands for "currency".

2013-02-08 Unconventional Policies and Capital Flows by Ben Emons of PIMCO

Although quantitative easing has grabbed the headlines, a number of central banks around the world have enacted other extraordinary measures in attempts to manage their economies. The Swiss National Bank (SNB), for example, adopted an exchange rate peg versus the euro while increasing its foreign exchange reserves to almost 80% of Swiss GDP.

2013-02-08 A More Savvy Insurance Market by Tarik Jaleel of Matthews Asia

During my last visit to Hong Kong, I attended a conference to discuss various opportunities in financial services along with industry experts and executives from both Asian and global institutions. The key theme that emerged from the event was how Asia is typically viewed as the world's primary growth market in this important sector, particularly given the slowdown in Europe and the regulatory environment in the U.S.

2013-02-08 A Different Playbook by Equity Investment Team of Janus Capital Group

Asia's handset market is developing quite differently than in Europe or the U.S., creating an entirely different playing field for Apple and other handset makers. Major brands are being challenged by the rise of cheap, but very capable generic smartphones. If major brands cannot innovate above and beyond the new offerings of these emerging cheap smartphones, they will not be able to command the high prices, and corresponding high profit margins, that have underpinned their success.

2013-02-08 Weekly Economic Commentary by Team of Northern Trust

Immigration reform would help the US economy at many levels. There is much going on with the US labor force participation rate. Will leadership change usher in a new era at the Bank of Japan?

2013-02-08 Out With the Dragon In With the Snake by Frank Holmes of U.S. Global Investors

Over 2013, we expect the Chinese government to continue its accommodative efforts, which should reinforce the equity rally. In addition, the new pyramid of power is focused on growth, as it seeks to improve and reform policies that will provide its residents with opportunities and social security, increase incomes and raise standards of living, which should encourage domestic consumption. Growth is set to be considerable over the next several years.

2013-02-07 Commodities: Correlating Trends with Opportunities by Mark Mobius of Franklin Templeton Investments

Commodity price inflation is both a social and an economic issue. In emerging markets in particular, food and energy costs take a deeper slice out of consumers' income, which can lead to the type of unrest that causes governments to topple. In addition to the potential impact of extreme weather on food supplies, central banks around the world are printing a flood of money, which could lead to inflated prices for other goods and services.

2013-02-07 Echoes of 2004 by Scott Minerd of Guggenheim Partners

Rising equities and tightening credit spreads define the near-term investment outlook, but this is not the first time we have seen this cycle play out in recent memory.

2013-02-07 From QE to Queasy: Fiscal Policy and the Risk of Inflation by Jason Hsu of Research Affiliates

Quantitative easing does not directly cause inflation. Rather, by enabling the government to issue low-cost debt, it fosters undisciplined spending, says Jason Hsu, CIO of Research Affiliates, LLC in this commentary. This spending, in turn, generates inflation, transferring wealth from future taxpayers to the current generation. Hsu argues that Americans are more likely to follow the European model of insufficient saving than to imitate the Japanese practices of private sector belt-tightening, high savings rates, and international lending.

2013-02-07 Investing in a Low-Growth World by Jeremy Grantham of GMO

This quarter I will review any new data that has come out on the topic of likely lower GDP growth. Then I will consider any investment implications that might come with lower GDP growth: counter intuitively, we find that investment returns are likely to be more or less unchanged a little lower only if lower growth brings with it less instability, hence less risk. Finally I will take a look at the reaction to last quarter's letter, specifically about my outlook for lower GDP growth.

2013-02-07 We Have Met the Enemy, and He Is Us by Ben Inker of GMO

If modern portfolio management has a single defining urge, it is almost certainly diversification. We look for diversifying assets, strategies, and managers. A thoughtful investor can argue against almost any asset class stocks, bonds, hedge funds, private equity, commodities, you name it but arguing against diversification is like arguing against indoor plumbing. I dont want to sound like I'm calling for a return to chamber pots and outhouses, so I'm not actually going to argue against diversification.

2013-02-06 The Job Market Data and the Fed by Scott Brown of Raymond James

Nonfarm payrolls fell by 2.8 million in January before seasonal adjustment, that is. Adjusted, payrolls advanced 157,000, about as expected. However, annual benchmark revisions showed a more rapid pace of job growth over the last two years a pace at odds with the Household Survey data. How might the Fed view the range of job market data?

2013-02-06 Focus on Fixed Income by Steve Van Order of Calvert Investment Management

Last week Administration officials, including the President, clearly ruled out using extraordinary legal measures to avoid defaulting on Treasurys financial obligations in the absence of a debt ceiling hike by Congress. The two legal measures most discussed, going back to the summer 2011, were invoking the 14th Amendment and minting a trillion dollar platinum coin. The coin idea was dismissed as Fed officials commented that the central bank would not honor the coin as a deposit, and the amendment idea has been shelved a number of times.

2013-02-06 GDP Report Tanks - Is A Recession Looming? by Gary Halbert of Halbert Wealth Management

We will cover a lot of ground today. We begin with a new report from Goldman Sachs which argues that the US economy will remain the strongest in the world for many more years. The report rebuts claims that America is a nation in decline. Quite the contrary, say Goldman analysts who claim that there is a growing"awarenessof the key economic, institutional, human capital and geopolitical advantages the U.S. enjoys over other economies."

2013-02-06 Market Commentary by Matthew Tuttle of Tuttle Tactical Management

The long awaited sell off finally came this week as the market suffered its worst day since November. The decline seems to have somewhat solved the overbought situation as the market rallied back the next day.

2013-02-06 The Good, the Bad, and the Greek (Risks) by John Mauldin of Millennium Wave Advisors

Greece is a small country with large implications. Last week we began to explore what I learned from my recent trip to Greece. In this week's letter we will finish those observations and in particular look at some of the comments from my meetings with over 40 people: owners of small businesses and large ones, billionaires, taxi drivers, politicians, central bankers, investors, ex-patriots, wives, and mothers. I believe we can arrive at some small understanding of the problems Greece faces. Then we will consider the broader consequences for Europe.

2013-02-06 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Earnings have come in pretty well, but the news on the economy remains dreary despite the cheerleaders in the financial media.

2013-02-05 How Much Should the US Spend on Healthcare? by Michael Edesess (Article)

How much of GDP should be devoted to healthcare? And how high should the government-provided safety net be? Only after those questions are answered can the issue of how to change government policy be addressed – if indeed it needs to be changed at all.

2013-02-05 Why Cash Kills by Charles Lieberman (Article)

Many investors remain in cash, earning nothing, out of fear that the rally in the stock market may be unsustainable or that such issues as the fiscal impasse or Europe's fiscal problems may yet start another meltdown. But while they remain focused on potential adverse developments, they suffer from the near zero interest rate they are earning on cash. Even in today's low inflation environment, such investors are experiencing a persistent erosion in the purchasing power of their capital, which will impair their ability to grow their portfolios in the future.

2013-02-05 Australia in the Asian Century by Team of Thomas White International

Early in 2011, The Economist magazine ran a cover story titled 'The Next Golden State.' The title, incidentally, referred to Australia. Today, Australias citizens enjoy some of the highest standards of living anywhere in the world. With a real income of $62,000 per person in 2012, the country ranked 13th worldwide. Five of the ten best livable cities in the world are in Australia. But, for all its advantages, the country's contribution to the world economy in absolute terms is small. It accounted for just over 1 percent of world GDP in 2011.

2013-02-05 In Uncertain Environment, Jobs Grow Tepidly by Chris Maxey, Ryan Davis of Fortigent

For the 35th consecutive month, private payrolls registered positive growth. It was hardly the robust report economists would prefer, but the labor market continues to mend. However, there are still plenty of reasons to be concerned, especially with sequestration on the horizon.

2013-02-05 2012 Equity Market Market Year in Review by Natalie Trunow of Calvert Investment Management

Equities started the year strong as global inflation remained tame, and aggressive, accommodative monetary policy by central banks around the globe helped equity markets rally hard off their lows posted in the fall of 2011. Continuously improving U.S. economic data, strong corporate earnings, and policy steps toward mitigation of the sovereign debt crisis in Europe also provided support for the equity markets worldwide.

2013-02-05 Fourth Quarter 2012 Equity Market Review by Natalie Trunow of Calvert Investment Management

With the excitement of the QE3 announcement wearing off in the fourth quarter, market participants refocused on the less-than-stellar earnings season in the U.S. and uncertainties surrounding the U.S. presidential election and impending fiscal cliff, while the negative impact of Hurricane Sandy further dampened investor sentiment. Despite a double-dip recession in the eurozone, there was some progress on the European policy front and China's economy continued to show signs of stabilizing, which helped international stocks outperform their U.S. counterparts.

2013-02-05 Eurozone: Divorce, Italian Style? by Milton Ezrati of Lord Abbett

The upcoming election may determine whether Italy continues its austerity and reform programs. The fate of the currency union may hang in the balance.

2013-02-05 Currency War or Something Altogether Different? by Niels Jensen, Nick Rees,Tricia Ward of Absolute Return Partners

"Who is afraid of currency wars?" asks Gavyn Davies in the FT. I have known Gavyn for 25 years and have to confess that he is way out of my league intellectually. He is one of the smartest people I have ever met and, thankfully, also one of the humblest. He rarely gets things wrong so, when I occasionally disagree with him, it always makes me slightly uneasy.

2013-02-05 Ditto by Howard Marks of Oaktree Capital Management

Anyone who reads my memos of the last 23 years will see I return often to a few topics. This is due to the frequency with which themes tend to recur in the investment world. Humans often fail to learn. They forget the lessons of history, repeat patterns of behavior and make the same mistakes. As a result, certain themes arise over and over. Mark Twain had it right: "History doesn't repeat itself, but it does rhyme." The details of the events may vary greatly from occurrence to occurrence, but the themes giving rise to the events tend not to change.

2013-02-04 A Gross Underestimate by Jonathan Coleman, Soonyong Park of Janus Capital Group

As we enter 2013, we felt it would be an appropriate time to revisit one of last years most controversial predictions of future equity performance. We acknowledge that equities in general may not continue to deliver the same real rate of return they have over the last century; however, we believe the glum outlook for the asset class forecasted by Bill Gross last year misses the mark. Our estimates of future equity returnsbased on three different approachesall point to a meaningfully higher forecast than Gross' pessimistic prediction.

2013-02-04 2013 Annual Forecast by Clyde Kendzierski of Financial Solutions Group

It's that time again. January will be over by the time you read this which means we are out of holiday excuses or "just ramping up for the new year" reasons for not getting back to work. Having said that, I'd like to offer my excuse for the Annual Forecast getting to you in February instead of the first week of the year. Hand over my heart, we started early this go-round.

2013-02-04 Shifting Sentiment? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

Is investor sentiment shifting in favor of equities, which could help to continue the recent rally?

2013-02-01 Q412 Portfolio Commentary by Jay Compson of Absolute Investment Advisers

While much of the fundamental picture has played out as we expected over the past 18-24 months, the financial markets appear to be concerned solely with the existence or non-existence of macro headlines and events. There seems to be a disconnect between market movements and fundamentals which means doing real work based on intellectual honesty and logic puts you at a disadvantage. Chasing momentum and profiting from central bank market manipulation appear to be the current winning strategies.

2013-02-01 Crystallization at Davos by Scott Minerd of Guggenheim Partners

The euphoria among my fellow Davos attendees was palpable, but short and long-term risks for the world's advanced economies, including competitive currency devaluation, remain concerning.

2013-02-01 The Lost Decade...Found? by Jeffrey Bronchick of Cove Street Capital

While much of the fundamental picture has played out as we expected over the past 18-24 months, the financial markets appear to be concerned solely with the existence or non-existence of macro headlines and events. There seems to be a disconnect between market movements and fundamentals which means doing real work based on intellectual honesty and logic puts you at a disadvantage. Chasing momentum and profiting from central bank market manipulation appear to be the current winning strategies.

2013-02-01 Moving the Hurdles by Scott Brown of Raymond James

The ink of my weekly piece was not even dry last Friday, when the House announced that it would vote on a three-month delay in the debt ceiling showdown. Congress now has until May 19 to raise the debt ceiling. So, the most dangerous hurdle has been moved down the track. Other hurdles remain in place.

2013-02-01 Monthly Investment Bulletin by Team of Bedlam Asset Management

Financial discipline is collapsing and with it, trust in the value of money. Many heavyweight thinkers in America, such as Nobel laureate Paul Krugman have suggested that a solution to avoid national debt ceilings imposed by Congress would be to mint a trillion dollar platinum coin. Meanwhile, heavyweights close to policy makers in Britain and Japan have been musing whether their central banks should write-off the mountains of government bonds they have bought recently.

2013-02-01 2013 Economic & Capital Market Outlook by Gregory Hahn of Winthrop Capital Management

It took our country 229 years to accumulate $8 trillion in federal debt. It only took the next eight years to double it to $16 trillion. History shows that when a country accumulates debt at this rapid pace, economic growth languishes. Not surprisingly, Congress is pursuing policies that attempt to inflate the economy. Five years after the Financial Crisis, we really havent fixed much. Instead, we've issued more debt in order to pay our bills and sustain a quality of life society cannot afford long term.

2013-02-01 The Biggest Loser by Peter Schiff of Euro Pacific Capital

For the past few generations Switzerland has enjoyed some of the strongest economic fundamentals in the world. The country boasts a high savings rate, low taxes, strong exports, low debt-to-GDP, balanced government budgets, and prior to a few years ago one of the most responsible monetary policies in the world. These attributes made the Swiss franc one of the world's "safe haven" currencies. But in today's global economy, no good deed goes unpunished.

2013-02-01 Dow To 14,000 and Beyond? by Frank Holmes of U.S. Global Investors

So will the Dow go beyond 14,000? Although you cant predict how hot the weather will be this summer, the clouds appear to be parting to reveal the sun today. Make sure your asset allocation positions your portfolio to shine.

2013-02-01 Weekly Economic Commentary by Team of Northern Trust

Is the world engaged in a currency war? Januarys job report had some pleasant surprises, but more progress is needed. Purchasing managers surveys suggest growth in the US, retreat for Europe

2013-02-01 A Gross Underestimate by Jonathan Coleman and Soonyong Park of Janus Capital Group

The glum outlook for the asset class forecasted by Bill Gross last year misses the mark. Our estimates of future equity returnsbased on three different approachesall point to a meaningfully higher forecast than Gross pessimistic prediction.

2013-02-01 Look at the Bears! Look at the Bears! by Christine Hurtsellers, Matt Toms and Mike Mata of ING Investment Management

Yes, the grumbling of bond bears is reverberating in Treasury yields, but that sound isnt the death knell of a grizzly; at this point, the closest ursine analogue is Boo-Boo Bear.

2013-01-31 Stability Still Matters as Investors Embrace Risk Again by Kent Hargis of AllianceBernstein

After years of chasing safety at all costs, investors are now reaching for opportunities in long-spurned riskier stocks. But they will still want to safeguard their portfolios against painful market swings in the future.

2013-01-31 Making Sense of Low Volatility Investing by Feifei Li of Research Affiliates

Why do low volatility stocks outperform riskier ones over time? Dr. Feifei Li, our Head of Research and my long-time collaborator, has focused on understanding the theoretical foundation underpinning the low volatility anomaly and documenting the strategy's risk-return characteristics in developed and emerging markets. In this issue of Simply Stated, our newsletter focusing on investor education, she summarizes the literature on the low volatility effect as well as provides additional insights from her own research based on an expanded global data set.

2013-01-31 Q4 2012 Letter by Team of Grey Owl Capital Management

During the second half of 2012, central banks turned their massive and coordinated monetary intervention "up to eleven." This is the overwhelmingly dominant economic and market force today. Despite the long-term consequences (which are very real), we believe the central bankers commitment is steadfast. It has and will likely continue to mute both real economic and financial market volatility (at the expense of long-term growth). A deeper analysis of what has changed, our assessment of the impact, and our portfolio response follows.

2013-01-31 Hasenstab: Little Value in U.S. Treasuries Right Now by Team of Franklin Templeton Investments

The financial markets may have let out a collective sigh of relief on January 1 when U.S. politicians managed to avoid falling off the fiscal cliff, but the fact is the fundamental issue plaguing the U.S. still hasn't been addressed mounting debt. As a result, Dr. Michael Hasenstab, co-director of the International Bond Department and portfolio manager for the Templeton Global Bond Fund, says he doesn't see much value in U.S. Treasuries right now. He does see it elsewhere in the world, though, including Ireland and select emerging markets where fiscal houses appear in much better order.

2013-01-31 A Look Back at My 2012 Calls by Russ Koesterich of iShares Blog

It's time again for Russ K's annual look back at the investment calls he made in 2012. Find out what he got right and the couple of things he got wrong.

2013-01-31 Signs of a Solid 2013 for Stocks by Milton Ezrati of Lord Abbett

Yield spreads versus bonds indicate that stock valuations have considerable upside.

2013-01-30 The Complicated Case of Mali by Bill O'Grady of Confluence Investment Management

On January 11, 2013, French President Francois Hollande announced the French military was intervening in Mali at the request of the government. The Mali military was reeling in the face of jihadist rebels from the north who were making rapid inroads toward the south. Although the U.N. Security Council had authorized an African-led military intervention in Mali to contain the rebels, it had been ineffective. Thus, France "piggybacked" off that resolution to justify its intervention.

2013-01-30 EU Financial Tax Portends Loss of Market Leadership by John Browne of Euro Pacific Capital

Although it was barely noticed by the American press, on January 22nd, EU finance ministers approved a new "Financial Transactions Tax" (FTT) that has implications for market competitiveness around the world.

2013-01-30 Fiscal Cliff: Making Decisions in Crisis Part I by Brian Singer of William Blair

Having lost touch with mainstream America, neither the Republican nor the Democratic Party enjoys much governing ability. Second, politicians struggle to function as leaders, regardless of competence, as a result of party disengagement. Third, left to their own devices, politicians will respond to their individual incentives. Bringing these observations together, neither party platform nor leadership vision will provide as much guiding force as the incentives of each politician, sometimes individually and other times in coalition.

2013-01-30 Weekly Market Commentary by Matthew Tuttle of Tuttle Tactical Management

The market continued to "melt up" this week. Everybody is expecting some sort of correction, but just like every time there is a consensus on something it never tends to happen. It is hard to envision the market having a massive continuation of this rally without some pullback, but we could easily continue to inch up for a while.

2013-01-30 Expanding Horizons: The Most Difficult Environment for Generating Income in 140 Years by Ehren Stanhope, Travis Fairchild of O'Shaughnessy Asset Management

In the most difficult environment for generating income in 140 years, we survey the landscape of income-generating options, review lessons from the previous bond Bear Market, and demonstrate why we believe global, dividend-paying equities deserve a prominent role in investor portfolios.

2013-01-29 And That's the Week That Was by Ron Brounes of Brounes & Associates

The trend is your friend...so hopefully it will continue for a little (lot) longer. With the uncertainty of the fiscal cliff on the backburner (for now), investors seem to like what they are seeing from earnings season and in the economy. They continued to take stocks higher as the S&P 500 settled above 1500 for the first time in five years and is currently riding a eight session winning streak.

2013-01-29 Emerging Europe: Regional Economic Review 4Q 2012 by Team of Thomas White International

As the 2012 year closed, the emerging economies of Europe joined their cousins in the developed world for their share of woes, and in particular, were impacted by the debt crisis in the Euro-zone, their primary trading partners. Though Russia, the biggest of these economies, finally managed to become a member of the World Trade Organization, the resource-dependent economy recorded slowing growth during the third quarter as both household consumption and state spending expanded at a slower pace.

2013-01-29 Q4 2012 Market Commentary by Team of Altegris Advisors

With the end of a historically challenging year for alternative investment strategies, signs emerge of a potentially more favorable environment.

2013-01-29 How Much Help from Housing? by Alan Levenson of T. Rowe Price

We expect the ongoing recovery in new housing construction from unsustainably low levels to contribute roughly percentage point to real GDP growth this year, and emphasize the risks to the upside of this forecast. Imminent employment growth in housing-related industries will provide an important channel for secondary "multiplier" effects of the housing recovery. Applying recent house price increases to the entire stock of owner-occupied housing overstates their likely wealth effect on consumer spending.

2013-01-29 What Budget Problems? by Christian Thwaites of Sentinel Investments

"Vickers falls on fear of peace." There's an apocryphal story of how on the day after D-Day, the stock of Vickers, a large defense contractor, abruptly fell. I can't find the source but it was a good story going around the City some, ahem, 30 years ago. Last week there was not a lot of price action in bonds until Friday when economic upticks replaced budgets as the main driver. We saw a one point correction in treasuries. The market is right to push budget concerns into the background for now.

2013-01-29 China's Last Soft Landing? by Stephen Roach of Project Syndicate

On the surface, the Chinese economy's resilience has been impressive the first to recover, as Chinese leaders always want to remind the rest of the world. But, beneath the surface, the economy risks losing its capacity for resilience unless the authorities accelerate the transition to a more consumer-led economy.

2013-01-28 UK Threat to Exit EU: Much Ado About Nothing by Darren Williams of AllianceBernstein

In a speech last week, British Prime Minister David Cameron raised the possibility that the UK might push the nuclear button and leave the European Union. We think both the threat and consequences of such a move have been exaggerated. The most striking aspect of Mr Camerons much-postponed speech on Europe last week was his promise to hold a referendum on the UKs membership of the European Union (EU) by the end of 2017. Such a vote, he said, would follow a new settlement to hand powers back to national governments.

2013-01-28 Capitulation Everywhere by John Hussman of Hussman Funds

The bears are gone, extinct, vanished. Among the ones remaining, many are people whom even I would consider to be either permabears or nut-cases. And yet, the historical evidence for major defensiveness has rarely been stronger.

2013-01-28 Economic Insights: Signs of a Solid 2013 for Stocks by Milton Ezrati of Lord Abbett

Yield spreads versus bonds indicate that stock valuations have considerable upside. Earlier in this recovery, when earnings were growing very strongly, consensus concerns about equities cited the danger of an earnings slowdown. Those expressing this concern pointed out, that such a slowdown would occur inevitably as the recovery matured, especially with economic growth proceeding at such a subpar rate. What seems to have escaped notice is that the slowdown already occurred in 2012 and that the stock market offered good returns despite it.

2013-01-28 Conflicted Objectives by Charles Lieberman (Article)

Policymakers in the U.S., Europe, Japan, and elsewhere all seek to weaken their currencies to stimulate exports and domestic growth. It is not possible for all of them to succeed, since some currencies must rise in value, if others decline. Although their individual objectives may be in conflict, their efforts are actually mutually supportive. As each country runs an accommodative monetary policy to weaken its currency, they are also simultaneously promoting stronger domestic growth directly. Indirectly, they are also stimulating demand for their trading partners.

2013-01-28 Is the Fed Doing the Right Thing? by Mark Oelschlager of Oak Associates Funds

After a strong 2012, the stock market is off to a good start in 2013, rising more than 5% so far in January and currently riding an eight-day winning streak (the longest since 2004). Encouraging economic data has a lot to do with this. Unemployment claims are at a 5-year low, home sales and prices are up, and consumer credit and retail sales are growing. Research firm ISI says that the current level of unemployment claims is consistent with 4% real GDP growth for the first quarter, which would be an acceleration from the sluggish growth of recent years.

2013-01-25 Americas: Regional Economic Review 4Q 2012 by Team of Thomas White International

The outlook for most economies in the Americas region improved during the fourth quarter as domestic consumption growth was sustained and the anticipated revival in global demand has lifted the prospects for export growth this year. Partly helped by fiscal and monetary policy measures introduced since 2011, consumer demand has held up across most countries in the region.

2013-01-25 Pension Liabilities Time to Get Real by Christian Stracke of PIMCO

Creeping pension liabilities are an increasing concern for credit investors. Companies should provide more granular information on both sides of their pension balance sheets, as well as use more realistic assumptions. A few companies have improved their disclosures in recent years, but in general the information available to investors is still far from what we need.

2013-01-25 Cliff Dwellers by Stephen Taddie of Stellar Capital Management

In the ensuing days and weeks there will be plenty of opinions about what passed and what will continue to be negotiated in the drama known as the fiscal cliff. The spectacle of across-aisle dealings makes for a well rated "Reality" show (Fiscal Riff?), but poor ratings for both effectiveness and efficiency in governance. With US-centric issues in the forefront, the focus has been taken off the ongoing Euro Zone talks, which continue to plod along.

2013-01-25 Opine Less, Think More by Francois Sicart of Tocqueville Asset Management

In his latest piece, Francois Sicart, Founder and Chairman of Tocqueville Asset Management, looks at investing from a broad perspective and goes over in detail some of the macro themes he is examining as he tries to help the reader make sense of what 2013 will bring. He discusses potential "black swans" that he has his eye on, the bounceback of American and European stock markets, the sometimes overlooked lack of a correlation between economic growth and stock market performance, what P/E ratios tell us both historically and in the present, and where valuations can go from here.

2013-01-25 Prisoner of the Bureaucracy by John Mauldin of Millennium Wave Advisors

I wrote some time ago that Greece had a choice between Disaster A: staying in the euro; and Disaster B: leaving the euro. I have recently come back from four days in Greece, meeting with lots of people at all levels of society, and will share with you in this letter my analysis of their choices and the results. I'll also have a few things to say about what the developments in Greece might mean for the rest of Europe and the developed world.

2013-01-25 Resource Investors: Why You Can Expect Sunnier Days Ahead by Frank Holmes of U.S. Global Investors

During the current commodity supercycle, there have been occasionstoo many to countwhen investor psyche has been damaged by reports about slowing U.S. growth, a hard landing in China or a debt crisis in Europe. Yet just behind the gloom, significant and positive trends are taking hold, causing the storms to start dissipating.

2013-01-24 German Gold Claw Back Causes Concern by John Browne of Euro Pacific Capital

Last week the Bundesbank (the German central bank) surprised markets around the world by announcing that it will repatriate a sizable portion of its gold bullion reserves held in France and the United States. To many, the news from the world's second largest holder of gold signaled a growing, if clandestine, mistrust among central banks, possibly fueled by diverging policy goals. The Germans have attempted to tamp down the alarm by highlighting the myriad of logistical, practical and historical reasons that qualified the announcement as unremarkable.

2013-01-24 Beggar Thy Currency Or Thy Self? by Mohamed El-Erian of Project Syndicate

One need not be an economist to figure out that, while all currencies can depreciate against something else (like gold, land, and other real assets), by definition they cannot all depreciate against each other. Yet, when push comes to shove, country after country is being dragged into a negative dynamic of competitive depreciation.

2013-01-24 Quick Takes on the Investing Year Ahead by Sam Wardwell of Pioneer Investments

We covered a lot of market and investment topics at Pioneer's National Sales and Marketing Meeting last week. Here are some notes on a few that were popular: GDP Growth for the U.S.. Expectations for rates: Fed Funds Rate and the 10-year Treasury, EM equities favored over U.S. Equities?, Things that keep us up at night (outside of the debt ceiling, Europe, and Middle East tension.

2013-01-24 Emerging Asia Pacific: Regional Economic Review 4Q 2012 by Team of Thomas White International

Emerging Asia Pacific economies showed strong signals of a rebound in economic activity amidst generally rising exports and stabilizing inflation. While some major economies like China, which had cut interest rates throughout 2012 to stimulate the economy, saw a mild resurgence in inflation, many countries like South Korea, Taiwan, Malaysia and Philippines saw inflation stabilize significantly during the quarter. Still, India, the region's second largest economy, continued to be troubled by rising prices despite high interest rates.

2013-01-24 Get Your Funk Out by Jim Goff of Janus Capital Group

I manage investment professionals for a living. When an analyst gives me the positives on one hand and the negatives on the other hand, but offers no conclusion, I want to cut one of those hands off. The best analysts understand all the issues but come to well-founded views.

2013-01-23 Dissipating Gloom by Charles Lieberman (Article)

Investor confidence seems to be returning, as the economic outlook improves and policy concerns are addressed. The tone of media coverage and strategy commentaries has improved considerably. Nonetheless, investors are not positioned for a more optimistic view. Hedge funds and other professional money managers remain underexposed to equities and retail investors are dreadfully light in equities and badly overweight bonds. Stocks will enjoy a very nice tailwind as these portfolios are rebalanced to reflect the more positive view.

2013-01-23 Economic Backdrop Supports Stocks, Credit Sectors and Munis by Russ Koesterich of BlackRock Investment Management

Thanks to solid earnings, some decent (if mixed) economic news and indications that the debt ceiling debate may be delayed slightly, stocks posted additional gains last week, continuing their strong start to 2013. For the week, the Dow Jones industrial average climbed 1.2% to 13,649, the S&P 500 index advanced 1.0% to 1,485 and the NASDAQ composite rose 0.3% to 3,134. Bonds have remained relatively steady, with the 10-year Us treasury closing the week at a yield of 1.84%, two one-hundredths lower than the previous Friday close.

2013-01-23 The Year of the American Consumer by Philip Tasho of TAMRO Capital

It was an above-average year for stock returns across the domestic market cap spectrum. Ultimately, unconventional and accommodative monetary policy trumped investor concerns over fiscal policy, the Presidential election and weakness overseas. The Federal Reserve (the Fed) entered uncharted waters when it announced open-ended quantitative easing through the ongoing purchasing of government securities. Importantly, other central banks globally waded in by mimicking the Fed in word if not deed and the global liquidity cycle continued apace.

2013-01-23 Is the European Crisis Over? by Chris Maxey, Ryan Davis of Fortigent

The European sovereign debt crisis that first erupted in 2010 and stoked almost three years of intense market volatility has all but faded from the front pages. Overshadowed by domestic policy issues and European Central Bank (ECB) President Mario Draghi's pledge to do "whatever it takes" to save the Eurozone, fears that the monetary union would crumble and unleash a maelstrom of financial distress appear to have dissipated.

2013-01-23 PIMCO's Secular Forum Preview by Mohamed El-Erian of PIMCO

It is almost time again for PIMCO's Secular Forum a critical part of the firm's investment process. This annual event, which takes place each May, brings together our investment professionals from around the world to debate and specify the key themes that we believe will affect the global economy and, consequently, our investment strategies over the next three to five years from asset allocation and relative value positioning to returns expectations and risk management.

2013-01-23 Avoid Disappointment, Aim Low by Christian Thwaites of Sentinel Investments

No, it's not a life aspiration. But it can work when it comes to investing. We had a rush of gains coming into the end of the year with the S&P up 22% over the year. But it's also one of the more relaxed markets and start we've had in years. The political agenda is still front and clear and we're in a lull until the debt ceiling arguments gain steam. The markets know this but seem comfortably complacent. They're probably right to be.

2013-01-23 The Washington Hurdles by Scott Brown of Raymond James

While President Obama is now beginning his second term, the new Congress isn't expected to "get down to business" until next month. There are three hurdles for Washington, which are likely to have significant implications for the financial markets.

2013-01-23 Developed Asia Pacific: Regional Economic Review - 4Q 2012 by Team of Thomas White International

Developed Asia Pacific economies witnessed mixed economic fortunes during the fourth quarter of 2012. While the group's largest economy, Japan, suffered from stubborn deflation and slumping trade due to a bitter territorial dispute with China, Singapore and Hong Kong managed to fare better.

2013-01-22 Wally Weitz on Value Investing in the Post-Crisis Era by Robert Huebscher (Article)

As the president and founder of Weitz Funds, Wally Weitz has spent nearly three decades putting his instinct for opportunity to work for shareholders. Influenced by the value-investing model of Benjamin Graham and Warren Buffett, Wally manages the Partners III Opportunity Fund (WPOPX), which has had an annual return of 10.85%, versus 6.23% for the S&P 500. In this interview, he discusses his investment methodology and how it has evolved since the financial crisis.

2013-01-22 Shoulder Pads and Supply Chains by Mariko Gordon (Article)

As an investor, it's essential that you keep your eyes on the ever-swinging pendulum of "best practices," whether these relate to business models, client service, or something else entirely. Here's an example of a company whose "80s style" approach to vendor relations keeps it ahead of the profitability pack in the 21st century.

2013-01-22 2013 Investment Outlook by Jeremy Boynton of Laureate Wealth Management

I would like to focus this commentary on three trends which I believe will have a larger positive impact on the US economy going forward than the broader investment community expects.

2013-01-22 And That's The Week That Was by Ron Brounes of Brounes & Associates

Tragedy in Algeria brought another reminder about just how dangerous the world can be. Oil prices rose on the enhanced turmoil in the region as well as on news that supplies unexpectedly dropped in the recent gov report. Financials led earnings season in a mostly positive way, though several releases included reminders about the financial crisis and the greed factor of certain professionals. The favorable economic data was well received as S&P 500 index again hit a five-year high though even the optimists remain cautious as the budget negotiations yield little positive results.

2013-01-22 The Economic Fundamentals of 2013 by Nouriel Roubini of Project Syndicate

The global economy this year will exhibit some similarities with conditions prevailing in 2012 no surprise there. But there will be some important differences, as fiscal austerity spreads to more advanced economies, the risk of a hard landing in China rises, and the threat of war in the Middle East grows.

2013-01-22 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company

2012 was a year of mixed results on the economic front, but generally good investment returns as measured by the S&P 500 Index. Some progress was made in Europe and China, and some clarification in direction was made in the U.S. We presented our thoughts on these topics at our December 6 seminar; an archive will be available on our website.

2013-01-22 Equities Set to Break Out of the Bear Trap by Catherine Wood of AllianceBernstein

In the face of significant uncertainties, US and global equities rallied in 2012 and at the start of the New Year. We think there might be more to come as stocks break out of the bear trap.

