Bonds & Interest Rates

“Fed will do what it takes,” declared Narayana Kocherlakota, President of the Federal Reserve Bank of Minneapolis and member of the Federal Open Market Committee. In a speech today he stated, “Doing whatever it takes … will mean that the FOMC is willing to continue to use the unconventional monetary policy tools that it has employed in the past few years. Indeed, it will mean that the FOMC is willing to use any of its congressionally authorized tools to achieve the goal of higher employment, no matter how unconventional those tools might be…

Moreover, doing whatever it takes will mean keeping a historically unusual amount of monetary stimulus in place—and possibly providing more stimulus—even as: Interest rates remain near historic lows.”

“One of the Silliest Things I Hear”

Michael Mike Campbell image Michael defends the producers of the products that allow us to live in a Society that is more luxurious than at anytime in history. 

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Are the Bells Ringing At the Top This Time Around?

imagesIt’s often argued that they don’t a bell at the top.

I would argue that we numerous bells ringing in the financial markets today.

Carl Icahn wants Apple to leverage up to boost returns to shareholders. Apple has maintained next to no debt for the better part of ten years.

Now share price is lagging and the goal is to issue a load of debt to buy back shares. Leveraging up companies that have long had little debt is a classic market mania indicator

Hilton is trying to go public. Put another way, one of the largest commercial real estate/ hospitality chains in the world is going public after being private for over 40 years…

Why go public now? Because you can raise funds cheaply in today’s high liquidity environment and you don’t want to be holding the bag when the economy slumps again.

The large financial institutions that bought homes and real estate in the slump are looking to exit. These groups and their clients didn’t get rich by being wrong.

They’ve made their profits by buying when no one else wanted to and now they’re getting out. Hedge fund Och-Ziff, PE firm Blackstone, and others are unloading their real estate portfolios.

The smart money is getting out of the market. Fortress Investment Group, Apollo Investment Group and other large “smart money” investors are literally “selling everything” they can. They’re not doing this because they expect things to improve and the market to continue to move sharply higher.

Indeed, even investment legend Warren Buffett, who has virtually never advocated against investing in stocks (with the exception of the Tech Bubble) has stated the market is “fully valued” at today’s levels.

Buffett loves stocks. He’s made his fortune investing in them. He is a near eternal optimist. For him to state the markets are fully valued and be sitting in the single largest cash hoard of his investment life is a major indicator that stocks are topping.

 

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Best Regards

Graham Summers

Don Coxe making his continued bullish case for gold; moreover, why it will be the cheapest insurance you will ever by. The article linked is one of the best reads of the week.

Click here to read more.

Robert Levy – Border Gold Corp. 

rlevy@bordergold.com

888.312.2288

www.bordergold.com 

The former number one gold miner Barrick Gold finally got some good news today. Barrick has probably been the poster boy for struggling miners over the past few years and their share price illustrates this. Definitely not indicative that this is a turning point for the mining sector, but nice to see that not everything is going against them.

Click here to read more.