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Showing posts from February, 2008

Features of the week

We have a rather wide range of interesting subjects and stories for you in today's "Features" wrap-up.

As we scroll down this list, you'll hear about Warren Buffett and Berkshire Hathaway's ever-increasing cash hoard, get Tim Iacono's view on the underpinnings of the US economy, and take an audio slideshow tour through Putin's Russia.

Sound good? It's all here in this Friday's edition of, "Features of the week".

1. US economy: spending eroded by inflation, business sentiment falls.

2. The US dollar breaks down against a range of foreign currencies.

3. Vacant homes and developer ghost towns.

4. Detroit Housing = ~$0. House prices in Motown may signal a bigger Rust Belt trend.

5. John Rubino profiles the canny moves of real estate investor Marcel Arsenault.

6. The three trillion dollar war. Costs of conflicts in Iraq and Afghanistan.

7. Across Putin's Russia. An FT "In depth" audio slideshow tour.

8. Sheep in human clothing - scie…

Expecting a dollar rally?

(EUR/USD chart courtesy of ForexRate.co.uk).
The dollar hit new lows against the Euro yesterday, and today.

Here's the latest update from RTTNEws:

Forex - Greenback Drops Further Against Majors [EUR/USD]

2/28/2008 12:23:15 PM The US dollar dropped further against its major counterparts at about 12:15 pm ET. As of now, it is trading near 1.5201 versus the euro, 1.0509 versus the franc, 1.9911 against the pound and 105.38 against the yen.

At this point, anyone who's been banking on an imminent dollar rally probably feels a bit like Linus waiting around for the Great Pumpkin on Halloween night.

Still, some well known investors, like Jim Rogers, are expecting a short term dollar rally at some point in the not-too-distant future.

Rogers told reporters at a Dublin investor conference that he expects the dollar to continue its long-term decline, but that he also expected an upcoming dollar rally, as current sentiment toward the currency was overwhelmingly bearish.

"There are so ma…

Recession: a self-fulfilling prophecy?

Will growing worry over a possible US recession help bring one about? In other words, is the fear of recession a self-fulfilling prophecy? Are we doomed to economic slowdown just by thinking about it?

Well, we're starting off with a lot of question marks here. Let's get down to the answers.

On Monday, we talked about some of the main ideas in Bill Bonner and Lila Rajiva's recent book, Mobs, Messiahs, and Markets, which shows how susceptible the individual can be to the influence of crowd behavior and mentality. We know that mood and psychology can drive manias, booms, and bubbles; can they also drive busts and recessions?

It would seem logical to think so. After all, if social mood and sentiment can fuel a boom, wouldn't the same factors of mood and psychology be at work during the ensuing bust? The boom and the bust are both just different parts of a larger cycle, just as euphoria and despair are the flipsides of human emotion.

But since we're talking about the aut…

Mobs, Messiahs, and Markets

Think for yourself and act accordingly.

If I were to sum up the ideas and underlying theme of Bill Bonner and Lila Rajiva's book, Mobs, Messiahs, and Markets, in a single sentence, that would be it.

It's a seemingly simple and succint philosophy, but executing this principle is where the difficulty lies. Because we are subject to the influence and demands of experts and leaders, along with the groupthink of crowds, our ability to reason and stand alone in a state of independence is constantly compromised. At one time or another, we are all subject to the pull of the crowd.

This is the idea that authors Bonner and Rajiva develop, or rather, expound on during the length of this book. This is not a new idea; many readers are likely to recall similar lessons on the dangers of groupthink and crowd behavior, as recorded in Charles Mackay's, Extraordinary Popular Delusions and The Madness of Crowds. What the authors of Markets do is update those lessons and apply them when chronicl…

Features of the week

Wow, we've got a lot in store for you in this Friday's edition of our, "Features of the week".

New highs for commodities, a bull market in Africa, interview clips with T. Boone Pickens and Marc Faber, and a whole lot more. So make yourself comfortable, and peruse these latest offerings of financial and cultural news. Enjoy!

1. Germany vs. Liectenstein: "Tax scandal has reached a new level".

For more on this issue, please see the following articles:

"Tax Evasion is German National Sport...", The Economist's report on tax havens and OFCs, "Places in the Sun", Ilana Mercer's, "The War on Tax Havens", Karen De Coster's 2003 article entitled, "Will Liechtenstein's Autonomy prevail?", and, "German Tax Bullies Attack Liechtenstein", from the Offshore Asset Protection blog.

After all, we promised you the bigger picture view.

2. Commodities mark time near peaks, as the CRB hits records highs.

3. Pickens e…

Will US stocks go higher?

What could take the stock market higher from here?

I think this is a question that's had a few investors thinking lately. I know that I've been wondering the same thing, especially after hearing some of my favorite investment minds mulling this question over in recent days.

