Skip to content




Noteworthy News – July 7, 2014

Economy:

More than half of 2014′s new jobs pay higher than average wage – MarketWatch

Most Americans think the U.S. is great, but fewer say it’s the greatest – Pew Research

UK ‘to become Europe’s second largest economy by 2020′ - BBC

Markets:

Tempers fray, prices rise as Egypt cuts fuel subsidies - Reuters

Bargain Borrowing Costs: Euro Crisis Will Help Germany Balance Its Budget – Spiegel

Managing credit bubbles – VOX

Dow Jones Industrial Average hits 17,000 for first time – BBC

Week Ahead: Investors Watch Fed, IMF – And Rupert Murdoch - Forbes

Why interest rates may stay very low for a lot longer - LA Times

Politics:

ECB’s Coeure: rates to stay low, Europe needs more investment - Reuters

The Top 12 Government Programs Ever – Slate

Banks:

Western banks start to pull out of Iraq – Financial Times

60875_cartoon_main

Posted in Economics, Markets, Media, Politics.


4th of July Sale with CapitalOne

I have been a big fan of the CapitalOne 360 accounts (previously ING Direct) for over 8 years.  The highest interest on your money market/savings account (.75%) with no hidden fees or minimums.  Easy and free unlimited electronic transactions with the checking account along with .2% interest on balances up to $49,999.

4th of July bonus – open up a checking account and get $100, open up a savings/money market and get $76:

Capital One 4th

Posted in Personal Finance.


Noteworthy News – June 23, 2014

 

Economy:

Employees Who Stay In Companies Longer Than Two Years Get Paid 50% Less – Forbes

High CEO salaries can be bad for business, U. study finds – KSL.com

Abenomics and the Japanese Economy – Council for Foreign Relations

Brookings Data Now: Statistics of Poverty in America – Brookings

No, The Poor Aren’t Poor Because They Refuse To Work – Think Progress

2 Stats That Should Terrify Every Millennial – Huffington Post

Income Inequality and Poverty Dashboard – Bloomberg

Markets:

Is It Better to Rent or Buy? - New York Times

Inflation? Only If You Look At Food, Water, Gas, Electricity And Everything Else – ZeroHedge

Politics:

7 ways Mike Lee’s push to get the GOP to stop obsessing over tax cuts for the rich matters – VOX

 

Banks:

Run on Corpbank prompts Bulgarian central bank to seize control - Reuters

0619natebeeler_cagle

Posted in Economics, Markets, Media, Politics.


Noteworthy News – June 16, 2014

Economy:

How America became uncompetitive and unequal - Washington Post

Ignore Those World Cup Productivity Studies - US News

The Lack of Major Wars May Be Hurting Economic Growth - New York Times

Congratulations, class of 2014: You’re totally screwed – Salon

Technology incubators: Has their time past? - Haaretz

Markets:

Central banks shift into shares as low rates hit revenues – Financial Times

The Fed could inadvertently jolt markets this week – CNBC

Politics:

Dangers of central banks’ public investments - USA Today

The path through the fields: Bangladesh has dysfunctional politics and a stunted private sector. Yet it has been surprisingly good at improving the lives of its poor – Economist

Gary Becker and the Economics Revolution that Wasn’t - New Yorker

Japanese central bank chief sticks his neck out, pressures PM Abe for action – Reuters

Banks:

Anat Admati Discusses the Still-Too-Big-to-Fail Banks on Bill Moyers – Naked Capitalism

Wells Fargo Nears Market-Value Milestone - Wall Street Journal

0611OlleJohanson

Posted in Economics, Markets, Media, Politics.


Invest in Putin?

Thanks to Mebane Faber for getting me looking at Cyclically Adjusted P/E ratios by country again.  The one country that caught my eye was Russia:

CAPES

The beauty of CAPE is that it smooths out earnings so you do not get to caught up in a short term focus.  There are many arguments against it, but I believe it gets close to what a long-term investor should be looking at.  For Russia, it has been the geopolitical stress and constant news stories that have kept their stocks in the “cheap” zone.  In addition, many investors were once bitten by the 98 Russian default and not eager to relive that experience.  If you look at the historical volatility of the MICEX index you might feel like caution is a wise choice:

MICEX Volatility

Only 50 stocks and a volatile environment leave everyone fearful of the MICEX index

There are a few things to take a look at before going headfirst towards the Red investment.  One item to keep in mind is currency depreciation.  If the Russian Ruble is losing value then investing in a Russian ETF denominated in dollars will be hurt by the depreciation of the Ruble.

Russian Ruble

There has been fairly significant depreciation in the value of the Ruble versus the dollar since 2011 (upward move) but it looks as if the trend might reverse

The second item that is helpful is the credit worthiness of the Russian government.  Given that there was a default in 1998, you would think that investors would be extremely cautious in lending money to Russia.  But most investment sins are forgiven in about 15 years…

Russian CDS

Fear (credit spread) spiked in 2014 but has quickly come back to normalcy

Lastly we could look at what easy ETF options exist to allow us to buy into the Russian story.  RSX, ERUS, RBL, RSXJ (small cap) and RUSL (3x Bull!).

For liquidity I will stick to RSX – Market Vectors Russia ETF:

Russian ETF RSXpng

Looks as if RSX has broken above its 200 day moving average

You will never feel 100% comfortable buying into a market that has sold off while everything else has rallied.  At the same time, you probably shouldn’t feel comfortable buying into a market that just continues to rally at odds with its own CAPE ratio…

 

Posted in Economics, Markets, Trading Ideas.

Tagged with , , , , .




Get Adobe Flash player
Copyright © 2009-2013 SurlyTrader DISCLAIMER The commentary on this blog is not meant to be taken as an investment advice. The author is not a registered investment adviser. There is no substitute for your own due diligence. Please be aware that investing is inherently a risky business and if you chose to follow any of the advice on this site, then you are accepting the risks associated with that investment. The Author may have also taken positions in the stocks or investments that are being discussed and the author may change his position at any time without warning.

Yellow Pages for USA and Canada SurlyTrader - Blogged

ypblogs.com