views on markets, equities, bonds, derivatives, finance, investing, the economy

Video - Euro-Zone Faces Up to New Reality

Video - Euro-Zone Crisis Faces Up to New Reality - "Recent data showing the euro-zone slowdown spreading to Germany suggests that new tactics will be needed to counter the malaise gripping the region"

Google searches can predict market moves

Google searches can predict market moves - "But investors shouldn't start trading with this strategy immediately, the researchers warned. Preis said that times have changed and words like "debt" might no longer be useful at predicting market movements. The strategy needs updating as new keywords become more relevant to the markets. Furthermore, Moat pointed out that now that their research paper has been released, other investors will try to use the strategy, diluting the impact in the long run. This study follows research from 2010 that showed that weekly transaction volumes for S&P 500 companies were correlated with online searches related to those companies." (read  more at link above)

Most of the World is Printing Money Now

US, Japan Now Global Allies in Money Printing: ""'Don't fight the Fed' and 'don't fight the central banks' are sayings for a reason," Yoshikami said. "The money we're spending right now for central banks is going to come out of the economy five and 10 years from now. It might be a sobering result that we get less growth then because we're spending it today." There are additional risks, the most glaring being that a big round of quantitative easing in Japan may be no better at stoking growth and the good kind of inflation there than it has been in the U.S. Despite the Fed's all-out efforts, unemployment remains elevated and inflation subdued, though stocks have soared. Investors, however, have shown little interest lately in pondering long-term ramifications when there's money to be made today. "Monetary policy is being used as the policy tool to create demand. The question is, is this going to end in tears?" Prudential's Krosby said. "Is this going to end in worse calamity for the markets than what we had in 2008 and 2009? No one knows . . .""

George Soros Cautious on China

Interview with George Soros | South China Morning Post: " I am also aware of the exceptional difficulties that the transition is going to bring, and therefore, if I were an investor, I think I would be very cautious in the near term – the next year or so. Because you have this situation when 2/3 of the economy has to slow down, and 1/3 has to expand. That already makes it very difficult. What makes it even more difficult is when there is an overall slowdown, the households’ first reaction may be to become more cautious, and their propensity to save would increase – they would be afraid that their job is not safe, and they would not be so confident in spending money. And then all three of the sectors would slow down at the same time. That would create a hard landing."

April 12 (Bloomberg) -- David Ingles reports on China growth. He speaks with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)

US States Promote Gold Bullion

Article I | U.S. Constitution | LII / Legal Information Institute: "ARTICLE I" . . . . SECTION 10. . . No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts; . . .

Trust in Gold Not Bernanke as U.S. States Promote Bullion - Bloomberg: "Distrust of the Federal Reserve and concern that U.S. dollars may become worthless are fueling a push in more than a dozen states to recognize gold and silver coins as legal tender. Arizona is poised to follow Utah, which authorized bullion for currency in 2011. Similar bills are advancing in Kansas, South Carolina and other states. . . . They reflect lingering dollar concerns, amplified by the Fed’s unconventional moves in recent years to stabilize the economy, said Loren Gatch, who teaches politics at the University of Central Oklahoma. “The legislation is about signaling discontent with monetary policy and about what Ben Bernanke is doing,” said Gatch, who studies alternative currencies at the Edmond, Oklahoma-based school. “There is a fear that the government, or Bernanke in particular and the Federal Reserve, is pursuing a policy that will lead to the collapse of the dollar. That’s what is behind it.” Bernanke has pushed interest rates to near zero since the 18-month recession that began in December 2007. The Fed said in March it would continue buying $85 billion in securities each month in a program known as quantitative easing that has ballooned its assets beyond $3 trillion and is aimed at keeping long-term borrowing costs low to support economic growth. . . ." (read more at link above)

IMF Lagarde Warns of New Financial Crisis (video)

IMF's Lagarde Warns of New Financial Crisis (video) - Bloomberg Europe Editor David Tweed recaps comments from IMF managing director Christine Lagarde warning of new financial imbalances and what she would like to see out of Europe and China. He speaks on Bloomberg Television's "The Pulse."

Bitcoin Virtual Currency: Digital "fools' gold" (video)

Bloomberg's Jonathan Ferro explains the business of Bitcoin and the problems associated with the virtual currency as the largest Bitcoin exchange experienced wild swings in the value of the currency during Thursday's trading day. He speaks on Bloomberg Television's "On The Move" April 12.

