Wednesday, May 12, 2010
“I’m betting the next move in the U.S. market is going to be up 15 to 20 percent,” Biggs, who runs New York-based hedge fund Traxis Partners LP and whose flagship fund returned three times the industry average last year, said in a Bloomberg Television interview. “I would just point out that the world is having a strong economic recovery, and so is Europe.”
Biggs recommended buying U.S. stocks last year when benchmark indexes sank to the lowest levels since the 1990s. He didn’t give a timeframe or refer to a specific measure. The Standard & Poor’s 500 Index rose 0.3 percent to 1,163.02 at 12:06 p.m. in New York, rebounding from a 1 percent loss. (more)
“We are on a path which will go to where Greece is, there's no question about that, if we don't adjust our present financial house,” Gregg says.
“If we continue to spend much more than we take in," he says. "We'll double our debt in five years and triple it in 10 years and essentially be where Greece is in about seven years,” he said Monday night on the Fox Business Network. (more)
The Senate voted unanimously Tuesday to authorize an examination of the Federal Reserve's closely guarded emergency lending to financial institutions in the months surrounding the 2008 financial crisis.
The measure passed 96-0 as an amendment to a comprehensive financial regulation bill before the Senate. The vote came as the Fed ramped up its emergency program to keep a European debt crisis from spreading further.
The Senate proposal would require a one-time audit by Congress' investigative arm, the Government Accountability Office, and cover a period beginning in December 2007. The GAO was specifically directed to examine potential conflicts of interest between the Fed and the banks receiving assistance. (more)
Lancaster — known throughout the U.S. as Pennsylvania Dutch Country — is about 40 minutes away from my house. And whenever I pass through the area, I'm reminded of what it means to be truly self-sufficient.
The region's many Amish inhabitants grow their own food ... help each other build their houses ... and use horse and buggies instead of gas-addicted cars. Heck, they were "green" before the term became fashionable.
I frequently interact with Amish famers at our local markets, and they are always happy and courteous. Plus, their products are top-notch. My own house was built by Amish craftsman in the 1980s from a reclaimed barn and the workmanship is impeccable. (more)
The root cause of the fall has yet to be established, and the regulator is scrabbling to put some form of system in order to maintain an orderly market in the future.
Creating a circuit breaker was understood to be the subject of yesterday's meeting in Washington of Mary Schapiro, SEC chairman, and the heads of the major US exchanges, including the New York Stock Exchange and the Nasdaq. The heads of electronic exchanges BATS Exchange and Direct Edge also attended. (more)
“Every heavily indebted sovereign borrower in the world is starting to wonder if they might be next,” forecasts Eric Fry in the Daily Reckoning. “This situation is very serious, very pervasive and very unlikely to be cured by any sort of ’rescue plan.’
“The chart above places the Greek crisis in a global context. As expected, countries like Italy and Greece are high on the list. But surprisingly, the US is on par with Spain and Portugal. America's three-year funding requirement seems much more ominous when viewed in absolute dollars.
“Most central bankers of the world realize this fact. That's why they all wish to support Greece -- not because they care about Greece, but because they care about avoiding close scrutiny of their own finances.
“Runaway government borrowing creates a frightening context for any would-be buyer of government bonds. That's why long-dated bonds may be some of the riskiest assets on the planet at the moment.”That would be a core component of our new “Trade of the Decade”: Buy Japan, Short U.S. debt.