From King “Bond Trader” to King “Bond Traitor”…?

We find it quite troubling to read such a forlorn commentary from such a respected, heavyweight investor as Bill Gross in his most recent Investment Outlook report. That the discounted NPV of our debt is $75 trillion is appalling and frightening. In Bill’s own words, “This country appears to have an off-balance-sheet, unrecorded debt burden … Continue reading

Outlook 2011: Part 1

It’s taken us more time than most to come out with our outlook for 2011, but prudence eventually pays more dividends.  The Dow is on the brink of breaking the psychologically-significant 12,000 point mark. Yet we still find cause for caution.  We’ve gone on the record in August calling for a 5-6 month broad market … Continue reading

The Official Start to the Holiday Season

Today’s market rally could be the action that us bulls have been waiting for since the Fed’s announcement of QE2 on Nov. 8.  The Dow, S&P 500, and Nasdaq closed up +2.27%, +1.64%, and +2.05%, respectively.  We gave our year-end forecast for the S&P at ~1,250 back in early September with the understanding that the … Continue reading

A market to be thankful for

On the eve of America’s most celebrated secular holiday, we would like to take the time and share the things we are thankful for: – Uncle Ben and the avuncular Fed. Despite strong skepticism and backlash over the Fed’s additional stimulus, QE2 has been a gift to the markets since Bernanke first gave hint back … Continue reading

InvestorJabber: Gary Shilling on the effects of QE2 and US economic prospects

Gary Shilling Sees `Significant’ Stock Selloff Within 12 Months When Gary Shilling speaks, we listen. Most recently Shilling has come out and voiced his dire forecast of the economic recovery.  “There’s not much that can be done,” said Shilling. “There isn’t any magic bullet. There isn’t anything in my view that’s going to return us … Continue reading

More on QE2 from the Weekend

Last week’s news gave us plenty to digest over the weekend.  The Fed’s QE2 dominated newspaper headlines and as such we picked up on two provocative articles worth taking a second look at (with highlighted points): ______________ From The Economist – Down the Slipway: – Already a Success: “You can declare QE to be a … Continue reading

QE2 Explained

We’ve been perusing intensely the past 24 hours trying to get an idea on what investors are saying about the Fed’s second round of stimulus, QE2.  And we admit, we’ve been caught quite off guard by the slew of pessimism.  Though, in reality, we are secretly grinning to be in the fortunate seat of Contrarians.  … Continue reading

Ladies and Gentlemen, I give you…QE2

Fed to Buy Extra $600 Billion of Treasuries to Boost Growth The number was widely expected. The reaction from Wall Street mixed. But at the close of trading on Wednesday, the equity markets spoke for themselves and all indices closed the day higher; the Dow having reached its highest level in two-years at 11,215 and … Continue reading

InvestorJabber: Marc Faber on QE2

Faber Interview on Fed Easing, Stocks Outlook, China Marc Faber of the Gloom, Boom & Doom report undoubtedly qualifies as an InvestorJabber.  He believes, much like we do, that QE2 will be a favorable boon for the markets. We have been contending since the first whispers of additional stimulus in July-August that the Fed has … Continue reading

Return of Risk…?

Fed Puts Stamp of Approval on Riskier Assets We believe that the Fed has no other option than to pump more money into the system to stimulate economic growth. As a consequence, QE2 will most likely artificially inflate asset prices in the short-term.  Part of the Fed’s intentions in facilitating appreciating asset prices is to … Continue reading

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