You may be bullish on the market, bearish, or indifferent, but it's still a rather interesting puzzle to look over. So I'm sitting here wondering, where do we go from here?

Recently, I looked at the cards in front of us and said, "Yeah, it's a bear market". No sooner had I uttered that, than others began looking for a rally, albeit one within the context of a longer-term (secular) bear market.

This was something we had to take seriously. After all, no market goes straight down without a fight. We are bound to get some rallies along the way, even if they don't take us back above previous highs.

But even if we re-enter a period where the Dow Jones Industrial Average is building streng…

Jeremy Grantham x 2

If you've already checked in on Monday's post, you probably noticed our mention of investor Jeremy Grantham's recent interview in Barron's.

Well, today we have two Grantham profiles for you: a link to his recent Barron's interview, and a profile of the famed Boston investor in today's Financial Times.

Grantham, a founding member of the Boston-based investment management firm GMO, is known for his ability to take an unpopular stance on the markets and stick to his guns, in spite of doubters and detractors. An excerpt from the FT piece illustrates this point:

"I remember when Jeremy made a stand against tech stocks in the late '90s, and was in the wilderness for what must have seemed like 50 years," says Jim Grant, founder and editor of Grant's Interest Rate Observer, who has known Mr Grantham for 15 years. "He lost many clients during that time, but he's a fighter, and just doesn't back down from a deeply held conviction. I think th…

Monday - Global view

US stock markets are closed today due to the Presidents' Day holiday. Nevertheless, the rest of the world's markets are open for business, and that being the case, I had some interesting links and stories to share with you.

First off, I'm reminded, by the comments in our recent, "Features of the week" post, of two noteworthy weekly roundup posts that you may want to check out.

Kent at The Financial Philosopher offers up the latest edition of his "Weekend Wisdom" series, while Prieur du Plessis at Investment Postcards weighs in with a week-in-review of the financial markets in, "Words from the (investment) wise...". You'll find a lot of market data and investment analysis here; be sure to check out that Jeremy Grantham interview in Barron's that Prieur has linked to in his post.

And now, on to the stories of the day. We've got a few articles for you which will offer a view of what's happening in the global financial markets, and …

Features of the week

We have a lot of great stuff to share with you in this weekend's edition of, "Features of the week".

From the high price of platinum, to a sit down with investment author and historian Peter Bernstein, you're sure to find something of interest here. So read, watch, and enjoy!

1. Warren Buffett's bid for municipal bond contracts guaranteed by MBIA, Ambac, and FGIC was one of the biggest business news stories this week. Some say the plan will save the muni market, and doom MBIA & Ambac.

2. Jim Chanos talks to Bloomberg News about regulations constraining investment managers in the midst of the ongoing credit crisis.

3. Investor, author, and historian, Peter Bernstein is interviewed for FT's View from the Markets program.

4. Will the UK housing market follow the US? UK house prices have surpassed US prices both in absolute terms and relative to income.

5. China spurs coal-price surge. Yes, this is likely to affect Europe and the US; some background info on this …

2008 Barron's Roundtable review

For anyone who didn't get a chance to fully read the three-part 2008 Barron's Roundtable issues, we're posting them here. All three parts from Barron's Online.

You may want to bookmark this post and refer back to it at your convenience. Especially if you missed out on one or two of the January Barron's Roundtable issues, as I did. Now let's get started with a quick overview of what you'll find inside.

First off, the Roundtable participants. Regular readers of the Barron's Roundtable will note that 2008's panel is made up of most of the usual suspects. Namely, Marc Faber, Art Samberg, Oscar Schafer, Felix Zulauf, Archie MacAllester, Meryl Witmer, Abby Joseph Cohen, Bill Gross, Scott Black, Mario Gabelli, and Fred Hickey.

An all-star cast, no doubt, but I'm sure that, like me, you have your favorites among this crowd. So let's jump in and get an idea of what each of them are saying in this year's Roundtable.

This year's Roundtable found…

Healthy habits, longer lives

A report out today on health and longetivity shows certain health habits are associated with longer lives in men.

Want to know more? Here's an excerpt from the article, "Men Who Maintain Healthy Habits Lead Much Longer Lives ".

"BOSTON, Feb. 12 -- The same lifestyle-related factors that help men survive middle age also help them stay healthy to age 90 and beyond, researchers here said.

More than half of men in their early 70s who exercised regularly, were not obese, didn't smoke, and didn't have diabetes or high blood pressure survived to 90, reported Laurel B. Yates, M.D., M.P.H., of Brigham and Women's Hospital, and colleagues in the Feb. 11 issue of Archives of Internal Medicine."

I've included this article today because, as the saying goes, "health is wealth". And monetary wealth and achievement may often turn out to be less meaningful or enjoyable in the absence of good health.

