Tag Archives: finances

Big Banks Win – Derivatives are Back

Once upon a time in the long ago we had banks that lent money to individuals and companies to expand and grow the economy. During the Great Depression lawmakers saw the need to rein in and regulate banks’ activities. The Glass Steagall Act of 1933 ruled that banks could not become involved in selling or trading securities. Separate Investment banks were organized that could underwrite and sell securities but they could not use depositor money.Continue Reading

Is the Bond Market Ready to Crash?

The media hype is for a sharp sell off in the bond market. Some “gloom and doom” pundits are even predicting a crash that will plummet the world into a worldwide depression. The US Federal Reserve has ended its $4.5 trillion bond purchase program. Fed Chairperson, Janet Yellen, has maintained a “stead as she goes” policy without a definitive time frame for raising rates. This has left analysts in a state of suspended animation.Continue Reading

Fed Tools: The US Federal Reserve’s Toolbox

This past week Janet Yellen, Chairwoman of the US Federal Reserve, gave her report on the state of the economy. The theme was “steady as she goes” with only minor adjustments to monetary policy. Here are some highlights from her text:Continue Reading

Investing in Small Cap Stocks

We have a group of stocks that we refer to as “Small Cap.” They are defined as having a Market Cap of between $250,000 and $2 billion. Many are start ups trying to bring a new product or service to market. For example we are seeing many of the biotech stocks in this category. Many of them have a promising new drug but it first must go through rigorous testing by the FDA. This is a lengthy process involving several stages of testing, often lasting up to three years. Only a small group make it through. These become he new “stars” of the investing world and their stocks rise, often very quickly.Continue Reading

Europe Goes to Negative Interest Rates-Investors Beware

Mario Draghi, Chief of the European Central Bank announced this week that it will go to “Negative Interest Rates.” Negative interest rates go below zero. The new rate will be (minus) -.1%. What does all this mean?Continue Reading

Is France Totally Bankrupt?

France is totally bankrupt. So says French Jobs Minister, Michel Sapin. Bruno Moschetto, professor of economics at the University of Paris added his own take on the French economy. He said: “The ability to tax citizens to death to bail out the state is hardly a reasonable measure of non bankruptcy.” “I suggest having to confiscate the wealth and savings of citizens to bail out the state is proof of bankruptcy.”Continue Reading

Why there is Falling Unemployment and a Drop in the Dow?

On Friday, the Labor Department reported an increase of 288,000 new jobs. The unemployment rate fell to 6.3%, the lowest in 5 ½ years. At the outset this was good news for the market, but as the day wore on, the Dow Jones Averages started to fade and ended down 45.98 points. What should have been a rip roaring rally fizzled. Some blamed the crisis in Ukraine.Continue Reading

Will the Oil Glut Cause a Drop in Price?

The world is awash in oil. From the US to the Mid East oil supply is outstripping demand. It is already causing disruptions in worldwide delivery systems.Continue Reading

Inflation is Rising and Government Can’t Stop It.

You are standing in line at the checkout of your local supermarket. The cashier tallies up your tab and you are shocked at how much it is. It’s way more than last year and even more than last month. It dug a big hole in your weekly paycheck. On the way home you stop to fill your gas tank only to find that the price of gas has gone up 15 cents a gallon since your last fill up. You arrive home and check your mail and find that your landlord just raised the rent. These events are not random. They are happening all across America.Continue Reading

Growth Stocks for 2014

We are in March now, with a bumpy ride in the past couple of months. The indices were hit hard and now have bounced back to their old highs. The bulls are looking for more buying here to punch the averages into new high ground. Whether a move into new highs is the real thing or just a bull trap remains to be seen. Meanwhile, we’ve had time to do some searching for growth opportunities in 2014.Continue Reading