by ilene - May 18th, 2013 9:59 pm
On the Billl Moyers Show
Public health historians discuss thwarted efforts to hold the lead industry accountable for toxic exposure threatening American children.
Science can be a battleground — witness the politics of climate change, the teaching of evolution, the uncharted terrain of genetic modification and stem cell research, among other contentious issues. But when industries release untested chemicals into our environment — putting profits before public health — our children are the first to suffer. Nowhere is this more troubling than in the ongoing story of lead poisoning.
Bill talks with David Rosner and Gerald Markowitz, public health historians who’ve been taking on the chemical industry for years — writing about the hazards of industrial pollution and the neglect of worker safety — despite industry efforts to undermine them. Their latest book, Lead Wars: The Politics of Science and the Fate of America’s Children, is the culmination of 20 years of research. Markowitz and Rosner warn that, for young children, there’s no safe level of exposure to this dangerous toxin still lurking in millions of homes. More here >
by ilene - May 18th, 2013 4:09 pm
Timing the market and picking stocks doesn't work for most people, according to Gerard Minack, an investment strategist departing Morgan Stanley with a final farewell note full of advice.
One of Morgan Stanley's investment strategists, Gerard Minack, is retiring.
This is a bummer. Minack's work was lucid and helpful.
But as a parting gift to clients, Minack wrote a two-page farewell note that contains the best investment advice you will likely ever receive.
What is this investment advice?
- Don't try to pick stocks
- Don't try to time the market
- Just invest in a portfolio of low-cost, tax-efficient index funds
Now, before you go scrutinizing Minack's note to find these bullet points, let me be the first to say that Minack does not actually explicitly articulate this advice.
Rather, he just demonstrates conclusively why any other investment strategy is idiotic.
For starters, Minack points out that, in the average year, 60% of actively managed mutual funds underperform their benchmark.
by ilene - May 18th, 2013 8:02 am
Submitted by Bruce Krasting
The Congressional Budget Office put conservative economic thinkers on their ass this week. In this Report (pdf), the CBO concluded that the US budget deficit is about to collapse to insignificance. The improvement in the deficit outlook is so large that it has lead liberal thinkers to start calling for more stimulus spending. If it were not for the three scandals brewing for Obama (Benghazigate, IRSgate and APgate) I think there would be calls to spend some more government money.
The CBO assessment of the deficit profile relies on every trick in the book. The assumption is that all of the variables that weigh on the deficit will be improving over the next few years. Tax collections will remain at historically high levels. Government spending will decline as the economy improves. Fannie Mae and Freddie Mac will be kicking $95Bn into the coffers. Social Security will cost less than previously thought. The same favorable result is assumed for both Medicare and Medicaid. And of course, there will be no wars or military incursions that have to be paid for. But, by far, the biggest driver of the reduced deficits will come from a robust economic recovery that is set to occur. This is the CBO forecast for top line GDP growth:
Wow! 6.5% growth is coming our way! Don't worry at all about the endless recession in Europe. Don't consider the rapid slowdown in China either. And please don't worry about the fact that the Fed is going to be taking its foot off the gas over the next 24 months – all that won't make any difference. The USA is set for a spurt of growth not seen for years.
What could the CBO be hanging its hat on when making this bold predictions of rapid economic expansion? I wonder if the CBO is relying on Obamacare to provide the big boost. This is the only significant economic development on the horizon. It will change everything when it's finally implemented. It will result in 32 odd million more people having access to healthcare. And when those people do have health insurance, they will be going to Doctors, getting treatments and medicines. And with those visits and related spending, the economy will get a lift – at least that is the thinking.…
by ilene - May 17th, 2013 1:33 pm
by ilene - May 17th, 2013 1:22 pm
Listening to this 1 hour video, so far covering risk, Jon Corzine, JPMorgan and the London whale trades.
Courtesy of Jesse's Cafe Americain
If you live in the UK you may watch this online here.
Otherwise you may watch it below.
Here is a link to Part 1 - Fixing the System
by ilene - May 17th, 2013 1:01 pm
This has been a nightmare week for Barack Obama, without a doubt the worst of his presidency so far. Steven T. Miller, acting commissioner of the Internal Revenue Service has resigned over his agency’s targeting of conservative groups, which even The Washington Post labeled this morning a “horror story”. Yesterday Obama’s Attorney General Eric Holder testified before the House Judiciary Committee on a host of issues including the Benghazi debacle, in what can only be described as a train wreck of a performance. Holder was simply unable or unwilling to answer most key questions, and demonstrated a level of contempt for elected officials in Congress that was breathtaking. It was yet another public relations disaster for the Obama team.
In addition the administration has come under heavy fire over the Justice Department’s monitoring of phone records belonging to Associated Press journalists. All this has combined to create a perfect storm in the first year of Obama’s second term, a wave of scandals that has been so damaging to the standing of this administration that even The New York Times today carries the headline on its front page: “An Onset of Woes Raises Questions on Obama Vision”. When even the usually subservient inflight newspaper of Air Force One has doubts over the job the president is doing you know the situation is really desperate for The White House.