The study's researchers note that while the findin…

Active Value Investing: interview

Vitaliy Katsenelson, author of the book, Active Value Investing: Making Money in Range-Bound Markets, was recently interviewed by the Financial Sense Newshour.

What is "active value investing"? Author Katsenelson and FSN host Jim Puplava delve into that topic at length during the interview, but here is a brief introduction to the ideas Katsenelson presents.

"For the next dozen years or so, the U.S. stock market will be a wild roller-coaster ride—setting all-time highs and multi-year lows in the process. While the twists and turns of this ride are still to be written by history, the long-term, sideways "range-bound" trajectory has already been set by the eighteen-year bull market that ended in 2000. When the dust settles, only those who adapted their investment strategies to this range-bound market will have captured any meaningful profits."

If you'd like to know more, just click on the Financial Sense interview link above and select your preferred audi…

Features of the week

Are you in the mood for a little weekend reading? Good, because we have some great stories and interview clips for you today. Enjoy our, "Features of the week".

1. Congress passes $168 billion "stimulus" package. Yep...

2. Please don't help. "Mr. Practical to the bureaucrats: don't try to fix the markets".

3. The rogue rebuttal. Questions over Société Générale's role in the Jerome Kervail "rogue trader" scandal. More on the unfolding drama from FT.com.

4. Financial Sense Newshour "Energy Roundtable" interview with Matt Simmons, Dr. Robert L. Hirsch, and Jeffrey G. Rubin.

Check this one out. There were some very interesting points made about the economics of finding and producing oil. It is, as far as we know, a finite resource (something economists tend to overlook).

5. So you want to be in charge of monetary policy? Bloomberg's Mark Gilbert on how to be Federal Reserve Chairman.

6. Chapter II: A commerical real estate bust.…

Charts: dollar, bonds, PMs

Bear Mountain Bull has got a few interesting charts up for us in today's "Chart Chatter" post.

For technical commentary on the US dollar ($USD), 30 year Treasury bond yields ($TYX), and the precious metals, gold and silver (GLD, SLV), head on over and check it out.

Plus, you can always head on over to the Bear Mountain Bull blog for end-of-day commentary on US trading and updates on market news throughout the day. If you're curious to know how things are looking in the markets and the economy, BMB offers an individual investor and trader's perspective. Check it out.

China's gold rush

You may have seen the item in last week's Features post describing China's recent climb to the top in global gold production.

While the Mineweb article cited China as the world's number 2 producer, just behind South Africa in terms of gold production, a recent Financial Times article holds China up as the new number one producer of gold.

Here are some excerpts from the FT article, "Rewards spur China gold rush".

"China’s mini-gold rush made it the world’s biggest producer in 2007, the first time any nation has surpassed South Africa since the late 19th century.

“Because of the higher gold price, companies with enough capital are lifting production,” said an official of the China Gold Association, citing one mine in Shanxi province planning to quadruple output over the next two years.

Gold production in China rose by 12 per cent to reach 276 tonnes in 2007, according to GFMS, the London-based precious metal consultancy, ahead of South Africa, with 272 tonnes.&q…

Bush unveils $3.1 trillion budget

Future of Yahoo! Finance

Ever since Microsoft's $44 billion bid for Yahoo! was announced last Friday, I can't help wondering (along with the rest of the blogosphere) what will happen to Yahoo's highly prized web properties, particularly Yahoo! Finance.

Will a MSFT/YHOO merger kill Yahoo! Finance as we know it? In spite of our recent tirades against changes to the Finance portal, it still remains one of the most widely used investment sites on the web. If you're a fan of the site, you have to wonder about any further changes that may come about through a union with "big Red(mond)".

Now Microsoft is no stranger to the personal finance and investment game. Their MSN Money portal has long been a popular destination for investors, and the MSN stock screener deluxe tool is one of my personal favorites. Plus, if memory serves, MSN Money was further ahead in the adoption of interactive stock charts.

But these points are likely to provide little comfort to long-time users of Yahoo Finance, who…

Features of the week

Microsoft makes an unsolicited offer for Yahoo!, dealing with recession, and a few words with famous investors Jim Rogers and Julian Robertson. Coming up in our, "Features of the week".

1. Microsoft makes an unsolicited $44.6 billion offer for Yahoo! in an attempt to challenge Google's search dominance.

2. Jim Rogers speaks with Bloomberg about commodities and the reckless Fed, who are "debasing the currency" and making the same mistakes that the Japanese have made.

3. Ahh...politics. After bickering back and forth for weeks, Obama and Clinton say, "let's be friends". The Democratic candidates have plotted a change in strategy and now wish to highlight the incessant bickering between Republican frontrunners.

4. Tiger's Julian Robertson roars again. Fortune profiles the retired hedge fund star and his recent success out of the limelight.

5. Two billionaires describe our outlook. Lamont Trading Advisors match up with George Soros and Julian Roberts…