2013-01-22 Ten for '13 by Investment Strategy Group of Neuberger Berman

Last year, despite the noise surrounding the U.S. elections and the ongoing European debt crisis, the main drivers of asset prices arguably were the large-scale bond-buying programs put in place by global central banks to alleviate systemic pressures. In 2013, we anticipate fewer aggressive central bank actions as the pace of global growth gradually picks up. We believe the largest influential factors to our outlook are premature fiscal tightening in the U.S. and a potential resurgence of eurozone problems.

2013-01-22 Puppet Show by John Hussman of Hussman Funds

What's fascinating is that in the presence of what are not thin strings, but massive cables supporting the economy like a puppet, the only response that Wall Street can muster is "Hey! He's walking!" as if the puppet is capable of motion without being propped up to a nearly reckless extent.

2013-01-22 Latin America: Europe's Pillar of Strength by Team of Thomas White International

European firms are shaking off pressure at home through various business transactions in Latin America.

2013-01-22 Keep Your Eye On The Ball - 2012 Year End Letter by Team of Sloan Wealth Management

The members of the Portfolio Management Team at Sloan Wealth Management (SWM) coach two baseball teams, two soccer teams, one T-ball team and one basketball team for our collective young children. Thus, we find ourselves stressing the basics. Learning the fundamentals of how to catch a pop-up will eliminate some of the fear of getting hit in the face. In 2012, we found many parallels to the capital markets as our portfolios posted high double digit returns in the face of fear.

2013-01-22 Year-End Investment Commentary by Team of Litman Gregory

Stocks shrugged off numerous worries to log a very good year in 2012, but can markets continue to climb? Certainly the worries remain. The most immediate has to do with the spending side of the fiscal cliff. The cliff deal made permanent the Bush tax cuts for all but high-income taxpayers but it did not address spending. So while the worst case of the cliff was avoided, the work is not nearly done. In this commentary we discuss our current assessment of the investment environment including a detailed look at what could go right, and tie it all back to our portfolio positioning.

2013-01-22 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Last week saw the markets continue to trade off of concerns over Apple, and just what might happen in Washington DC concerning the debt limit negotiations. Earnings season will hit high gear this week.

2013-01-19 France and the UK Could Be the Lynchpins of Europe by John Browne of Euro Pacific Capital

While the problems of Europe appear to be contained, under the surface the problems are getting more dire by the day.

2013-01-18 Is the Euro "Dangerously High"? by Darren Williams of AllianceBernstein

Jean-Claude Juncker's view that the euro is "dangerously high" isn't shared by the European Central Bank (ECB). As long as this is the case, the single currency may continue to defy fundamentals and act as an unwelcome headwind for an economy still struggling to break out of recession.

2013-01-18 Middle East/Africa: Regional Economic Review 4Q 2012 by Team of Thomas White International

According to the International Monetary Fund's Regional Economic Outlook report, countries in the Middle East and North Africa region are expected to grow at different rates. Oil exporting nations are cashing in on high energy prices and production, and are projected to expand 6.6 percent in 2012 before tempering in 2013. On the other hand, oil importers such as Jordan, Morocco and Tunisia among others are expected to clock growth just over 2 percent as the slowdown in the world economy and political tensions continue to hinder expansion for some of these countries in transition.

2013-01-18 2013 International Outlook by Colin Moore of Columbia Management

We continue our outlook for 2013 with a review of select international economies and financial markets. Similar to the U.S. the road to recovery will be bumpy and we expect financial markets to continue being affected by macroeconomic uncertainties. While the overall environment remains uncertain, some of the significant headwinds in 2012, e.g. the Chinese leadership transition and a complete disintegration of the eurozone, are perhaps less concerning for markets than they were a year ago.

2013-01-18 Quarterly Review and Outlook by Van Hoisington, Lacy Hunt of Hoisington Investment Management

The American Taxpayer Relief Act has lifted the immediate uncertainty of the fiscal cliff. Nevertheless, tax increases that are already in effect from this act, as well as the Affordable Care Act, impose a major obstacle to growth for the U.S. economy in the first half of 2013. The result of these taxes is considerable, especially in light of the poor trend in household income. In addition, these tax increases will continue to act as a drag on economic growth until late in 2015 and are unlikely to produce the revenue gains advertised.

2013-01-18 Equity Investment Outlook January 2013 by Team of Osterweis Capital Management

Despite many headwinds and amid great uncertainty, both the U.S. economy and stock market enjoyed a rather good year in 2012. Real Gross Domestic Product ("GDP") grew around 2%, and the stock market, as measured by the S&P 500 Index, returned 16%. At the risk of sounding complacent, we believe that the fundamental trends that produced such favorable results in 2012 are still in place and should support another good year in 2013.

2013-01-18 Are Central Banks Easing Off Prematurely? by Team of Northern Trust

Are central banks easing off prematurely? Washington is girding for another budget imbroglio; Inflation is contained, for now.

2013-01-18 4 Sensational Facts About Gold Investing That You Might Not Know by Frank Holmes of U.S. Global Investors

1. Gold has been a consistent performer over the decades. 2. Gold should remain a hot commodity in 2013. 3. Gold is the least volatile commodity on the table. 4. The last four years were better than you thought.

2013-01-18 Fixed Income Investment Outlook by Team of Osterweis Capital Management

We continue to feel that the mismatch between yield and interest rate exposure means that investment grade bonds are less attractive compared with the non-investment grade universe, especially in shorter maturities. Treasury, investment grade corporate and high yield bonds have yields and effective durations that are virtually unchanged compared to levels three months ago. Yields on short-dated high yield paper have actually risen a bit and are still, in our opinion, the most attractive sector we look at in terms of interest rate risk.

2013-01-18 Will This Risk-On Period Last? by Daniel Loewy and Brian Brugman of AllianceBernstein

The odds of the market staying in risk-on, risk-off mode are lower than they were a few months ago, in our viewbut still too high to take a highly aggressive stance.

2013-01-17 International Equity Commentary December 2012 by Team of Thomas White International

International equity prices made robust gains in December, as further improvement in economic trends across most regions lifted the outlook for 2013. Policymakers in the U.S. managed to put together an agreement at the last minute and averted the 'fiscal cliff', one of the major risks that had restricted investor sentiment during earlier months. In Europe, though economic signals remain largely weak, the further fall in bond yields of the troubled countries has helped sustain optimism about resolving the region's fiscal crisis this year.

2013-01-17 Signs of a Rotation by Scott Minerd of Guggenheim Partners

As yields continue to dwindle and risks in the fixed income market come into clearer focus, investors have begun to regard equities as a compelling alternative to bonds.

2013-01-17 The Year Past, The Year Ahead by Michael Gomez of PIMCO

The multiyear run of performance by emerging market (EM) sovereign external debt has been remarkable but residual valuations look either just fair (investment grade) or expensive (high yield) versus other comparable credits. We still see abundant opportunities in EM local markets, while EM equities are poised to benefit from a relatively low starting point for both earnings and earnings expectations.

2013-01-17 Investing in Africa: Misconceptions and Realities by Mark Mobius of Franklin Templeton Investments

It's easy to fall prey to misconceptions and generalizations about places we've never been: to assume everyone in the United States drives big cars, all the French love croissants and all Canadians play hockey. There are many misconceptions about investing in developing markets, and Africa certainly has its fair share, but it's dangerous to make sweeping generalizations.

2013-01-17 End of An Era: 30 Years of Double-Digit Chinese Growth by Bryce Fegley of Saturna Capital

Slumping exports, lackluster domestic consumption, and slowing urban migration contribute to lower growth expectations for China. With Chinese manufacturing capacity now saturated relative to global demand, and developed economies facing the consequences of over-indebtedness, external tailwinds to China's growth have passed.

2013-01-16 Global Economic Overview - December 2012 by Team of Thomas White International

The global economic outlook brightened further in December, as economic data from most regions indicated sustained, though moderate, improvement in both domestic and external demand. Europe showed further signs of stabilization in the financial markets, as bond yields of the most troubled countries continued to decline in response to the earlier assurance by the European Central Bank (ECB) to buy unlimited quantities of sovereign bonds.

2013-01-16 Haka Politics and the Slow Crawl by Christian Thwaites of Sentinel Investments

In the last few months we have seen the rise of Haka politics. Familiar to any All Blacks fan, this is the ritualistic Maori war dance, full of noise, bluster and theater. But it rarely intimidates and most opponents sit it out with some amusement. So it is with the political interventions last year. We saw countless announcements and intentions from EU leaders and solemn pledges with little follow-through. And in the US we had a soporific election and a squalid squabble over the fiscal cliff that caught the public but not the market's attention.

2013-01-16 3 Reasons the Stock Market Rally Could Falter by Russ Koesterich of iShares Blog

Enjoy the US stock market rally while it lasts. Russ Koesterich has three reasons why investors should remain cautious in the near term.

2013-01-16 UK Economic Quagmire Adds Pressure for Monetary Policy Change by Darren Williams of AllianceBernstein

Bank of England governor-elect, Mark Carney, has raised hopes that the central bank may soon switch to a nominal GDP target. In our view, the costs outweigh the benefits, but the attractions of a radical new approach will grow if the economy remains stuck in the doldrums.

2013-01-15 Gundlach’s Predictions for 2013 by Robert Huebscher (Article)

Don't expect the low volatility that characterized the capital markets in 2012 to continue. Global economic uncertainty remains, and markets are poised like a 'coiled snake' to reward or penalize investors in certain asset classes, according to Jeffrey Gundlach.

2013-01-15 Template for a Year-End Client Letter 2012 in Review: Learning from the Past, Looking to the Future by Dan Richards (Article)

Client concerns about whether you're on top of things can be reduced by sending regular overviews of what's happened in the immediate past and the outlook for the period ahead. That's why each year since 2008, I have posted templates to serve as a starting point for advisors looking to send clients an overview of the year that just ended and the outlook for the period ahead.

2013-01-15 Land of the Rising Dead by Christian Thwaites of Sentinel Investments

Yes, you knew we were going to talk about Japan. It's all the rage and the big standout in market performance in the last few weeks. Since November the broad Nikkei-225 average has risen 24% because there's new thinking in town. It's hard to describe Japan's 20 year malaise. Once proud companies shaken, the shattering of a property market and total collapse of stocks. Even if the market rises at the same level of the last few months, it will take six years to re-reach its peak. A more reasonable 10% growth rate will take 14 years. Weird things happen when economies enter deflation.

2013-01-15 Forecast 2013: Unsustainability and Transition by John Mauldin of Millennium Wave Advisors

As we begin a new year, we again indulge ourselves in the annual rite of forecasting the year ahead. This year I want to look out a little further than just one year in order to think about the changes that are soon going to be forced on the developed world. We are all going to have to make a very agile adaptation to a new economic environment (and it is one that I will welcome). The transition will offer both crisis and loss for those mired in the current system, which must evolve or perish, and opportunity for those who can see the necessity for change and take advantage of the evolution.

2013-01-15 Are Investors Buying into the Equity Story? by Chris Maxey, Ryan Davis of Fortigent

Last week we discussed the debate over active versus passive management. We believe active managers can add tremendous value in particular segments of the market, despite recent challenges. Outside of the active management discussion, many investors are deciding whether equities are a prudent place to allocate capital at this point in the market cycle. The first week of the year answered investors' opinions on that question loud and clear.

2013-01-15 Japan: Tip of the Spear by Bill O'Grady of Confluence Investment Management

On Sunday, December 16, 2012, Shinzo Abe, the leader of the Liberal Democratic Party (LDP), led his coalition to a decisive electoral victory in Japan. The LDP won 294 out of 480 seats and, with the additional 29 seats captured by its coalition partner, the New Komeito Party, will control the lower house in the Japanese Diet. Abe was named the new prime minister ten days later.

2013-01-15 New Year's Vantage Point: Christopher Molumphy by Christopher Molumphy of Franklin Templeton Investments

For a view on the U.S. and global fixed income market and potential opportunities therein, we turn to Christopher Molumphy, CFA, chief investment officer of Franklin Templeton Fixed Income Group.

2013-01-15 The Year Past, The Year Ahead by Michael Gomez of PIMCO

While not immune to global economic headwinds, emerging market investments remain well positioned to outperform their developed world counterparts over time. The multiyear run of performance by emerging market (EM) sovereign external debt has been remarkable but residual valuations look either just fair (investment grade) or expensive (high yield) versus other comparable credits. We still see abundant opportunities in EM local markets, while EM equities are poised to benefit from a relatively low starting point for both earnings and earnings expectations.

2013-01-15 Declaring Victory at Halftime by John Hussman of Hussman Funds

Present overvalued, overbought, overbullish, rising-yield conditions fall within a tiny percentage of market history that is associated with dismal market outcomes, on average. Its true that we've observed extreme conditions since about March 2012 with little resolution aside from short-term declines. But the S&P 500 remains only a few percent from its March 2012 high, and if history is any guide, the extension of these unfavorable conditions is not likely to reduce the depth of the market loss that can be expected to resolve them.

2013-01-15 What's Behind the Buyback Binge? by Milton Ezrati of Lord Abbett

The pace of stock repurchases says much about equity valuationsand companies' expectations for economic growth.

2013-01-15 Emerging Markets Equity Commentary: December 2012 by Team of Thomas White International

Emerging market equities outperformed during the month of December, helped by signs of further improvement in the economic growth outlook. Economic data released over the month were largely positive for most emerging countries, and strengthened the optimism that these markets could see a moderate improvement in growth rates during 2013.

2013-01-15 From Cliff to Ceiling! by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

When it was all said and done not much happened in the final quarter of 2012. Anxiety picked up immediately after the election as the bickering over the fiscal cliff escalated. In the end, the worst-case scenario was avoided at least for a couple of months and stocks ended about where they began the quarter.

2013-01-14 And That's the Week That Was by Ron Brounes of Brounes & Associates

Finally, a week not totally dominated by "fiscal cliff" discussions (though politicos now have their hands full with a gun control debate...what are the chances of compromise there?). Alcoa kicked off earnings season as usual and the early results lend credence to the thought that China will again be relied upon to lead any global recovery. Major banks announced major settlements as they continued to try to close the (negative) books on the financial crisis. Oil rose on Saudi production cuts.

2013-01-14 The More Things Change... by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

One crisis averted...another one on the way? Of course, but we're still positive on the US economy and stock market.

2013-01-14 Bond Market Review & Outlook by Thomas Fahey of Loomis Sayles

The final quarter of 2012 was the icing on the cake of an exceptional year for the credit sectors. Fourth quarter credit gains stemmed in part from uncommonly aggressive monetary policy responses in the third quarter. As economic growth continued to undershoot expectations, major central banks made clear that they were dissatisfied with the status quo of tepid economic growth and high unemployment. The Federal Reserve went so far as to tie its monetary policy to the level of the unemployment rate.

2013-01-14 Equity Market Review & Outlook by Richard Skaggs of Loomis Sayles

While the S&P 500 Index posted a slightly negative fourth-quarter return, the Index's 16.0% return for all of 2012 was notable in the face of a long list of global fundamental concerns. Midcap and small cap stocks performed better during the final three months of the year, posting gains of roughly 2.0%-3.0%. The fourth quarter outperformance of smaller stocks was enough to overtake the S&P 500 for the year, but just fractionally.

2013-01-14 The 'Dark Continent' is Shining Bright by Team of Thomas White International

From a recipient of aid, Africa has transformed itself into a magnet attracting capital and investment.

2013-01-11 Thanks, Everybody...We'll be Right Back! by Colin Moore of Columbia Management

The Washington Comedy Club has taken a brief intermission and will be back in session shortly to resume the show. Please enjoy the facilities of this great country, free of charge, while you wait. Ignore the "Nero" character in the far corner playing the fiddle. Apparently, he isn't part of the show. Economic uncertainty emanating from fears of the U.S. fiscal cliff has been deferred but not avoided.

2013-01-11 2013 Leveraged Credit Report: High Yield and Bank Loans by Scott Minerd of Guggenheim Partners

Record high prices, historically low yields and gradually deteriorating fundamentals have tempered expectations for the leveraged credit market. Generating above-market returns in 2013 will require an even greater emphasis on fundamental credit analysis to unearth opportunities in attractively valued segments of the market, such as upper middle-market bank loans.

2013-01-11 New Year's Vantage Point: Norm Boersma by Norman Boersma of Franklin Templeton Investments

As we ring in a new year, it's a good time to gain some perspective on where we've been, and where we might be headed. Norm Boersma, CFA, chief investment officer of Templeton Global Equity Group, takes a look at the current headwinds facing the global equity markets, from fiscal imbalances to growth challengesand how market uncertainty can result in market mispricings.

2013-01-11 2 Reasons to Stick With Emerging Markets by Russ Koesterich of iShares Blog

Think emerging markets equities have run their course? Not so fast despite recent strong performance, Russ explains why there's room for further EM gains in 2013.

2013-01-11 Abe's Return May Prod Japan Forward by Kenichi Amaki of Matthews Asia

Japan's politics have entered 2013 with a mixed freshness. Former Prime Minister Shinzo Abe has clinched a rare second shot at the prime minister's post. His first term, which began in late 2006, lasted only about a year and ended with his sudden resignation. But following its landslide victory last month, his Liberal Democratic Party (LDP) has secured a two-thirds majority in the 480-seat Lower House, giving it the constitutional power to override Upper House opposition, where no single party holds a majority, on almost all issues.

2013-01-11 Winter Quarterly Commentary by John Prichard of Knightsbridge Asset Management

While a last minute compromise may have been reached on taxes, it represents only a brief rest stop on a required road of repair. On the positive side, we should see less annual wrangling with tax rates having been made permanent, meaning they will not automatically change at some future date (but rather only when Congress feels like changing them), with many areas also sensibly indexed for inflation.

2013-01-11 Fed Policy Update: Waiting for Clearer Criteria for Open-Ended Asset Purchases by Alan Levenson of T. Rowe Price

The FOMC's shift from dates to economic conditions as the basis for policy rate guidance clarified the criteria for beginning rate hikes. The criteria for ceasing open-ended asset purchases are not clear, and may reflect not only the evolution of the labor market recovery but also concerns about financial stability and the size of the Fed's balance sheet. We expect the Fed to try to clarify these criteria in the months ahead. Asset purchases will end a "considerable time" before policy rate hikes commence, and rate hikes will commence before asset sales.

2013-01-11 Pacific Basin Market Overview - December 2012 by Team of Nomura Asset Management

Equity markets ended the year on an upbeat note, shrugging off concerns over the impending "fiscal cliff" while focusing on better economic data from the U.S. and China. In Japan, expectations of a higher inflation target and a depreciating yen brought some overseas investors back to the Tokyo stock market. The MSCI AC Asia Pacific Free Index including Japan gained 5.6%, while the MSCI AC Asia Pacific ex Japan Free Index also closed 5.6% higher in the October-December quarter of 2012.

2013-01-11 Special Edition: The Outlook for 2013 by Team of Northern Trust

At this time of the year we typically get warm and generous wishes for the New Year and, of course, numerous questions about what our crystal ball has in store for 2013. While many economists publish their perspectives prior to January 1, we opted to wait in the hope of having a clear fiscal picture for the United States. A lot of good that did us...

2013-01-11 Invest In Equities: Your Future Self May Thank You by Frank Holmes of U.S. Global Investors

Investors have had an illusion about the stock market since the financial crisis. With the barrage of negative headlines and abhorrence toward risk, investors seemed to feel that equities would not improve going forward. This turned out to be a mistaken belief.

2013-01-10 Market Perspectives Q4 2012: Politics vs. Economics by Richard Michaud of New Frontier Advisors

The major news of the quarter was that a fiscal cliff deal passed in the final hours of the 112th Congress and was signed by President Obama. The deal averts tax increases on most Americans and prevents large indiscriminate cuts in spending in many government programs. It also averted, by nearly universal consensus among macroeconomists, tipping the American economy into recession with attendant global implications.

2013-01-10 Chuck Royce on Q4 2012: Quality Rising by Chuck Royce of The Royce Funds

Do you think the market's strength in the year's second half marks the beginning of a more historically normal period for equities? I do. Of course, we've been calling for a more typical market environment for a while now, so our recent forecasting has been less than stellar. However, the market's second-half results were telling. In the third quarter we saw many quality stocks keep pace with the small-cap market as a whole. Many of these businesses then went on to outpace the Russell 2000 in the fourth quarter, particularly in October, when the rally began to cool.

2013-01-10 A Brighter Picture for Jobs and the Economy by Scott Minerd of Guggenheim Partners

Promising fundamental developments suggest that U.S. economic expansion is likely to continue and equities will rise in the first quarter.

2013-01-10 A New Years Vantage Point: Michael Hasenstab by Michael Hasenstab of Franklin Templeton Investments

As we ring in a new year, it's a good time to gain some perspective on where we've been, and where we might be headed. In the first few weeks of January, Beyond Bulls & Bears will be featuring a series of investment commentaries from select Franklin Templeton investment management teams. These professionals provide their insights on the market ups and downs of 2012, and the potential challenges and opportunities that may lie ahead from their respective vantage points. Today we hear from Michael Hasenstab, portfolio manager and co-director of the International Bond Department.

2013-01-08 2012: Resumption of the Stock Market Recovery by Ronald Surz (Article)

Let's take a close look at the details of what occurred in 2012 so we can assess the opportunities and prepare for the surprises that 2013 will bring. I'll give you my opinions, and you should form your own.

2013-01-08 Energy and the End of Growth by Michael Edesess (Article)

Is economic growth coming to an end? That's been a hot topic of discussion, thanks to a paper by Robert J. Gordon. It had a simple but striking thesis: 'There was virtually no growth before 1750, and thus there is no guarantee that growth will continue indefinitely.' But before 1750 there were no fossil fuels either. Only once humans tapped the large deposits of coal and oil did economic growth truly awaken. The history of economic growth is, so far, the history of fossil fuels. This causes us to wonder whether economic growth will end when it is no longer powered by fossil fuels.

2013-01-08 The Forecast for Risk in 2013 by Geoff Considine (Article)

With the new year upon us, pundits are issuing their forecasts of market returns for 2013 and beyond. But returns don't occur in a vacuum – meeting clients' goals requires an asset allocation that appropriately balances return and risk. So what follows are my predictions for risk across major asset classes, based on a theoretically sound approach that has proven to be reliable in the past.

2013-01-08 Crystal Ball Gazing by Team of Bedlam Asset Management

Several recent government announcements are likely to impact the global economy and equity markets over the medium term. In order of importance these are: the Federal Open Market Committee pledge to target zero interest rates until unemployment reaches 6.5%; the new government in Japan, under an increasingly monetarist LDP leadership; commitments by the new Chinese leadership to boost domestic infrastructure and consumption; and finally, the softening line of the Republicans on the fiscal cliff.

2013-01-08 The Good Without The Awful by John Hussman of Hussman Funds

Generally speaking, the very best times to be long are when a market decline to reasonable or depressed valuations is followed by an early improvement in market internals (breadth, leadership, positive divergences, price-volume behavior, and so forth). This is a version of a general principle: bullish investors should look for uniformly positive trends to be coupled with an absence of particularly hostile features such as overvalued, overbought, overbullish conditions. Put simply, we are looking for the good without the awful.

2013-01-08 Brave New Start to the Year by Christian Thwaites of Sentinel Investments

Well that was fun. Negotiations went to the brink, we had politicians dropping the "F" bomb a few steps from the Oval Office, the Senate described as "sleep deprived octogenarians" by a congressman and an all around feeling that it was better than nothing. Welcome to the American Taxpayer Relief Act, which actually, er...raises taxes for everyone. That's right. No one in 2013 pays less than they paid in 2012. This is our best estimate of the fall out. It's definitely better than what was at risk back in November but it's still a net drag on the economy of around 1.0%.

2013-01-08 Why China Won't Crack by Milton Ezrati of Lord Abbett

For the world's second largest economy, a hard landing scenario looks increasingly remote.

2013-01-08 Another Lost Year for Active Management by Chris Maxey, Ryan Davis of Fortigent

There is no doubt that 2012 will be remembered by many investors, for reasons both good and otherwise. One group less likely to remember the good of 2012 is active managers. Across the universe of hedge funds and mutual funds, relatively few were able to outperform their comparative benchmarks. This continues a long running trend of active managers lagging their less active counterparts and raises many questions about the efficacy of active management.

2013-01-08 Surging EM Corporate Bond Issuance: Cause for Concern? by Shamaila Khan of AllianceBernstein

New bond issuance by emerging-market companies boomed in 2012, leading to fears of a bubble. But we think this market growth is positive for investors, rather than a harbinger of soaring debt levels or deteriorating credit quality.

2013-01-07 Fixed Income Asset Allocation Post-Apocalypse by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

December 21, 2012 the day the Earth was prophesized to collide with a black hole of kaputness has come and gone in defiance of the Mayan calendar. The more upbeat interpretation of the 5,125-year Mayan cycle, however, is that the end date doesn't signify Armageddon but rather the beginning of a new time for positive change here on earth. So allow us to suggest an investment playbook to cash in on this silver lining. In short, the sweetness of the metaphorical fortune cookie in your hand will depend on how you allocate your fixed income assets in 2013.

2013-01-07 Restricted Room for Higher Rates by Scott Minerd of Guggenheim Partners

Interest rates should rise through 2013, however, the level to which they can increase will be limited by the Federal Reserve's ongoing attempt to stimulate activity in the housing market.

2013-01-07 Germany and Eastern Europe: Lessons in Free Trade by Team of Thomas White International

Economies in east and central Europe are attracting huge foreign investments into the automobile sector.

2013-01-07 Investments That May Keep Me Up at Night in 2013 by Charles Lieberman (Article)

The outlook for 2013 is quite improved compared with 2012. Domestic economic growth prospects are significantly less troublesome. The election is over. Europe has (painfully) slowly made progress in reducing its own budget problems. It is not all clear sailing, however. (It never is.) Europe remains a work in progress. All of the geopolitical risks of 2012, notably North Korea, Iran, and all of the rest of the Middle East, remain on the docket in 2013. And the battle over the U.S. budget will resume in the near future.

2013-01-07 An Unconstrained Approach to Bond Market Investing by Sabrina Callin, Lisa Kim of PIMCO

Investors are increasingly focused on alternatives to traditional investment strategies. Unconstrained bond portfolio construction should be driven by an outcome-oriented goal, with strategies assessed on an individual risk/reward and correlation basis, and each investment in the portfolio evaluated rigorously for the expected risk and return as well as the potential impact of the correlation to other investments in the portfolio.

2013-01-06 And That's the Week That Was by Ron Brounes of Brounes & Associates

Welcome to a new beginning, a new yeara new optimistic investor, a new bipartisan Congress, (well, maybe not). The more things change, the more they stay the same. While investors embraced the budget deal (that is less of a deal than a procrastination), the pragmatists realize that very little has changed other than the "fiscal can" has been kicked down the road for two months. Stocks skyrocketed; bonds plunged; politicos bickered. Welcome to 2013.

2013-01-04 Ring in the New by Mark Mobius of Franklin Templeton Investments

The "year of the dragon" in 2012 certainly didnt disappoint, as the global markets battled one financial dragon after another. From the Eurozone's sovereign debt crisis to persistently high unemployment in the U.S. and a mayday call from many who worried that China's growth rate was headed for a "hard landing," 2012 certainly was interesting. As we turn the calendar page to 2013, the Eurozone seems to be in less-critical condition and China's economic growth still appears to be flying but as of this writing, the U.S. debt problems still haven't been solved.

2013-01-03 ProVise Bullets by Ray Ferrara of ProVise Management Group

HAPPY NEW YEAR EVERYONE!We don't know what you did on Monday night to ring in 2013, but the U.S. Senate was in session as they were attempting to avoid the so-called "fiscal cliff".At 2:07 a.m. on New Year's Day the Senate passed a bill, 89 to 8, which does a number of different things.Then late that same morning, the House also passed the bill.We are going to touch on a few of the highlights in this opening Bullet and promise to give a more detailed analysis in our mid-month Bullets.

2013-01-03 Money for Nothin' Writing Checks for Free by Bill Gross of PIMCO

It was Milton Friedman, not Ben Bernanke, who first made reference to dropping money from helicopters in order to prevent deflation. Bernanke's now famous "helicopter speech" in 2002, however, was no less enthusiastically supportive of the concept. In it, he boldly previewed the almost unimaginable policy solutions that would follow the black swan financial meltdown in 2008.

2013-01-03 A Year on the Brink by Joseph Stiglitz of Project Syndicate

The two main surprises in 2012 were the slowdown in emerging markets, which was slightly sharper and more widespread than anticipated, and Europe's embrace of some truly remarkable reforms though still far short of what is needed. Looking to 2013, the biggest global economic risks are there and in the US.

2013-01-03 And That's the Week That Was by Ron Brounes of Brounes & Associates

Welcome to the end of 2012. Investors are hardly basking in the glow of a positive year for stocks. They are less than enthusiastic about the recovery in housing. They seem to be overlooking the actions of the Fed and the implications for the indefinite low rate environment. Two words remain firmly entrenched in the minds. FISCAL CLIFF. What say you (besides bickering and backstabbing)Prez O, Speaker Boehner, Senators McConnell and Reid? Time is running out and five straight down days proves that investors are growing more and more nervous. Happy New Year (I think).

2013-01-03 Outlook 2013: Fiscal Cliff Remains Unresolved, but Opportunities Still Exist by Russ Koesterich of BlackRock Investment Management

As we look ahead to 2013, it is impossible to make any sort of forecast without first turning our attention to the still-unresolved fiscal cliff debate. We have long said that unless we were to see significant movement on the issues of tax rates and entitlement spending, the most likely outcome would be some sort of bare-bones deal. At the time of this writing, congress and the President were still negotiating, but our analysis suggests that such a bare-bones resolution remains the most probable result, even if it does not come before the January 1 deadline.

2013-01-03 High Yield Market Overview December 1, 2012 by Team of Nomura Asset Management

The high yield market, as measured by the Bank of America Merrill Lynch U.S. High Yield Master II Constrained Index, posted a positive total return of 0.74% in November, as high yield investors focused on the fiscal cliff and the risk that the U.S. government fails to negotiate a resolution.

2013-01-03 2013 Forecast: Good Economy, Challenged Markets by Douglas Cote, Karyn Cavanaugh of ING Investment Management

We enter 2013 bombarded by conflicting signals. While fundamentals have been mixed of late, longer-term themes our "tectonic shifts" like the energy revolution are gaining momentum and promising to make positive contributions sooner rather than later. And while salutary measures taken by policymakers have eased global risks and lessened fears of Armageddon, there is considerable work yet to be done.

2013-01-03 And That's the Quarter that Was by Ron Brounes of Brounes & Associates

Politics ruled the day over the past three months (and beyond) and unfortunately the trend may very well continue as the averted "fiscal cliff" was merely postponed for another two months. For now, investors are happy, but what will tomorrow bring? (That's a question for you, Prez Obama and Speaker Boehner.) Happy New Year

2013-01-03 5 Investment Ideas for a Post-Fiscal Cliff Deal World by Russ Koesterich of iShares Blog

As discussed in previous posts, Congress kicked off the New Year with a bare bones deal to avert (or at least delay) the fiscal cliff. Though markets responded positively to the news Wednesday morning, the euphoria isn't likely to last.

2013-01-02 Is Fracking a ‘Happy Solution’ to our Energy Needs? by Richard Vodra, JD, CFP (Article)

A few weeks ago, John Mauldin called fracking a 'happy solution' that will produce jobs, potentially solve our trade deficit and generate new tax revenue, though energy prices may rise in the process. But how excited should we be about the 'shale revolution'?

2013-01-02 Brian McMahon on Thornburg’s Investment Income Builder Fund by Robert Huebscher (Article)

Brian McMahon is the chief executive officer and chief investment officer for Thornburg Investment Management, where he the co-portfolio manager for the $11.4 billion Thornburg Investment Income Builder Fund (TIBAX). The fund's goal is income production, and it has outperformed its benchmark, the Morningstar Moderate Target Risk, over the last ten years (10.87% versus 2.88%). In this interview, he offers his views on the economy and the markets, and how he has positioned his fund.

2013-01-02 Somewhere Over the Rainbow by John Mauldin of Millennium Wave Advisors

We are 13 years into a secular bear market in the United States. The Nasdaq is still down 40% from its high, and the Dow and S&P 500 are essentially flat. European and Japanese equities have generally fared worse. The average secular bear market in the US has been about 11 years, with the shortest to date being four years and the longest 20. Are we at the beginning of a new bull market or another seven years of famine? What sorts of returns should we expect over the coming years from US equities?

2013-01-02 Fiscal Cliff vs. Jimmy Cliff: How the leap may look more like Y2K or the Mayan calendar by Rob Isbitts of Sungarden Investment Research

As "Cliff" makes his way from post-election debate to complete absurdity I did some research. As it turns out, many of the potential outcomes of the Fiscal Cliff in January are in sync with the titles of popular songs from this Reggae superstar Jimmy Cliff. No, I'm not a Reggae fan, but it was pretty funny when I looked it up and I think I can get some points across while writing something that will keep advisors into the holiday spiritbefore reality returns soon.

2012-12-31 Brief Holiday Update by John Hussman of Hussman Funds

Though our concerns still weigh heavily toward the defensive side, there are hints of progress toward the resolution of the lopsided market conditions we've seen.

2012-12-31 And That's the Week That Was by Ron Brounes of Brounes & Associates

Welcome to the end of 2012. Investors are hardly basking in the glow of a positive year for stocks. They are less than enthusiastic about the recovery in housing. They seem to be overlooking the actions of the Fed and the implications for the indefinite low rate environment. Two words remain firmly entrenched in the minds. FISCAL CLIFF. What say you (besides bickering and backstabbing)Prez O, Speaker Boehner, Senators McConnell and Reid? Time is running out and five straight down days proves that investors are growing more and more nervous. Happy New Year (I think).

