What the U.K. Can Teach Debt-Riddled Washington

Jun 22, 2011, 8:42 am EDT
What the U.K. Can Teach Debt-Riddled Washington

Last year, the U.K. took the first painful steps on the path of fiscal austerity that the U.S. has so far avoided.And the iShares MSCI United Kingdom ETF Fund (NYSE: EWU) has outperformed the major American stock market indices. The EWU U.K. ETF is up 20% in the last 12 months, compared to about 16% for the broader U.S. market.

Of course, The iShares United Kingdom ETF fund doesn’t tell the whole story. The 40 billion pound “unavoidable budget” of emergency tax increases, public sector job cuts and government spending cuts in Great Britain was incredibly unpopular with the public regardless of how the British ETF performed.

Some experts argue that Prime Minister David Cameron is trying to do too much too fast. The Conservative government, though, has its fans. Pimco fund manager  Saumil H. Parikh recently argued that the U.K.’s economic policy could be could be a model for the U.S. to follow.  Moody’s Investor Service recently reaffirmed the government’s AAA rating on its sovereign debt with the not surprising warning that it would be in danger if the government slacked off on its austerity policy. Read 

The Country That May be Able to Achieve Energy Independence

Jun 20, 2011, 11:19 am EDT

Could the United States ditch its dependence on foreign oil by 2020?

No way, not with the leadership we have, and the never-ending, me-first haggling of both major parties. Hubris, self interest, reelection posturing and financial self-interest all enter in. It is enough to make one sick.

If not America, where then? The answer is Sweden, which is one of a number of reasons I have been advising purchase of the Swedish krona through CurrencyShares Swedish Krona Trust (NYSE: FXS). I have taken a substantial position in this exchange-traded fund (ETF) myself, and will continue to add to my holdings. Read 

Is This the End of the 2009-2011 Bull Market?

Jun 14, 2011, 3:00 am EDT
Is This the End of the 2009-2011 Bull Market?

Last week, the Dow closed below 12,000 for the first time since March 18, after falling for six straight weeks. That hasn’t happened since the week ending Sept. 30, 2002, but that was at the tail-end of a 30-month bear market — a great historic buying opportunity.

Compared to the dismal days of 2002, the recent six-week decline has been small (-6.8%). Last year, the S&P fell much further (15.3%) from April 29 to July 1, but then it rose 33% in 10 months. In this latest sell-off, data from EPFR Global tells us that retail and institutional investors withdrew the most money from U.S. mutual funds of any week since August 2010. But selling stocks then, before the launch of QE2, was also a bad move! So what’s next? Global Growth Should Resume Once Japan Recovers

The global economy is still expanding, but at a slower pace. Investors are selling stocks because they are concerned about the U.S. economy after the Fed suddenly ends its second round of quantitative easing (QE2) this month. It’s hard for the market to recover when so many investors used Thursday’s rally as an excuse to run for the exits (and perhaps a long weekend in a cooler place) on Friday. This malaise could last another few weeks, until we see positive second-quarter earnings announcements come mid-July. Read 

10 Scary Financial Headlines You Don’t Need to Fear

Jun 13, 2011, 1:17 pm EDT

June has not been kind to investors. It began with what the press told us was the “largest one-day loss in over nine months,” with the Dow falling 279 points, or 2.2%, on June 1. What’s more, that decline locked in the fifth-straight negative week, something that the press told us hadn’t happened since the terrible market crisis of 2008.

The press is usually negative, but June has been a bad-news bonanza, so I’d like to go over 10 of the most negative headlines and turn them on their ear, statistically. Maybe by the end of this exercise, you will be able to smell the roses in your garden instead of dodging all those well-publicized nettles in the forest. The Positive Angle Behind 10 Scary Headlines

At the start of June, the Wall Street Journal’s headlines naturally focused on the negative news. The June 1 headline was “Housing Imperils Recovery,” while June 2 was “Economic Outlook Darkens.” In addition, the talking heads of CNBC counted down the “start of hurricane season” and “June’s dismal market history,” but these scare-mongers ignored any historical perspective that revealed a positive angle. Read 

3 Surprising Ways Obama Is Fixing the Economy

Jun 13, 2011, 4:59 am EDT
3 Surprising Ways Obama Is Fixing the Economy

Last Wednesday, I was part of a group of 25 financial journalists that took part in the White House’s first-ever Personal Finance Online summit. We asked dozens of questions to top ranking economic officials – and had the privilege of a brief Q&A with President Barack Obama himself.

There are many reasons to be skeptical of the Obama Administration. I’ve pieced together the most compelling reasons to worry our leaders aren’t doing enough in my recent article about ways Obama is inspiring panic, not confidence. But in the effort of balance, I have to share some of the biggest reasons for optimism that I found over the course of last week’s White House summit.

So, here is the other side of the story based on my notes from interviews with some of the Obama administration’s top economic officials: Read 

3 Reasons to Panic Over Obama’s Economic Plan

Jun 13, 2011, 3:41 am EDT
3 Reasons to Panic Over Obama’s Economic Plan

Last week, I had the privilege of attending a finance roundtable at the White House and the opportunity to participate in Q&A sessions with the highest-ranking economic officials in the administration – including President Obama himself.

I asked for your questions, and through dozens of emails and even more comments in the forums of InvestorPlace.com, you gave me the ammunition for some hard questions for Obama and his team.

There were a number of good questions asked of White House officials at last week’s summit. And while the answers were often well-crafted and non-controversial, a closer read of the responses reveals some important insight into what Obama’s economic team is doing to fix things right now. Read 

1 209 210 211 212 213 218