Thursday, May 2, 2013
Bill Gross: Investment Outlook (May 2013)
“There Will Be Haircuts”
by William H. Gross
“Good as Money,” proclaimed the ad for Twenty Grand Cognac. Being a beer drinker, and never having cashed in a Budweiser to pay for a fill-up at the local gas station, I said to myself “Man, that must be really good stuff!” Even in a financial meltdown I thought, you could use it in place of cash, diamonds, gold or Bitcoins! And if the Mongol hordes descend upon us during a future revolution, who wouldn’t prefer a few belts of Twenty Grand on the way out, instead of some shiny rocks and a slingshot?
Well, not being inebriated at that moment I immediately shifted focus to a more serious topic.
What IS money? A medium of exchange and a store of value is a rather succinct definition, but we generally think of it as cash or perhaps checks that reflect some balance of “ready” cash at a friendly bank. Yet as technology and financial innovation have progressed over the past few decades, and as central banks have tenuously validated the liquidity and price of various forms of credit, it seems that the definition of money has been extended; not perhaps to a bottle of Twenty Grand Cognac, but at least to some other rather liquid forms of near currency such as money market funds, institutional “repo” and short-term Treasuries “guaranteed” by the Fed to trade at par over the next few years.(more)
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by William H. Gross
“Good as Money,” proclaimed the ad for Twenty Grand Cognac. Being a beer drinker, and never having cashed in a Budweiser to pay for a fill-up at the local gas station, I said to myself “Man, that must be really good stuff!” Even in a financial meltdown I thought, you could use it in place of cash, diamonds, gold or Bitcoins! And if the Mongol hordes descend upon us during a future revolution, who wouldn’t prefer a few belts of Twenty Grand on the way out, instead of some shiny rocks and a slingshot?
What IS money? A medium of exchange and a store of value is a rather succinct definition, but we generally think of it as cash or perhaps checks that reflect some balance of “ready” cash at a friendly bank. Yet as technology and financial innovation have progressed over the past few decades, and as central banks have tenuously validated the liquidity and price of various forms of credit, it seems that the definition of money has been extended; not perhaps to a bottle of Twenty Grand Cognac, but at least to some other rather liquid forms of near currency such as money market funds, institutional “repo” and short-term Treasuries “guaranteed” by the Fed to trade at par over the next few years.(more)
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McAlvany Weekly Commentary
Middle East Quagmire with Stratfors Kamran Bokhari
Posted on 01 May 2013.
About this week’s show:
-Arab Spring: Revolution to Transition
-Syria and Chemical Weapons
-Israel surrounded by Chaos
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Questcor Pharmaceuticals Inc (NASDAQ: QCOR)
Questcor Pharmaceuticals, Inc., a biopharmaceutical company, provides
drugs for the treatment of multiple sclerosis, nephrotic syndrome, and
infantile spasms indications. It primarily offers H.P. Acthar Gel, an
injectable drug for the treatment of acute exacerbations of multiple
sclerosis in adults; to induce a diuresis or a remission of proteinuria
in the nephrotic syndrome without uremia of the idiopathic type or that
due to lupus erythematosus; and as monotherapy for the treatment of
infantile spasms in infants and children under two years of age. The
company's H.P. Acthar Gel also focuses on rheumatology-related
conditions, including collagen diseases and rheumatic disorders. In
addition, it offers Doral for the treatment of insomnia. The company
sells its Acthar primarily to specialty pharmacies; and Doral to
pharmaceutical wholesalers. Questcor Pharmaceuticals, Inc. was founded
in 1990 and is headquartered in Anaheim, California.
To analyze the company's stock for potential trading opportunities, please take a look at the 1-year chart of QCOR (Questcor Pharmaceuticals, Inc.) below with my added notations:
After a nasty fall in September, QCOR has slowly worked its way
higher, one level at a time. From November through January the stock
created a clear level of support at $25 (green). Over the last (5)
months, QCOR has commonly reacted to the level of $30 (blue), both as
support and resistance. It has also not been uncommon for the stock to
find support or resistance at the $35 level (red). In summation, QCOR
primarily reacts to the increments of $5.
The Tale of the Tape: QCOR has broken below $30. A short position could be entered at the $30 resistance with a stop placed above that level. A long play could be made on a break above $30 with an expectation of a rally up to $35.
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To analyze the company's stock for potential trading opportunities, please take a look at the 1-year chart of QCOR (Questcor Pharmaceuticals, Inc.) below with my added notations:
After a nasty fall in September, QCOR has slowly worked its way
higher, one level at a time. From November through January the stock
created a clear level of support at $25 (green). Over the last (5)
months, QCOR has commonly reacted to the level of $30 (blue), both as
support and resistance. It has also not been uncommon for the stock to
find support or resistance at the $35 level (red). In summation, QCOR
primarily reacts to the increments of $5.The Tale of the Tape: QCOR has broken below $30. A short position could be entered at the $30 resistance with a stop placed above that level. A long play could be made on a break above $30 with an expectation of a rally up to $35.
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The next domino: Australia doubles tax on retirement savings
Though
Australia’s national balance sheet is comparatively quite strong, the
government has been running at a net deficit for years… and they’re
under intense pressure to balance the budget.The good news is that Australia now has a goodly number of investor-friendly immigration programs designed to bring productive foreigners into the country, similar to the trend we’re seeing across Europe.
On the flip side, though, the Australian government has just announced new rules which penalize citizens who have responsibly set aside savings for their own retirement.
Any income over A$100,000 drawn from a superannuation fund (the equivalent of an IRA in the United States) will now be taxed at 15%. Previously, all such income was tax-free.
Read More @ sovereignman.com
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Foreign Holdings of US Securities Have Exploded
Foreigners now hold more than $13 trillion in American securities,
a record set as the U.S. seeks to assert itself as the safest port in
troubled global waters.
China and Japan combined owned more than $3.4 trillion, including $2.4 trillion in debt, a number that has grown since the data set was compiled.
The total value of U.S. stocks and bonds under foreign ownership rose 6.5 percent in 2012, with stocks actually rising more on a percentage basis, according to the most recent data from the U.S. Treasury.
Foreign holdings have more than doubled since 2005 and are getting close to the $15 trillion total size of the U.S. economy. (more)
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China and Japan combined owned more than $3.4 trillion, including $2.4 trillion in debt, a number that has grown since the data set was compiled.
The total value of U.S. stocks and bonds under foreign ownership rose 6.5 percent in 2012, with stocks actually rising more on a percentage basis, according to the most recent data from the U.S. Treasury.
Foreign holdings have more than doubled since 2005 and are getting close to the $15 trillion total size of the U.S. economy. (more)
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