2012-12-31 Armageddon? by Jeffrey Saut of Raymond James

So we wait for the alleged Armageddon for the second time in as many weeks. And as one smart money manager writes, "We should not forget that Congress has a magic eraser. No matter what they do, with a few strokes of a pen everything goes back to effectively January 1, 2013 and the Fiscal Cliff will take its place on the great wall of media creations (remember Y2K?)." Whether you call it Armageddon, or "orchestrated drama," there is nothing in my bag of tricks that suggests this is the beginning of a massive decline for stocks.

2012-12-28 The Year's Surprises in Gasoline, Oil and Resources Stock Prices by Frank Holmes of U.S. Global Investors

On Wednesday, I talked about three of the top 10 commentaries that were popular over 2012. Here are a few more to highlights.

2012-12-28 Shinzo Abe's Monetary-Policy Delusions by Stephen Roach of Project Syndicate

The politicization of central banking worldwide continues unabated. The resurrection of Shinzo Abe and Japan's Liberal Democratic Party pillars of the political system that has left the Japanese economy mired in two lost decades and counting is just the latest case in point.

2012-12-28 Don\'t Wait for the Robins: Investment Strategy for 2013 by Pamela Rosenau of HighTower Advisors

Warren Buffet once remarked, "If you wait for the robins, spring will be over." "Uncertainty" has been an overarching issue since the financial crisis of 2008 and one of the principal reasons that investors have remained on the sidelines away from the equity markets. As it has been a part of the investment lexicon, "uncertainty" will always exist in some capacity. In 2012, investors began by focusing on European issues, then the U.S. election, and now the fiscal cliff. In fact, when there is little uncertainty and investors appear unafraid, one should be more concerned.

2012-12-28 Readers' Golden Nuggets Focused on Gold, Resources and Overcoming Negativity by Frank Holmes of U.S. Global Investors

The past few days Ive been counting down the most popular commentaries over the past year. China, commodities and bond fund popularity were big hits; so were the Surprises in Gasoline, Oil and Resources Stock Prices. Here are the top four.

2012-12-27 The Ten Most-Read Articles in 2012 by Robert Huebscher (Article)

As is our custom, we conclude the year by reflecting on the 10 most-read articles over the past 12 months. In decreasing order, based on the number of unique readers, those are…

2012-12-26 Putting Clients' Cash to Work by Dan Richards (Article)

A central challenge advisors face are is clients who need mid- to high-single-digit returns to achieve their long-term goals, but who have an overweight position in cash. A recent luncheon with a group of highly successful advisors highlighted this challenge and illuminated a way to overcome it.

2012-12-26 Looking on the Bright Side by John Mauldin of Millennium Wave Advisors

It is Christmas Eve and not the time for long letters just a brief note on why the fiscal cliff is not the End of All Things, and to point out a worthy cause led by some good friends of mine who are helping people who truly have no options in life. And we'll start things off with a movie review of sorts to launch us into a positive take on the year behind and the year ahead.

2012-12-26 Assessing ISG's "Ten for '12" by Investment Strategy Group of Neuberger Berman

Earlier this year, we offered a forward-looking view of 10 macro themes that we anticipated for 2012. These ideas were meant not to be "surprises" but rather guideposts within the context of a longer-term strategic allocation. At year-end, we are pleased to note that seven of our 10 themes fully materialized. We provide a brief look below.

2012-12-26 Why China is a Reason for Optimism by Robert Horrocks of Matthews Asia

"China has taught me how to think about growth. Consider its stable political environment: it has gone from revolutionary upheaval to smooth (almost boring) transitions of power."

2012-12-24 And That's the Week That Was by Ron Brounes of Brounes & Associates

Down to the homestretch. While investors generally spend the last few days of the year window-dressing and setting positions for the next, this year they face the added uncertainties of the "fiscal cliff" and the negative implications for the economy. Though the data of the week seemed positive and reflective of "solid" (too strong?) growth, the budgetary matters and inability of our "best and brightest" to work together do not bode well. So much for Plan B. Perhaps a late year holiday gift is still in order?

2012-12-24 Emerging Markets Equity - Monthly Product Commentary: November 2012 by Team of Thomas White International

Sustained domestic demand growth and a revival in export demand are anticipated to drive expansion next year.

2012-12-21 Year-End Capital Markets Forecast by Jason Hsu of Research Affiliates

What looks best for 2013? Given financial repression in developed marketspolicies that prolong negative real interest ratesemerging market local currency sovereign bonds are likely to outperform their developed market counterparts. For equities, both developed (ex-U.S.) and emerging markets offer more attractive valuations and better dividend yields than U.S. stocks.

2012-12-21 The Barbarous Relic Expresses an Opinion by John Gilbert of GR-NEAM

Gold has a long and varied history in economics and finance. Otherwise sensible people lose rationality and logic when conversation turns to the subject, with some rising to passionate romance, and others to apoplexy. It elicits neither for us, which allows us an attempt at a reasoned view. That is more important today than usual, because there is a message in gold's price behavior, and it is not an encouraging one. That message is that not only are rates of return low at the moment, but they may remain there for some time.

2012-12-21 Light at the End of the Tunnel for Gold by Frank Holmes of U.S. Global Investors

Intuition was telling me something was going on these past few days in the gold market. Our investment team was watching gold and gold stocks take a tumble for no obvious reason. It wasnt only us who felt this way: many analysts were caught off-guard. One comment from Barclays Research indicated that the week was unusually brutal with quite a few confused participants with some seemingly positive aspects of the market not having an impact.

2012-12-20 2012 in Review by Investment Strategy Group of Neuberger Berman

As we approach the New Year and contemplate the opportunities the investment landscape may offer in 2013, it helps to look back at the performance trends of 2012. Overall, the year-to-date period has seen impressive results from various risk assets, which is in line with the projections of our Asset Allocation Committee. However, ongoing concerns about volatility and Europe hampered the markets at times. Here, we provide a performance scorecard and consider potential developments in the year ahead.

2012-12-20 Italy: The Impending Elections by Giordano Lombardo of Pioneer Investments

As Italy's technocratic party prepares to exit , I asked Cosimo Marasciulo, Pioneer's Head of European Government Bonds and Foreign Exchange, for his thoughts on pending elections in 2013 and how they might affect investors. I'll share a few of those thoughts with you here.

2012-12-19 PIMCO's Cyclical Outlook for Asia: Awaiting the Policy Breakthrough by Tomoya Masanao, Robert Mead, Ramin Toloui of PIMCO

Our base case for China includes incremental policy reform, but we also see an increased chance of a potential positive surprise on reform, resulting from the recent changes in leadership. Japan's new government will likely focus on reflating the structurally impaired economy, but policy effectiveness will remain questionable. Australia is being burdened by the unintended consequences of the policy responses of others, accompanied by the impending rebalancing of the Chinese economy.

2012-12-19 2013: A Year in Multi-Asset Investing by Johanna Kyrklund of Schroders Investment Management

Extreme political risk is reduced but the cyclical environment remains challenging. Safe havens are expensive and we are increasingly incentivized to take on more risk. Equity valuations are attractive. Our core emphasis remains on quality although there is tactical opportunity in pockets of extreme value.

2012-12-19 With German Growth Slowing, Time to Take Some Profits? by Russ Koesterich of iShares Blog

Overweighting Germany has made a great deal of sense this year, but now Russ gives 3 reasons why it may be time to take some profit and revert to a neutral position.

2012-12-19 PIMCO Cyclical Outlook for Europe: Policy Developments Will Shape Growth Prospects and Risks by Andrew Balls of PIMCO

Policy developments in particular, the European Central Banks acceptance of its role as a lender of last resort have helped to normalize European financial markets but been insufficient to promote decent growth. Eurozone leaders recently laid out a long-term roadmap to achieve stability, but the plan faces great execution risk, technically and politically, and in cross-border coordination. We continue to take a cautious approach and underweight European credit risk and European financials in general, looking for specific opportunities rather than broad exposure.

2012-12-19 ING Fixed Income Perspectives December 2012 by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

While all the good little boys and Cindy Lou Whos dream of sugar plums and new iPhone 5s in blue, the adults in our modern-day Christmas story can't sleep but a wink, as visions of getting Scrooge'd by the fiscal cliff are making hearts sink. No matter if this political humbug cease or persist, down the chimneys of a recuperating housing market Ol' Saint Bernanke-olas will continue to gift $85 billion of Treasury and MBS purchases per month or more until the labor market can finally get over the hump and deliver 6.5% unemployment and inflation of 2.5% and no more.

2012-12-19 The Consumer Catalyst in Asia's Emerging Markets by Andrew Sleeman of Franklin Templeton Investments

There may be no better evidence of the economic power of the consumer than the spending frenzy that occurs this time of yearthe sparkling lights, the must-have gifts and gadgets, the indulgent meals. Whether online, brick and mortar, big box or mom-and-pop, retailers count on the year-end consumer boom.

2012-12-18 Jeremy Siegel on 'Dow 15,000' by Robert Huebscher (Article)

Jeremy Siegel was one of very few individuals to have correctly predicted the strong performance of the equity markets over the last year. The Wharton professor and author of the renowned book, Stocks for the Long Run, forecasts continued strong performance for the year ahead.

2012-12-18 Pulling Back the Lens in Emerging Markets by Western Asset Management (Article)

Emerging markets remain resilient, according to Western Asset Portfolio Manager Rob Abad. But in the face of so much global uncertainty, investors would be wise to consider the latest trends and dynamics impacting this maturing asset class.

2012-12-18 The Case for Conservative Optimism by Clark M. Blackman II (Article)

Advisors should heed the wisdom from George Washington: Troubles pass. Tomorrow will be better. This kind of optimism is the key to finding success as an investor, as a businessperson, and in life.

2012-12-18 What's Going Right? by Chris Maxey, Ryan Davis of Fortigent

Discussions of the fiscal cliff are capturing investor's attention, largely at the expense of trends pointing in the right direction. Year-end is synonymous with future prognostications, but current indicators suggest there is reason to be optimistic about the turn of the calendar this holiday season.

2012-12-18 The Fed's Giant Stride by Christian Thwaites of Sentinel Investments

FOMC: The news from this meeting was widely telegraphed (see Yellen, Evans, etc. last month) but produced some real and welcome developments. Here's the quick summary.

2012-12-18 The 2013 Geopolitical Outlook by Bill O'Grady of Confluence Investment Management

As is our custom, in mid-December, we publish our geopolitical outlook for the coming year. This list is not designed to be exhaustive. As is often the case, a myriad of potential problems in the world could become issues in the coming year. The lineup listed below details, in our opinion, the issues most likely to have the greatest impact on the world. However, we do recognize the potential for surprises which we will discuss throughout the year in the weekly reports.

2012-12-18 Israel: Natural Gas Bonanza Buoys Economy by Team of Thomas White International

From being an energy-deficient nation, Israel is poised to become a leading gas exporter in the region in the years ahead.

2012-12-18 Energy Face-Off: North American Energy Independence vs. Canada's Export Plans by John Devir of PIMCO

President Obama's November 2011 postponement of a decision on whether to permit an oil pipeline from Canada's oil sands to the U.S. Gulf Coast caused a barrage of protests and negative press in Canada. Canada's new focus on building capacity to sell to Asia-Pacific could hinder U.S. ambitions of energy independence from overseas oil, since the U.S. imports roughly 30% of its crude oil from Canada. We see investor opportunities in rail transportation and pipeline systems that possess excess capacity.

2012-12-18 Central Bank Insurance by John Mauldin of Millennium Wave Advisors

Possibly, the question I am asked the most is, "What do you think about gold?" While I have written brief bits about the yellow metal, I cannot remember the last time I devoted a full e-letter to the subject of gold. Longtime readers know that I am a steady buyer of gold, but to my mind that is different from being bullish on gold. In this week's letter we will look at some recent research on gold and try to separate some of the myths surrounding gold from the rationale as to why you might want to own some of the "barbarous relic," as Keynes called it.

2012-12-17 Roach Motel Monetary Policy by John Hussman of Hussman Funds

Monetary policy has become a roach motel easy enough to get into, but impossible to exit.

2012-12-17 The Eurozone's Delayed Reckoning by Nouriel Roubini of Project Syndicate

The tail risks of a Greek exit from the eurozone or a massive loss of market access in Italy and Spain have been reduced for 2013. But the fundamental crisis of the eurozone has not been resolved, and another year of muddling through could revive these risks in a more virulent form in 2014 and beyond.

2012-12-17 2013: A Year in Global Emerging Markets by Allan Conway of Schroders Investment Management

We expect emerging market equities to deliver solid performance during 2013 and perform even better over the longer term. Emerging markets look extremely attractive in terms of valuations. We believe the Chinese economy has stabilised and will see a modest recovery next year and that tail risks in the developed world have been reduced for now by central bank policy.

2012-12-15 Looking Back to Look Ahead by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Markets have been more focused on short-term forces; not least being Washington and the fiscal cliff negotiations. But taking a step back and gaining some longer-term perspective can help investors better weather short-term volatility. Even beyond the fiscal cliff, Washington and fiscal policy will likely remain in focus next year. Monetary policy is also front-and-center with the Fed maintaining its extremely accommodative policy and targeting specific economic conditions instead of providing calendar guidance. Europe managed to make it through the year, but challenges and risks remain.

2012-12-15 The Cost of Viewing the US as a Safe Haven by Russ Koesterich of iShares Blog

Since exiting the recession in mid-2009, US stocks have significantly outperformed international markets. But can the United States still be viewed as a safe port in a storm? Russ K explains why it might be time for investors to consider raising their allocation to international stocks.

2012-12-15 A Face-Off Between Passive and Active Investing by Frank Holmes of U.S. Global Investors

Exchange-traded funds continued to attract assets in 2012 while money has been exiting mutual funds. Still a majority of assets continue to be invested in actively managed products: As of the end of 2011, of the nearly $13 trillion invested in funds, index and exchange-traded funds comprise only about 8 percent, according to the Investment Company Institute.

2012-12-14 2013: A Year in Global Equities by Virginie Maisonneuve of Schroders Investment Management

Global equities are very attractively valued and we are positive for their prospects in 2013 as the global economy normalises. Progress in Europe, the end of China's growth slowdown and continued momentum in the US economic recovery will support global equities. Longer-term investors must position themselves for a growth-saturated world in which sustainability and innovation will be even more important.

2012-12-14 FOMC Laying the Groundwork for an Exit Strategy? Investment Implications. by Paresh Upadhyaya of Pioneer Investments

Yesterday's FOMC meeting was a surprisingly eventful one that injected some volatility into financial markets. As expected, the Fed left its target rate of 0 - .25 percent unchanged and implemented more quantitative easing (QE). It announced additional monthly purchases of agency mortgage-backed securities of $40 billion per month and stated that "The Committee also will purchase longer-term Treasury securities after its program to extend the average maturity of its holdings of Treasury securities is completed at the end of the year at a pace of $45 billion per month."

2012-12-14 Fiscal Friction is Taking a Toll on Confidence in Washington and Rome by Carl Tannenbaum of Northern Trust

Fiscal friction is taking a toll on confidence in Washington and Rome. What inflation rate should be used to index entitlements? Our updated US forecast assumes a budget resolution before year end.

2012-12-13 FOMC: More of the Same on QE, But New Language to Guide It by Team of Northern Trust

The Fed's decision to increase the scope and size of the quantitative easing program following the two-day FOMC meeting was largely expected. Its choice of new wording to express its posture came sooner than expected.

2012-12-13 Decoupling From the Eurozone by Scott Minerd of Guggenheim Partners

Recent positive data releases from the U.S. and Asia seem to indicate that global investors should not expect to be severely affected by the ongoing problems in the eurozone.

2012-12-13 Will China's New Leaders Rise to Reform? by Mark Mobius of Franklin Templeton Investments

While the uncertainty wrought by the election process in democratic countries may be largely absent in China, the country's gradual transition to new leadership and the likely new course for the country over the next decade still raises questions. In March 2013, the National People's Congress, China's parliament and highest state body, intends to formally usher in China's leadership, and some members of the "old guard" are retiring. Will China's new leaders continue to reform the economy, moving it toward a domestic consumption model, and still be able to maintain enviable growth rates?

2012-12-13 2012 in Review by Investment Strategy Group of Neuberger Berman

As we approach the New Year and contemplate the opportunities the investment landscape may offer in 2013, it helps to look back at the performance trends of 2012. Overall, the year-to-date period has seen impressive results from various risk assets, which is in line with the projections of our Asset Allocation Committee. However, ongoing concerns about volatility and Europe hampered the markets at times. Here, we provide a performance scorecard and consider potential developments in the year ahead.

2012-12-13 The Fake Economy by Bill Mann of Motley Fool Funds

A random question for you (one that contemplates your breaking federal law, so be forewarned): Given enough time and ample resources, do you think you could create a reasonable facsimile of a $20 bill? I'd wager that given modern printing capabilities, a reasonably diligent and determined individual could create a fool-some-of-the-people copy of a $20 bill.

2012-12-13 3 Potential Scenarios for 2013 by Russ Koesterich of iShares Blog

Despite getting lucky in 2012, many of the major risks that economies and markets faced this year remain. With the current environment in mind, Russ K shares his 3 potential scenarios for 2013 along with potential investment strategies for each.

2012-12-13 Pacific Basin Market Overview - November 2012 by Team of Nomura Asset Management

Asian equity markets ended higher this month, although they were heavily influenced by events elsewhere. Improved economic data from Germany, coupled with expectations that Greece will receive a further round of financial support from the European Union (EU), helped to lift sentiment. Meanwhile, investors were paying close attention to the American congressional budget negotiations to avoid the looming year-end "fiscal cliff" risk to the economy, although U.S. economic data was generally positive.

2012-12-13 2013: A Year in Emerging Market Debt (Relative Strategies) by James Barrineau of Schroders Investment Management

Perhaps the biggest positive for emerging market debt investors is the deteriorating fiscal and economic fundamentals in the developed world. As the asset class has evolved, the opportunity set for investors has grown rapidly. Local currency in emerging markets has attracted tremendous interest but we think returns will moderate in 2013, possibly significantly.

2012-12-12 Low Volatility, Attention & Asset Growth by Matt Malgari of Knight Capital Group

Infused with the vicissitudes of quarreling politicians, growing mountains of debt and stagnant economies in much of the developed world, investors have been faced with a virtual bull market in "worry" and, oddly, an actual bull market in U.S. equities over the last couple of years. Chief among the beneficiaries of the newfound obsession with geometric returns appears to be "low-volatility" products which have begun showing up in force across the investment universe.

2012-12-11 Loomis Sayles' Matt Eagan on the Macro and Fixed Income Outlook by David Schawel, CFA (Article)

In this interview, Loomis Sayles' Matt Eagan discusses the fixed income universe, Fed policy and issues facing the global macro economy. Eagan is the co-manager, along with Dan Fuss, of the Loomis Sayles Bond Fund and he manages the Loomis Sayles Strategic Alpha Bond Fund.

2012-12-11 Fine Wine - Why it's for More than Just Drinking by Mark E. Ricardo, JD, LLM, AAMS (Article)

For many investors, an ideal asset class would combine superior long-term absolute and risk-adjusted returns with a hedge against inflation and stock market volatility. There's a way to get all of that, in an asset class you might never have thought of until now: fine wine. Investment-grade wine deserves careful consideration, particularly now that - unlike other collectibles, such as art and rare books - it can be traded on a regulated exchange.

2012-12-11 The Death of Managed Futures? by Chris Maxey, Ryan Davis of Fortigent

Managed futures strategies, or systematic trend followers, have long been an important component of diversified high net worth portfolios. Because of their ability to go both long and short in more than 100 global futures markets spanning equities, currencies, commodities, rates, and bonds managed futures have historically generated very uncorrelated performance to traditional investments.

2012-12-11 Tax Reform: A First Step by Clyde Kendzierski of Financial Solutions Group

I rarely use this space to rant about political issues, but the recent election made it obvious just how dysfunctional the American political process has become. The ongoing financial crisis in the US will never get fixed as long as both political parties remain focused on solutions that make the problem worse. The Democrats want to give people more money to spend, claiming this will grow the economy. The Republicans want to cut taxes, so that people have more to spend, claiming that will grow the economy

2012-12-11 Peak Oil or Peak Energy? A Happy Solution by John Mauldin of Millennium Wave Advisors

A consistent theme in this letter has been the connections between items that may seem to be far removed from each other but are actually linked at the very core. If you push on one end you get a reaction in what would seem to be the most unlikely spots. Today we explore the connection between the fiscal deficit and energy policy.

2012-12-11 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The stock market continues to have one eye on Washington DC and the other on the various global concerns of slowing growth and European disintegration. The net result was another quiet and slow week of trading.

2012-12-11 PIMCO Cyclical Outlook: At Policy Crossroads by Saumil Parikh of PIMCO

The maturation of the global cyclical growth phase suggests we look to a handoff to more secular drivers of growth. But strong secular drivers remain elusive due to the continuation of New Normal headwinds.Policies are at important crossroads in every major economy. 2013 will be the year of policy change, with policymakers in major economies challenged to enact structural changes that spur private sector growth before government-balance-sheet-led growth is exhausted.

2012-12-10 Secular Bear Markets - Volatility Without Return by John Hussman of Hussman Funds

There is enormous risk, in my view, in the temptation to accept zero interest rates and low single-digit prospective market returns as an enduring characteristic of the financial markets while ignoring the unsustainable distortions that have produced this environment.

2012-12-10 Russia's WTO Entry a Big Boost to World Economy by Team of Thomas White International

The WTO's 156th entrant is the world's ninth largest economy and Europe's biggest.

2012-12-10 Food, Water, Electricity & Shelter by John Petrides (Article)

As investors continue to grapple with near term, well documented, uncertainties surrounding the fiscal cliff and global economy, the market continues to present some interesting long term investment opportunities, particularly in our Growth strategy.

2012-12-10 13 for '13 by Richard Bernstein of Richard Bernstein Advisors

Each December we publish a list of investment themes that we feel are critical to the coming year. We continue to believe that US equities are in the midst of a major bull market that could ultimately rival 1982's bull market. It is hard to be bearish when one considers the following.

2012-12-10 Have the New Paper Clips Arrived, Enid? by Christian Thwaites of Sentinel Investments

If there's one economic stat that spans the economic/political spectrum, it's jobs. Last week's NFPs had a headline of 146,000, way above estimates, and an unemployment rate of 7.7%, the best since December 2008 and a comfortable one point below a year ago.

2012-12-10 Property Taxes Paid, More on Housing and A "Quote of the Week" by Team of Lumesis

This week we will take a look at property tax data released this week, housing-related data and the possible impact of the same. Before doing so, a reminder from last week, a brief word on the deficit reduction talks (notice we did not use the "C" word) and a quote worth considering.

2012-12-08 How Gold Miners Can Leverage the Price of Gold by Frank Holmes of U.S. Global Investors

Gazing into their crystal balls this week, Wall Street firms interpreted differing futures for gold next year. Morgan Stanley awarded gold the best commodity for 2013 while Goldman Sachs called the end of the metals hot streak. After seeing 11 consecutive years of positive performance from gold, one needs to be wary of research analysts price forecasts, as they have consistently underestimated the shifting dynamics driving the precious metal higher.

2012-12-08 Weekly Economic Commentary by Team of Northern Trust

What are the margins of monetary policy? The November job report showed only modest improvement. Japan continues to struggle, with a change of government on the horizon.

2012-12-07 3 Implications of a Fiscal Cliff Tax Hike by Russ Koesterich of iShares Blog

From the outside, its hard to find much evidence that Washington is getting closer to a fiscal cliff deal. Perhaps there is more going on behind the scenes than the headlines suggest, but as of today it is hard to find much evidence that the odds of a deal have risen. As the potential for fiscal drag rises, it is worth reiterating why this is so dangerous. From my perspective, the biggest risk to the economy, and to financial markets, comes from the tax side of the equation.

2012-12-07 The Keynesian Depression by Scott Minerd of Guggenheim Partners

Five years have passed since the beginning of the Great Recession. Growth is slow, joblessness is elevated, and the knock-on effects continue to drag down the global economy. The primary difference between today and the 1930s, when the U.S. experienced its last systemic crisis, has been the response by policymakers. Having the benefit of hindsight, policymakers acted swiftly to avoid the mistakes of the Great Depression by applying Keynesian solutions. Like the last depression, we are likely to live with the unintended consequences of the policy response for years to come.

2012-12-06 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks continued to bounce back from their post-election sell off. In fact for the entire month of November the popular averages were virtually unchanged. For the past week one can see from the charts above that the Dow Jones Industrial Average was flat and the NASDAQ Composite gained 1.5% as Apple starts to regain some of the ground it has lost since September.

2012-12-06 From a Fiscal Cliff to a Fiscal Speed Bump by Scott Minerd of Guggenheim Partners

More granular analysis of the line items in the fiscal cliff tells a less harrowing story than what Congress and the media are presenting. The official projections are showing scary numbers for the fiscal cliff, but when we dig into the details we see that the real impact will likely be materially less significant. According to the Congressional Budget Office, the fiscal cliff adds up to a total increase in tax revenue of $631 billion, which is approximately 4% of GDP. Going through the report line by line tells a different story.

2012-12-06 Ditching Before the Fiscal Clif by Peter Schiff of Euro Pacific Capital

Turn on the TV and this is what you'll hear: The US budget is heading for a fiscal cliff. If a deal isn't reaching in Congress by the end of this year, a combination of automatic tax hikes and budget cuts will sink America into economic depression. There is no escape. Of course, my readers know that the fiscal cliff is merely an example of the piper having to be paid. The problem isn't the bill, but that we ran it up so high in the first place.

2012-12-05 Argentinas Trials & Trubulations by Chris Maxey and Ryan Davis of Fortigent

Equity markets climbed higher for a second straight week, extending a rally that began November 16. For the week, the S&P 500 rose 0.6% and the Dow Jones Industrial Average gained 0.2%. In the post-mortem on Q3 earnings season, much has been made of the first quarter of negative earnings growth in three years. However, analysis by Morgan Stanley reveals an even more disturbing picture of corporate America: just 10 companies in the S&P 500 delivered 88% of the indexs earnings growth. Of those 10, four accounted for more than half and Apple alone made up nearly one-fifth of the indexs growth.

2012-12-05 Headline Roulette by Christian W. Thwaites of Sentinel Investments

That Fiscal Thing dominated the week. Every twitch out of Washington was greeted with over analysis by the press and us. Less so the markets. Truth is, markets are not very good at discounting political uncertainty. Sure, a tax scare here and a debt ceiling impasse there might lead to a sell-off but ultimately it's about earnings, corporate health and outlook and on those metrics, nothing last week really upset the markets in a major way. The bond market tends to get this right.

2012-12-05 Resilient Markets Mask Greater Concerns in Real Economy by Douglas Cote of ING Investment Management

Though equity markets have been calm, the real economy tells a different story. If our leaders in Washington arent able to arrive at a compromise, January 1 will mark the beginning of the countrys first scheduled recession, though third quarter corporate earnings suggest a global slowdown is evident. Dont be surprised to see a Christmas rally should Congress kick the fiscal can down the road and the Fed extend Operation Twist.

2012-12-04 Cliff Diving by Michael Lewitt (Article)

While there may be compromise to avoid the self-inflicted crisis of the fiscal cliff, the course of fiscal policy is unlikely to alter significantly. There is a great deal of bold talk about tax reform, but the odds of our current leaders replacing our profoundly flawed tax regime with one that would breed economic growth and productivity are low. Congress will be lucky to avoid the fiscal cliff; asking it to alter the economy's DNA is unrealistic.

2012-12-04 And Thats The Week That Was by Ron Brounes of Brounes & Associates

Obama meets with the nations governors and speaks before the Business Roundtable to continue drumming up support for his budget deal. (Arent most governors counted among the countrys wealthy?) Expect the bickering and blame-placing to continue until finally a small deal is reached with the majority of the work tabled for later in 2013. (How will Moodys and S&P perceive that move?) The economic calendar heats up with critical news from labor and manufacturing and retailers share insight into the holiday shopping season thus far. And Europe is never far from the radar screen.

2012-12-04 In Search of the Holy Grail by Niels Clemen Jensen of Absolute Return Partners

This month's letter focuses on the short to medium term factors that drive our asset allocation and portfolio construction. All research suggests that financial markets are not driven by economic fundamentals in the short to medium term, so why should the investment process be?

2012-12-04 High Uncertainty, Low Optimism by Francis Gannon of Royce Funds

In these uncertain times, we continue to follow our discipline and to identify those ideas that we believe will be the beneficiaries of potentially better economic times ahead. Many of the economic events that the markets feared would pull the U.S. economy into recession have already occurred, including the rapid slowdown in China and the recession in Europe. As the saying goes, bull markets climb a wall of worrysurprisingly , the Russell 2000 gained 12.35% year-to-date, 13.09% over the one-year, 13.85% over the past three years, and 8.71% over the past 10 years through the end of November.

2012-12-03 Housing, GDP, Lumesis Muni Index & Federal $ to the States by Gregg L. Bienstock of Lumesis

While the media is fixated on the looming cliff and having everyone and their mother opine, information about the status of our economy is of as much importance. This week we take a look at housing prices, GDP, the Coincident Index, the DIVER Muni Index and how much of each States revenue comes from the Federal Government. We keep hearing how much better the housing market is. In this regard, we routinely remind our readers that better or worse depends on from where you start. Starting pre-recession to date, only Texas, Oklahoma and the Dakotas have seen positive housing price trends.

2012-12-03 Europes Economic War of Attrition by Mohamed El-Erian of Project Syndicate

During the war of attrition that followed Egypt's defeat in the June 1967 war with Israel, underlying tensions festered. While the parallels with today's European debt crisis are far from perfect the threat is economic rather than military there is a real sense of no peace and no war.

2012-12-01 The Significant Impact of U.S. Oil Production by Frank Holmes of U.S. Global Investors

The Eagle Ford shale formation lies south of our headquarters in San Antonio, Texas, giving the U.S. Global investment team a firsthand, tacit perspective on the oil and gas industrys growing natural resources phenomenon. Weve witnessed how the oil activity is boosting the local economy with solid-paying jobs, a healthy housing market and strong consumer sentiment, as oil giants such as Schlumberger and Halliburton take a bigger stake in the area.

2012-12-01 Weekly Economic Commentary by Team of Northern Trust

Many nations are being reminded that when times are tough, so is budgeting. Americas energy picture is changing for the better. The EU took an "extend and pretend" strategy with Greece.

2012-12-01 Are Corporate Bonds Expensive? by Team of Neuberger Berman

As in the case of Treasury bonds, yields for U.S. corporate credits have fallen to historic lows as prices have risen. The yield on the Barclays Aggregate U.S. Investment Grade Bond Index was recently at 2.8%far below levels achieved during the heady days of 2007. Obviously, this reflects overall interest rates, but is it also a sign that corporate issues may be overvalued? We explore the issues and consider how investors should position their portfolios for the current environment.

2012-12-01 The How Matters by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Market focus has clearly been on fiscal cliff negotiations. An agreement that averts the cliff would likely ignite a further near-term rally, but the ultimate solution and its components could have longer term consequences that may not be as market-friendly. US economic data has been impacted by Hurricane Sandy, but it appears modest growth is continuing; although business investment has fallen off. Housing continues to provide support and the Fed is staying the course. There are some signs of growth stabilization globally, notably in some of the emerging economies, including China.

2012-11-30 Where Are We in the Boom/Bust Liquidity Cycle? by Thomas Fahey of Loomis Sayles

In an often cynical world, standard financial and macroeconomic quantitative models give people the benefit of the doubt. Fundamental economic theory assumes the best of us, supposing that human beings are perfectly rational, know all the facts of a given situation, understand the risks, and optimize our behavior and portfolios accordingly. Reality, of course, is quite different.

2012-11-29 The 13th Labour of Hercules: Capital Preservation in the Age of Financial Repression by James Montier of GMO

James Montier, a member of GMO's asset allocation team, writes to institutional clients in a new white paper on the prospects for preserving and growing capital in a world of slowing growth. Defining financial repression loosely "as a policy that results in consistent negative real interest rates," Mr. Montier poses the question "how does a value investor respond to this? It certainly appears as if the assets one would normally associate with capital preservation are expensive. So can and/or should you substitute other assets such as equities into the role of safe-haven value store?"

2012-11-29 Greece Still Needs a Long-Term Growth Plan by Darren Williams of AllianceBernstein

Even by the standards of the sovereign-debt crisis, the provisional agreement reached yesterday by euro-area finance ministers and the International Monetary Fund (IMF) on a second Greek rescue package looks like a messy fudge. It is clear that Greece's euro-area partners are determined to avoid a near-term euro-area exit, but a long-term solution will require a much more effective growth strategy.

2012-11-29 Small-Caps Pack Big Punch in Emerging Markets by Frank Holmes of U.S. Global Investors

In October, the International Monetary Fund painted a gloomier picture for global investors, as it projected slower growth due to slumping world trade and uncertainty in the West. Despite the forecast, big gains can still be unlocked in the faster-growing emerging markets. We believe the smaller stocks are holding the key.

2012-11-28 Idiosyncratic Risk...and the Other Kind by Jeffrey Bronchick of Cove Street Capital

If the recent election demonstrated anything of relevance to an investor, it should have been the beginning of the end of the tyranny of the "catalyst." The day before the election, an investor could have legitimately been worried about any number of micro, macro, domestic or global issues. And yet the sun rose, work was attended to by those who have jobs, markets opened, fell, and closed and the collective attention moved to the next "perceived" catalyst-the so-called fiscal cliff. Calling Roseanne Roseannadanna.

