Standard & Poor’s infamously downgraded U.S. treasuries. Ever since, investors have been richly rewarded for purchasing bonds of the downgraded, AA-quality debt. Now Moody’s downgraded French banks for their exposure to the sovereign debt of the PIGS (Portugal, Italy, Greece, Spain). And yet, iShares MSCI France (EWQ) rose more than 3% shortly after the announcement. Of course, these are two very [...] Continue Reading...
The number “88″ means a lot of different things to different people around the world. For some, it expresses the notion that the universe is both infinitely large and infinitely small. Others see it as a message of eternal love. Meanwhile, Chinese culture recognizes “8″ as its luckiest number, with “88″ symbolizing even greater fortunes. However, 8/8 is a rather dismal date for the [...] Continue Reading...
Headlines prey on human emotions. So when you see bold lead-ins like, ”98% Chance of a Greek Default” or “75% Chance of a New Recession,” it usually pays to keep one’s emotions in check. One reason to avoid reacting to current commentary? If you’re reading it now and responding to it now, the market is way ahead of you. [...] Continue Reading...
Euro-zone members have yet to come to a meaningful agreement on how to save weaker countries from sovereign debt defaults. Consequently, Germany has been studying the adverse impact that a default by Greece would have on German banks. Meanwhile, CEOs of French financial institutions can be seen on the talk circuit, claiming that banks in France are well-capitalized and [...] Continue Reading...
Many analysts have now decided that Europe’s sovereign debt crisis will be ”worse than Lehman.” Only time will tell whether risk assets around the world will struggle as badly as they did when the global financial system “seized up” in late ‘08 through early ‘09. Yet investors should take note of a few differences in circumstances. First, U.S. [...] Continue Reading...
Market Update, Mining ETFs, Agriculture ETPs, Commodity ETFs, Staples ETFs Click here to listen to the show: 09-11-2011 Continue Reading...
Forget the idea that the economy will contract in upcoming quarters… at least for a moment. And put aside the idea that housing prices have yet to bottom out. Instead, let’s focus entirely on the price movement of a premier benchmark in this year’s stock market correction. Specifically, U.S. stocks in the S&P 500 fell from a May 2 intra-day [...] Continue Reading...
As many times as gold vigilantes try to short the yellow metal — as often as gold bugs try to take profits near $1900 oz — new buyers still keep coming back. For example, after a 3%+ smackdown on 9/7/11, the SPDR Gold Trust (GLD) managed to rally back 2% on Thursday, 9/8/11. Yet, even as precious metal funds [...] Continue Reading...
Historically, it has been relatively rare for the CBOE Volatility Index (VIX) to break “30.” And when it has hit 30 on the upside, the spike typically meant that panic selling was nearing completion. However, the rules of the VIX game changed in 2008. Breaking 30 no longer signified capitulation. In fact, in a more volatile investing world, “30″ may only indicate the beginning of [...] Continue Reading...
At one time, Chancellor Angela Merkel of Germany enjoyed remarkable popularity. Today, her political career may depend on whether or not she persuades enough of her countrymen to finance the ongoing bailout of member countries in the euro-zone. Regardless, iShares MSCI Germany (EWG) has been punished mercilessly. This ETF held the insidious title of worst country ETF of August with single-month losses of nearly 20%. Perhaps ironically, there [...] Continue Reading...
