4 Reasons Bonds are No Longer “Safe”
When investors think of “risk aversion,” typically treasury bonds, corporate bonds and municipal debt rank highly on the list. In today’s economic climate, however, it appears there may be more risk in low yielding debt than there is in stocks themselves, which are generally considered to be the most risky.
The Flee to Bonds
With deflation concerns [...]
Why “Absolute Return” Funds Absolutely Underperform
Billions of dollars tumbled into absolute return funds in the wake of the financial downturn. Although these funds may guarantee absolute returns, they’re more likely to under-perform.
The Basis of the Business
Unlike other mutual funds and even exchange-traded funds, an absolute return fund has more in common with insurance policies than it does investments. The goal [...]
Commodities: The Key to Predicting the Next Market Movement
Commodities and equities are very different investment vehicles. One represents ownership in a company or business, while another represents ownership in one of the most basic units of production. While they aren’t interchangeable, commodities typically lead any stock market rebound.
The Basis for Correcting Recessions
The Federal Reserve and Congress both spend significant amounts of energy and [...]
What a Tariff Means for the Tire Industry - And Your Portfolio
Trade relations between the United States and China became threatened last week when President Obama enacted a new tariff of 35% on Chinese made automotive tires. The tariff, which has increased by nearly 800% from 4% to 35%, could bring about a wave of protectionism in what has so far been a relatively “friendly” recession.
The [...]
How to Profit from Inflation: Think Emerging Markets
It’s par for the course that emerging market economies are flush with inflation. The root generally stems from vast government subsidies and legislative measures intended to help businesses compete in international trade. Although inflation is often considered a terrible stain on any portfolio, the good news is that with emerging markets, it may just make [...]
Invest in Your Emergency Fund - Instead of Your 401(k)
While a stockpile of cash is unlikely to generate any top-notch returns, for many people, an emergency fund could have prevented the financial and retirement peril created by an on-going recession. According to a recent Monster.com poll, more than 50% of Americans have less than one-month of income saved. After one month, those polled would [...]
3 Companies with Cash to Reach the Economic Rebound
During a recession, companies that succeed do not have the best business. Rather, the companies that are successful are those that can withstand the shakeout. Here are three names that have proven brands, proven businesses, and enough money to sustain even the longest of recessions.
Office Depot (ODT)
Businesses that service other businesses never fare too well [...]
Why LIBOR Rates Show a Future Bull Run
LIBOR rates have plummeted since the start of the credit crisis last fall to levels unseen since the last recession in 2003. As they continue to fall, showing strength in the amount of credit available, banks have become more willing to borrow and lend, producing rather large profits at current mortgage rates.
Why LIBOR is so [...]
Hearye, Hearye: The Treasury Bubble is Bursting
It is now the beginning of the end of the treasury bubble. As investors feared further financial decay, treasuries were the hottest security on the market. Today, they’re hardly drawing any interest and rates are slowly, but surely, creeping upward.
Bubble Burst 101
Cash was king, but cash isn’t good enough for the biggest investors. Institutions, banks [...]
Will ETP Derivatives Help Individual Investors?
The first exchange-traded product to list in the United States will be launching soon. Its goal is to track the changes in price of American real estate with a leverage of 300%. The new products are very much like derivatives, having zero investments in their “underlying index” and instead using capital shifting measures to make [...]