2012-11-28 How Low Can They Go? by Mark Newlin of Mesirow Financial

Mesirow Financial's Fixed Income team provides insight that can help bond investors put in perspective the current low interest rate environment.

2012-11-28 November 2012 Monthly Investment Bulletin by Team of Bedlam Asset Management

Equities have rarely been so attractive yet any investor acting on the perceived wisdom of the last 50 years would scoff and keep selling: the bad news will worsen for economic activity, growth in credit, wages, consumption, employment and in several countries, political stability. Few indices are glaringly cheap as measured by Cyclically Adjusted Price to Earnings multiples (CAPE: chart p.4) with many expensive, especially in many emerging markets.

2012-11-28 A Turn in the Credit Cycle by Scott Minerd of Guggenheim Partners

Investors should understand the recent transition in the credit market and the implications it could have for the trajectory of asset prices over the long-term.

2012-11-27 Capital Formation and the Fiscal Cliff by John Mauldin of Millennium Wave Advisors

In today's economic environment, we often complain about volatility and uncertainty, but there is one thing I think we can be fairly certain of: taxes are going up. I constantly try to impress upon my kids, most of whom are now adults, that ideas and actions have consequences. In todays letter we will look at some of the consequences of an increase in taxes. Please note that this is different from arguing whether taxes should rise or fall. For all intents and purposes that debate is over

2012-11-27 Are Equities Still Cheap? by Chris Maxey, Ryan Davis of Fortigent

Since reaching a near-term top in mid-September, the S&P 500 Index fell more than 7%. After a 4% rally in the last five trading days, there are reasons to believe equity markets are poised to extend recent performance despite headline concerns.

2012-11-27 Fixed Income Perspectives by Christine Hurtsellers, Matt Toms, Mike Mata of ING Investment Management

A wise American once said "Life is hard; it's harder if you're stupid." A good example is when your pals in Washington are so busy pushing their partisan agendas that they lose sight of what could happen to the American economic Thunderbird if it goes all Thelma and Louise over the fiscal cliff. With the latest elections in the books, it remains to be seen if a Democratic president and acrimonious Republican House can put on their thinking caps to devise a way to delicately pump the brakes of fiscal restraint.

2012-11-27 Fiscal Perdition by Marie Schofield of Columbia Management

Fiscal consolidations are underway across the developed world, and many require large adjustments. At a minimum, countries need to bring their primary budgets into balance in an effort to stabilize growing debt-to-gross domestic product (GDP) ratios. Many are looking at trimming deficits totaling 5% of GDP or more. This will require both spending cuts and tax increases which often work counter to stabilizing debt ratios, as this can brake GDP growth and undermine both the fiscal position and the political fortitude for action.

2012-11-27 Seasonal Rallies and Fiscal Cliffs by Jerry Wagner of Flexible Plan Investments

Black Fridaythat term used to be reserved for days that major crashes began in the stock market. Fortunately, we saw anything but last week as stocks soared to their best week in months. The market followed through once again on the pre- and post-Thanksgiving positive seasonality pattern that we reported on last week.

2012-11-26 Deja Vu All Over Again by Tony Crescenzi, Andrew Bosomworth, Lupin Rahman, Ben Emons of PIMCO

If the eurozone is to endure, it will require reduced economic differences among countries and larger common fiscal capacity. Emerging market central banks are likely to remain in wait-and-see mode while looking to the U.S. for clarity on the fiscal negotiations and domestic macro prints for signs of moderation in both inflation and activity. While central banks in advanced economies have not traditionally used explicit policies to target exchange rates, the European debt crisis may change all that.

2012-11-26 Stuck in the Muddle with You by Milton Ezrati of Lord Abbett

Raising Keynes hasn't worked. What will finally lift the fog of uncertainty that bedevils the economy?

2012-11-26 The Calm Before the Storm? by Russ Koesterich of iShares Blog

Between the US Thanksgiving holiday and a recessed Congress, there was not much news to drive the markets last week. Russ K expects that to change this week, and he explains why, in the face of potentially higher market volatility, he favors municipal bonds.

2012-11-26 Illegitimum Non Carborundum by Jeffrey Saut of Raymond James

In my opinion Richard Fisher said in plain English what Ben Bernanke is trying to say in a much more politically correct way hey Congress, get your act together because I have done just about all I can do on a monetary basis, so it is up to y'all to make the tough decisions on fiscal policy that need to be made to get this economy going again. Surprisingly, I think Congress, and the President, will rise to the occasion because if they don't, and the country falls off the "fiscal cliff" for an extended period of time, it most assuredly will put us back into a recession.

2012-11-26 Buying Treasuries and Avoiding Stocks Not the Way to Go by John Buckingham of AFAM

While we know better than to make too much out of a low-volume rally, especially during a holiday-shortened trading week, it was interesting to hear what The Wall Street Journal had to say one week ago at this time. As the publication helped ready investors for the week ahead, one story advised folks to head toward the safety of U.S. Treasury securities: "Expect safe-haven Treasurys to draw demand at the expense of stocks in the coming weeks, bucking a seasonal trend that has often favored riskier assets."

2012-11-26 Negativity Creates Value; What if the Mayans are Wrong? by Charles Lieberman (Article)

Being negative is easy and sophisticated, so it is attractive for pundits, analysts and the media to play the part. But, it also creates tremendous opportunity. The market seems to be discounting the possibility that the world will come to an end along with the Mayan calendar in near term. If the market is correct, investment strategy doesn't matter. But if the market is incorrect, there are tremendous investment opportunities.

2012-11-26 Fiscal Cliff: An Emerging Markets' View by Mark Mobius of Franklin Templeton Investments

Now that the U.S. presidential election is over and President Barack Obama has been re-elected to serve a second four-year term, we're able to do what we always do after a major election or regime change, and that's examine the potential implications of policy changes on our investments. As our team sees it, there are two main factors for global investors to consider: the U.S. economy's future health, and President Obama's foreign policy stance toward key countries, particularly China.

2012-11-26 Overlooking Overvaluation by John Hussman of Hussman Funds

Presently, on the basis of smooth fundamentals such as revenues, book values, dividends and cyclically-adjusted earnings, the S&P 500 is somewhere between 40-70% above pre-bubble valuation norms, depending on the measure. That's about the same point they reached at the beginning of the 1965-1982 secular bear period, as well as the 1987 peak.

2012-11-26 Japan: After the Quake, After the Floods by Richard Mattione of GMO

Japan's recovery from the Tohoku earthquake and tsunami of March 11, 2011 has been so astounding that people rarely even think about the tsunami anymore. Even fewer remember that heavy rains in Thailand further disrupted the global production chain at the end of 2011. With so much accomplished, why do so few Japanese companies see bright days ahead?

2012-11-26 And That's the Week That Was by Ron Brounes of Brounes & Associates

Investors breathed a sigh of relief (perhaps temporarily) and expressed thanks in the form of the strongest week in the market in several months (though on light volume). Domestically, housing data confirmed strength in the sector and retailers opened their doors earlier than usual with the hope that "if you open, they will come." Overseas, Europe's struggles continued, though manufacturing in China looked to be on the mend. Happy Thanksgiving and enjoy the weekend; after all, next week starts the home stretch for the end of the year...(and the fiscal cliff).

2012-11-23 Five Amazing Global Consumer Trends by Frank Holmes of U.S. Global Investors

Fifth Avenue no longer the worlds most expensive retail location. China set to be the second largest luxury market by 2017. Viva Macau is gaming capital of the world. Inexpensive Indian Aakash 2 could revolutionize tablet industry. Emerging market residents don't need a bank account to pay with their mobile wallet.

2012-11-21 Meet Cliff by Rob Isbitts of Sungarden Investment Research

Oh, we had heard about Cliff. We were warned about this nefarious character many months ago. We knew he was lurking and we knew he was not going to just go away. Cliff had invited himself into our lives, and unless we dealt with him, he was not going anywhere. You, the hard-working financial advisor, have probably been wondering when everyone else would notice him. That time came when the sun came up Wednesday after the election. There he was, casting his extraordinarily long and potentially costly shadow. Fiscal Cliff finally entered the national spotlight. It is time to meet him.

2012-11-20 President Obama’s Re-Election and the Impact on the U.S. Economy by Eaton Vance Distributors, Inc. (Article)

President Obama’s re-election resolves a major element of uncertainty that has hung over the political landscape. But what kind of impact will his victory have on the economy and the markets, especially with the House still in Republican control? We posed that question to a roundtable of five investment professionals from Eaton Vance Management, Hexavest and Richard Bernstein Advisors.

2012-11-20 Fix the Debt! by Team of Franklin Templeton Investments

In the "normal" course of a U.S. election, investors typically breathe a sigh of relief when the results come in, with at least one layer of market uncertainty removed. This time around, the political squabbling hasn't ended with the close of the polls on November 6. The debate about the "fiscal cliff," a combination of spending cuts and tax hikes set to go into effect on January 1, 2013, has heightened. Market volatility since the election seems to have heightened, too.

2012-11-20 Euro Crisis: Major Implications For Investors by John Browne of Euro Pacific Capital

The euro crisis has begun to feel like an everlasting steeplechase with high hedges and water obstacles blocking the path to economic resurgence on the Continent. Each time a hurdle has been cleared another problem emerges to potentially block the track. The latest developments involve ugly anti-austerity riots across the southern tier and open rifts emerging among the creditors, most notably between the International Monetary Fund and northern nations.

2012-11-20 Where Will the Jobs Come From? by John Mauldin of Millennium Wave Advisors

For the last year, as I travel around, it seems a main topic of conversation is "Where will my kids find jobs?" It is a topic I am all too familiar with. Where indeed? Youth unemployment in the US is 17.1%. If you are in Europe the problem is even more pronounced. The basket case that is Greece has youth unemployment of 58%, and Spain is close at 55%. Portugal is at 36% and in Italy its 35%. France is over 25%. Is this just a cyclical symptom of the credit crisis?

2012-11-20 Emerging Markets Equity -- Monthly Product Commentary: October 2012 by Team of Thomas White International

Economic data from major emerging markets suggested a moderate reversal from the weak trends of recent months.

2012-11-20 Bumpy End To The Year by Christian Thwaites of Sentinel Investments

Europe would like to have America's problems. Here we have declining public spending, increasing receipts, falling debt to GDP ratios and unemployment 3% below the European average. This puts the Fiscal Cliff (and I was so hoping to avoid that clich) debate somewhat in context. It's serious enough to draw the attention of corporate CEOs, put a heavy dampener on business confidence, which we saw in the recent NFIB report, and postpone hiring plans and capital investment, which showed up in last week's Empire and Philly Fed surveys.

2012-11-20 Favoring France: The Newest Bright Spot in Europe by Russ Koesterich of iShares Blog

Europe may be stabilizing, but it's not out of the woods yet. One bright spot on the continent? France. Russ explains why he would now overweight the country's equities.

2012-11-20 Syria: The Problem of Intervention by Bill O'Grady of Confluence Investment Management

The situation in Syria continues to deteriorate. The rebels, though divided, are acquiring heavy weapons (there have been reports they have some tanks), mostly by taking them from the regime. Apparently, the rebels are also attracting former soldiers who can operate such weapons. Still, there is nothing to suggest that either side is about to dominate the other and so the current civil conflict will likely continue.

2012-11-20 On the Road to Zero Growth by Jeremy Grantham of GMO

In a new quarterly letter to institutional clients, GMO chief investment strategist Jeremy Grantham makes the case that, "the U.S. GDP growth rate that we have become accustomed to for over a hundred years -- in excess of 3% a year -- is not just hiding behind temporary setbacks. It is gone forever." He cautions, "investors should be wary of a Fed whose policy is prefaced on the idea that 3% growth for the U.S. is normal."

2012-11-19 Little Dutch Boy by John Hussman of Hussman Funds

In the Mary Mapes Dodge book titled Hans Brinker, there is a fictional story within the story of a little Dutch boy who, on his way to school, notices a hole in the dyke. Having nothing else to fix the leak, he plugs the hole with his finger and stays there through the night until workers come to repair it. We are now into the fourth year of efforts to print trillions of little Dutch boys out of dollars and euros in order to stop a tide from crashing through a fundamentally damaged dyke. All of this has bought time, but no workers have arrived, and no real repairs have been done.

2012-11-19 Waiting for Godot by Charles Lieberman (Article)

Democratic and republican policymakers are actively negotiating over the fiscal cliff, as investors watch and wait with baited breath. They seem to be making progress, or so they suggest in their public comments. But until the situation is resolved, markets are likely to remain volatile. Other issues do seem to be moving towards resolution.

2012-11-19 Q3 2012 Market Commentary by Jon Sundt of Altegris

Decisive actions by central bankers altered the course of global markets in the third quarter of 2012 at least temporarily.

2012-11-19 The Year of Betting Conservatively by Nouriel Roubini of Project Syndicate

As consumers, firms, and investors become more cautious and risk-averse, the equity-market rally of the second half of 2012 has crested. And, given the seriousness of the downside risks to growth, the correction could be a bellwether of worse to come for the global economy and financial markets in 2013.

2012-11-19 I'll Be Back by Jeffrey Saut of Raymond James

The call for this week: Obviously, I am back from Europe and y'all have done a pretty poor job of holding the markets together in my two-week absence. Indeed, since the election the SPX has lost 6.28% from its intraday high to last Friday's intraday low. The biggest losing sectors over that timeframe have been Energy (-6.2%), Financials (-5.9%), and Technology (-5.9%). Given the President's views on energy and banks the weakness in those two sectors should not come as a surprise. Still, I think the surprise is going to be a more cooperative environment from our leaders going forward.

2012-11-19 The Seeds of Higher Market Volatility Were Sown by Mike Temple of Pioneer Investments

A paradigm shift in financial markets has taken place since 2008 into a more volatile investment environment that will demand different ways of managing risk. In an ironic twist of intention, today's higher volatility is the consequence of attempts by central banks to engineer a less volatile economic environment.

2012-11-17 Three Events That Sum Up the Week by Frank Holmes of U.S. Global Investors

India regained its title as the strongest performing market, overtaking the greater China area, as the country experienced a bounceback in demand due to improved sentiment during the festival season. The Federal Housing Administration reported that it has exhausted its reserves, possibly requiring a bailout from U.S. taxpayers for the first time ever in its nearly 80-year history. The global economic picture came into focus a little more this week with the announcement of Chinas new leadership.

2012-11-16 ProVise Bullets by Ray Ferrara of ProVise Management Group

With the elections behind us, we must now look ahead to the next six weeks of a Lame Duck Congress. Given the fact that the President was re-elected, the Republicans maintained control of the House, and the Democrats gained in the Senate, we know there will either be collaboration or chaos in Washington. The positioning has already started. The more things change, the more they stay the same.

2012-11-16 November Fundamentals by Chris Brightman of Research Affiliates

For the second half of the 20th century, U.S. gross domestic product growth averaged 3.3% per year. This growth was driven by a combination of rising population and employment rates and increased productivity. But all three of these factors are slowing or declining. What does this mean for future growth?

2012-11-16 Central Bankers Take Steps Where Politicians Fear to Tread by John Remmert of Franklin Templeton Investments

In the past few years, many global central banks have enacted various measures to stimulate their respective economiesin some cases without the support of fiscal measuresand sometimes to little effect. John Remmert, senior vice president and senior portfolio manager for Franklin Equity Group, shares his insights on why central banks have acted in some cases where politicians seemed fearful to tread.

2012-11-16 Obstacles to a Lasting Recovery: The Liquidity, Hesitancy & Solvency Traps by Thomas Fahey of Loomis Sayles

Those familiar symptoms are back again to start the summer: risk aversion; falling equity prices; rising volatility; record-low German and US government bond yields; wider credit spreads; a European country getting picked on; and a stronger US dollar. We have seen this bad movie twice before, during the summers of 2010 and 2011.

2012-11-16 Fed Balance Sheet Expands, Reward-Risk Clarity Fades by Alan Levenson of T. Rowe Price

While the minutes of the October 23-24 FOMC indicated a lack of consensus regarding whether to initiate a new asset purchase program to replace the Maturity Extension Program (MEP) upon its year-end conclusion, we believe that the Committee will announce at the conclusion of its December 11-12 meeting that the Fed will begin open-ended purchases of Treasury securities at a pace close to the $45 billion per month in the MEP.

2012-11-16 Weekly Economic Commentary by Carl Tannenbaum, Asha Bangalore of Northern Trust

The focus on the fiscal cliff cannot be overstated. It is very hard for the world's central banks to set rules governing monetary policy. The troika charged with addressing Greece has some internal disagreement.

2012-11-15 Russia and China's Neighborly Interests by Mark Mobius of Franklin Templeton Investments

Whether our neighbors are as close as the airplane seat next to us or across a national border, most would probably agree that while we may not see eye to eye, peaceful cooperation makes more sense than tense relations. China and Russia share some 4,000 miles of common border, and their neighborly relationship has certainly had some ups and downs. But it's clear to me that the opportunities for cooperation between these two nations have enormous potential mutual benefits, particularly in the trade of natural resources.

2012-11-15 3 Reasons Not to Flee Dividend Stocks by Russ Koesterich of iShares Blog

As the fiscal cliff approaches, investors are becoming wary of dividend stocks, unsettled by the potential for a near tripling of the tax on dividends. But Russ K explains why he remains comfortable with dividend paying stocks with one major exception.

2012-11-15 Too Low for Too Long by Scott Minerd of Guggenheim Partners

The Federal Reserve faces the risk of inducing a sell-off in bonds similar to that which occurred in 1994 when Dr. Greenspan tightened credit conditions after maintaining an artificially low interest rate environment for an extended period.

2012-11-15 Nothing Changed by Doug MacKay, Bill Hoover of Broadleaf Partners

Many events have transpired since our mid-September update, but not much has really changed. Economic growth should remain slow for as far as the eyes can see, as each region of the world struggles with its own version of the New Normal. Capitalistic animal spirits have gone the way of the modern American male and while not completely extinct, he's decidedly more metrosexual. Flannel has ceded ground to the skinny jean and ambition has given way to contentment. Save for the halls of America's top military brass, unbridled passion is simply no longer.

2012-11-14 U.S. Economic and Interest Rate Outlook - November 2012 by Carl Tannenbaum, Asha Bangalore of Northern Trust

Our updated forecast anticipates some movement on the "fiscal cliff."

2012-11-14 Euro Area Still in Denial about Failure in Greece by Darren Williams of AllianceBernstein

Despite the Greek government's best efforts, last night's meeting of euro-area finance ministers failed to approve the release of new funding. We think it's only a matter of time before Greece gets its money. But the latest delay reflects deep disagreement about how to reduce current unsustainable debt levels.

2012-11-14 The Sun Also Rises by James Hunt of Tocqueville Asset Management

In his latest "Insights" piece, James Hunt, portfolio manager of Tocqueville International Value Fund, explains why Japanese equities, despite the country's poor demographics, huge public debt and weak growth prospects, still harbor some excellent opportunities. Mr. Hunt writes: "Everyone thinks Japan is sinking into obscurity and this negative sentiment provides us with the opportunity to buy what I consider to be excellent global franchise businesses at knock down valuations."

2012-11-13 David Rosenberg on Obama's Victory by David Rosenberg (Article)

The election is behind us. The Fed has spent its last bullet. We are at an inflection point of the earnings and sales cycle. The fiscal cliff, the Chinese political transition and the spread of the euro zone recession to the north lie ahead.

2012-11-13 Voyages by Michael Lewitt (Article)

Anything short of drastic entitlement reform, serious cutbacks in defense spending, and serious tax reform that alters incentives away from speculation in favor of production will leave this country stuck on the dangerous path it is on today.

2012-11-13 Emerging Markets: Maintaining Perspective by Robert O. Abad (Article)

In this Q&A, Western Asset Portfolio Manager Robert Abad discusses the latest dynamics and trends within emerging markets (EM). Although EM continue to demonstrate resiliency, Mr. Abad believes that given the amount of global uncertainty today, it is important that investors evaluate opportunities alongside a manager equipped to guide them through the risks and rewards of this evolving asset class.

2012-11-13 Quarterly Letter by Team of Grey Owl Capital Management

The multiple hurricanes of fiscal deficits and monetary malfeasance are headed our way. Unfortunately, financial market models that seek to assess the magnitude, direction, and timing of economic tempests are far less precise than those of our scientific brethren. So, we prepare for the worst, but we dont immediately evacuate. There are still plenty of opportunities for solid investment returns and we will describe two new investments in the pages that follow. Yet, the risks are real, as we have discussed frequently in these letters, so our overall portfolio structure remains conservative.

2012-11-13 Europe: Opportunity of a Generation by David Marcus of Evermore Global Advisors

A difficult political and economic backdrop is masking exceptional opportunities in European markets for discerning, long-term oriented investors. Evermore believes that there is a generational opportunity to build significant wealth by selectively investing in catalyst-driven, deep value European securities, trading at depressed valuations.

2012-11-13 The Election by Jeffrey Saut of Raymond James

As most of you know I was in Glasgow, Edinburgh, London, Zurich, and Geneva during election week seeing institutional accounts and speaking at conferences. Of course the question on all the portfolio managers' (PMs) minds was about the election, the subsequent effect on the economy and the various markets, currencies, and the Fiscal Cliff.

2012-11-13 Equities Slumped Post-Election as Investors Grew Fearful of Approaching Fiscal Cliff by Team of ING Investment Management

Equities slumped post-election as investors grew increasingly fearful of the approaching fiscal cliff in light of a divided Washington, though encouraging economic data out of the U.S. and China helped stabilize markets on Friday.

2012-11-13 Central Bank Insurance by John Mauldin of Millennium Wave Advisors

"If you want to enjoy life, go to Buenos Aires. If you want to do business, go to Sao Paulo," the saying goes. It is hard to get an impression of a country by going to a city of 20 million people. It is like visiting New York City and thinking you can understand the United States. But I never fail to enjoy myself in Brazil.

2012-11-13 China's Transition Occurring at a Critical Time by Chris Maxey, Ryan Davis of Fortigent

While the presidential election in the U.S. was on the forefront of most investors' minds, current events in China could be equally important to the global economy. China is going through a political transition at the same time as it seeks to re-balance its economy. Whether those efforts will be successful remains a great unknown.

2012-11-13 Four More Years... by Kate Schapiro of Sentinel Investments

Americans went to the polls this past Tuesday and re-elected President Obama to four more years in office. In addition, the partisan breakdown of Congress stayed roughly the same in both the House of Representatives (Republican majority) and Senate (Democratic majority). So after nearly two years and billions of dollars spent on campaigning, debating, polling, grand-standing and mudslinging, the leadership is unchanged. A good argument for campaign finance reform if ever there was one.

2012-11-13 Scotland: The Same, Only Better? by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

As the Eurozone countries are trying to find the functional balance between national sovereignty and Eurozone-wide central control on the national level, fractures are also appearing within the nation states themselves. Additionally, the Northern European countries are questioning the extent to which they should be expected to bail out the Southern countries, while the wealthier regions of the nation states reason that they would be more efficient in managing their internal fiscal budgets.

2012-11-13 Argo and Ethel: America Has Never Been a "Rose Garden" by Bill Smead of Smead Capital Management

We recently had the pleasure of seeing a movie, Argo, and a documentary on HBO, Ethel. Argo is the story of the rescue of the six Americans from the Canadian Ambassador's residence at the time of the Iranian takeover of the US Embassy in Teheran. Ethel is a documentary which tells the story of Ethel Kennedy, the wife of Senator Robert Kennedy. It was produced, directed and narrated by Ethel Kennedy's youngest daughter, Rory. I rate both of these films highly and believe they tell US investors something they need to be reminded of.

2012-11-12 And That's the Week That Was by Ron Brounes of Brounes & Associates

"Four more years...Four more years." While those words may be music to the ears of Obama supporters worldwide, investors seemed less than impressed (at least initially). A second Obama administration brings plenty of question marks about the global economy, the tax code, the regulatory environment, Corporate America, and, of course, the financial markets. Stocks plunged on the first day post-election, but many analysts believe that is less a statement about the Obama victory and more a concern that the "fiscal cliff" is now clearly atop the news headlines.

2012-11-12 Can Housing Save the U.S. Economy? by Stephen Sheehan of Columbia Management

After leading the U.S. out of the Great Recession, the manufacturing sector has recently begun to show signs of sputtering. Uncertainty surrounding the election and fiscal cliff in the U.S., decelerating growth in China and a perpetually weak Europe have led to a soft patch in the third quarter. This global hiccup has caused some U.S. companies to catch a cold, most notably those in heavy machinery, transportation, metals and mining, and general industrials.

2012-11-12 Lopsided Risks by John Hussman of Hussman Funds

The recent sequence of overvalued, overbought, overbullish, technically exhausted setups followed by a clear technical breakdown is of greatest concern here, because we often observe that sequence at the beginning of deep and extended market losses.

2012-11-12 Surveying the Post-Election Landscape by Team of Lord Abbett

Of all the uncertainties facing investors over the past few years, the U.S. presidential election was among the most significant. And now that the election is over, asset managers are assessing the opportunities and riskssuch as the looming fiscal cliffwithin their respective markets. Indeed, the direction of fiscal policy remains investors' foremost concern, according to a recent survey of nearly 600 financial advisors conducted on Lord Abbett's postelection Web conference.

2012-11-12 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The election results were no sooner determined when stocks started selling off. Hard to believe it is coincidence, but it is also hard to believe the markets were caught off guard either.

2012-11-12 President Obama Wins Reelection; Equity Markets Trade Lower by Matthew Rubin of Neuberger Berman

Congress remains split following Tuesday's vote (Democrat Senate, Republican House. DJIA and S&P 500 decline 2.0% and 2.3%, respectively, last week. European Central Bank and Bank of England maintain current monetary policy stances.

2012-11-09 Americas: Economic Review 3rd Quarter 2012 by Team of Thomas White International

Economic trends in most countries across the Americas region saw a moderate recovery during the third quarter, though the pace of growth remains subdued. Slower global demand due to the ongoing European recession and the slower expansion in Asia continues to restrict exports from the Americas. At the same time, domestic consumption growth has been relatively more robust than expected and has helped most regional economies prevent a deeper slowdown.

2012-11-09 Looking Past the Election by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

The election results are in, removing at least one area of uncertainty from the equation. For the near term, economic data in the United States may take a back seat. Growth around the world appears soft, but some pockets are more encouraging than others.

2012-11-09 Two Policy Instruments, Two Labor Market Thresholds by Alan Levenson of T. Rowe Price

Despite understandable post-election focus on the resolution of the looming fiscal cliff, there is persistent interest in the conditions under which the FOMC will end the asset purchase program initiated in September ("QE3"). The economic projections and monetary policy expectations submitted for the September 12-13 FOMC meeting indicate that a consensus for rate hikes begins to build as the unemployment rate approaches 7.0%.

2012-11-09 Weekly Economic Commentary by Carl Tannenbaum, Asha Bangalore, Victoria Marklew of Northern Trust

Hurricane Sandy will impact the pattern of upcoming data, but is not likely to have a lasting economic impact. Our updated forecast anticipates some movement on the "fiscal cliff." France may be part of Europe's problem, not a source of Europe's solutions.

2012-11-09 A Portrait of Two Presidents by Frank Holmes of U.S. Global Investors

On Friday, President Obama addressed the two topics that have been on many equity investors minds since election night: the economy and the dreaded fiscal cliff. In his speech, he delivered his familiar plan to combine spending cuts with increasing revenue by raising taxes on the wealthiest Americans. Thats how we did it in the 1990s, when Bill Clinton was president, says the president.

2012-11-09 Will China Ditch Mao To Save The Party? by James Gruber of Asia Confidential

Maintaining the status quo isn't an option. It'd jeopardize the future of the Communist Party itself. But the party has a habit of reinventing itself and I am cautiously optimistic that it'll do so again. You're likely to see China move more and more towards a Singaporean-style economic and political model.

2012-11-08 Overcoming the Brake Light Shockwave by Christian Thwaites of Sentinel Investments

Big democratic breakthroughs, say Egypt, Tunisia are halting and fall far short of the hopes they embodied. Technology is a race over mobility and brevity but hardly elicits the same wonder from years past. Governments are polarized. The US had almost no voting overlap in recent years so big ideas are on the wane. In Europe, the supra-national organizations like the EU are swift to talk and slow to act. No we're not reactionaries. We think all this is explained by the deepest drop in output in the post-war period and the slowest recovery.

2012-11-08 Make Way for Debt Mutualization in Europe by Scott Minerd of Guggenheim Partners

Hurdles and hold-ups are inevitable but recent policy developments in Europe indicate that the ECB and the Bundesbank are cooperating and greater federalization is likely.

2012-11-08 Emerging Asia Pacific: Economic Review 3rd Quarter 2012 by Team of Thomas White International

Emerging Asia Pacific economies faced a challenging third quarter in 2012 as exports to key developed markets such as the Euro-zone came under pressure. As the austerity policies implemented by many of the countries in the Euro-zone caused a significant slump in demand, emerging market economies, which serve as the workshop of the world faced significant difficulties. Almost all major export-dependent nations like China, South Korea, Taiwan and Malaysia faced pressure to export growth. Still, most of the economies possessed both monetary and fiscal ammo to overcome the slowdown.

2012-11-08 Alternative Thoughts - All That Volatility For Nothing? by Lawrence Epstein, Josh Rowe of Orinda Asset Management

In 2011, the S&P 500 had one of the smallest price changes in its history, but investors experienced significant daily volatility. Stock investors experienced an extraordinarily tumultuous 2011 marked by the collapse of governments, standoffs over raising the national debt ceiling, and an escalation of the sovereign credit crisis in Europe. Markets rose and fell several percentage points in minutes on the barest of rumors from Washington and Brussels and frequent surprises in economic data around the globe.

2012-11-08 A Delicate Balance by Team of Franklin Templeton Investments

You'd be hard-pressed to find someone who argues that balance is a bad thing, but in this time of austerity versus growth and political us-versus-them, you'd be equally hard-pressed to find agreement on how to achieve balance. Right now the U.S. economy is teetering on the edge of the much-publicized so-called "fiscal cliff," a one-two punch of automatic spending cuts and tax increases set to go into effect in 2013, and which threaten to tip the nation into recession.

2012-11-08 Developed Europe: Economic Review 3rd Quarter 2012 by Team of Thomas White International

Amid signs of a deepening economic slowdown in Developed Europe, three key events brought some cheer to the beleaguered region, raising hopes of a lasting solution to its debt crisis. In early September, the European Central Bank (ECB) announced its new Outright Monetary Transactions scheme, which is in effect a commitment by the ECB to buy unlimited quantities of sovereign bonds with up to three years in maturity, providing the bond-issuing member country agrees to a reform agenda.

2012-11-07 October 2012 Monthly Commentary by David Kelly of J.P. Morgan Funds

A light flashed on in my car this morning, telling me that it was due for service. When I take it in, the mechanics will presumably check both the engine and the brakes before deciding on exactly what it is that I need to repair, replace or adjust. For investors, after nine months of ups and downs in markets, an investment strategy checkup is in order.

2012-11-07 US Olympic Swim Team and Warren Buffett: Buy and Hold by Bill Smead of Smead Capital Management

The US swim team has their own criteria for developing young athletes. We assume in every ten-year stretch that they support the swimming efforts of 25 to 30 young athletes in hopes of finding an occasional Mark Spitz or Michael Phelps. Most of them share the characteristics we described about Michael Phelps. The US Olympic team is the most successful swim team portfolio manager in the world. What can we learn from them as portfolio managers?

2012-11-07 October Surprise by Douglas Cote of ING Investment Management

Third quarter earnings growth for S&P 500 companies is at risk of being negative for the first time in three years. While the presidential election is important, Congress will ultimately control spending and tax legislation. Monetary stimulus alone is both inadequate and unsustainable; pro-growth taxation, spending and regulatory policy is key to our economic revival.

2012-11-07 Report Raises Questions About Central Bank Gold Holdings by John Browne of Euro Pacific Capital

For years I have cautioned that changes in the ownership of gold held in the vaults of key central banks around the globe may not have been accurately reported. A report issued last month in Germany has once again brought these issues to the fore. In today's environment of rampant money creation and questioning of central bank activities, such uncertainty is bound to spark the curiosity of an increasing number of investors.

2012-11-06 Lacy Hunt on Our Economic Future by Robert Huebscher (Article)

Last week I spoke with Lacy Hunt, an unequivocal advocate of deficit reduction. Hunt defended – as persuasively as few others can – the need to address our fiscal imbalances. But equally respected economists are advocating for the other extreme, and he shares some common ground with them.

2012-11-06 ClearBridge Advisors - Market Commentary Q312 by Harry “Hersh” Cohen (Article)

Vibrant end demand is missing, as consumers have neither the wherewithal nor the will to spend as they did in prior periods.

2012-11-06 The Prize for the Fiduciary Standard: Global Market Leadership by Stephen Winks (Article)

Tough times in the brokerage business are about to get tougher. A difficult investment environment and damage to its reputation are threatening the industry, and now it faces regulatory challenges under Dodd-Frank as it evolves from its current sales-driven culture to a professional services culture focused on advice and the fiduciary standard. Bold leadership will be necessary to navigate this challenge; without it, the brokerage industry and their clients will suffer.

2012-11-06 The Absolute Return Letter: The Era of Kakistocracy by Neils Jensen of Absolute Return Partners

We are now five years into a crisis that just doesn't want to go away. Paraphrasing Charles Gave of GaveKal who wrote a supremely succinct paper on this topic only last week, policy makers continue to tamper with interest rates, foreign exchange rates and asset prices in general. They continue to permit deposit-taking banks to operate like casinos. They issue new debt to pay for expenditures when we are already drowning in debt. They just don't seem to get it. Albert Einstein once defined insanity as doing the same experiment over and over again, expecting a different result.

