Happy Mother’s Day Mr. Bernanke
In light of the current low interest rate environment, we are watching particularly closely for instances of “reaching for yield” and other forms of excessive risk-taking, which may affect asset prices and their relationships with fundamentals. It is worth emphasizing that looking for historically unusual patterns or relationships in asset prices can be useful even .. read more
Financial Impulsion
You’ve probably read about financial repression in which governments or their agents interfere in the market in an effort to reduce debt. The most obvious recent example is the Fed and other central banks interfering in bond markets and suppressing interest rates. While these central banks generally justify this act on the grounds that it .. read more
Companies Spending Money Badly
Stock buybacks hit a record last month according to this post from Cardiff Garcia at FT Alphaville quoting a Birinyi Associates post: We recorded $117.8 billion in buyback authorizations during the month of February, representing a 103% gain over the same period in 2012 ($118 bln vs. $68 bln). .. read more
Fed, ECB Do Nothing, Markets Don’t Crash
There’s an old saying on Wall Street that the market will always act in a way that frustrates the majority of market participants. If that is true, then it goes without saying that the majority must be bearish because this market has had ample opportunities to move lower and steadfastly refuses to do so. Coming .. read more
Dividend Slump Ending
Companies are using the big rise in profits for dividends. That’s good news for shareholders but maybe not so good news for the unemployed. If companies felt they had a good use for those funds, they’d retain them and maybe hire someone or buy a piece of equipment. Instead they are paying out dividends to shareholders: April .. read more
Worst Quarter For Stock Dividends…Ever!
Via MarketWatch: While March proved positive for equities, with the S&P 500 up 8.5% from February, the month also capped one of the worst quarters for shareholders, with companies slashing dividends by the most since Standard & Poor’s began keeping record in 1955. A record 367 of the 7,000 U.S. companies tracked by S&P cut .. read more
