Monday, November 29, 2010

American Lost Decade

Bullish December




Contrary to popular belief, the month of december has consistently given positive returns over the period of time. Popular notion is that Investors, fund managers sell off thier position in december, which is a holiday season and come back in January to take fresh positions again.
But statistically speaking, December as a month is bullish and given better returns than other months

Tuesday, November 23, 2010

The Great Fed Dilemma




The Fed has taken criticism over the recession and Wall Street bailouts, but in the financial overhaul this year, it helped defeat proposals to strip away its power to regulate and supervise banks.

Mr. Bernanke, who had thought the worst was behind him, was unsettled by the suddenness of the recent attacks. He has said that the Fed was in a no-win situation; if it had not acted, it would have been criticized for ignoring the painfully slow pace of the recovery.

The situation forms an odd corollary to the early 1980s, when Mr. Greenspan’s predecessor, Paul A. Volcker, sharply raised interest rates, setting off back-to-back recessions in a painful but effective war on inflation.

Liberals attacked Mr. Volcker, a Democrat, as an inflation-fighting zealot who disregarded the plight of the unemployed. Now conservatives are portraying Mr. Bernanke, a Republican, as trying too hard to stimulate growth and underestimating the risk of inflation.

Read More http://www.nytimes.com/2010/11/23/business/economy/23fed.html?_r=1

Sunday, November 21, 2010

Earnings Warnings




chart illustrates how earnings declined over 92% from its Q3 2007 peak to Q1 2009 low which brought inflation-adjusted earnings to near Great Depression lows. Since its Q1 2009 low, S&P 500 earnings have surged (up over 900%) and have just crossed above a level that occurred at the peak of the dot-com bubble. In fact, earnings have only been higher than current levels for a 29-month stretch that occurred at the tail end of the credit bubble.

Saturday, November 20, 2010

The Debt Web



The Mesh or the Mess of th Debt tangle in The Continent.

PIIGS Debt Crisis





The so called PIIGS debt blunder. Its consequences on Germany's economy and Euro can be imagined.