2012-11-06 Same Old Samba for Brazil by Milton Ezrati of Lord Abbett

The old saw for the last 80-plus years puts Brazil perpetually on the verge of becoming the next economic powerhouse, but never quite making it. It is easy to see the potential. The nation is large; rich in natural resources and arable land; has a sizable, active population; and has well-developed trade relations in the Americas, with Europe, and with Africa. Brazil has failed to realize its potential less for economic reasons than because of misguided government policies.

2012-11-06 Favorable Reports Post Sandy by Christian Thwaites of Sentinel Investments

The devastation of Sandy blighted the week. We were lucky in that most of our employees escaped the worst effects. We had some evacuations and plenty of lost power. But the images of devastation were overwhelming and we hope our clients and friends of the firm are safe. Perhaps, as a non-native, my perspective is warped but in the US we have an uncanny ability for industry, problem-solving, drive, inventiveness and optimism. Sometimes the very best of us comes out in these times.

2012-11-05 Three Men Make a Tiger by John Mauldin of Millennium Wave Advisors

In a few hours we will know the outcome of the US elections (hopefully without a repeat of 2000!). So, given that eventuality, why should we bother to explore the rather significant disparity in the models being used to create the polls to predict the outcome of the elections? Because doing so will help us understand why the models we use to predict the effects on our investments of market behavior and macroeconomics so often fail us, and why we should approach the use of such models with a full measure of wariness and skepticism.

2012-11-05 Stream of Anecdotes by John Hussman of Hussman Funds

Analysts who interpret economic data as a stream of unconnected anecdotes are likely to find recent data encouraging, and will easily dismiss any concern about a U.S. recession on that basis. For our part, the internals of the economic picture new orders, backlogs, real income growth, and even the employment components of prominent economic surveys continue to deteriorate. Based on dozens of economic variables and methods that account for leading/lagging relationships (e.g. unobserved components estimates) our view remains that the U.S. economy has already entered a recession.

2012-11-05 A New Queen Bee by Jeffrey Saut of Raymond James

By the time a queen bee is five she is old and no longer reproduces, leaving her army of honeybees torn between loyalty and survival. Since the hive cannot survive without a productive queen, the beekeeper reached into the hive with a long-gloved hand and squashes the enfeebled queen. With the entire hive as witness, all know the queen is dead. Absent the scent of their leader, the honeybees panic. Something similar to that "queen bee" sequence may be happening currently. The "old queen," at least in the private sector, was driven by exports and manufacturing.

2012-11-05 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

A storm shortened trading week saw virtually no movement in the popularly followed stock market indices.

2012-11-05 And That's the Week That Was by Ron Brounes of Brounes & Associates

Superstorm Sandy overshadowed most all newsworthy stories during the week as much of the East Coast (and beyond) suffered some ill-effects and many will be fighting to overcome challenges for many days (weeks, months) to come. The stock market closed over consecutive days to start the week and uncertainty (volatility) ensued with investors enjoying the best single day performance in a month-and-a-half, only to give up those gains a day later as many set portfolios in advance of the election. Soon the campaign will be a distant memory (but the "fiscal cliff" will become a near-reality).

2012-11-05 China Forges Ahead by Team of Janus Capital Group

Economic headwinds loom on the horizon as we approach 2013, including a sovereign debt crisis in Europe and pending fiscal cliff in the U.S., but we think you can cross China off your list of worries. Economic data pointing to a slowdown in China has troubled investors. Many even question the reliability of that data, and suggest things could be worse than reported.

2012-11-05 Election Matters, But Stocks are Cheap by Brian Wesbury, Bob Stein of First Trust Advisors

Tomorrow's election may be the most important one for economic policy of our generation. Years from now, we may look back at the choice Americans make as an inflection point leading toward either more economic freedom or less, with major effects on long-term economic growth and living standards.

2012-11-05 The Foreign Policy Choice by Bill O'Grady of Confluence Investment Management

Tomorrow is Election Day. After months of campaigning and hours of watching insipid political commercials, the time to decide is upon us.

2012-11-02 World's Economies Come of Age by Mark Mobius of Franklin Templeton Investments

As we grow and age, our needs and habits often change. The same is true of economies, which grow and change along with their people. Short-term statistics that impact a country's economic growth rate, such as consumer spending, exports and the like are certainly important, but there are also long-term shifts that can have significant economic implications for the future. Changing demographics is one of them. As a long-term investor, I have to look not only at today's opportunities, but also plan for tomorrow's developments.

2012-11-02 Of Varied States: Cyclical, Storm-Tossed and Swing by Alan Levenson of T. Rowe Price

The latest readings on employment growth and household formation show a firm underpinning for moderate growth, with the household sector gathering momentum toward the emergence of positive feedback loops. Despite the immense human cost of Superstorm Sandy, the adverse impact on measured economic activity is likely to be short-lived, with a compensating rebound to emerge before quarter-end. Next week's general election results should bring clarity to the route that policy makers will take to avoid the year-end fiscal cliff.

2012-11-02 Who Will Lead America Over the Next Four Years? by Frank Holmes of U.S. Global Investors

If President Obama is reelected, it could be a negative for certain energy companies involved in natural gas fracking, says International Strategy & Investment (ISI). Conversely, a Governor Mitt Romney win could be significant for energy companies. In its Romney Portfolio ISIs rationale is that Romney and the GOP will try to do more to promote traditional forms of energy, including offshore drilling, approving the Keystone pipeline, and exploiting the nations coal resources.

2012-11-02 High Yield is Looking Expensive by Russ Koesterich of iShares Blog

High yield has enjoyed a rally over the last several months. Russ explains why it may be a good time to reexamine your exposure to the asset class.

2012-10-31 US Stocks Facing a Bumpy Ride by Russ Koesterich of iShares Blog

The US stock exchanges are slated to reopen for trading on Wednesday, after Hurricane Sandy prompted the longest weather-related closure of the New York Stock Exchange since 1888. What can investors expect when trading resumes? Russ K explains.

2012-10-31 Switch: Business Confidence Sinks While Consumer Confidence Lifts by Liz Ann Sonders of Charles Schwab

A wide gap has developed between sagging business confidence and improving consumer confidence...and the election and fiscal cliff appear to be the culprits.

2012-10-31 Macro View: Natural Disaster Economics by Scott Minerd of Guggenheim Partners

"Super-Storm" Sandy will distort economic activity and data over the coming months.

2012-10-30 Building Portfolios that Beat their Benchmark: Measuring Nanometers with a Yardstick by Bob Veres (Article)

Using tools he co-developed with the Nobel-prize winning economist Bill Sharpe, one advisor has found that he can reliably outperform an appropriate benchmark. His work proves it is possible to build a portfolio knowledgably. You just need the right tools to get the job done.

2012-10-30 The Yield Hunt by Michael Lewitt (Article)

The high-yield market is not in danger of imminent collapse as some have argued. As long as defaults remain relatively low, and interest rates remain invisible, investors will continue to chase yield. But a few things could cause a sharp sell-off in the near future.

2012-10-30 Nice Speech, Tough Crowd by Christian Thwaites of Sentinel Investments

Sandy is pummeling everything we know on the eastern seaboard. I hope everyone stays safe and we can ride this out without too much damage. Thankfully markets are closed. Meanwhile, here's our views on capital markets on Monday.

2012-10-30 Weekly Update: Commentary and Statistics by Team of ING Investment Management

U.S. equity markets fell back into decline during the week, as earnings reports and more specifically, forward outlooks inspired investor caution. Meanwhile, a potential "Frankenstorm" has the East Coast on edge for the coming week.

2012-10-30 A Bombing in Lebanon by Bill O'Grady of Confluence Investment Management

The larger issue is related to Syria's civil war and the growing potential for the conflict to regionalize. In this report, we will offer a short history of Lebanon and Syria, examine the current state of the conflict in Syria and discuss the potential for the Syrian civil war to become a regional conflict. As always, we will conclude with potential market ramifications.

2012-10-30 A Europe of Solidarity, Not Only Discipline by George Soros of Project Syndicate

The decision at the EU summit in June to form a banking union, and the ECB's commitment to unlimited intervention in the sovereign-bond market, could be a turning point for Europe were these steps reinforced with additional measures. Unfortunately, the EU's unfolding tragedy characteristically feeds on such glimmers of hope.

2012-10-29 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

Disgruntled investors took a look at the earnings reports and ran for the hills. With some industrial and techs issuing pessimistic reports (mainly in their outlooks), investors chose to take a hiatus. Election season is just a week-ish away and then the fiscal cliff looms in the not-so-distance future, so plenty of uncertainties and concerns remain for the time being. (And don't forget Spain.)

2012-10-29 The Quest for Certainty by John Mauldin of Millennium Wave Advisors

The last two weeks we have been looking at the problems with models. First we touched on what I called the Economic Singularity. In physics a singularity is where the mathematical models no longer work. For example, models based on the physics of relativity no longer work if one gets too close to a black hole. If we think of too much debt as a black hole of sorts, we may understand why economic models no longer work. Last week, in "The Perils of Fiscal Cliff," we looked at the use of fiscal multipliers by economists in order to argue for or against governmental economic policies.

2012-10-29 Distinction Without a Difference by John Hussman of Hussman Funds

In recent weeks, market conditions have fallen into a cluster of historical instances that have been associated with average market losses approaching -50% at an annualized rate. Of course, such conditions don't generally persist for more than several weeks the general outcome is a hard initial decline and then a transition to a less severe average rate of market weakness (the word "average" is important as the individual outcomes certainly aren't uniformly negative on a week-to-week basis).

2012-10-29 The White Hurricane by Jeffrey Saut of Raymond James

I revisit The White Hurricane this morning because it potentially looks like another 100-year storm is heading pretty close to Manhattan. So in addition to dealing with the Benghazi scandal, Syrian atrocities, Euroquake, the "fiscal cliff," a stalled U.S. economy, softening earnings momentum, waning revenues, a dysfunctional government, the nastiest campaign I have ever seen, and who Taylor Swift should date next, Wall Street now has to contend with the potential of being flooded out.

2012-10-29 Narrowing It Down: Single Country vs. Broad Exposure by Russ Koesterich of iShares Blog

With the number of exchange traded products continually growing (globally, there are now more than 4700 ETPs and counting), an interesting debate has arisen about whether investors should gain access to international equity markets through a fund that tracks a broad benchmark or through more granular regional or country exposures. Typically choice is a positive thing, but it's understandable that the size and scope of the ETP market can add a layer of complexity to an investor's selection process.

2012-10-29 The Shifting Investment Environment: Picking Growth Stocks in a "Saturated" World by Virginie Maisonneuve, Katherine Davidson of Schroders Investment Management

Is the global economy close to reaching a tipping point? The impacts of our key themes (demographics, climate change and the emerging market supercycle) are combining with the ramifications of the global financial crisis to create an environment where growth is reaching a point of "saturation". In this world, focusing on the sustainability of growth becomes more important than ever. This is important for investors as the global economy painfully adjusts to new realities and follows a rocky path to normalization.

2012-10-26 October 2012: Fixed Income Investment Outlook by Team of Osterweis Capital Management

Like last year, this summer's quarter was eventful. Investors entered the quarter with high expectations that the European Central Bank (ECB) and Federal Open Market Committee (FOMC) would provide the markets with more monetary largesse. On July 26th, Mario Draghi, President of the ECB, vowed to "do whatever it takes" to preserve the euro. Risk assets then began an anticipatory rally heading into some key events in mid-September.

2012-10-26 October 2012: Equity Investment Outlook by Team of Osterweis Capital Management

Equity and other "risk" assets rallied in the third quarter in anticipation of further monetary easing by central banks around the world. The prospect of increased liquidity from the central banks appears to have focused investor attention, at least temporarily, away from the generally softer economic data that continue to emerge from Europe and Asia.

2012-10-26 Of Irish and Fiscal Cliffs by Team of Franklin Templeton Investments

Dr. Michael Hasenstab, Templeton Global Bond Fund portfolio manager and co-director of Franklin Templeton Fixed Income Group's International Bond Department, doesn't prescribe legislative answers, but he can relate the fiscal challenges the U.S. faces to the experiences of a country with its own dramatic cliffs: Ireland.

2012-10-26 Don't Fear a Normal Gold Correction by Frank Holmes of U.S. Global Investors

Dont let the short-term correction fool you into selling your gold and gold stocks. The dramatic increase in money suggests that monetary debasement will continue, and in addition to all the above drivers, these are the positive dynamics driving higher prices for gold and gold stocks.

2012-10-26 What Now? by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

The market appears to be in a "wait-and-see" mode in advance of the elections, but looking beyond November 6th is important for investors. The election is only one piece of the puzzle, and certain aspects of the political landscape likely won't be much clearer after Election Day. Earnings season has been somewhat disappointing, even though there was a relatively low bar to hurdle. We see more signs that the slowdown in the United States may be ending, however, with strength in housing particularly noteworthy.

2012-10-26 Weekly Economic Commentary by Carl Tannenbaum, Asha Bangalore and James Pressler of Northern Trust

Fiscal policy is a matter of multiplication. US GDP growth accelerated in the third quarter, but remains less than ideal. Recent reports out of China reassured the markets, but underlying trends are not so promising.

2012-10-25 Cheap Debt is Good News for Stocks by Scott Minerd of Guggenheim Partners

The eventual return of leveraged buy-outs (LBOs) and an uptick in mergers and acquisitions (M&A) should give investors further reason to be bullish on stocks.

2012-10-25 The Arithmetic of Equities by Andrew Redleaf of Whitebox Advisors

t is a first principle at Whitebox to be security agnostic: to penetrate the labels like bond and stock and hybrid and assess the real status of a security by the risks and rewards that flow from the combination of economic circumstances and the details of capital structure. For most of the last decade it was quite clear to us that equities bore all their traditional risk but bolstered only bond-like rewards (at best), while high yield bonds often offered equity-like returns that could be shielded from default risk by shorting the all too risky stock of the same or a similar firm.

2012-10-25 In or Out? The Case for - and Against - the Stock Market by Team of Knowledge @ Wharton

Given ongoing volatility in the stock market, it's no surprise that investors are increasingly bearish on the market's prospects, beset by a lack of confidence in its institutional underpinnings and a general pessimism about the direction of the economy. But is that distrust misplaced? Wharton experts are mixed about the future fortunes of the stock market, with some saying that investors are withdrawing at the worst possible time and others noting that many people had entrusted too much of their retirement savings to the fate of equity markets.

2012-10-25 Are European Value Stocks Poised for Recovery? by Tawhid Ali of AllianceBernstein

For the last few years, the sovereign debt crisis in Europe has caused equity investors to flee the continent. Today, that exodus has set up an attractive opportunity for value investors. By the end of September, European stocks were trading at a 16% discount to global equities based on price/book value, well below their average of the last 24 years.

2012-10-24 Policy at a Crossroads by Investment Strategy Group of Neuberger Berman

On September 13, the Federal Reserve announced a third round of quantitative easing, dubbed QE3, in the hope of providing an additional boost to the slow U.S. economic recovery. Although this latest policy action reinforces the notion that the U.S. is prepared to support its economy for as long as needed, some economists question whether the stimulus can really make a difference. In this issue of Strategic Spotlight, we consider the recent effects of loose monetary policy and whether the Fed has "reached its limit."

2012-10-23 How to Change the Regulatory Debate - Before it's Too Late by Bob Veres (Article)

After almost a decade of lobbying, arguing, and posturing, the long fight on Capitol Hill over who will regulate RIAs and how to define 'fiduciary' is approaching a close. Within the next six months, there will no longer be any real excuse to put off a decision, and new players, both in Congress and at the SEC, will be eager to start fresh.

2012-10-23 ECB Bond Buying Is a Double-Edged Sword by Darren Williams of AllianceBernstein

European Central Bank (ECB) president Mario Draghi's promise to do "whatever it takes to preserve the euro" and create a new bond-purchase program has been positive for market sentiment. But the program also carries real dangers if it breaks the fragile consensus on the board of the ECB and eases the pressure on governments to create a "genuine" economic and monetary union.

2012-10-23 The Perils of the Fiscal Cliff by John Mauldin of Millennium Wave Advisors

In today's letter we'll peek over the Fiscal Cliff and see what economic models can tell us about government spending. And if we have time we'll quickly look at an interesting study that uses economics to predict the outcome of this US presidential election.

2012-10-23 Silver Anniversary by Jeffrey Saut of Raymond James

It was Friday October 16, 1987 as I looked across Wheat First Securities' trading desk only to see a stark look on the face of my second in command, Art Huprich. At the time the D-J Industrials (INDU/13343.51) were down about 100 points with 30 minutes left in the trading session. And, as stocks swooned I said to Art, "Today is just for practice!" Little did I know how prophetic that statement would prove.

2012-10-23 The GDP Outlook by Scott Brown of Raymond James

On Friday, the Bureau of Economic Analysis will release the advance estimate of third quarter GDP growth. Theres always a lot of uncertainty in the advance estimate. The BEA will have to make assumptions about inventories, foreign trade, and a few other missing components. However, the report should continue to show the U.S. economy in recovery mode.

2012-10-23 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks remained sluggish last week as earnings guidance more than last quarter's reports put a damper on stock prices. In addition, the European summit was a failure and investors remain hesitant before the November elections.

2012-10-22 And That's the Week That Was by Ron Brounes of Brounes & Associates

Maybe a four day work week would make some sense? Well, at least, it would have been helpful this week. After a strong start in the equity markets (and a four-day winning streak), the anniversary of Black Monday brought horrid memories of past bearish times and stocks gave up all (most) of their early gains. Major techs reported poor earnings and the Nasdaq struggled more than most as weak PC demand continues to take its toll. Good news...one bad day does not a market make.

2012-10-22 The Data-Generating Process by John Hussman of Hussman Funds

For anyone who works to infer information from a broad range of evidence, one of the important aspects of the job is to think carefully about the structure of the data what is sometimes called the "data-generating process." Data doesn't just drop from the sky or out of a computer. It is generated by some process, and for any sort of data, it is critical to understand how that process works. In the financial markets, the data-generating process is often very misunderstood.

2012-10-22 An Alternate Reality by Robert Stimpson of Oak Associates

The largest positive factor affecting the environment for stock prices this year has been the recovery in the housing sector. After years of struggle, the sector appears to have turned the corner. The housing market had been showing signs of improvement for some time, but the debate as to whether the recovery was legitimate weighed on the group and added to concerns over the economy.

2012-10-22 Politics, Cliff Watching Take Priority in the Short-Term by Bob Doll of BlackRock Investment Management

The US elections are only two weeks away, and the recent polls show a very tight race. There are significant differences, both perceived and real, in the policies of the two candidates and the impact they might have on financial markets.

2012-10-22 More traction...Just Look Through the Earnings by Christian Thwaites of Sentinel Investments

Last week saw an important debate on how the US has fared in the post recession recovery. The short answer is, "not well" if measured by a return to GDP growth trends or per capita income. But the counter, as explained by Reinhart and Rogoff, is "faster than you would expect." We're in the second camp.

2012-10-22 The Little Country That Could by Bill O'Grady, Kaisa Stucke of Confluence Investment Management

In this geopolitical report we will take a brief look at Estonia's history, its economy after the break-up of the Soviet Union, its remarkable economic growth in the 1990s and early 2000s, and the ensuing downturn in 2008. The country stands out for choosing a different path to deal with the recession than many other European countries.

2012-10-22 3 Investment Strategies for the New World by Russ Koesterich of iShares Blog

No doubt about it the investment climate has changed, and it's unlikely to change back anytime soon. Russ K gives 3 possible solutions for investors seeking to adjust to the new investment world.

2012-10-19 International Equity - Monthly Product Commentary: September 2012 by Team of Thomas White International

International equities made strong gains in September as aggressive policy action from central banks in Europe and the U.S. helped offset concerns over moderating economic growth across the globe. The European Central Bank (ECB) announced a program to buy unlimited quantities of debt issued by troubled countries such as Spain, Portugal, and Greece, provided they adhere to a strict fiscal adjustment timetable.

2012-10-19 Fall Quarterly Commentary by John Prichard of Knightsbridge Asset Management

It was a busy quarter for central bankers. A surprise statement during July by European Central Bank President, Mario Draghi, moved markets: "Within our mandate, the ECB is ready to do whatever it takes to preserve the Euro... and believe me, it will be enough." These words sparked an immediate and sharp turnaround in European bond yields (down) and world equities. Not to be outdone, Fed Chairman Bernanke announced QE3 on September 13th, promising to continue purchasing bonds, thereby increasing the money supply, until employment conditions improve.

2012-10-19 House of Mirrors by Jeremy Boynton of Laureate Wealth Management

Did you ever try to navigate the "House of Mirrors" as a kid at your local carnival? You know the one I mean ---- where you walk through a labyrinth of mirrors designed to confuse your orientation while mocking you with various distortions of your body? If you were particularly skilled, you could use the mirror to your own advantage. What a compelling metaphor for the current state of the financial markets.

2012-10-19 Quarterly Letter by Ron Muhlenkamp of Muhlenkamp & Company

In his latest quarterly letter, Ron Muhlenkamp, president and portfolio manager of the Muhlenkamp Fund, re-examines Europe, China, and U.S. Politics as the major drivers of the markets. On September 7, 2012, Muhlenkamp published a Market Commentary, headlined "Threat of European Banking Crisis Recedes." In it, he discusses the Outright Monetary Transactions program, introduced by the European Central Bank. Mr. Muhlenkamp thinks this program makes credible the ECB's promise to do all it can to keep the Eurozone together.

2012-10-19 Muddling Down the Middle by Josh Thimons of PIMCO

PIMCO expects that the debate over the fiscal cliff will end in fiscal consolidation, but not a fiscal catastrophe. Unfortunately, while the Fed's monetary policy actions have been, by and large, successful in achieving its intermediate-term goal of increasing asset valuations, they have not been effective in influencing real economic outcomes. Our forecast for the drag on GDP from the fiscal cliff in the coming year is roughly negative 1.5%. Improvement in the housing market will only fill a small part in that hole.

2012-10-19 Monthly Investment Bulletin by Team of Bedlam Asset Management

In their efforts to support growth, governments and central bankers have steadily chipped away at the free market. Through increased regulation, financial suppression and monetary intervention they have accentuated the lack of supply in quality fixed income paper, driving bond yields down to previously unthinkable levels. Policy makers are almost pathological in their belief that the end justifies the means as they try to inflate away their debt by keeping interest rates below nominal growth.

2012-10-19 Blurring Lines: Positioning for Developed and Emerging Market Realignments by David Fisher, Julie Salsbery of PIMCO

The demographic, financial and political lines separating developed and emerging countries are increasingly blurred, and we believe bond investors will need to adapt. Not only do investors need to take a more holistic approach to analyzing and investing in sovereign debt, they also need to reconsider their strategic thinking regarding benchmarks and their tactical approach to seeking returns. PIMCO Global Advantage Strategy utilizes a GDP-weighted benchmark and capitalizes on PIMCO's global resources to create a portfolio designed to reflect the evolving international opportunity set.

2012-10-19 Global Overview: September 2012 by Team of Thomas White International

Aggressive policy action by the U.S. Federal Reserve and the European Central Bank (ECB) helped lift investor sentiment further in September, even as economic signals from across the world continued to be jaded. The Fed has committed to buy mortgage backed securities and keep interest rates low until U.S. economic growth becomes more vigorous and the unemployment rate declines to more comfortable levels.

2012-10-19 Stealth Mode by Stephen J. Taddie of Stellar Capital Management

After more than 30 years of declining rates, a reversal that started a longer term trend of higher interest rates, like that experienced from the late 50s to early 80s could be devastating to bond investors. In addition, interest rate increases have not treated many other income investments like fixed rate preferred stocks very well as many of these issues have extremely long maturities, and/or are perpetual. This makes stretching for yield in this type of environment both challenging and hazardous.

2012-10-19 Chinese Stocks Looking Like a Bargain by Frank Holmes of U.S. Global Investors

This appears to be a good time to be investing in China, as stocks are historically cheap. Chinese stocks are also cheap compared to emerging markets.

2012-10-19 ECB Needs to Rescue German and French Banks More than European Periphery: Global Macro View by George Bijak of GB Capital

Whenever we talk about rescuing overleveraged Europe it is always about Spain, Italy, Portugal, Ireland, and Greece the European periphery loaded with debt that they cannot possibly repay. But a closer look at the recent IMF data reveals that German and French banks need rescue more than anybody

2012-10-18 Quarterly Review and Outlook - Third Quarter 2012 by Hoisington and Hunt of Hoisington Investment Management

Entering the final quarter of the year, domestic and global economic conditions are extremely fragile. Across the globe, countries are in outright recession, and in some instances where aggregate growth is holding above the zero line, manufacturing sectors are contracting. The only issue left to determine is the degree of the downturn underway.

2012-10-18 Investment Outlook 2013: "ABCD" Investing: Anything Bernanke Cannot Destroy by Cliff Draughn of Excelsia Investment Advisors

The Ben Bernanke and Mario Draghi concert gave the markets a double shot of their love in the month of September by promising to print as much money as needed to finance the debts of their respective countries. Ever since the financial fraternity party ended in 2008 and the world began deleveraging its massive credit hangover, the global markets have been hooked on the next shot of love from the central bankers.

2012-10-18 As Global Growth Falters, Consider Emerging Markets by Russ Koesterich of iShares Blog

Global growth this year is forecast to lag that of both 2011 and 2010, and the outlook for 2013 isn't much better. These sobering forecasts are bolstering Russ K's view that investors should consider being overweight emerging market stocks.

2012-10-18 Macro View: Europe's Glacial Move To Federalization by Scott Minerd of Guggenheim Partners

Uncertainty continues to weigh on European markets but the continent is still drifting toward federalization. Recent trends and political developments are constructive for an eventual return to growth for the region.

2012-10-18 Emerging Markets Equity - Monthly Product Commentary: September 2012 by Team of Thomas White International

Investment inflows and low interest rates helped emerging market equities. Emerging market equities saw a healthy recovery during the month of September, as the U.S. Federal Reserve and the European Central Bank rolled out aggressive monetary measures to support their respective economies. As the U.S. and Europe are the biggest markets for exports from emerging market countries, it is hoped that the latest monetary stimulus measures will help these countries revive the export growth that has slackened in recent months.

2012-10-17 Fuzzy Math from the Continent of Peace by Christian Thwaites of Sentinel Investments

Whoops! The IMF made two announcements last week that caught our attention. But to set up the joke in all this, it's worth remembering that for decades the IMF preached austerity economics to any country that needed balance of payments assistance.

2012-10-17 Economics is Such a Drag by Fred Copper of Columbia Management

At least in Europe it is. Central bankers around the world are doing everything they can to try and pump up the global economy. Mario Draghi, President of the European Central Bank, has been incredibly aggressive and creative in trying to rectify the imbalances plaguing Europe.

2012-10-17 Emerging Europe: Third Quarter 2012 Economic Review by Team of Thomas White International

In its recent economic assessment, the European Bank for Reconstruction and Development (EBRD) said it expects growth to slow down during the year in member countries such as Russia, Poland, Hungary, and Turkey as the effects of the Euro-zone crisis spills over. The bank said many of these countries have already seen lower growth, but Russia especially is affected by falling commodity prices. Striking a similar note, the International Monetary Fund in its World Economic Outlook said emerging economies of the world are at risk should the developed economies experience a continued slowdown.

2012-10-17 Q3 Investor Letter by Team of HORAN Capital Advisors

At the beginning of the third quarter, investors following the "sell in May" strategy felt vindicated as the S&P 500 Index declined over 9.0% from May 1st to June 4th. The June 4th date turned out to be the intra-year market low and the equity rally was almost uninhibited throughout the remainder of the third quarter. We have been experiencing mixed global economic data over the past several months and in response, the Federal Reserve announced a third round of quantitative easing. While the market initially responded favorably, it ultimately declined through the end of the quarter.

2012-10-16 Stiglitz vs. Bremmer: What’s Next for the Global Economy? by Ben Huebscher (Article)

On October 3rd, the same night Barack Obama and Mitt Romney were clashing in their first debate, two equally polarized men met in New York City's Kaufmann Concert Hall to discuss the future of economics, both here and abroad.

2012-10-16 The New World of Credit by Michael Lewitt, Editor, The Credit Strategist (Article)

In an era in which economies are driven by the creation of fiat money by central banks, and where the base of hard money is dwarfed by the volume of outstanding debt, every form of capital is tied to credit. In 1919, William Butler Yeats famously wrote that 'the center cannot hold.' A century later, there is no center.

2012-10-16 Bank of England Still Aiming at the Wrong Target by Darren Williams of AllianceBernstein

The UK is celebrating a near three-year low in consumer price inflation, but we think the Bank of England (BOE) should be more worried about the role that money and credit play in the inflation process.

2012-10-15 Should We Bail Out (of) Europe? by Joni Clark of Loring Ward

The troubling headlines from Europe just keep on coming, and the seemingly-never-ending string of economic summits has failed so far to develop a comprehensive solution. This has led some investors to wonder if they should reduce their exposure to investments in the eurozone.

2012-10-15 Equity Market Review & Outlook by Richard Skaggs of Loomis Sayles

Global equity markets performed well in the third quarter after posting modest losses in the second quarter. The soft second quarter, which followed back-to-back double-digit quarterly gains, proved to be a pause rather than a signal that the equity bull market was ending. Though defensive sectors garnered favor in the second quarter, economically sensitive sectors have generally led performance this year, with technology, financials and consumer discretionary topping the list year to date.

2012-10-15 Bond Market Review & Outlook by Thomas Fahey of Loomis Sayles

Aggressive policy responses from major central banks were dominant forces in the third quarter. The European Central Bank (ECB), Federal Reserve (Fed), Bank of Japan (BoJ) and other central banks took decisive action, prompted by the escalating European sovereign debt crisis, slowing global growth, financial market volatility, and the impending US "fiscal cliff."

2012-10-15 Lender of Last Resort Move Crucial to Regional Stability by Andrew Balls of PIMCO

While the ECB's engagement as a lender of last resort is crucial, Europe's big four governments must provide political commitments supportive of ECB policy to counter the lingering threat of a Greek exit, address convertibility risk, and build a more stable union. However, this will require sustained growth. Faced with capital flights from the periphery and lowered credit ratings, the key challenge remains crowding-in private and foreign official investors to buy peripheral sovereign debt.

2012-10-15 Seven Varieties of Deflation by A. Gary Shilling of Gary Shilling & Associates

Inflation in the U.S. has historically been a wartime phenomenon, including not only shooting wars but also the Cold War and the War on Poverty. That's when the federal government vastly overspends its income on top of a robust private economyobviously not the case today when government stimulus isn't even offsetting private sector weakness. Deflation reigns in peacetime, and I think it is again, with the end of the Iraq engagement and as the unwinding of Afghanistan expenditures further reduce military spending.

2012-10-15 Passed Pawns by John Hussman of Hussman Funds

I've long been fascinated by the parallels between Chess and finance. Years ago, I asked Tsagaan Battsetseg, a highly ranked world chess champion, what runs through her mind most frequently during matches. She answered with two questions "What is the opportunity?" and "What is threatened?" At present, I remain convinced that the key opportunity lies in closing down exposure to risk.

2012-10-15 QE3Back to the Future by Milton Ezrati of Lord Abbett

The broad scope and open-ended nature of the Federal Reserve's third round of quantitative easing raises questions about what exactly Fed chairman Ben Bernanke has in mind. Some insight, remarkably, emerges from a speech he gave in November 2002 to the National Economists Club in Washington, D.C., when he was simply a Fed board member. Taking his cue then from fears of a Japanese-style deflation, he laid out a path for monetary stimulus in an extreme situation, outlining nontraditional policy tools that have since become common.

2012-10-15 Economic Singularity by John Mauldin of Millennium Wave Advisors

There is considerable disagreement throughout the world on what policies to pursue in the face of rising deficits and economies that are barely growing or at stall speed. Both sides look at the same set of realities and yet draw drastically different conclusions. Both sides marshal arguments based on rigorous mathematical models "proving" the correctness of their favorite solution, and both sides can point to counterfactuals that show the other side to be insincere or just plain wrong.

2012-10-15 And That's the Week That Was by Ron Brounes of Brounes & Associates

Though investors seemed to overlook the negative earnings projections for the third quarter, the initial releases finally brought out the sellers. While the naysayers had been drowned out by the optimism of the Fed moves, the early results and management warnings prompted investors to sell (and sell and sell) as the major equity indexes each plunged over 2% in what was considered the worst week since June. Heck even a "cheery" Joe Biden couldn't save the markets this week.

2012-10-15 High Yield and Bank Loan Outlook by Scott Minerd of Guggenheim Partners

The leveraged credit market turned in an impressive Q3 with high yield bonds and bank loans returning 4.3 and 3.1 percent, respectively. Unprecedented accommodation from central bankers across the globe has alleviated much of the macroeconomic tail risk that we highlighted in last quarters publication. Presented with a seemingly insatiable demand for new issue bonds, issuers returned to the torrid pace of issuance that characterized the start of 2012 by raising a record $99 billion during the third quarter.

2012-10-15 Commodity Inflation Complicating Pro-Growth Policies by Ryan Davis of Fortigent

The return of commodity inflation raises several questions, primary among them being the impact it will have on emerging markets. While rising commodity prices are generally bullish for equity prices in emerging markets, it may also inhibit central bank flexibility at a time when many developing countries are experiencing decelerating economic growth. This issue was paramount in 2010, leading to underperformance in many EM stock markets. Since then, however, commodity prices have generally moved sideways, allowing those fears to subside.