Golden Cyberfetters - Paul Krugman: What we want from a monetary system isn’t to make people holding money rich; we want it to facilitate transactions and make the economy as a whole rich. And that’s not at all what is happening in Bitcoin.

see also Cryptocurrency | MIT Technology Review

US Economy Outlook

Asia Times Online :: Global Economy: "America will keep running trillion-dollar deficits as far as the eye can see, and the world won't come to an end. The present generation of economists, pundits, and hedge-fund heroes will retire before we see the consequences of fiscal irresponsibility. There's a simple explanation for this, and it's called "fracking". America will produce more energy than Saudi Arabia by 2020 and turn what used to be a colossal foreign trade deficit into a small but comfortable surplus. And that will enable America to keep selling huge amounts of government securities to the rest of the world at fairly low interest rates. . . . " read more at link above

Is the Global Economy Slowly Falling Apart? | " . . .There’s always the possibility of external shocks that would knock the U.S. economy off track. But based on the trends that can be evaluated now, it looks as though a sluggish recovery will continue for several years, and that the outlook could well improve after that. The overall picture may not be particularly upbeat, but the worst appears to be behind us. Certainly, the relentless decline foreseen by Stockman and other pessimists seems unsubstantiated by what we can know now."

Fed Considers Early End of Easing

Records of their March meeting, which were released early, showed that several officials expected the bond-buying stimulus program to be ratcheted down by midyear.--

Fed Officials Consider Early End of Easing - "Displaying an array of views, Federal Reserve policy makers were considering scaling back their effort to encourage growth ( QE, Quantitative Easing) slightly earlier than expected if the economy continued to rebound, according to minutes released Wednesday of their most recent meeting last month." (read more at links above)

Remembering Margaret Thatcher

RealClearMarkets - Without Thatcher, There's No 'Cool Britannia' For Blair: "So while the health of the economies in the U.K. and U.S. presently leaves much to be desired, Margaret Thatcher's sad passing is a good reminder of just how much worse things were before she and Reagan transformed the policy landscape. Our troubles are surely less daunting today thanks to Thatcher and Reagan having so powerfully changed the debate, and even better, the success of their policies at a time when a previous generation had similarly begun to question capitalism provides us with a clear roadmap out of our present difficulties. Though Thatcher has left us, she didn't take her growth-boosting policy ideas with her. In her absence, one way to honor her would be to ask what she did amid troubled times, and mimic it."

Even Margaret Thatcher couldn’t have fixed the mess that the UK economy is in – Quartz: "Either way, those suggesting a repeat of the Iron Lady’s approach to economic policy offers a panacea might do well to recall a quote from another great 20th Century figure, John Maynard Keynes:
Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist."
Real Clear Markets - Video - Gross: Here's What We're Buying Now: "Risks are rising, and that has Pimco investing in higher quality, highly liquid investments, bond investor Bill Gross told CNBC. "We're buying what the Fed's buying to avoid the complexities of risk going forward," Gross said. He noted that geopolitical risks are on the rise as tensions build on the Korean peninsula, and there are changes in the euro zone following the Cyprus bailout that may create additional risks investors would want to avoid."

Mort Zuckerman: Economy slow slide to worse by end of year

The McLaughlin Group 4/5/13: 26:47 -- Will the economy improved by the end of the year? – Mort Zuckerman: “it's going to continue to slowly subside  and get worse between now and the end of the year”

Shiller and Siegel: Market Overvalued? (video)

Weighing in on current valuations and whether a bullish market is too much of a good thing with Robert Shiller, Yale economics professor and Jeremy Siegel, Wharton finance professor.

Bitcoin Virtual Cash Gets Money-Laundering Rule

Sara Eisen takes a look at Bitcoin, what it is and how it's used. She speaks on Bloomberg Television's "Market Makers." (Source: Bloomberg)

Why would anyone use Bitcoins?--

Bitcoin Virtual Cash Gets Money-Laundering Rule - "The FBI report last year said Bitcoin attracts cybercriminals who want to move or steal funds. "Bitcoin might also logically attract money launderers and other criminals who avoid traditional financial systems by using the Internet to conduct global monetary transfers," the report said. An FBI spokeswoman declined to comment when asked about the agency's concerns regarding virtual currencies. For now, the size of the bitcoin market is so small that it could be difficult or costly to move and exchange large amounts of illicit funds. Another danger: extreme price fluctuations. The value of a bitcoin rose to more than $60 a unit from less than $49 on one exchange following the release of FinCen's new guidance—a move that Mr. Garzik attributed partly to a new level of certainty and legitimacy that federal recognition attaches to bitcoin transactions."

Thomas Hoenig of the Kansas City Fed on the Economy (video)

Thomas Hoenig, Federal Reserve Bank of Kansas City president, discusses his outlook on inflation, the economy, and the direction of the United States in an interview with CNBC's Larry Kudlow.

Business - Google News

Credit Writedowns

Central Banking