Skip to main content

Monday's notes

Some recent stories and business features of note for your Monday reading:

1. Lehman Brothers reports its first loss as a public company and outlines its plan to raise up to $6 billion in common and preferred stock.

2. As prices surge, Argentines cry foul over the official figures - FT.

"As food and fuel costs rise relentlessly, popular and official perceptions of inflation are diverging in many countries. But economists believe Argentines may have more reason than most to doubt the accuracy of their government's calculations. This could spell trouble for a country with a history of economic crises - especially at a time when a three-month-long conflict with farmers is shaking consumer and investor confidence.

When Mr Fernández acknowledged recently that Indec, the statistics agency, "wasn't measuring consumers' reality", many Argentines could not have agreed more. Yet while the government has been reporting what many economists and consumers feel are suspiciously low inflation figures for nearly a year and a half, the cabinet chief has announced changes that he says will result in a figure that is lower still."

This is a storyline familiar to those of us in the US and elsewhere, thanks to rampant money printing and rising inflation worldwide.

3. "The Reverse Wealth Effect". Chris Ciovacco looks at America's financial condition and notes that Americans are now saddled with more debt than ever as real estate and financial asset prices decline.

4. "How the FT is Losing the Financial Opinion Wars" - Felix Salmon.

5. Marc Faber speaks to Bloomberg TV and says stocks, commodities, and real estate are inflated and overvalued.

``I don't see any compelling value in equities, real estate or commodities,'' Faber said from Zurich. ``Contrary to the last 25 years, we are in a period of de-leveraging. Corporate profits in particular are still far too high for 2009 and have to be adjusted downwards, and valuations become less compelling.''

Faber thinks that investors should now focus on what to sell (or avoid), rather than focusing on what to buy.

He also notes that central bankers can increase the quantity of money at will, but they cannot increase the quantity of gold and commodities at the same rate. Therefore, money loses its purchasing power against commodities, the supplies of which are limited. Still, Marc feels the big upside may be gone for commodities, and investors should not buy them blindly.

As you can see, monetary inflation and its effects are a big theme in today's news. Enjoy the articles and remember to connect the dots and look for the related themes within.

Popular posts from this blog

Finance Trends 2019 Mid-Year Markets Review

Email subscribers of the Finance Trends Newsletter receive the first look at new articles and market updates, such as the following piece, sent out to our email list on Sunday (6/14).   Hello and welcome, everyone! If you received our last email notice over the July 4th holiday, you'll know that this weekend's newsletter will serve as a mid-year market update and a follow-up to issue #29, " How to Reinvest in a Rising Market ".   Ladies and gentlemen, without further ado, let's start the show...  Finance Trends Newsletter: Our Mid-Year Market Review When we last spoke, back in February, the U.S. stock market was rallying off its December-January lows. As the S&P 500 and Nasdaq reclaimed their 200 day moving averages in February and March, it became increasingly apparent that a lot of retail investors (and perhaps some institutional investors) were left under-invested while watching this recovery move from the sidelines.  The U.S. stock ...

Jesse Livermore: How to Trade in Stocks (1940 Ed. E-book)

If you've been around markets for any length of time, you've probably heard of 20th century supertrader, Jesse Livermore . Today we're highlighting his rare 1940 work, How to Trade in Stocks (ebook, pdf). But first, a brief overview of Livermore's life and trading career (bio from Jesse Livermore's Wikipedia entry). "During his lifetime, Livermore gained and lost several multi-million dollar fortunes. Most notably, he was worth $3 million and $100 million after the 1907 and 1929 market crashes, respectively. He subsequently lost both fortunes. Apart from his success as a securities speculator, Livermore left traders a working philosophy for trading securities that emphasizes increasing the size of one's position as it goes in the right direction and cutting losses quickly. Ironically, Livermore sometimes did not follow his rules strictly. He claimed that lack of adherence to his own rules was the main reason for his losses after making his 1907 and...

How to "Pull the Trigger" on Your Trading Ideas

In our last post, I quoted hedge fund manager, Jim Leitner on the importance of following up on your investment ideas.  Today I'd like to follow up and share some thoughts on how you can learn to consistently "pull the trigger" on your best trading setups and investing ideas. In order to help you do that, we'll take from the best and offer up key insights from interviews with top traders and trading psychologists like Alan Farley, Brett Steenbarger, and Doug Hirschhorn .  Now before we get to their key insights on overcoming trading anxiety and pulling the trigger on your trading ideas, let's remember what Jim Leitner said in his interview: "Learn to love to listen to people and when you hear something interesting, follow up on it. Don't just think, "Well that's an interesting idea" only to find out a year later that the company you could've bought shares in is now up 500-fold. You never want to say woulda, coulda, shoulda...