Showing posts with label equities. Show all posts
Showing posts with label equities. Show all posts
9:53 PM
race to the bottom
Unknown
equities , income , interest rates , qe4
Expansionary monetary policy, which lowers interest rates and eases credit, can be used to fight unemployment and economic recession. Policy makers around the world have put this practice in place. The "race to the bottom" for global interest rates is on.
Low interest rates should help increase consumer spending. But lower rates could be translated as damage limitation rather than growth promotion. Balance sheets are strong and cash is piling up. Job creation has to come from the corporate sector. However corporations are not on a hiring binge.
Corporate hiring caution is coming from economic uncertainty. One item in that category is the fiscal cliff. Fed policy has pushed interest rates to all-time lows. Dividend yields are now very attractive. Dividend yields are now higher than treasuries for the first time in 50 years. Investors are looking at equities to provide income. They are extracting capital from share buybacks or dividends.
Policymakers need to look at the equity market's part in driving corporate behavior. Meaningful acceleration in the global economy isn't likely to come from the listed sector of corporations.
Low interest rates are contributing to the situation of corporations becoming capital distributors instead of investors. Rates should be allowed to rise so equity investors will become less income-obsessed. Interest rates however will remain low.
Link to the source story from Tyler Durden
Low interest rates should help increase consumer spending. But lower rates could be translated as damage limitation rather than growth promotion. Balance sheets are strong and cash is piling up. Job creation has to come from the corporate sector. However corporations are not on a hiring binge.
Corporate hiring caution is coming from economic uncertainty. One item in that category is the fiscal cliff. Fed policy has pushed interest rates to all-time lows. Dividend yields are now very attractive. Dividend yields are now higher than treasuries for the first time in 50 years. Investors are looking at equities to provide income. They are extracting capital from share buybacks or dividends.
Policymakers need to look at the equity market's part in driving corporate behavior. Meaningful acceleration in the global economy isn't likely to come from the listed sector of corporations.
Low interest rates are contributing to the situation of corporations becoming capital distributors instead of investors. Rates should be allowed to rise so equity investors will become less income-obsessed. Interest rates however will remain low.
Link to the source story from Tyler Durden
9:56 AM
profit from the fiscal cliff
Unknown
equities , fiscal cliff , markets , risk , spdr
After the election equity markets took a beating. The fiscal cliff on the horizon added to the negativity. Congress and the White House have helped to deflect the negative mood. If we go over the cliff, it will be a risk-on event.
For more details read the article from Seeking Alpha
In feeling that the cliff will be avoided there are two bullish ideas from the article I share with you.
SPDR S&P 500 Index Fund (SPY) - 109 billion dollars in assets.
SPDR Dow Jones Industrial Index Fund (DIA) - 10.32 billion dollars in assets.
Central bank intervention bolstered markets. The fiscal cliff issue will dictate market direction. Act according to your strategy and tactics. This article is for your consideration only.
For more details read the article from Seeking Alpha
In feeling that the cliff will be avoided there are two bullish ideas from the article I share with you.
SPDR S&P 500 Index Fund (SPY) - 109 billion dollars in assets.
SPDR Dow Jones Industrial Index Fund (DIA) - 10.32 billion dollars in assets.
Central bank intervention bolstered markets. The fiscal cliff issue will dictate market direction. Act according to your strategy and tactics. This article is for your consideration only.