George F. Will, one of America’s most influential political commentators, and a columnist for The Washington Post, believes there are “echoes of Watergate” in both the IRS and Benghazi scandals. As Will wrote earlier this week:
The burglary occurred in 1972, the climax came in 1974, but40 years ago this week — May 17, 1973 — the Senate Watergate hearings began exploring the nature of Richard Nixon’s administration. Now the nature of Barack Obama’s administration is being clarified as revelations about IRS targeting of conservative groups merge with myriad Benghazi mendacities.
Keep reading: Barack Obama's Presidency Is Imploding – Business Insider.
by phil - May 17th, 2013 8:38 am
Reality, reality, wherefore art thou reality?
I like to put up this chart of the Macro Indicators (this one from Zero Hedge) every once in awhile, just to keep us grounded as we play the market at these nose-bleed levels. And yes, I know I sound like a grumpy old bear, the same way I was accused of being a perma-bull 8 months ago, when the S&P had crashed 10%, back to 1,343 and I wrote articles like:
- "Thankless Thursday – Still Waiting for that Stimulus to Kick In" (11/1/12)
- "Two Term Tuesday – Obama Victory Allows 4-year Rally to Continue" (11/6)
- "Fed Up Thursday – WMT and the Fed Fail to Boost the Market" (11/15)
- "Testy Tuesday – Can We Hold Our Weak Bounce Levels?" (11/20)
- "Dividend Investing – Giving Yourself an Automatic Edge" (11/25)
- "Cyber Monday – Record Retail Sales Trump Cliff Concerns, for Now" (11/26)
- "GDPhursday – Fiscal Cliff Progress Good for 200 Points Ahead of GDP" (11/29)
After that, we were off to the races and people finally stopped making fun of me for being so bullish in such an "obviously" declining market. Yes, I was early – that's the problem with reading too much and looking at the Fundamentals – sometimes you see things that seem "obvious" to you but it does take the crowd a while to catch up and, for better or worse, it's the crowd that does the buying and selling.
So now I'm worried and, although I was clear (I thought) at the beginning of the month that we may keep going up until Options Expiration Day (today), or even to the end of May, into the holiday weekend – I've still been branded a perma-bear by readers (not our Members, who know me better) who seem angry that I dare question the market.
Well, I have to dare – it's my job. And I'd love to be a sell-out as bullish market newsletters make more money so we attract less new people when we go bearish but I kind of think it's my job to tell you what I think is going to happen – not just what you want to hear.
As noted yesterday, my plan for the weekend is to do some soul-searching and try to figure out if MORE FREE MONEY will continue to trump the underlying weakness in the Global Economy.…
by ilene - May 15th, 2013 9:33 pm
Courtesy of SoberLook.com
While the equity markets continued to march higher, other "risk-on" asset classes such as currencies and commodities have stumbled. The decoupling of the S&P500 index and the Australian Dollar (below) is a good example.
This is an indication that the market views large US companies (and other international firms) as being somewhat immune to weakness in global economic growth. Historically however that has not always been the case.
by ilene - May 15th, 2013 9:18 pm
Courtesy of SoberLook.com
Econoday: – Amongst the larger economies Germany managed a disappointingly small 0.1 percent quarterly advance but there were fresh falls in France (0.2 percent), Italy (0.5 percent) and Spain (0.5 percent). Neither the Italian nor Spanish economy has seen any growth since the second quarter of 2011.
Elsewhere performances were poor with quarterly expansion amongst those members supplying the data restricted to just Belgium (0.1 percent) and Slovakia (0.3 percent). There will be little surprise that Cyprus (minus 1.3 percent) was at the bottom of the growth table and there was renewed weakness too in the Netherlands (minus 0.1 percent), Portugal (minus 0.3 percent) and Finland (minus 0.1 percent). Estonia's good run also came to an abrupt halt (minus 1.0 percent) while Austrian activity was unchanged from the fourth quarter.
Some had hoped that as periphery nations begin to show trade surplus (due to declining domestic demand and lower labor costs), their economies may stabilize. But with global demand remaining weak in the first quarter and unemployment reaching new highs, that stabilization did not materialize. For now the periphery can not export its way out of recession.
Furthermore, the Eurozone periphery nations continue to struggle with what amounts to a paralyzed banking system with limited credit expansion capabilities. One key reason for this paralysis is a large (and growing) book of non-performing loans held by these nations' banks (unemployed borrowers and broke housing developers tend to have trouble making payments on their loans).
|Non-performing loans as % of total loans across the Euro area
And just like in Japan in the 90s, not addressing the bad loan problem quickly generates prolonged periods of contraction. And that's how we end up with headlines like this:
by ilene - May 15th, 2013 9:09 pm
China’s central bank, which manages the world’s largest foreign exchange reserves, is looking into a growing scandal over the access journalists at Bloomberg News had to potentially sensitive data, reports said Wednesday. The People’s Bank of China (PBoC) is the latest major financial organisation…