2012-10-15 The New Investment World is Not Near, It's Here by Russ Koesterich of iShares Blog

The recent pace and magnitude of economic change has left many investors disoriented, to say the least. Russ K explains why this new environment is unlikely to change any time soon, which may have implications for investors' current and long-term strategies.

2012-10-12 Teetering on the Edge? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

Concerns about a possible US recession remain elevated in light of the pending "fiscal cliff," resulting in some lackluster stock market action. The fiscal cliff and uncertainty around tax and regulatory policy appear to be influencing business decisions to the detriment of economic growth. While worst-case scenarios for Europe may have been taken off the table by the ECB, Spain's reluctance to ask for aid is causing consternation. And although we see continued weak growth in China, signs indicate the global slowdown may be turning around.

2012-10-12 Chinas Pyramid of Power by Frank Holmes of U.S. Global Investors

We've been able to witness Chinas incredible growth, with GDP averaging 10 percent per year and more than 500 million people moving out of poverty over the past 30 years. Now after three decades of tremendous expansion, this new generation of leaders will have to carefully maneuver the country into the next decade, towing the line between maintaining the stability created during the previous Hu-Wen administration and continuing the political and economic reform necessary to adjust to the countrys slowing growth.

2012-10-12 Should We Bail Out (of) Europe? by Joni Clark of Loring Ward

Though the eurozone has its share of ongoing challenges and uncertainty, this doesn't mean investors should exit Europe entirely.

2012-10-12 U.S. Economic and Interest Rate Outlook - October 2012 by By Carl Tannenbaum and Asha Bangalore of Northern Trust

Budget negotiations in the US and Europe are attempting to balance austerity, prosperity, and posterity. US exports and imports are showing the strains of sluggish conditions overseas. Our updated economic forecast reflects some "cliff" effects, but not a renewed recession.

2012-10-12 Long/Short Investing: Bon Apptit by Geoffrey Johnson of PIMCO

Long/short equity is a distinct investment approach that seeks to reduce downside risk while still capturing much of the equity markets upside potential. By removing the long-only constraint, long/short managers have an expanded opportunity set with the potential to generate returns and mitigate risk from both long and short investment ideas. Long/short equity strategies have a lower long-term volatility and risk profile than the market as a whole and have captured a good percentage of price movement in up markets and a smaller percentage in down markets.

2012-10-12 The Golub Group Commentary by Team of The Golub Group

High-quality businesses that have the ability to pay and increase their dividends are even more attractive in this low yield environment and the valuations of these businesses are cheap on an historic basis and relative basis to the alternatives.

2012-10-11 Inflation Regime Shifts: Implications for Asset Allocation by Nicholas Johnson, Sebastien Page of PIMCO

Investors who are concerned about inflation should focus on increasing their exposure to asset classes that provide a positive beta to changes in inflation. We believe that asset prices are much more sensitive to inflation surprises than actual inflation levels themselves. Given the current macro environment, investors face the possibility that low growth and high inflation may coexist. Commodities provide a levered response to inflation. Investors can hold a relatively small amount of commodities to hedge a much larger portfolio.

2012-10-11 Macro View: China in Transition by Scott Minerd of Guggenheim Partners

With nominal growth rates falling faster than expected, the possibility of a hard landing for China country's economy appear to be increasing. More importantly, however, there is more to this situation than is immediately observable.

2012-10-10 Return to Bretton Woods by Scott Minerd of Guggenheim Partners

The gold-convertible U.S. dollar became the global reserve currency under the Bretton Woods monetary system, which lasted from 1944-1971. This arrangement ended because foreign central banks accumulated unsustainably large reserves of U.S. Treasuries, threatening price stability and the purchasing power of the dollar. Today, central banks are once again stockpiling massive Treasury reserves in an attempt to manage their currency values and gain advantages in export markets. We have, effectively, returned to Bretton Woods.

2012-10-10 Collapse in UK Investment Income Is Cause for Concern by Darren Williams of AllianceBernstein

A collapse in direct investment income was the main factor behind the UK's record second-quarter current account deficit. It's too early to know whether this represents a permanent shift. But, if it does, it would make rebalancing the economy more difficult and have important implications for the pound.

2012-10-10 Pacific Basin Market Overview by Team of Nomura Asset Management

Regional equity markets remained largely directionless and volatile during the third quarter amid the summer trading lull. Government policy action towards the end of the quarter triggered the biggest market moves. However, the euphoria was short lived following the announcements of the European Central Bank's Outright Monetary Transactions and the Federal Reserve Board's third round of quantitative easing.

2012-10-10 And That's the Quarter That Was by Ron Brounes of Brounes & Associates

The "quarter of Bernanke" left investors optimistic over the past three months despite the ongoing concerns at home and abroad (and a critical election).

2012-10-10 Third Quarter Surge Caps 12-Month Relentless Risk Rally by Douglas Cote of ING Investment Management

Despite the rally of the past year, equity markets still look cheap. Weakening manufacturing data suggest the 12-quarter streak of positive earnings growth may come to an end in the third quarter. Housing has turned the corner, providing consumers with cause for confidence. Though fundamentals have wavered a bit, we are constructively bullish on risky assets, as "successful investing demands a choice between prudent risk control and outright risk avoidance".

2012-10-09 Dividend Income: Music to Our Ears by ClearBridge Advisors (Article)

The hunger for income among investors is helping put dividends in the spotlight, say Hersh Cohen and Mike Clarfeld of ClearBridge.

2012-10-09 A Q3 Letter to Clients - Insights from a Wall Street Legend by Dan Richards (Article)

Here is a template for a letter to serve as a starting point for advisors looking to send clients an overview of the past 90 days and the outlook for the period ahead. In it, I draw upon investing principles articulated by the legendary Barton Biggs, who passed away earlier this year.

2012-10-09 The Yin and Yang of 2012 Stock Markets Through September by Ron Surz (Article)

Despite investor concerns about the economy, stock markets delivered substantial returns in the year-to-date, with the S&P 500 returning more than 16% and Europe, Australasia, Far East (the EAFE index) delivering more than 10%. This growth has been in the face of investor withdrawals from equity mutual funds. So if mutual fund investors are selling, who is buying?

2012-10-09 Bibi Blinks by Bill O'Grady of Confluence Investment Management

On September 27th, Israeli PM Benjamin Netanyahu gave a speech before the U.N. General Assembly. Although it will be best remembered for his "looney toons" prop of a cardboard bomb which he used to describe when Iran crosses the "red line" (which, appropriately enough, was drawn on the bomb with a red marker), the real story of the speech was his apparent climb down from pressing for an attack on Iran.

2012-10-09 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks advanced last week as the impact of the Fed's monetary easing combined with some better economic data persuaded traders to continue to buy.

2012-10-09 Expect Economic Sluggishness to Persist by Bob Doll of BlackRock Investment Management

Although the economy does seem to have improved a bit in recent months compared to where it was in the second quarter, growth levels in both the United States and around the world will likely remain subpar at least through the middle of next year. The base case for the United States appears to be the economy continuing to grow at around 2% (perhaps a notch higher) over the course of 2013. This growth level would be contingent on avoiding the full force of the fiscal cliff and would be underpinned by a recovery in housing and a pickup in capital spending levels.

2012-10-09 Global Investment Outlook by Team of Aberdeen Asset Management

Global growth remains positive but momentum is lacking. Central bank action has eased tensions. Markets are calmer but future direction is uncertain

2012-10-08 Number Five by John Hussman of Hussman Funds

Examine the points in history that the Shiller P/E has been above 18, the S&P 500 has been within 2% of a 4-year high, 60% above a 4-year low, and more than 8% above its 52-week average, advisory bulls have exceeded 45%, with bears less than 27%, and the 10-year Treasury yield has been above its level of 20-weeks prior. While there are numerous similar ways to define an "overvalued, overbought, overbullish, rising-yields" syndrome, there are five small clusters of this one in the post-war record.

2012-10-08 Easing Labor Pains for Europe? by Milton Ezrati of Lord Abbett

The Continent sees the first stirrings of needed job-market reforms.

2012-10-08 Strong Employment But Still Lots of Slack by Christian Thwaites of Sentinel Investments

The ECB's dearth of tools came through loud and clear last week. Rates remained unchanged not because the economies have a ghost of a chance of recovery but because inflation, at 2.7%, scored well above the 2% target. There's a certain amount of in-built inflation in European economies not present in the US, for example, indexing across many industries and pensions, VAT and euro denominated commodity costs. The combination of higher oil costs and a weaker euro put some of the YOY increases in energy costs as high as 40%.

2012-10-05 Economic Recovery and Debt Reduction: Faster, Please! by Chris Molumphy of Franklin Templeton Investments

It's tough to be patient in an age of instantaneous communications and instant gratification. We all want immediate answers to our questions and quick fixes to our problems. When it comes to real world tangles like the global economy, though, Chris Molumphy, CIO of Franklin Templeton Fixed Income Group, reminds us that patience, not a magic pill, is the order of the day when it comes to European and U.S. struggles to cure their economic ailments. He's realistic about these problemsbut isn't waiting to act where he does spot investment opportunities.

2012-10-05 Rare Earths Could Be Pawn in Island Spat... Again by Heiko Ihle of Euro Pacific Capital

As China and Japan continue to ratchet up tensions over a group of disputed islands in the East China Sea, many investors may be wondering how the dispute could affect the marketplace. One potential area for fallout is the market for rare earth elements (REEs): the futuristic sounding group of 17 minerals with unpronounceable names that play a critical role in everything from hybrid cars to flat screen TVs.

2012-10-05 Election Preview by Investment Strategy Group of Neuberger Berman

Our Investment Strategy Group sizes up the approaching U.S. election and its potential impact on the "fiscal cliff."

2012-10-05 Market Respite by Richard Michaud of New Frontier Advisors

In a period of looming macroeconomic risks and great investor uncertainty the quarter resulted in solid gains in most global equity markets. The Dow was up 4.3%, the S&P 500 5.8% and the NASDAQ 6.2% for the quarter. Year-to-date the Dow was up 10%, the S&P 14.5% and the NASDAQ 19.6%. The news internationally was encouraging though mixed with European indices up 8% for the quarter and 11.8% for the year while Pacific indices were up 2% for the quarter and 7.4% for the year.

2012-10-05 How Helicopter Ben Helps Jobs and, Inadvertently, Gold by Frank Holmes of U.S. Global Investors

The world's central bank leaders continue to spike the monetary punch bowl, with investors imbibing on gold once again. This flurry of gold buying prompts many curious investors and doubting media to ask me two questions: 1) How can demand for gold and gold stocks continue; and 2) How high can the precious metal go? To answer these questions, we need to look at the intentions behind the economic and political decision-making across several developed countries, analyze the causes, the effects, and the possible ramifications.

2012-10-04 Priming the Liquidity Pump by Mark Mobius of Franklin Templeton Investments

The global economy is often like a line of dominos. One piece tumbles, causing others to fall too. This year, weak economic growth and heavy debt burdens in many developed markets had a domino effect on emerging economies, and many investors lost confidence in both. In response, central banks have taken actions to boost economic growth and prime the liquidity pump.

2012-10-04 Collective Action Clauses: No Panacea for Sovereign Debt Restructurings by Ben Emons of PIMCO

Beginning next year, collective action clauses (CACs) will become mandatory for sovereign bonds issued by European countries under U.K. law. CACs, which allow a supermajority of bondholders to agree to changes in bond payment terms, became popular following Argentina's default in 2001 and even more so after the financial crisis of 2008. On balance, the introduction of CACs in European government bond markets in 2013 is positive for investors.

2012-10-04 Monetary Mystification by Joseph Stiglitz of Project Syndicate

Central banks on both sides of the Atlantic took extraordinary monetary-policy measures in September, sending stock markets soaring. But politicians and markets in both Europe and America are mistaken if they believe that monetary policy can restore economic growth and boost employment.

2012-10-04 Overtime, Then (not so) Sudden Death by Jerome Schneider of PIMCO

The FDIC's unlimited insurance coverage on demand deposits is set to expire on December 31. While the expiration by itself might not be a game changer, it adds to the uncertainty that looms over liquidity strategies as global interest rates continue to be squeezed. We believe that actively managed short-term strategies that dynamically adjust to market conditions are viable solutions, with more attractive risk and return characteristics than money markets.

2012-10-04 When Career Risk Reigns by Neils Jensen of Absolute Return Partners

In this month's Absolute Return Letter we pick up the baton from last month. How does the current crisis actually affect financial markets? How do you overcome the low returns? What can you do to protect the downside risk in a high correlation environment? We argue that career concerns often lead to irrational decisions by professional money managers and that this provides opportunities for those who can afford to deviate from the norm.

2012-10-04 Market Dimensions by James Damschroder of Gravity Capital Partners

An interesting and perhaps volatile fourth quarter is upon us. We have elections and the fiscal cliff straight ahead. Markets dislike uncertainly, making asset prices potentially marginally lower.

2012-10-03 Understanding How "Debt Deleveraging" Works by Gary Halbert of Halbert Wealth Management

For many years, I have warned that our massive explosion in federal debt (up 50% just since Obama took office) would one day stifle economic growth. Obviously economic growth is currently stifled, what with the weakest post-recession recovery in decades. But the question remains as to whether our massive national debt and trillion-dollar budget deficits are the main reason for the disappointing recovery.

2012-10-03 The Fed Plays All Its Cards by Peter Schiff of Euro Pacific Capital

There never really could be much doubt that the current experiment in competitive global currency debasement would end in anything less than a total war. There was always a chance that one or more of the principal players would snap out of it, change course and save their citizenry from a never ending cycle of devaluation. But developments since September 13, when the U.S. Federal Reserve finally laid all its cards on the table and went "all in" on permanent quantitative easing, indicate that the brainwashing is widely established and will be difficult to break.

2012-10-03 Stocks Are Taking a Breather from the Rally by Bob Doll of BlackRock Investment Management

To at least some extent, the pause in the rally we have seen over the past couple of weeks can be attributed to some profit-taking on the heels of a significant multi-month uptrend (US stocks rose close to 6% in the third quarter). It is also likely, however, that investors are coming to grips with the fact that the world continues to face some serious risks and are recognizing that not all of the world's problems can be solved by central bank action.

2012-10-03 Where are the Global Winners? by Louie Nguyen of Soledad Investment Management

In today's ber-dreary and volatile global market condition, it can be difficult to imagine how the various markets around the world will eventually right themselves. It is worth noting, however, that the global market has righted itself before, from predicaments that seem just as, if not even more, dire than what we face today. Think Thailand and Korea in 1997, Mexico in 1994 and the Dot-Com Bubble in 2000. The following is the latest in our annual Global Price to Earning (P/E) analysis. It is part of our on-going effort to find compelling investments from around the world.

2012-10-03 Don't Bring Me Down: Not Swayed by Pessimism at BCA Conference by Liz Ann Sonders of Charles Schwab

We present highlights, key takeaways and perspective on the recent BCA Research Investment Conference. The eurozone crisis and China's slowdown remain risks, but are somewhat offset by optimism about US markets. Politics will remain a force underpinning uncertainty and volatility.

2012-10-03 Let the Good Times Roll by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

To summarize our current position, while we acknowledge there are many risks we feel those are already reflected in the market and stock prices will drift higher as investors begin to recognize the positive developments outlined above. Analysts remain very bearish and continue to recommend a below-average weighting to stocks. Moreover, despite strong returns from equities investors have pulled money from U.S. stock funds for 18 straight months and are largely under-allocated when compared to history.

2012-10-03 A Funny Thing Happened On The Way To Economic Armageddon by Scott Colyer of Advisors Asset Management

After the recent announcement by the U.S. Federal Reserve (Fed) that they would begin to engage in what has been deemed "QE3," there has been a lot of skepticism that such a plan could actually work. The Fed is attempting to carry out their dual mandate of price stability and full employment by engaging in a new round of asset purchasing targeted at the mortgage market.

2012-10-02 Woody Brock on Why to Own Stocks Now by Robert Huebscher (Article)

Dr. Horace 'Woody' Brock is the founder Strategic Economic Decisions and the author of American Gridlock. In a recent talk, he explained why investors should own stocks - particularly those with stable dividends - and why bonds are very risky in today's environment. This is the transcript; a video of this talk is also available.

2012-10-02 A Daily Reading Plan That Attracts New Clients by Dan Richards (Article)

Digesting news and sharing it with clients is part of every advisor's daily routine. Doing that efficiently, however, in such a way as to better position yourself with your clients, requires a structured approach that is far from obvious.

2012-10-02 Lessons from Scandinavia by Kaisa Stucke, Bill OGrady of Confluence Investment Management

During the late 1980s and early 1990s, Scandinavian nations suffered through balance sheet recessions. Commentators have suggested that U.S. policymakers could use the Scandinavian response to their crises as a roadmap for resolving the current U.S. situation. As part of our own analysis, we have studied several earlier events to understand the underlying similarities and differences to develop insights into the current event.

2012-10-02 The 2010, 2011, 2012 Corrections Were P/E Multiple Related; Earnings Were Sound by George Bijak of GB Capital

We had nasty stock market corrections in the middle of 2010, 2011 and 2012 caused by political uncertainty about Europe's debt. In times of market declines it is good to remind ourselves the difference between a correction and a bear market.

2012-10-01 Leap of Faith by John Hussman of Hussman Funds

Both the economy and the financial markets will do fine in the longer-term, but to imagine that there will not first be major challenges and disruptions is a leap of faith and a leap over a century of economic and financial history that screams otherwise.

2012-10-01 Gaming US Fiscal Reform by Mohamed El-Erian of Project Syndicate

The need to address America's fiscal situation has just been magnified by a warning from Moody's that the US could lose its top credit rating if Congress fails to make progress on medium-term fiscal reforms. But why didn't the imposition of a "fiscal cliff" in 2011 succeed in focusing US politicians' minds?

2012-10-01 Understanding the Equity Market's Valuation by Charles Lieberman (Article)

An excellent interview with a highly regarded value investor Bill Nygren in the latest issue of Barron's provides a good review of the math that demonstrates objectively that stocks remain cheap. At current valuations, stocks are sufficiently cheap that companies can use free cash flow to buy back shares at a pace sufficient to grow earnings per share by about 10% annually, consistent with the market's long-term historical record and dramatically above the 4% growth suggested by bond manager Bill Gross.

2012-10-01 More Pieces of the Puzzle by Scott Brown of Raymond James

Recent economic data have been mixed. Consumer attitude measures have improved, but manufacturing figures have softened. On balance, the numbers are consistent with more of the same: a positive, but lackluster-to-moderate pace of growth.

2012-10-01 Recession Risk Rising by Brian Wesbury, Bob Stein, Strider Elass of First Trust Advisors

Economic forecasting was relatively easy from the end of World War II until the middle of the prior decade. Most of the time, you could just focus on monetary policy. But then came the last recession, which had nothing to do with the Fed being too tight. Instead, falling home prices and mark-to-market rules rendered some major banks under- capitalized. A pure financial panic ensued, the likes of which we had not seen for 100 years. But what if this was not a one-time event?

2012-10-01 Euro-Area Interest Rates: To Zero and Beyond? by Darren Williams of AllianceBernstein

There has been some speculation that the European Central Bank (ECB) may soon push its deposit rate into negative territory. We think a cut in the deposit rate would be a poor substitute for measures aimed directly at repairing the monetary transmission mechanism in the troubled peripheral countries. But there's a case for reducing the deposit rate, and one which we think is worth rehearsing.

2012-10-01 And That's the Week That Was by Ron Brounes of Brounes & Associates

Bad news from Spain (no good news, no bad news.) Investors spent the week trying to make heads or tails about the headlines out of Europe, while analyzing the news from a suddenly resurging housing sector and a suddenly ailing manufacturing sector. For the most part, however, many were booking profits from a successful third quarter, while reallocating positions for the final stretch of the year. (Surely the Prez election and the "fiscal cliff" must enter into their decision-making moving forward).

2012-10-01 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stocks finally fell back last week. Weak economic data combined with concerns over Apple's new phone release hurt investor confidence.

2012-10-01 Typical Post-QE by Christian Thwaites of Sentinel Investments

We have typical post-QE market behavior. GTs sold off, then rallied. Equities rose, then flattened. The dollar sold off then strengthened. Gold crept up. Other commodities rose, yawned and gave up most of their gains. Earlier QEs took several months for this to play out. It now all happens in quick time.

2012-10-01 Dont Be Fooled By September's Market Rally by Russ Koesterich of iShares Blog

September has historically been the worst month of the year, but this time around it did not play to script. The surprising rally distracted complacent investors from signs of increasing volatility. Russ K explains.

2012-09-29 Uncertainty and Risk in the Suicide Pool by John Mauldin of Millennium Wave

Investors in the stock market, especially professionals, are obsessed with risk, your humble analyst included. We try to measure risk in any number of ways, looking for an edge to improve our returns. Not only do we try to determine probable outcomes, we also look for the 'fat tail' events, those things that can happen which are low in probability but will have a large impact on our returns.

2012-09-28 Falling Off the Fiscal Cliff? by Libby Cantrill, Josh Thimons of PIMCO

When we look at how the fiscal debate is likely to play out, rather than how it should play out, our base case is the fiscal cliff will likely be resolved in a short-term deal before the end of the year, making what was a cliff more like fiscal black diamond still dangerous, but not likely to land the economy in a body cast.

2012-09-28 The Danger of Safety by Owen Murray of Horizon Advisors

Investors have become cautious and anxious following the bear market of the past twelve years and the recent bouts of extreme volatility. We examine risks and opportunities in light of the difficult market environment in our special report The Danger of Safety."

2012-09-28 Gold Glitters by John Browne of Euro Pacific Capital

Just a few weeks ago, Mario Draghi, President of the European Central Bank, announced that he would do anything required to bailout the weakest members of the Eurozone and in so doing prevent the euro currency from dissolution. Two weeks ago, as signs of recession increased, Fed Chairman Bernanke announced he would do anything required to stimulate the U.S. economy, real estate, and the financial markets. But the biggest winners thus far that may have resulted from these newly communicated intentions are not the euro or the broad stock markets but rather gold and gold-related investments.

2012-09-28 Schwab Market Perspective: Disrespected RallyCan It Continue? by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

US equities are trading near five-year highs but numerous measures show investors remain skeptical. The enthusiasm following the Fed's announcement of more quantitative easing was short-lived, although the summer rally in stocks could be at least partially attributed to anticipation of more stimulus. The enthusiasm following the Fed's announcement of more quantitative easing was short-lived, although the summer rally in stocks could be at least partially attributed to anticipation of more stimulus.

2012-09-28 Commodity Stocks: Improving Returns With No Extra Volatility by Frank Holmes of U.S. Global Investors

Not every investment is the same. Even within the commodities space, when looking at measures such as correlation, performance and risk, two indexes can have very different effects on a portfolios results.

2012-09-27 QE3: Better for Gold than the Economy? by Russ Koesterich of iShares Blog

The Fed's recent actions may not have much impact on the economy, but, as Russ explains, keeping interest rates low for an extended period may help support commodities, particularly gold.

2012-09-27 Reality Check for Europe by Carl Tannenbaum of Northern Trust

Over the past two years, the markets have gone through cycles of escalating concern about Europe punctuated by brief periods of calm.

2012-09-27 Reconnaissance: Strategy Notes by Douglas Clark Johnson of Codexa Capital

The investment outlook for large swaths of the Islamic world may actually strengthen, because of or in spite of, events of recent weeks. Stock-price buoyancy on the Egyptian and Karachi exchanges, amid continuing public outrage, may presage coming improvements. Also this week, we take a look at Turkey, given the exceptional gains seen on the Istanbul Stock Exchange.

2012-09-27 Growing Pains in the BRICs by Investment Strategy Group of Neuberger Berman

The "BRIC" countries have been a focal point of investor interest since the early 2000s. Brazil, Russia, India and China account for about half of the world's population, boast vast natural resources and are among the fastest-growing economies in the world. That said, progress at times has been uneven. Since 2010, the MSCI BRIC Index has largely underperformed the S&P 500 as economic growth flagged. In this edition of Strategic Spotlight, we discuss current conditions and the outlook for these markets.

2012-09-27 Its the (REAL, not the financial) economy, stupid! by Kane Cotton of Bellatore Financial, Inc.

The Fed is relying on the wealth effect. It can't directly bring down unemployment (i.e., part of the "real" economy), so it is focusing on the areas that it can affect, the financial economy and asset prices. Since both PCE and Core CPI inflation measures have been fairly low and are unlikely to become uncomfortably high in the near term due to the slack labor market, low capacity utilization and stagnant incomes, the Fed is again taking aim at asset prices.

2012-09-27 Congress Adjourns Until November: Election and Lame Duck Session Update by Andy Friedman of The Washington Update

Well over a year ago, I predicted that President Obama has the better chance of recapturing the Independent vote and winning the 2012 presidential election. I continue to hold that view.

2012-09-27 Dividend Yield vs. Dividend Growth by Ashvin Viswanathan of O'Shaughnessy Asset Management

Investor demand for high-yielding companies has grown even stronger because of the perception that these companies are more defensive and recent news that the Federal Open Market Committee (FOMC) has extended its forecast of low rates until 2015. We believe buying a portfolio of high-quality, global, market-leading companies with superior valuations and high dividend yields provides investors with an excellent opportunity to consistently beat the market, while providing high income relative to fixed income securities in the current environment.

2012-09-26 Bernanke Put: Beware of Easy Money by Alex Merk of Merk Funds

Central bankers around the world may be providing a backstop to the financial markets in much the same way Greenspan did during the "Goldilocks" years, but when the short-term euphoria wears off, will the negative repercussions be even more severe?

2012-09-26 Is China Becoming Less Competitive? by Dara White of Columbia Management

Concerns about the pace of economic growth in China and the imminent change in leadership have continued to escalate. At the beginning of the year, we highlighted the potential for the rate of economic growth to slow significantly. I recently visited Asia to get a clearer perspective on the situation in China specifically, and Asia generally.

2012-09-25 Jim Bianco – Markets Will Benefit From Disastrous Fed Policy by Robert Huebscher (Article)

The Fed's quantitative easing policy will be 'disastrous,' according to Jim Bianco, but prices for riskier assets will rise over the near term as a result. In remarks last week, Bianco, the head of the Chicago-based economic research firm that bears his name, also gave the US economy a near-failing grade of C-, and warned that inflation will be 'problematic.'

2012-09-25 Value Investing in a Macro-Driven Environment by Robert Huebscher (Article)

The GoodHaven Fund (GOODX) is managed by Larry Pitkowsky and Keith Trauner. For most of the previous decade, Larry and Keith held research, portfolio management, and executive positions with the Fairholme Fund. I spoke with them last week.

2012-09-25 Seeking Solace in Northern Europe by Russ Koesterich of iShares Blog

The risks in Europe are slowly improving, but it will take a long time to fully implement needed reforms. Until that happens, Russ will continue to focus his European exposure on some northern countries.

2012-09-25 Stocks Should Overcome Hurdles to Continue the Bull Market by Bob Doll of BlackRock Investment Management

Although global economic data has been relatively weak in recent years, risk asset prices have nonetheless advanced. We would attribute this trend to the fact that weak economic growth does not, by itself, limit the potential for risk assets. In our view, the liquidity-driven reflationary policies of the world's central banks have been a more important factor for asset prices than economic growth levels have been.

2012-09-25 The Ramifications of a Robin Hood Tax by Frank Holmes of U.S. Global Investors

Chief Justice John Marshall, in 1819, once described policymakers' great influence, remarking, "The power to tax involves the power to destroy." With rising fiscal deficits and a desperate need to raise revenue, many nations have come up with various tax solutions to raise billions of dollars. One hotly contested idea in the U.S. and Europe lately, and once advocated by John Maynard Keynes during the Great Depression, is a financial transactions tax imposing a cost on buys and sells of stocks or bonds.

2012-09-25 The Beginning of Fall Blues by Jerry Wagner of Flexible Plan Investments

I only have time for a short note today. It's probably a reflection of the shorter days that fall ushers in or maybe the increased pace of business that the end of summer vacations seems to ignite. Speaking of seasons, the market weakness we saw last week is just what our Political Seasonality Index has been suggesting that the stock market might have in store for us in this period.

2012-09-25 The Future Of Money Market Funds by Gregory Hahn of Winthrop Capital Management

The Financial Crisis of 2008 has left its mark on the capital markets and the economy, and money market mutual funds are one of those areas that were affected. One of the pieces of unfinished business following the financial crisis is improved regulation of money market mutual funds.

2012-09-24 And That\'s the Week That Was by Ron Brounes of Brounes & Associates

These days, the various central bankers keep trying to outdo themselves with new stimulus deals. This week, Bank of Japan followed the Fed leads with an expanded bond buying program. Perhaps the moves will reap dividends and the global economy will surge to higher highs in the not so distant future. (Or perhaps the "easy money" strategies will have little impact long-term and lead to periods of inflation and asset bubbles.) Apple's latest "new new" thing remains in hot demand (but can supplier keep up?).

2012-09-24 If youre a partisan Republican, skip this commentary by David Edwards of Heron Financial

In June after stocks slumped over concerns about Europe, we wrote "US stocks however, were a good value a month ago and a better value today. With the weak hands forced out by the recent 10% pullback, we are moving forward with investments in stocks." With two and half months remaining in the year, our "buying panic" forecast is starting to look prescient.

2012-09-24 Trade Winds Shifting in America's Favor by Milton Ezrati of Lord Abbett

The improvement in the U.S. trade balance can be traced to the dollar's relative weakness and increasing domestic energy production.

2012-09-24 Some Parting of the Clouds by Charles Lieberman (Article)

The ongoing rally in the equity market and corresponding rise in Treasury yields mirror the slow improvement in financial market conditions in Europe and moderate gains in domestic economic data. This still leaves more progress to be made on both fronts, but uncertainty remains elevated over the fiscal cliff, the threat of military conflict in the Middle East, the upcoming election, and tax policy.

2012-09-24 Clear Progress by Christian Thwaites of Sentinel Investments

Two weeks into a new era of ECB and Fed policy and it is a tie between the gains in equities, with the US and European broad indexes up around 2.2%. But it's the lack of follow-through and opacity of the ECB moves which are perhaps the most disconcerting and so, probably, the more short-lived. While both central banks reported easing in the form of securities purchases they had very different origins and aims.

2012-09-24 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

The stock market was flat on low volume last week. In other words little of consequence happened. Oil prices fell back somewhat after rumors that a release from the Strategic Petroleum Reserve were floated by our government in an attempt to influence the market of yet another asset class. One wonders where the stock market, interest rates and the price of commodities would be if the government both at home and elsewhere was not manipulating prices to the extent they do.

2012-09-24 ECB Throws Euro a Life Preserver by Philippe Brugere-Trelat of Franklin Templeton Investments

A few short months ago, the euro appeared to be in critical condition. The crushing weight of debt, particularly in Southern Europe, seemed to be sucking the life out of the European Union. Now that the European Central Bank has announced that it stands ready to provide some life support to the euro, the contagion fears seem to have ebbed, and one might even say predictions of its death were perhaps greatly exaggerated.

2012-09-24 Alice in Euroland by Giles Conway-Gordon of Cogo Wolf Asset Management

If you have a taste for make-believe, fantasy and unreason the shifts and contortions of the European elite in the face of the Eurozone (EZ) crisis, culminating in the latest plan for the European Central Bank (ECB) to purchase unlimited quantities of the bonds of EZ members in financial difficulties, have left you spoilt for choice over the last few months.

2012-09-22 QE Infinity: Unintended Consequences by John Mauldin of Millennium Wave

Last Monday an op-ed in the Wall Street Journal, penned by five PhDs in economics, among them a former Secretary of the Treasury and an almost-guaranteed Nobel laureate (and most of them former members of the President's Council of Economic Advisors) minced no words in excoriating the current QE policy. We will look at that op-ed in detail below. The point is that there are grave reservations about the current policy among some very serious policy makers.

2012-09-21 Short-term Gratification and Long-term Return by Francois Sicart of Tocqueville Asset Management

Over time, I have tried to learn from my investment experiences. As a result, my style has become influenced less by greed and fear and more by patience and realism. Here are a few of the lessons I have learned and passed along.

2012-09-21 The Ramifications of a Robin Hood Tax by Frank Holmes of U.S. Global Investors

Could a transaction tax have unintended consequence for American banks? While the jury is still out on that answer, Hungarys example is a reminder to policymakers to comprehensively consider the rewards of collecting a Robin Hood tax along with the risks. Profits and bank credit growth rates across Hungary plummeted due to the hefty bank levies imposed.

2012-09-19 Global Investment Bulletin by Team of Bedlam Asset Management

If America's Federal Reserve Bank were a battleship, it is losing off every available piece of ordnance. The portfolio has been positioned for such an event. The USS Fed does not know who or where the enemy is, or whether its attack will hit anything for several quarters.

2012-09-19 Us and Them: Household Sector Deleveraging vs. Public Sector Leveraging by Liz Ann Sonders of Charles Schwab

The eruption of the financial crisis in 2008 unleashed a household deleveraging cycle, triggering unprecedented Fed easing and now QE∞. Next up, government sector deleveraging.

2012-09-19 Power Struggles and Progress in Romania by Mark Mobius of Franklin Templeton Investments

Bordering the Black Sea in Southeastern Europe, Romania offers visitors a variety of beautiful and dramatic landscapes concentrated in a relatively small land area, including modern cities and medieval villages, sweeping mountain vistas, broad plains and sandy beaches. Romania may also be one of the more attractive investment destinations in emerging Europe today, but its political environment has been characterized by some power struggles as dramatic as its scenic views.

