Oct 25, 2011, 6:00 am EDT
One of the most important players in any market is the Federal Reserve. It controls the amount and cost of money in the system, so it naturally has to be at the center of our attention at all times.
That’s what makes the release of its meeting notes so fascinating, if you have the slightest bit of policy wonk in you at all. It’s like putting your ear to the door and hearing (albeit three weeks after policies are announced) what the grownups are talking about.
BMO Financial senior economist Michael Gregory always does a nice job analyzing Fed minutes. His interpretation of the October notes is that the Fed, at its Nov. 2 meeting, is not likely to embark on another round of quantitative easing, if only “to allow some time for the past two actions to percolate.” But he thinks more easing is inevitable, which ultimately is going to be a plus for stocks — possibly from lower levels. Read
Oct 24, 2011, 1:21 pm EDT
Libya will be a multibillion-dollar payday for U.S. stocks if the political situation stabilizes itself. And stocks like Exxon (NYSE:XOM), General Electric (NYSE:GE) and Caterpillar (NYSE:CAT) will be first in line to benefit from the rebuilding.
Thanks to more than four decades of misrule by the late Libyan dictator Moammar Gadhafi, the North African nation is a mess. Though it boasts Africa’s largest proven reserves of oil, the petroleum sector remains in dire need of investment. Libya’s National Oil Company had planned to double production to 3 million barrels per day by 2012, a goal that became unrealistic as foreign oil companies fled during the civil war. Libyan light, sweet crude is of high quality and easy for oil companies to refine and thus in very high demand.
Gadhafi squandered billions in Libya’s oil wealth for more than four decades — the country’s unemployment rate is about 30%, and according to the CIA World FactBook, one-third of Libyans live at or below the national poverty line. But thanks to a revolution, the economy could provide opportunity to the region. Read
Oct 21, 2011, 10:41 am EDT
With friends like Donald Trump and Vikram Pandit, does Occupy Wall Street need enemies?
Both The Donald and the Citigroup (NYSE:C) CEO recently have said that they sympathized with the views of the Occupy Wall Street movement — bizarre statements considering Trump and Pandit are examples of the corporate greed that has infuriated the masses.
Take Trump. There is no greater living symbol of the excesses of capitalism. For Pete’s sake, the man sells his own branded water and the Donald J. Trump Signature collection of apparel! Never mind the ease with which he navigates bankruptcy (his companies or properties have filed for bankruptcy four times). No, Trump decided that he could speak for the common man. Read
Oct 20, 2011, 12:03 pm EDT
There’s a lot of fuss about United States Postal Service profitability (or lack thereof) these days. Ideas to streamline the USPS include closing post offices in rural locations, eliminating Saturday mail delivery and other cutbacks.
But cuts aren’t the only way to bridge the budget gap at the USPS. To create more revenue, U.S. postage rates are about to go up — again!
Starting Jan. 22, the price of a first-class stamp will go up a penny, from 44 cents to 45 cents. Postcard stamps will jump more than 10%, from 29 cents to 32 cents. Read
Oct 19, 2011, 4:34 pm EDT
Social Security checks will see their first increase in three years this January. The Social Security COLA, or Cost of Living Adjustment, will amount to 3.6%.
But seniors should be outraged by the Social Security increase — because it isn’t an increase at all. The fact is the government program is paying less than it has in years past, and the recent COLA “increase” doesn’t make up for the ground that seniors have already lost.
Thanks to inflation pushing up prices and a stagnant economy hindering income, many senior citizens rely on their monthly Social Security check more than ever before. And on its face, an increase going into 2012 seems like a good thing. But here’s why the recent Social Security COLA is woefully deficient — and just a political move to appease older voters who have every right to be furious: Read
Oct 18, 2011, 2:06 pm EDT
Republican presidential hopeful Mitt Romney has raised about six times as much cash from the employees of Wall Street firms as has President Barack Obama, according to a New York Times analysis of recent campaign finance filings. This discrepancy is particularly noteworthy, given that the financial services industry was a major backer of Obama’s 2008 campaign. In fact, Goldman Sachs (NYSE:GS) was Obama’s biggest supporter in the private sector: Its workers coughed up $1 million last time around.
So far in this election season, that same group has offered up a mere $45,000 for the president, dwarfed by the $350,000 they have given to the Romney campaign.
What’s changed in three years? Bear with me as I point out the obvious. Read