2012-09-19 Farmland: The New Gold? by Randy Bateman of Huntington National Bank

Yes, it's just 'dirt', but life on this planet wouldn't exist as it does today unless it didn't comprise a third of the world's surface. Unfortunately much of that 'dirt' is in areas too wet, dry, rocky, salty, devoid of nutrients, or covered by snow for agricultural production. With only 14 percent of the world's landmass considered fertile, and that shrinking at a significant pace, there's a realization that increased farm production is essential to satisfy the increasing demand for food products.

2012-09-18 Campaign Rhetoric and Our Energy Future by Michael Edesess (Article)

At their respective conventions, both President Obama and Mitt Romney spoke to a centrally important topic for America and the world: energy. Their positions – political posturing aside – are broadly similar. But rather than a coherent, sustainable vision for the energy future of the United States, both men's rhetoric reflected the usual exercise in political base-touching, apple pie-polishing, and third-rail avoidance. And two important, perhaps crucial, pieces of the energy puzzle were hardly mentioned at all.

2012-09-18 Shock and Awe by Jerry Wagner of Flexible Plan Investments

Almost twenty years ago, the US initiated a campaign of "Shock and Awe" with its bombing campaign on the Iraqi capital city of Bagdad. I bring this up because some commentators are comparing the Federal Reserve announcement made last week (not to mention the shocking new Arab unrest and murder of our Ambassador!) to the "Shock and Awe" of the first day of the Iraq War. What made it "Shock and Awe" was that the new Fed policy differed, according to John Carney at CNBC, in three ways from past Fed actions.

2012-09-18 $4 Gas Could Put Brakes on Growth by Milton Ezrati of Lord Abbett

Reaction to the recent climb in gasoline prices appears surprisingly muted, but a sustained rise could result in a significant drag on U.S. growth.

2012-09-18 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Last week the stock market got all it wanted from the Central Banks of Europe and here at home. The money presses have been put on full power. The result was a continuation of the stock market rally along with commodities while bonds suffered a setback as investors swapped out.

2012-09-18 Federal Reserve Actions Help the Rally to Continue by Bob Doll of BlackRock Investment Management

The headline news last week was the US Federal Reserve's announcement of a new round of quantitative easing in which the central bank plans to purchase $40 billion of mortgage-backed securities on a monthly basis (without a predetermined end date). The Fed also pushed back the timeframe on how long it will maintain its current zerointerest-rate policy, indicating that the current level of rates should be in effect through the middle of 2015.

2012-09-18 Fed Delivers another Big Dose of QE by Scott Colyer of Advisors Asset Management

Yesterday, the Fed delivered the much anticipated dose of Quantitative Easing (QE) announcing that it would continue to buy U.S. Agency Mortgage Backed Securities (MBS) in an effort to further drive growth in the U.S. economy and decrease the ranks of the unemployed. The monthly purchase rate of $40 billion will be in addition to the already $10 billion that is being reinvested from QE 1&2 in mortgage-backed securities. This new money balance sheet expansion by the Fed accompanies additional guidance that the Fed would stay low on interest rates likely until mid-year 2015.

2012-09-17 And That's the Week That Was by Ron Brounes of Brounes & Associates

Dr. B. has spoken and investor are happy (though some Republican investors probably have mixed feelings). Though not all economists were on board with QE3, the policymakers looked at the labor market and took action. With promises of more bond-buying and low fund rates into 2015, investors went on a risk asset buying spree and stocks shot up to multi-year highs. So let the over-analysis (and political bickering) begin.

2012-09-17 Charlie Dreifus on the Global Economy and Its Impact on Stocks by Charlie Dreifus of The Royce Funds

Portfolio Manager Charlie Dreifus examines the data from Europe, China, and the U.S. and discusses how it may affect domestic stock prices.

2012-09-17 Emerging Markets Equity Monthly Product Commentary: August 2012 by Team of Thomas White International

Emerging market equities saw a marginal price correction during the month of August, as concerns about growth moderation in these economies persisted. The economic downturn in Europe, one of the largest markets for export-oriented emerging market countries, continues to force policy makers in emerging economies to come up with programs to support domestic growth. However, renewed optimism over aggressive policy action to stem the fiscal crisis in Europe helped the emerging markets in.

2012-09-17 Ben Wants You To Spend Cash by John Petrides (Article)

This week the Federal Reserve launched its third round of monetary policy easing in as many years. Under QE3 (quantitative easing), the Fed will purchase $40 billion of mortgage backed securities on a monthly basis with the purpose of continuing to fuel the housing market. Under QE3, the Fed said it will keep its zero interest rate policy until mid-2015, with the goal of removing market assumptions of a rising rate environment. The Fed is and always will be data dependent, so all of these actions are subject to change.

2012-09-17 Global Overview: August 2012 by Team of Thomas White International

Signs of emerging political consensus in Europe over supporting further action by the European Central Bank (ECB) and a closer banking union helped sustain investor sentiment during the month of August. Germany and select other countries that were skeptical of open ended policy measures by the ECB now appear to be scaling down their opposition.

2012-09-17 Was QE3 Necessary? It Depends on Who You Ask... by Ken Taubes of Pioneer Investments

Last week Chairman Bernanke and the Fed launched another aggressive stimulus program, QE3, saying that they will buy $40 billion in mortgage debt per month and continue to purchase assets in order to boost growth and reduce unemployment. He also announced that the Fed is not likely to raise rates from the current rock bottom lows until at least mid 2015, vs. 2014 as previously stated.

2012-09-17 The 9/11 Lessons for Terrorists by Bill O'Grady of Confluence Investment Management

In this report, we will outline potential lessons learned over the past 11 years by terrorist groups. By doing this, we hope to outline how terrorists might act in the future. As always, we will conclude with potential market ramifications.

2012-09-17 A Fed Fueled Rally by Chris Maxey of Fortigent

The week was overshadowed by policy actions from the Federal Reserve, which led to a 2.2% gain in the Dow Jones Industrial Average and a 1.9% increase in the S&P 500 Index.

2012-09-15 The Direction of the Compromise by John Mauldin of Millennium Wave

I think this election has the potential to be one of those rare times, at least in terms of economic outcomes. In Thoughts from the Frontline we cover economics and investments, money and finance. We only rarely stray into the political world, and then only glancingly. Today, we cross that gray line, but at a somewhat different angle, as we look at the economic consequences of the political decision that will come with the choices we make in November in the US.

2012-09-14 Afraid of QE3? Buy Real Assets by Seth J. Masters of AllianceBernstein

We expect to see continued asset-buying announcements from central banks around the world: the ECB last month, the Fed today, the Bank of Japan imminently. The impact of these announcements, and ensuing implementations on the real economy, are likely to be ambiguous at best. However, our research suggests that real assets such as real estate and commodities will profit from asset purchases in the near term and protect from related inflationary risks in the medium term.

2012-09-14 All In by Doug MacKay and Bill Hoover of Broadleaf Partners

Dissatisfied with progress on the jobs front, the Fed went "all in" yesterday in its much anticipated, most recent policy announcement. Unlike QE1, QE2 and Operation Twist, the latest addition to the monetary smorgasbord is open-ended, meaning that it has no pre-established termination date. Policy will remain stimulative for as long as it takes to see a substantial improvement in employment. Rather than keeping rates low well into 2014, it could now be well into 2015 before they tick back up.

2012-09-14 Open-Ended Easing by Carl Tannenbaum and Asha Bangalore of Northern Trust

The Federal Open Market Committee (FOMC) took a very forceful set of steps this week, designed to stimulate what officials have called a "frustrating" job market. Our updated forecast suggests that the growth trajectory of the US economy is positive but sufficiently sub-par for the Fed to have initiated additional monetary policy support. There are increasing signs that China's economy is slowing more than the official readings would suggest.

2012-09-14 Surviving a Downturn by Michael Han of Matthews Asia

During my recent trip to Northeast Asia, many managers I met were concerned about the gloomy macroeconomic news still coming out of Europe and were curious to hear from me about the state of the U.S. economy. Given their concerns, companies were preparing for a worst-case scenario and continuing to leverage their competitive advantage as they have done during past downturns. Surprisingly, some companies I met with in more developed parts of Asia seemed to welcome this downturn.

2012-09-14 Weaker Growth Helps Shift Germanys Approach to Sovereign-Debt Crisis by Darren Williams of AllianceBernstein

Recent German data show clearly that the sovereign-debt crisis is starting to bite. This might help explain why the government has given a green light to the European Central Banks (ECBs) new sovereign-bond purchase program. It may also indicate a more lenient approach to Greeceat least for the time being.

2012-09-14 ProVise Bullets by Team of ProVise Management Group

It is a heads I wintails you lose - scenario for American farmers. Everyone has heard about the drought throughout the U.S. being the worst since the 50s. However, dont feel too badly for the farmers as their net income will hit a record $122 billion this year. How can that possibly be, given all of the crops drying up? Easy. Since the supply is down and demand remains the same, the price has jumped dramatically and has offset the loss of yield per acre.

2012-09-14 Reconnaissance: Strategy Notes by Douglas Clark Johnson of Codexa Capital

The prominent US trade mission has been in Cairo at a particularly challenging moment politically. At-hand circumstances will remind these business leaders just how volatile the country can be, especially in the absence of growth. Egypt is probably the largest emerging market with the most uncertain economic direction, at least for the time being. We also take a closer look this week at Turkish-Iranian trade relations and policy developments in Indonesia.

2012-09-14 Operation Screw by Peter Schiff of Euro Pacific Capital

The Fed will try to conjure a recovery on the backs of currency debasement. It will not stop or alter from this course. If the economy fails to respond to the drugs, Bernanke will simply up the dosage. In fact, he is so convinced we will remain dependent on quantitative easing that he explicitly said he won't turn off the spigots even if things noticeably improve. In other words, the dollar is screwed.

2012-09-14 All Signs Pointing to Gold by Frank Holmes of U.S. Global Investors

So, gold investors, if you havent put in your orders, consider getting them in quickly, because the bulls are buying. Credit Suisse saw 'massive inflows' into gold exchange-traded products in August after experiencing significant outflows compared to crude oil and the broader market in March, April, May and July. August shows a clear preference toward gold.

2012-09-14 Central Banks Take Center Stage by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

Accommodative central banks have traditionally been good for equities and stocks have responded positively to recent action. However, each market reaction to US Fed action has been shorter in length and challenges persist. Although recent economic data has been beating relatively low expectations, it is still not meeting the Fed's hopes. We appreciate the sentiment of wanting to stimulate growth, but the Fed's power is limited. It's down the street in Washington where the real power to stimulate growth lies.

2012-09-13 Back to the Future: What's at Stake for the Economy in the Obama-Romney Contest by Team of Knowledge @ Wharton

To hear the two candidates tell it, the U.S. presidential election offers a dramatic choice on the economy: Vote for me, each says, if you want a robust recovery; pick my opponent, and we'll plunge back into recession. But given the huge problems the country currently faces, the future -- no matter who wins in November -- will look much like the present, according to several Wharton faculty.

2012-09-13 Fiddling at the Fire by Nouriel Roubini of Project Syndicate

Worldwide, political leaders are putting off the economic reforms needed to avoid a painful, if not catastrophic, endgame. But, as everyone kicks the can down the road, the can is getting heavier and, in the major emerging markets and advanced economies alike, is quickly approaching a brick wall.

2012-09-13 U.S. Dollar: Don't worry, be happy by Alex Merk of Merk Funds

May we suggest a Twitter version of today's FOMC statement: "Don't worry, be happy!" The Fed may want you to take a valium to stomach the ride ahead. Will the latest statement by the Fed put the U.S. dollar at risk of melting away under your feet?

2012-09-12 Housing's 'Green Shoots' by Investment Strategy Group of Neuberger Berman

Headwinds in the housing market appear to be abating as the U.S. economy gradually heals.

2012-09-12 On Uncertain Ground by Howard Marks of Oaktree Capital

I'm going to devote this memo to the uncertainty in the world and the investment environment and then offer my take on the appropriate strategy response. This will require me to touch on a large number of topics, but I will try to dwell less than usual on each of them.

2012-09-12 Pacific Basin Market Overview - August 2012 by Team of Nomura Asset Management

Pacific Basin equity market performances were mixed during August 2012 and generally underperformed markets in Europe and North America, largely due to the drag caused by concerns surrounding Chinas slowing economic growth rate. Numerous statements made by European leaders to support the Euro helped to allay fears and brought yields on sovereign bonds lower during the month.

2012-09-12 PIMCO Cyclical Outlook: Building Rickety Bridges to Uncertain Outcomes by Saumil Parikh of PIMCO

Without structural change aided by well-planned fiscal policy, we are afraid the nominal bridges of monetary policy will fail to reach their desired outcomes. The probability of a deflationary left-tail outcome emanating from the eurozone has declined substantially in the short run, yet outright economic growth in the eurozone will remain elusive in 2013.The much-publicized "fiscal cliff" is set to hit the U.S. economy on January 1, 2013, and could reduce U.S.

2012-09-12 Is Europe Fixed? Not Even Close! by Fred Copper of Columbia Management

Euro Area (EA) equities have rallied 16% since European Central Bank (ECB) President Mario Draghi made his now famous July 26 pronouncement that "Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough." Does this mean the EA is fixed? Not even close.

2012-09-11 Ponzi Games by Michael Lewitt (Article)

Whatever schemes the European Central Bank may cook up over the next few months will only prove short-term liquidity relief to what are long-term insolvency problems. Like any Ponzi scheme, the last money in is going to be hurt the worst when the charade comes to an end. In the meantime, investors proceed at their own risk.

2012-09-11 Ready, Set, Fed! Weak Jobs Report Raises QE3 Odds by Russ Koesterich of iShares Blog

Russ says the US Federal Reserve Open Market Committee has more reason to consider quantitative easing at this week's meeting, after the latest payroll report suggests the US economic recovery is likely to remain weak into the end of the year.

2012-09-11 The Winds of Market Change by Mark Mobius, Michael Hasenstab of Franklin Templeton Investments

As we cross the mid-way point of the year, you might say the equity and fixed income markets have been a lot like the recent weather in much of the world: uncertain, and tending toward extremes. The perception of a stormy economic climate has driven some equity valuations to extremely low levels, particularly in Europe, and investors have been pouring into fixed income despite extremely low yields.

2012-09-11 Fed Preview: Time to Forge Ahead by Carl Tannenbaum of Northern Trust

I got home at about 8 one evening last week, and it looked like a bomb had gone off inside my house. The shrapnel included empty pop cans, open bags of snacks, and scores of used napkins. The sink was filled with dirty dishes, and laundry (clean, or dirty?) was strewn about the floor. No one was home, leading me to suspect that the explosion had done them all in.

2012-09-11 The Problem of Proxies by Bill O'Grady of Confluence Investment Management

In this report, we will discuss the role of proxies and their use by governments, including a historical perspective of their positive and negative aspects. A short discussion of the regional factors of the Syrian situation will follow, focusing primarily on Iran's problem if the Assad regime is replaced by a Sunni-led government. Interestingly enough, these regional factors also affect the proxy groups, making them more difficult for their sponsors to control.

2012-09-11 Rally Should Continue, but Look for More Volatility by Bob Doll of BlackRock Investment Management

Despite a relatively disappointing jobs market report for August, stocks rose last week as investors focused on the European Central Banks (ECB) announcement of its longawaited plan to buy bonds in the secondary market. The ECB program represents an important step in terms of lowering volatility and providing a cushion for Europes debttroubled countries to make some longer-term improvements in their fundamentals.

2012-09-11 Mondays! by Jerry Wagner of Flexible Plan Investments

In 1965, John Phillips penned Monday, Monday for the first album released by The Mamas and the Papas. The song was a melancholy downer. But it is perfect for summing up the experience for most investors over the last ten years. As you can see, if one had only invested on Mondays, the result would have fallen significantly short of investments for the full market period.

2012-09-11 US Stock Market Sentiment in a World of Wide Asset Allocation by Bill Smead of Smead Capital Management

Our long-time readers are aware that we are stingy when it comes to trading and big believers of keeping trading costs low at Smead Capital Management. Despite these natural inclinations, we do try to keep the pulse of sentiment in the US stock market.

2012-09-10 The Siren Song of Growth: Why Investors Willfully Set Sail for the Rocks by Matt Malgari of Knight Capital Group

Gaining an informational edge through more efficient and effective tools of fundamental company financial analysis and relative valuation is still a crucial goal for active equity managers. This should be even truer in a lower return world, particularly when investment returns may be under transition, driven in part by difficulties in maintaining long-term growth opportunities of a given company's own capital investments.

2012-09-10 Late-Stage, High-Risk by John Hussman of Hussman Funds

The market conditions we observe at present are very familiar from the standpoint of historical data, matching those that have appeared prior to the most violent market declines on record (e.g. 1973-74, 1987, 2000-2002, 2007-2009).

2012-09-10 The August Employment Report and the Fed by Scott Brown of Raymond James

The August job market report was disappointing. Nonfarm payrolls rose less than expected and previous figures were revised lower. The unemployment rate fell, but that was due to a decrease in labor force participation (dont read too much into that).

2012-09-10 Performance Anxiety?! by Jeffrey Saut of Raymond James

In last week's verbal strategy comments I suggested participants study the chart pattern of the S&P 500 (SPX/1437.92) and then think about what it would feel like if you were an underinvested portfolio manager (PM), or even worse a hedge fund that is massively short of stocks betting on a big decline. The concurrent performance anxiety would be legend because not only would you have performance risk, but also bonus risk and ultimately job risk.

2012-09-10 As the Euro Tumbles, Spaniards Look to Gold by Peter Schiff of Euro Pacific Precious Metals

The unremitting deterioration of the eurozone's sovereign debt landscape continues to fuel uncertainties about the longevity of the euro as a strong currency. Such uncertainties are not only leading to capital flight from the EMU's periphery to the core and destabilizing markets worldwide, but they are also beginning to frighten southern European savers into seeking refuge outside their 10-year-old currency.

2012-09-10 Russia: Riding on the Fast Lane by Team of Thomas White International

The fall in oil and natural gas prices has prompted the Russian government to turn its attention to the country's hitherto ignored manufacturing sector.

2012-09-10 Will Greece Set Sail from the Euro? by Milton Ezrati of Lord Abbett

Despite a chorus of voices calling for Athens to exit the currency union, the potential consequences would likely be unpalatable for the rest of Europe.

2012-09-10 When Bad Is Good by Kristina Hooper of Allianz Global Investors

Faith in the Fed is growing more devout. Despite another disappointing jobs report, stocks drifted higher Friday to close out a strong week for the major averages as investors pinned their hopes to an imminent policy move from central bankers. It is becoming more apparent every day that the U.S. economy is sputtering. While housing appears to have stabilized, jobs and manufacturing are areas of concern.

2012-09-10 Back to School: Summer Vacation Ends for Central Bankers by Andrew Boczek of Sentinel Investments

The heady days of "Maestro" Alan Greenspan may be long gone. Nonetheless, most of us still take for granted that similarly wise men and women, aloof from the pressures of politics and short term market fluctuations, have the capacity to set the proper price of our most precious commodity: time. Or said another way, to set an effective interest rate policy that encourages either savings or spending, today or in the future, to help manage long term economic stability.

2012-09-10 Are Labor Markets the Key to Fed Easing? by Chris Maxey of Fortigent

Widely reported last week was anemic labor market growth in August. Some talking heads took this news in stride, assuming this would guarantee further market intervention by the Fed, but there is a danger in assuming any form of quantitative easing will alleviate the intermediate-term concerns of the market.

2012-09-08 Why Germany Should Lead or Leave by George Soros of Project Syndicate

If Europe is to escape its crisis, its leaders must awaken Germany to the misconceptions that are guiding its policies. At this point, that will not happen unless they persuade Germany to make a choice: become a benevolent hegemon or exit the eurozone.

2012-09-08 Debt Be Not Proud by John Mauldin of Millennium Wave

The unemployment numbers came out yesterday, and the drums for more quantitative easing are beating ever louder. The numbers were not all that good, but certainly not disastrous. But any reason will do, if what you want is more stimulus to boost the markets ever higher. Today we will look first at the employment numbers, because deeper within the data is a real story. Then we look at how effective any monetary stimulus is likely to be.

2012-09-07 Policymakers Powerless to Stem Capital Flight from Spain by Darren Williams of AllianceBernstein

Capital flight from Spain is accelerating. As foreign investors and banks pull massive sums out of the country, policymakers look powerless to stop it. So far this year, there has been a net capital outflow from Spain of 220 billion. We can identify three main channels: foreign investors sold 84 billion of Spanish securities; foreign banks withdrew 91 billion of loans or deposits from Spain; and banks located in Spain shifted 61 billion of deposits abroad.

2012-09-07 Spinning Pessimism Into Opportunity by Peter Langerman, Ed Jamieson of Franklin Templeton Investments

In the markets and in life, we face bullish and bearish periods. Some days are good and some days are bad. But even on bad days, good things can and do happen, which may explain our sometimes Pollyanna-sounding persistence on the existence of a bright side even in the face of somber-sounding issues like fiscal cliffs and austerity measures.

2012-09-07 The ECB: No Rest for the Weary by Carl Tannenbaum of Northern Trust

The economic picture in Europe is worsening, exposing flaws in the foundation of the euro compact. The European Central Bank is trying its best, but remains hindered by its charter. European policy makers should focus on stabilizing the situation first, and seeking retribution later.

2012-09-07 Euro: Looks Like a Duck, Quacks Like a Duck by Alex Merk of Merk Funds

If it looks like a duck, quacks like a duck, it just might be a duck. We are talking about the euro: it now looks like a currency, acts like a currency, it might as well be yet another currency.

2012-09-07 The Federal Reserves Next Move: QE3? Perspectives on U.S. monetary policy by Team of Janus Capital Group

We believe the Fed will take additional action by mid-September to stimulate the economy, probably through a third round of quantitative easing. U.S. economic growth remains well below potential and is slowing, and the Fed is not meeting its dual mandate to ensure price stability and full employment. We recently reduced our 2012 GDP growth estimate to between 1.5% and 1.7%.

2012-09-07 Policymakers Report Card on Competitiveness by Frank Holmes of U.S. Global Investors

The U.S. dropped to No. 7 on the World Economic Forums newly released 2012 Global Competitiveness Index report. Switzerland retained its top position as the most competitive nation, followed by Singapore, Finland, Sweden, the Netherlands and Germany. Asian countries continue to be among the most competitiveand many are gaining strength. Among the top 20, five are from Asia.

2012-09-07 Chinas Next Act by Frank Holmes of U.S. Global Investors

World markets may not have to wait much longer for Chinese policymakers to act, as the government recently announced new infrastructure projects. According to Bloomberg, China approved 25 new subway construction projects, with related investments estimated to be more than 840 billion yuan. Railway, subway and construction stocks in China increased on the news. China is in much better shape than the rest of the world. A powerful rebalancing strategy offers the structural and cyclical support that will allow it to avoid a hard landing.

2012-09-07 Recent Speech Given by Lacy Hunt, Ph.D. by Lacy H. Hunt of Hoisington Investment Management

The most sensible recognition of budget policy came from David Hume, one of the greatest minds of mankind. In his 1752 paper Of Public Finance, Hume advocated running budget surpluses in good times so that they could be used in time of war or other emergencies. Such a recommendation would, of course, prevent policies that would send countries barreling toward the bang point. Countries would have to live inside their means most of the time, but in emergency situations would have the resources to respond.

2012-09-06 September 12th Looms Large for Germany by John Browne of Euro Pacific Capital

The German economy is undoubtedly the powerhouse of Europe. As a result, an understanding of the developments within Germany can offer a strong indication of the path that the rest of Europe is likely to take. Until recently, Germany stood as a bastion of sound money against those Keynesian led regimes in the developed nations that favor continual currency debasement as an economic panacea.

2012-09-06 Laboring a Point by Jerry Wagner of Flexible Plan Investments

Right before Labor Day each year we are treated to a major policy speech at the Federal Reserve Board's meeting of the Fed's Open Market Committee. In 2010, we were treated to suggestions from Chairman Bernanke that a new period of Quantitative Easing was near. And sure enough, the Federal Reserve announced QE2 on October 22nd of that year.

2012-09-06 How to Unscramble an Egg by Niels Jensen, Nick Rees,Tricia Ward, Thomas Wittenborg of Absolute Return Partners

This month we take a closer look at the root problems behind the current crisis. Too often root problems are confused with symptoms and the wrong medicine is prescribed as a result. We identify five root problems, all of which must be addressed before we can, once and for all, leave the problems of the past few years behind us.

2012-09-06 Reconnaissance: Strategy Notes by Douglas Clark Johnson of Codexa Capital

Pessimism about the next administration's impact on the emerging markets is held in check by the likely convergence of US and Chinese economic interests. More than ever, Ms. Smith needs Ms. Wong. To borrow a recent Financial Times headline, "Obama should pray that China overtakes the US." To us, Indonesia and Malaysia look pretty promising by this standard. Other stories include a look at timber and an update on Bahrain's economy.

2012-09-06 September: A Rough Month for the Markets? by Gary Halbert of Halbert Wealth Management

September is often a bad month for the stock markets, historically speaking, and this year it could be especially turbulent. In addition to all the uncertainty about the weak US economy, there is uncertainty about what the Fed may do just ahead and what, if anything, will be done to address Europe's recession and debt crisis. In addition, there is the looming presidential election which no doubt will go hyperbolic this month.

2012-09-05 September Economic Update by Justin Anderson of Cambridge Advisors

August was characterized by relatively low volatility as stocks continued to grind higher and bond yields traded in a fairly narrow range. The economy saw little change as the slow growth theme continued. European officials mostly took the month off so the sovereign debt crisis fell off the radar for the month. Politics have dominated the headlines, but a close race hasn't provided an impetus for investors to make significant portfolio changes.

2012-09-04 Postcard from India: Taking Frugal Engineering to the World by Team of Thomas White International

The first 25 ton truck that rolled out of Daimler's new Indian manufacturing plant in June this year was similar in most respects to other trucks the company sells across the globe. Even on a closer look, the only major difference seemed to be the name and logo on the front grill. The iconic Mercedes three pointed star logo had been replaced by a new round logo and brand name, BharatBenz.

2012-09-04 An Upgrade of UK Equities by Russ Koesterich of iShares Blog

With UK economic growth showing signs of stabilization, the downside of investing in the region now appears more balanced versus the potential benefits. Russ believes it's time to upgrade equities from the United Kingdom to a neutral status.

2012-09-04 All QE, All the Time by Chris Maxey of Fortigent

In a week of relatively light trading to wrap up the summer, equity markets trickled lower, as the Dow Jones Industrial Average lost 0.5% and the S&P 500 Index fell 0.3%. It was a mixed week of economic data in the U.S., but markets were clearly locked in on Ben Bernanke's speech in Jackson Hole, Wyoming. News on housing seems to confirm that a bottom is in place, while manufacturing data continues to move in all different directions.

2012-09-01 The Case for Emerging Europe by Frank Holmes of U.S. Global Investors

If history had turned out differently, the USSR wouldve taken home the most Olympic medals this year, as the total awarded to athletes from the area was 163, according to a blog on Foreign Policys website. As we all know, the Wall came down, the Soviet Union collapsed, and now Russia has to be content with its third-place position of 82 medals. Athletes from the United States were awarded the most medals (104), followed by participants from China, who took home 88.

2012-09-01 Schwab Market Perspective: Back to Work by Liz Ann Sonders, Brad Sorensen, Michelle Gibley of Charles Schwab

As summer winds down, we expect things to heat up as policymakers get back to work, resulting in a challenging investment environment.

2012-09-01 And That's the Week That Was by Ron Brounes of Brounes & Associates

Isaac vs. Romney vs. Bernanke. Each took their turn in the limelight this week. While the Hurricane dropped plenty of rain and brought damaging winds into Louisiana, the devastation didnt compare to Katrina. Romney humbly accepted his party's nomination, while still trying to prove to T-Partiers (and women) that he should be their guy (and he can bash his opponents with the best of them.

2012-09-01 The Consequences of Easy Monetary Policy by John Mauldin of Millennium Wave Advisors

We heard from Bernanke today with his Jackson Hole speech. Not quite the fireworks of his speech ten years ago, but it does offer us a chance to contrast his thinking with that of another Federal Reserve official who just published a paper on the Dallas Federal Reserve website. Bernanke laid out the rationalization for his policy of ever more quantitative easing. But how effective is it?

2012-08-31 While Everyone Worried About Europe by Robert Horrocks of Matthews Asia

We all do it. We all refer to Asia as an export-driven economy. It's one of those seemingly useful bits of shorthand. Unfortunately, I believe it has come to do more harm than good. Along with "emerging economies," I would like to banish the phrase to the ranks of outlawed jargon.

2012-08-30 Opportunity Cost: Emotions by Matt Lloyd of Advisors Asset Management

Emotions may be keeping your clients in cash, putting their long-term goals at risk. Taking a snapshot of headlines and it is not hard to discern where investors' predispositions lay.

2012-08-30 The Calm Before the Storm? by Jerry Wagner of Flexible Plan Investments

I know these are the dog days of summer, a time that Jack London captured perfectly in the quote here. Nothing much is happening in the financial world as summer draws to a close. There was little news from Europe. The last of earnings reporting season is behind us, and while the results were the worst since the rally began in March of 2009, they were not terrible.

2012-08-30 The ESM: Saviour, Super SIV or End of the Road? by Andrew Bosomworth of PIMCO

So long as the fundamental issues about the future of the eurozone remain unsolved, the extra supply of ESM bonds will likely drive up the borrowing costs of its weaker stakeholders. Without a cap on or exit clause from additional capital calls, the ESM could lead northern eurozone countries down a difficult and unsustainable path.

2012-08-30 Dividends: The Next Bubble? by Ed Perks, Don Taylor of Franklin Templeton

Dividend-paying stocks have received a good deal of attention this yearand for good reason. Ed Perks, senior vice president and director of the Core Hybrid Portfolio Management Group at Franklin Templeton, and Don Taylor, senior vice president and portfolio manager for Franklin Equity Group, suspect it's these fearful prognostications that are overinflated, not the asset class. As they see it, the dividend-paying stock universe is expanding, and deserves investor attention.

2012-08-30 Fixed Income Investing - the Dangers of Complacency by Bill Woodruff of Bandon Capital Management

The paper points out the US has been in a declining interest rate environment for 30 years, producing a tailwind for fixed income investors but one with little room left for further decline. At these interest rate levels - the yield on the 10 year US Treasury recently hit an all-time month end low of 1.49% - fixed income investors face unique risks which are predominantly unfamiliar.

2012-08-29 International Real Estate Securities: Review and Outlook by Jon Cheigh, Rogier Quirijns, Gerios Rovers, Luke Sullivan of Cohen & Steers

We would like to share with you our review and outlook for the international real estate securities market as of July 31, 2012. The FTSE EPRA/NAREIT Developed ex-U.S. Real Estate Index had a total return of 5.2% for the month (net of dividend withholding taxes) in U.S. dollars. By comparison, U.S. REITs returned 2.0% for the month, as measured by the FTSE NAREIT Equity REIT Index. Year to date, the indexes returned 21.3% and 17.2%, respectively.

2012-08-29 Closed-End Funds by Douglas Bond of Cohen & Steers

We would like to share with you our review and outlook for the closed-end fund market as of July 31, 2012. For the month, the total return of the Morningstar U.S. All Taxable ex-Foreign Equity Closed-End Fund Index was 3.0% based on market price and 2.3% based on net asset value (NAV). Year to date, the index had a market-price return of 11.8% and a NAV return of 8.1%. By comparison, the S&P 500 Index and the Barclays Capital U.S.

2012-08-29 Is Inflation Returning? by Martin Feldstein of Project Syndicate

Inflation is now low in every industrial country, and the combination of high unemployment and slow GDP growth removes the usual sources of upward pressure on prices. Nevertheless, financial investors are increasingly worried that inflation will eventually begin to rise, owing to the large expansion of commercial bank reserves engineered by the United States Federal Reserve and the European Central Bank (ECB).

2012-08-29 The Russian Evolution by Mark Mobius of Franklin Templeton

It might be tempting to say "everything old is new again" in Russia, given the return of Vladimir Putin to the presidency after a four-year hiatus, an interesting development in the country's political evolution. I think Russia has also evolved a great deal as an investment destination in the past two decades and holds great potential, although there is still more work to be done to open the markets and instill investor confidence.

2012-08-28 Who’s Fooling Whom? by Michael Lewitt (Article)

Equity markets are exhibiting a remarkable degree of complacency. The VIX is currently at extremely low levels and it can maintain those levels for a long period of time. The worse things get in terms of the economic data, the higher the market goes on hopes of central bank stimulus. At this rate, the Dow will peak just as the world is coming to an end!

2012-08-28 Taking Rational, not Rationalized, Risks by Wylie Tollette of Franklin Templeton Investments

Like beauty, "risk" is often in the eye of the beholder. What might seem "risky" to one person (such as traveling to an exotic destination) might be an exciting adventure for someone else. Wylie Tollette, Senior Vice President and Director of Performance Analysis and Investment Risk at Franklin Templeton Investments, travels around the world, working with portfolio managers to focus on a different kind of risk.

2012-08-28 Are Markets Nearing a Crossroads? by Chris Maxey of Fortigent

A relatively quiet, end-of-summer week resulted in modest losses for equity markets. The Dow Jones Industrial Average closed down 0.9% and the S&P 500 index lost 0.5%. There were limited amounts of economic data for the market to digest last week, but plenty of other headlines kept participants active. It was a decent week overall for economic data, as reflected by the continued recovery in the Citigroup Economic Surprise Index.

2012-08-28 Israel and the Evangelicals by Bill O'Grady of Confluence Investment Management

On several occasions, we have noted that Israel enjoys significant leverage over U.S. policy into the November elections. Often, it is assumed that this leverage comes from the influence of American Jews on the political system. Although not unimportant, the numbers, as discussed here, suggest that the Jewish vote is barely significant in only two states, New York and Florida. Even in these two states, capturing all the Jewish voters would not guarantee winning these states.

2012-08-28 Curious Repetition by Christian Thwaites of Sentinel Investments

Greece had a bond payment in the middle of the week that was paid with no drama and then announced that it had enough cash to finance its needs through October. However, it is using cash set aside to recapitalize banks in order to meet general obligations. The bond buying proposals are still priced into the market.

2012-08-28 Policymakers Hold the Key to Confidence by Bob Doll of BlackRock Investment Management

The Dow Jones Industrial Average fell 0.9% to 13,158, the S&P 500 Index slid 0.5% to 1,411 and the Nasdaq Composite lost 0.2% to close the week at 3,070. As August draws toward a close, US equities have hit four-year highs, corporate bond yields touched multi-year lows and many risk assets can look back on a pretty good summer. But despite plenty of investment and central bank activity, we continue to see a shortage of economic and financial market confidence.

2012-08-27 The Trend is Your Fickle Friend by John Hussman of Hussman Funds

Typically, the best that can be achieved with popular moving-average crossover systems is a moderate reduction in drawdown risk, but zero or negative incremental long-term return versus a buy-and-hold.

2012-08-27 U.S. Real Estate Securities: Review and Outlook by Jon Cheigh, Thomas Bohjalian of Cohen & Steers

We would like to share with you our review and outlook for the U.S. real estate securities market as of July 31, 2012. The FTSE NAREIT Equity REIT Index had a total return of 2.0% for the month, compared with a 1.4% return for the S&P 500 Index. Year to date, the indexes returned 17.2% and 11.0%, respectively.

2012-08-27 European Real Estate Securities: Review and Outlook by Rogier Quirijns, Gerios Rovers of Cohen & Steers

We would like to share with you our review and outlook for the European real estate securities market as of July 31, 2012. For the month, the FTSE EPRA/NAREIT Developed Europe Real Estate Index had a total return of 3.9% (in U.S. dollars, net of dividend withholding taxes). By comparison, U.S. REITs had a total return of 2.0%, as measured by the FTSE NAREIT Equity REIT Index. Year to date, the indexes had total returns of 14.0% and 17.2%, respectively.

2012-08-27 And That's the Week That Was by Ron Brounes of Brounes & Associates

When Ben Bernanke talks...investors listen, Republican moans, Romney belittles, and markets react. For now, the jury is still out about any upcoming stimulus move as the policymakers appear far from consensus. Housing continued its rebounding ways, though manufacturing again raised concerns. Europe still appears to be in disarray as Greece takes direction (and a scolding) from its stronger brethren. Stocks ended their nice winning streak, though closed the week on a high note.

2012-08-27 FPA Crescent: Steve Romick's Semi-Annual Report by Steven Romick of FPA Fund

FPA Crescent Fund has released its Semi-Annual report on the state of the fund and its investments. The piece also delves into portfolio manager Steve Romick's market outlook and thoughts regarding the fund's positioning moving forward.

2012-08-25 Boomers are Breaking the Deal by John Mauldin of Millennium Wave

We look at the trends in employment as well as take note of a signpost we passed on the way to finding out that we cant pay for all the future entitlements we have been promised.

2012-08-24 Large Cap Value: Review and Outlook by Richard Helm of Cohen & Steers

We would like to share with you our review and outlook for the U.S. large cap value market as of July 31, 2012. For the month, the Russell 1000 Value Index had a total return of 1.0%, compared with a total return of 1.4% for the S&P 500 Index.

2012-08-24 Preferred Securities: Review and Outlook by William Scapell, Elaine Zaharis-Nikas of Cohen & Steers

We would like to share with you our review and outlook for the preferred securities market as of July 31, 2012. For the month, the BofA Merrill Lynch Fixed Rate Preferred Index had a total return of 1.7% and the BofA Merrill Lynch Capital Securities Index returned 2.9%. Year to date, the indexes had total returns of 11.1% and 12.7%, respectively.

2012-08-24 Emerging Markets Real Estate Securities: Review & Outlook by Jason Yablon of Cohen & Steers

We would like to share with you our review and outlook for emerging markets real estate securities as of July 31, 2012. For the month, the FTSE EPRA/NAREIT Emerging Real Estate Index had a total return of 2.2% in U.S. dollars (net of dividend withholding taxes), compared with 3.6% for the FTSE EPRA/NAREIT Developed Real Estate Index (net), a broad measure of the global real estate securities market. Year to date, the indexes returned 19.0% and 18.9%, respectively.

2012-08-24 Gold: First Mover Advantage by Frank Holmes of U.S. Global Investors

This week, gold bugs were rewarded with the long-awaited positive momentum in the yellow metal, and on Friday, bullion rose to about $1,670. After falling below the 200-day moving average, gold had been stuck in quicksand for several months. With the jumps in the price this week, bullion swiftly rose above this critically important long-term moving average.

2012-08-24 Taking Stock of Corporate Earnings by Team of Neuberger Berman

The corporate earnings season for the second quarter of 2012 has just about ended. Investors entered this period with much apprehension as the global economic slowdown set expectations for disappointing earnings. However, U.S. numbers surprised on the upside, contributing to a rally in equity markets worldwide. Given the importance of the corporate sector to the current economic recovery, we take a deeper look at recent earnings data to highlight important trends.

2012-08-23 Early Retirement for the Eurozone? by Nouriel Roubini of Project Syndicate

Germany and the ECB are now relying on the hope that large-scale liquidity will buy time to allow the adjustments needed to restore growth and debt sustainability in the eurozone periphery. But, if a eurozone breakup can only be postponed, delaying the inevitable would merely make the endgame worse much worse.

2012-08-23 The Emerging Story in Europe by Mark Mobius of Franklin Templeton

There's a unique and often overlooked story coming out of some of Europe's emerging markets that interests me more. While much of developed Europe is still struggling to get its fiscal house in order, much of emerging Europe already has. Some of the emerging markets in Europe deserve to be a greater part of the European story, and in my view, can offer compelling investment opportunities at attractive valuations.

2012-08-23 'Japanification' by Scott Mather, Dirk Jeschke of PIMCO

The same dark forces that Japan has been battling could continue to infect the developed world. During Japan's banking crisis deflationary expectations became embedded in the economy early on, preventing real short-term rates from remaining negative and thereby clogging monetary transmission. One of the chief explanations for the outbreak of deflation in Japan was the difference in the structure of the labor market.

2012-08-23 Reading the Right Tea Leaves to Gauge Market Volatility by Daniel Morillo of iShares Blog

Market volatility has come to be associated with short-term events, like the Lehman Brothers bankruptcy or the downgrade of US debt. But Daniel Morillo explains why investors should keep an eye on broad macroeconomic prospects and not the latest breaking news headline to gauge where market volatility is headed for the longer term.

2012-08-23 The Growth Factor by John Barr, Chris Retzler of Needham Funds

During July, the domestic economy continued to slow and Europe again appeared on the precipice of disaster. On August 3rd, the July employment report showed unemployment at 8.3%, essentially unchanged from June. We believe the real story is that the civilian labor force participation rate has fallen to 63.7%, which is down from a peak of 67.3% in 2000.

2012-08-23 Global Real Estate Securities: Review and Outlook by Jon Cheigh, Chip McKinley of Cohen & Steers

We would like to share with you our review and outlook for the global real estate securities market as of July 31, 2012. The FTSE EPRA/NAREIT Developed Real Estate Index had a total return of 3.6% for the month (net of dividend withholding taxes) in U.S. dollars. Year to date, the index returned 18.9%.

2012-08-23 Global Listed Infrastructure: Review and Outlook by Robert Becker, Benjamin Morton of Cohen & Steers

We would like to share with you our review of the global infrastructure securities market as of July 31, 2012. For the month, the UBS Global 50/50 Infrastructure & Utilities Index had a total return of 0.5% (net of dividend withholding taxes). Year to date, the index had a return of 5.0%.

2012-08-22 What Will it Take for the Rally to Continue? by Bob Doll of BlackRock Investment Management

One of the factors underlying the upturn in stock prices over the past couple of months has been a modestly improving trend in US economic data. Last week, retail sales advanced 0.8%, well ahead of expectations. This was the first increase in four months, which suggests that while households remain generally cautious, spending levels are beginning to tick higher.

2012-08-22 The Bullish Case for Energy Stocks by Russ Koesterich of iShares Blog

Lower crude oil inventories and less spare capacity among OPEC oil producers are just two of many reasons why I continue to be bullish on energy and energy stocks over the long term. As I've been writing about for months, oil supply remains tight by historical standards. Among the reasons I gave in a post early this summer, I expect crude prices to rebound in the long term...

2012-08-22 Reflections: Frenzy and Illusion by John Gilbert of GR-NEAM

The insolvency of Lehman Brothers was a fault line in financial history. The failure of the U.S. government to act as lender of last resort in Lehmans insolvency was a deflationary shock unlike anything in decades. Now, in Europe, there is a growing risk of a second large deflationary shock in just five years, if Germany were to disavow contingent liability for deeper Eurozone union. The result is that there is a developing craze for safety underway.

2012-08-22 Mistrust Fuels Continued Gold Demand by John Browne of Euro Pacific Capital

In the face of growing fears of a renewed global plunge into economic depression and a climate of low apparent price inflation, investors might expect commodities and precious metals to be falling in price. Instead, gold continues to hover around a relatively high $1,640 an ounce and silver at $29. At the same time, central banks - including those of the ever more important China, Russia and India - continue aggressively to buy gold.

2012-08-22 The Faustian Bargain by Scott Minerd of Guggenheim Partners

In Goethe's 1831 drama Faust, the devil persuades a bankrupt emperor to print and spend vast quantities of paper money as a short-term fix for his country's fiscal problems. As a consequence, the empire ultimately unravels and descends into chaos. Today, governments that have relied upon quantitative easing (QE) instead of undertaking necessary structural reforms have arguably entered into the grandest Faustian bargain in financial history.

2012-08-21 The Persistence of Profits: The Quality Conundrum, Part I by Matt Malgari of Knight Capital

As avid consumers of a wide variety of investment material, we have to admit that certain firms have demonstrated such proficiency at lucid commentary they have become in-house favorites. In some cases, the writing has such a profound impact that we find ourselves entangled in visceral debates post publication, vexing our wonderful programmers with follow-up questions seeking further clarification or insight. In our opinion, Grantham Mayo (GMO) is one of these firms.

2012-08-21 Drudge Headline Indicator Surges to New High Then Pulls Back by Team of Bespoke Investment Group

The Drudge Report, with its 30,000,000 page views per day, is probably the most widely followed news source on the web. The Drudge Report is not a financial news site, however, so when a financial news story grabs the Drudge headline, it means that the story has crossed over from just a financial news story to a mainstream news story.

2012-08-21 Is Now the Time to Take Stock in Europe? by Norm Boersma of Franklin Templeton

Being a value manager in the equity space this year hasn't been an easy job. When investors are focused on capital preservation and risk is said to be "off" the table, the value proposition can certainly require some conviction. Templeton Equity Group CIO Norm Boersma knows that when certain sectors are out of favor, that's often when the best opportunities surface. To position for a time when risk is back "on," he is embracing the low market valuations present in Europe and elsewhere.

2012-08-21 Anniversary Weaks by Christian Thwaites of Sentinel Investments

A couple of anniversaries last week: five years since the start of the credit crunch and one year since the US downgrade. The ramifications of both are still evident daily, of course. We're still living the consequences. So this is as good a time as any to take stock.

2012-08-21 Inflation Subdued, But Will It Last? by Chris Maxey of Fortigent

As the economy continues to grind along at a sub-optimal rate of growth, many pundits are calling for additional quantitative easing measures from the Federal Reserve. Recent inflation data keeps the door open for further easing, but pockets of higher prices exist, keeping the Fed at bay.

2012-08-21 U.S. Equities After the Earnings Season: Is There Still an Opportunity? by Joseph Tanious of J.P. Morgan Funds

Now in its fourth year of recovery following the financial crisis, the S&P 500 is once again testing the 1400 level, having rallied over 100% from its March 2009 lows. Meanwhile, earnings have hit an all-time high, but it is becoming clear that earnings growth is slowing. All of this has occurred against a backdrop of global economic uncertainty, unprecedented central bank action, and the most polarized U.S. political landscape we have ever seen.

2012-08-20 The Outlook for Inflation and Fed Policy by Scott Brown of Raymond James

The odds of further accommodation from the Federal Reserve have decreased significantly in the last few weeks, as the level of fear has diminished. The financial markets now expect most of the fiscal cliff to be avoided. In Europe, leaders will still have to act against the region's crisis, but theyve also continued to express a strong resolve "to do whatever it takes" to keep the eurozone intact. Perhaps more importantly, U.S. economic data reports have generally improved.

2012-08-20 And That's the Week That Was by Ron Brounes of Brounes & Associates

Once upon a time, Facebook and Groupon were prospective Wall Street darlings. Now both they are pushing all-time lows with analysts questioning their overall revenue models. For now, they are in the minority, as some decent earnings numbers and economic data brought back the "bulls" (at least those who arent on vacation) and sent the major indexes higher (again). Europe still has plenty of issues; the jury is still out on the Fed's next moves; and the campaign season is heating up.

2012-08-20 The Basis For Fear by Charles Lieberman (Article)

Last week, I wrote about how stocks are cheap historically and also with respect to other asset classes, such as bonds. This week, I want to focus on the reasons for this. Stocks are not cheap by accident. Investor concerns over Europe, renewed recession in the U.S., the fiscal cliff and the huge budget deficits provide ample reason for caution. However, not all of these concerns are well placed and some of the issues can be resolved favorably.

2012-08-20 Europe's Unstable Hammock by Mohamed El-Erian of PIMCO

This summer I have been asked a lot about Europe -- not so much by economists but by others concerned that the lingering crisis there would make their daily economic life even more challenging. In responding to these questions, I have often struggled to summarize in a few sentences the causes of Europe's existential crisis, let alone what is likely to occur next (including elements of a solution) -- that is until I tried to use a hammock.

2012-08-20 August 2012 Newsletter by Jim Tillar, Steve Wenstrup of Tillar-Wenstrup

The stock market has surprised most everyone by rallying of over 11% since bottoming in early June. At that time the market had given up most of its double-digit gain for the year and seemed destined to continue to fall given the poor macro-economic environment . A heavy dose of uncertainty in Europe caused a further exit from investors. Fortunately going into that decline we had accumulated a healthy cash position. After the decline into early June we decided to increase our equity exposure despite the uncertainty for several reasons.

2012-08-20 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Stock prices have been supported by strong profits permitting buybacks and rising dividends as well as the absence of negative news from Europe. In fact, with all the leaders there taking vacations it has allowed rumors and leaks of possible steps, which have produced lower borrowing costs in Spain and Italy. This has allowed for a reflex rally there that has served as a catalyst for the continued rally in our domestic markets.

2012-08-17 Evaluating the Wisdom of Buying Gold by Frank Holmes of U.S. Global Investors

At the end of January 2008, I posted a discussion about how the book The Wisdom of Crowds by James Surowiecki could explain gold's price climb. The book's premise was basically that "large groups of people are smarter than an elite few." Even before the height of the global crisis, there was a "wise crowd" of investors who had been buying gold as a safe haven from currency risks and the trillions of dollars invested in derivatives, and as a way to recycle petrodollars.

2012-08-17 Disconnected Markets Confound Investors by John Browne of Euro Pacific Capital

The current environment for investors is perhaps one of the most confusing that many have ever encountered. Unpredictable markets now appear to take no clue whatsoever from underlying economic data, and maxims long cherished by traditional money managers are being abandoned in favor of seemingly illogical choices. While such an environment is enough to encourage many to cash out completely, we believe that investors should remain focused on the fundamentals.

2012-08-17 Fiscal Cliffhanger by Brian Horrigan of Loomis Sayles

In the famous 1955 movie Rebel Without a Cause, troubled high school student Jim Stark (played by James Dean) winds up playing a game of chicken with his classmates. The US economy is at risk of driving, so to speak, over a "fiscal cliff" starting January 1, 2013, an event that threatens to wreck the economy. There are fewer than five months to avoid going over this cliff.

2012-08-17 Press Play by Liam Molloy, Bethany Carlson of Galway Investment Strategy

The Treasury has doled out approximately $10.5 billion on excess bank reserves over the last four years. The emergency Fed policy of paying 25 basis points on excess reserves was enacted on October 6, 2008 to incentivize banks to hold them in the midst of the financial crisis. It worked. But the policy also introduced another headwind to velocity of money.

2012-08-17 Groundhog Day: Will Septembers Sell-off Repeat? by Russ Koesterich of iShares Blog

Investors might feel they are trapped in their own version of Groundhog Day this year as Russ K expects September, which has historically been the worst month of the year for capital markets, to once again fall victim to its well-documented negative seasonal bias.

2012-08-17 Love Trade Cools as Central Banks Gold Demand Heats Up by Frank Holmes of U.S. Global Investors

Although the Love Trade (purchasing gold for coins or jewelry) is on ice for now, a relatively new gold buyer has been warming up to gold. Central bank purchases hit a record high since the official sector became gold buyers three years ago. If this trend continues over the remainder of 2012, central banks will be entering a new territory of gold buying that has not been seen since the early 1960s and since the end of the Bretton Woods System in 1971.

2012-08-17 How Change Happens by John Mauldin of Millennium Wave

This is an encore appearance of the letter that is clearly the most popular one I have ever written, updated with a few thoughts from recent times (it was also part of a chapter in Endgame). Numerous reviewers have stated that this one letter should be read every year. As you read, or reread, Ill be enjoying a week off.

2012-08-16 The ECB Is Too Tight Absolutely and Relatively by Scott Mather, Dirk Jeschke of PIMCO

Looking at measures of the quantity of money and its transmission into the real economy reveals that ECB policy is quite tight. Growth hardly stands a chance under this scenario. Relatively tight monetary policy would perhaps be understandable if the eurozone were threatened by inflation. However, inflation is low and falling in the Eurozone. The ECB may be playing a game of chicken with European policymakers. If true, this is a dangerous strategy.

2012-08-16 Markets Holding Up Despite Volatility by Ken Taubes of Pioneer Investments

Despite a steady stream of negative headlines and high volatility, markets are holding up pretty well. The broadest measure of the stock market, the S&P 500 Index, is up nearly 13% year-todate through today, August 13, 2012. The NASDAQ is up almost 17%. High yield bonds are up almost 9.7% while investment grade corporate bonds have gained over 7%. Even Europe has managed 7.5%, as measured by the FTSE Eurofirst 300 Index in dollar terms.

2012-08-16 Monthly Investment Bulletin by Team of Bedlam Asset Management

A good month: a gross increase of 3.13%, over twice the index at .49%. Opinion polls the morning after the opening ceremony for the London Olympic Games estimated that 2.5% of the television audience (or 30m viewers) actually believed that the Queen and James Bond parachuted into the Olympic arena. Even if true (the poll was tiny and perhaps respondents had a better sense of irony), such gullibility is understandable on live TV. But naivety in financial markets is unforgivable.

2012-08-16 Searching for a Fiscal Ladder by David Kelly of J.P. Morgan Funds

As America begins to cool down after a long hot summer, the economy remains sluggish. Economic growth in the first half of the year is estimated to be less than 2%, reflecting continued business and consumer caution, tight lending standards and a shrinking government sector. This pace of growth, in turn, has produced a monthly average of just over 100,000 new jobs since February, leaving the unemployment rate marooned above 8%. For investors, however, the picture is not that bad.

2012-08-15 Early Retirement for the Eurozone? by Nouriel Roubini of Project Syndicate

Whether the eurozone is viable or not remains an open question. But what if a breakup can only be postponed, not avoided? If so, delaying the inevitable would merely make the endgame worse much worse.

2012-08-15 ProVise Bullets by Ray Ferrara of ProVise Management Group

There are bears out there who are extremely disappointed that the U.S. has not entered another recession over the past three plus years. Certainly, the 18 months of downturn in the markets that began in October of 2007 and culminated in March 2009 gave them a lot to cheer about. But, since then, they have looked everywhere possible to come up with bad news.

2012-08-14 Blind Faith by Michael Lewitt (Article)

Central banks are facing political and practical obstacles that will render it very difficult for them to deliver anything more than anodyne words and actions as summer moves into the always dangerous August holiday season. IPhones should be kept on alert at the beach through Labor Day.

2012-08-14 China Growth Threatened by the West by Chris Maxey, Ryan Davis of Fortigent

As we head further into the second half of 2012, it is clear that policy from central banks in the US, Europe, and China will drive markets and the global economy. Monetary policy in the US is becoming less impactful, while central bankers in Europe appear unwilling to tackle the enormity of their collective problem. It could be China that provides a sparkplug for second half global growth...

2012-08-14 The Eurozone Drama Continues by Bill O'Grady of Confluence Investment Management

In this report, we will review the political and economic structure of the Eurozone. From there, we will discuss the critical event that caused the reversal in safety assets and what this reversal likely means for the geopolitics of the Eurozone. As always, we will conclude with potential market ramifications.

2012-08-14 Careful With That Beehive, Eugene by Christian Thwaites of Sentinel Investments

When you move a beehive, you must move it more than three miles or not less than three feet. Anything else confuses the bees. Markets can be the same. And that's why President Draghi's comments reverberate still after two weeks. No one seems to understand what he meant.

2012-08-14 Oil: Does Supply and Demand Matter? by Bill Smead of Smead Capital Management

We believe the long-term demand for oil will be greatly influenced by where the world gets its best future growth. As the chart below shows, the US has cut by 50% the amount of energy which is required to generate each dollar of Real Gross Domestic Product (GDP).

2012-08-13 Thinking about Treasuries? 2 Reasons to Think Again by Russ Koesterich of iShares Blog

The Fed will soon own more long-term Treasuries than the entire private sector. Russ explains the implications of this milestone for US long-dated debt and shows investors where to look for more attractive alternatives.

2012-08-13 Which Way Will the Pendulum Swing for Gold? by Frank Holmes of U.S. Global Investors

One of the most fascinating aspects when watching a sporting event like the Olympics is the historical statistics highlighting the tremendous advances in athleticism over the years. In the spirit of the events this summer, BTN Research compared gold's advancement from the beginning of the games in Beijing to the London Olympics.

2012-08-13 Begging for Trouble by John Hussman of Hussman Funds

Investors remain so addicted to the temporary high of monetary intervention that they are practically begging to be shot, mauled by dogs, and diced by a Veg-O-Matic so they can get their next fix of pain-killers.

2012-08-13 Driving with the Doors Off by Doug MacKay, Bill Hoover of Broadleaf Partners

Two months ago I bought a bulldozer-yellow Jeep Wrangler, replacing my eight year old black Audi A6. While the A6 had been a wonderful car, I was ready for something new and a Jeep fit the bill. Driving with the doors off was a lot of fun, but certainly a different feeling than I was used to experiencing. The stock market over the last two months and perhaps even last three summers has been a lot like that, different, but ultimately rewarding.

2012-08-13 Double Dip? Doubtful by Milton Ezrati of Lord Abbett

The flow of economic news is hardly encouraging. Jobs growth remains disappointing. Recent readings on consumer spending and business activity show weakness as well. If the picture of the housing market has improved a bit, it still hardly portrays strength. Talk of an imminent recessionary dip has become common, for the third time now in as many years. While some recent economic reports have been discouraging, underlying fundamentals do not point to a return to recession.

2012-08-13 Morocco: Making its Mark by Team of Thomas White International

Unlike some of its North African neighbors, Morocco is not known for its petroleum reserves. But here, there is another type of oil that seems to have attracted the world's attention these days. Deep inside the country's southwestern desert lies an herbal oil extracted from the seed of a thorny tree. Argan oil, which gets its name from the Arganier tree, is said to work wonders on thirsty dry skin, and now is being sought after by the beauty-conscious men and women across far-flung continents.

2012-08-13 Invest with the Best?! by Jeffrey Saut of Raymond James

I have been a "fan" of the astute Claude Rosenberg ever since hearing him speak. Some will remember him as the author of Investing with the Best, which deals with the daunting task of selecting an investment manager. Given the plethora of investment managers, picking a manager is difficult. That's why many individuals' selection process consists of nothing more than looking at a portfolio manager's track record for the past few years. We think such a simplistic approach is a mistake.

2012-08-13 Commodities to Power Emerging Markets Higher by Dawn Bennett of Bennett Funds

In Latin America, Brazil leads as a natural supplier of copper and crude oil, which it is now able to extract and export on competitive terms. Nations rich with natural resources perform well during times of global economic expansion. In particular, countries rich with industrial commodities tend to outperform those without.

2012-08-13 The Fundamental Case for the 20,000 Dow by Seth Masters of AllianceBernstein

While some people deem stocks expensive relative to 10-year trailing earnings, we take a forward-looking approach. It starts with the premise that the stock market is not a casino and stock prices are not pulled out of thin air: they reflect the intrinsic value of companies' future earnings.

2012-08-13 Stocks Look Poised for Continued Gains by Bob Doll of BlackRock Investment Management

Although investor attention seems focused on a number of well-known downside risks (including the European debt crisis, hesitant US economic growth and the pending US fiscal cliff), stocks have continued to climb higher and last week notched their fifth consecutive week of gains.

2012-08-11 And Then There Is Disaster C by John Mauldin of Millennium Wave

I have contended for some time that Europe is faced with two choices: Disaster A, which is the break-up of the eurozone, or Disaster B, which is the creation of a fiscal union, which keeps the euro more or less intact. Over the last few months I have come to realize that there is indeed a third option, which now looks increasingly possible. European leaders might do nothing more than deal with the problem immediately in front of them, moving from crisis to crisis in a slow-motion drift toward fiscal union.

2012-08-10 Where Wealth Thrives and Innovates by Frank Holmes of U.S. Global Investors

A surprising wealth of information about the world's most prosperous people can be discovered in two new reports. The Chinese Millionaire Wealth Report 2012 found that there are now a million millionaires in China. On average, a Chinese millionaire is 39 years old, has an average of four luxury watches, vacations in France, and owns a business. KPMG;s The Wealth Report 2012 found that there are 18,000 centa-millionaires in Southeast Asia, China and Japan.

2012-08-10 Schwab Sector Views: Cautiously Cautious by Brad Sorensen of Charles Schwab

We remain slightly defensive with our sector recommendations but admit that we're a bit concerned over doing so. While we certainly believe this is the appropriate positioning given the continued elevated uncertainty in the market, combined with sluggish economic data, we also acknowledge that some defensive areas appear extended and the possibility of a near-term cyclically-based rally exists.

2012-08-10 2012 2Q Economic - Capital Market Summary by Greg Hahn of Winthrop Capital Management

The single biggest driver for the economy and investment returns is the deleveraging process which we are currently struggling through. Arguably, we have successfully transferred debt from the financial sector to the U.S. government through the Fed's QE programs. As we move through the long process of reducing debt, economic growth inevitably moderates as resources are applied to debt reduction rather than fixed investment and consumption within the economy. As a result, expected returns on financial assets are lower.

2012-08-10 Citius, Altius, Fortius by Carl Tannenbaum of Northern Trust

Countries across the globe seek faster, higher, stronger growth. Central banks in the United States and Europe are both seeking new ways to stimulate economic activity. Recent news from the housing market has been encouraging, but the race to recovery is likely to be a marathon, not a sprint. Headwinds blowing from Europe and China will continue to present significant downside risks to U.S. economic growth.

2012-08-10 Dividend Taxation and Stock Returns by Team of Neuberger Berman

With bond yields declining globally, stocks with high dividends have become increasingly popular as income seekers face a narrowing set of investment choices. The increased demand has caused dividend-paying stocks to outperform broader markets over the past few years, but as the expiration of the Bush tax cuts looms ever larger heading into year-end, investors are concerned that these stocks might grow less attractive. We explore the potential impact of higher taxes on dividend-paying stocks and how investors should be positioned in the months ahead.

2012-08-10 Dog Days by Liz Ann Sonders, Brad Sorensen and Michelle Gibley of Charles Schwab

We now appear to be firmly in the dog days of summer. Low volume and little conviction may dominate but investors need to stay vigilant and now is a good time to prepare for the fall. The recent Fed meeting yielded no new action, but policy makers reiterated that they will act if necessary. We are skeptical that more stimulus measures will have a lasting impact. A waiting game has ensued in Europe as investors look for action following hopeful comments from various officials. But despite concerns over corn prices, central banks will continue to ease, helping to support global growth.

2012-08-09 Market Surge is Amplified by Low ExpectationsAs Expected by Matt Lloyd of Advisors Asset Management

European fears have subsided a bit as the European Central Bank's (ECB) president continued to offer words of support for a more comprehensive solutionthough he appeared to dampen the statements with concessions about the ECB's ultimate subservient role to the governments.

2012-08-09 Viva Reforma en Mxico by Mark Mobius of Franklin Templeton

Elections come and go, but the real test of a candidate might be whether the promises made on the campaign trail are actually put into place. Enrique Pea Nieto and his Institutional Revolutionary Party (PRI) emerged victorious in Mexico's July 1 presidential election on the promise of reform and the end to old, "undemocratic" ways.

2012-08-09 Reconnaissance: Strategy Notes by Douglas Clark Johnson of Codexa Capital

India's massive power failure was a gift to both investment bankers and asset managers. There will likely be a surge in infrastructure-related financing and investment activity directed at South Asia. We also look at sovereign wealth fund transparency; the UAE funds rank comparatively well. Our allocation guidelines for North Africa focus on Morocco, where we believe we will see sustained gains for both portfolio and direct investors once the European situation stabilizes.

2012-08-09 Pacific Basin Market Overview - July 2012 by Team of Nomura Asset Management Co.

Most equity markets in the Pacific Basin region recovered somewhat in July after a weak second quarter on expectations of further monetary easing and measures by the European Central Bank to forestall a Euro currency crisis. However, when we examine the sector results, it is hard to conclude that the recovery was accompanied by an improvement in sentiment.

2012-08-08 How Hoover Caused the Euro Crisis by Christian Thwaites of Sentinel Investments

There is a Burkean principle that many sorts of change must be regarded with skepticism. In the last few months in Europe we have seen new maxims, new ideas, new commitments, new resolves, lots of new acronyms, yet very little has changed from two years ago when Greece surfaced as the first casualty of the banking/sovereign crisis.

2012-08-08 Stock Pickers: "Somebody I Used to Know" by Bill Smead of Smead Capital Management

Art has a tendency to express culture. One of today's catchiest songs does a great job of explaining the relationship between institutional/individual investors and US common stock picking. The song captures what has happened since the summer of 1999, when Warren Buffett warned investors about forward stock market returns because of a love affair that institutional and individual investors were having with US large cap stocks.

2012-08-08 CASSH-ing In by Russ Koesterich of iShares Blog

Many of the large, developed markets, including the United States, are mired in excess debt and prolonged deleveraging. Russ believes that some of the smaller developed countries the ones he refers to as the CASSH countries -- are proving more resilient.

2012-08-08 Emerging Markets Equity Monthly Product Commentary: July 2012 by Team of Thomas White International

Emerging market equities made modest gains during the month of July, as global markets sustained the optimism from the last week of the previous month. Select markets in Asia, such as Indonesia, Korea, and Malaysia, as well as Turkey and South Africa outperformed during the month. Repeated assurances by European policymakers over further policy action helped assuage market concerns about the region's fiscal crisis worsening, though economic data continues to be relatively weak.

2012-08-08 Monthly Product Commentary: International Equity - July 2012 by Team of Thomas White International

International equities made modest gains during the month of July on repeated assurances from European policymakers that they will explore all possible steps to prevent a collapse of the monetary union and arrest further economic decline. Developed markets in Europe's Nordic region and the Asia Pacific, excluding Japan, as well as select emerging markets in Asia ended with healthy gains for the month.

2012-08-08 ECB Policy: Over-Promise and Under-Deliver, Investor Behavior: Over-Anticipate and Over-React by Colin Moore of Columbia Management

Last week was a good example. Investors anticipated a major announcement from Mario Draghi, President of the ECB on Thursday because of remarks he had made the previous week at a conference in London. When he did not announce any immediate monetary policy changes following the regular meeting of the ECB, the markets demonstrated considerable volatility, declining on Thursday and rising on Friday.

2012-08-07 Why Hedge Funds Destroy Investor Wealth by Michael Edesess (Article)

If all the money that's ever been invested in hedge funds had been put in Treasury bills instead, the results would have been twice as good. So claims Simon Lack - a former JPMorgan executive whose job was once to help steer billions into hedge funds - in his recent book, The Hedge Fund Mirage: The Illusion of Big Money and Why It's Too Good to Be True. You'd think hedge fund advocates would immediately pounce on this and refute it; but it's irrefutable.

2012-08-07 Weekly Commentary & Outlook by Tom McIntyre of McIntyre, Freedman & Flynn

Last week gave us quite a bit of information, but on balance the stock markets did not seem fazed one way or the other. Disappointment at a lack of policy initiative from the world's Central Bankers was offset by an employment report, which was very confusing at best, but certainly did not indicate a meltdown in the economy.

2012-08-07 Lose The Swimmies! by Dan Morris of Morris Capital Advisors

As the end of June and the July 4th holiday approached much of our nation was gripped in an oppressive heat wave. Most people sought some respite from the weather at the pool, the lake, or the beach. For us, it was the pool, and it was crowded, with adults wishing for some quiet space, teenagers splashing and creating a commotion, and the young ones in their swimmies. I even saw one youngster, with a overprotective parent or nanny, using a flotation ring and swimmies.

2012-08-07 Promises, Promises by John Browne of Euro Pacific Capital

In the last w