From the CPFB (Consumer Financial Protection Bureau) blog by Rohit Chopra, “Our initial findings on the size of the private student loan market are sobering. When we add in the outstanding debt in the federal student loan program, it appears that outstanding student loan debt hit the trillion dollar mark several months ago – much larger than estimates from other recent reports. It seems that this market is too big to fail….Unlike other consumer credit products, student debt keeps growing at a steady clip. Students borrowed $117 billion in just federal student loans last year. And students continue to borrow … …READ MORE
Category Archives: Front Page
Disconcerting Milestone: US student loans above $1trln.
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Money in Motion Currency Trade
Friday on CNBC’s Money in Motion (click here for the segment) I recommended a GBPUSD trade with supporting information:
Sell GBP/USD
Entry 1.5925
S/L 1.6025
T/P 1.5650
• UK has their budget announcement and it will highlight how little the government can do with threat of AAA downgrade.
• FT article makes the case for a BOE LTRO.
• Bank of England minutes should show concern for weak economic growth.
So far, what I was looking for has happened as the BOE voted 9-0 for easing (vse 7-2) and the UK public sector net borrowing was double what was expected … …READ MORE
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US Republican Primary Update: Romney Crushes
Yesterday, Illinois voters went to the polls and Mitt Romney almost matched his polling totals I wrote about on Monday. Romney won with 46.7% to Santorum’s 35%. Now, Romney has 563 delegates about half way to 1,144 needed to win and avoid a convention fight. Santorum has only 263 delegates and needs to take 70% of the remaining primary delegates to win the nomination…..almost an impossible task. Party leaders will begin to put extraordinary pressure on Santorum to quit the race to allow Romney a clear, unambiguous path to the nomination.
If the Republicans goal is to win the White … …READ MORE
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Volcker Delayed=Upside for Banks
The WSJ carries a story today about how banks are fighting the implementation of the Volcker Rule under Dodd-Frank and may now be getting help. “Senators from both parties are working to give regulators more time to write the rule, potentially easing banks’ concerns that their activities will run afoul of the law as a July deadline passes….The Volcker rule, which restricts banks’ ability to trade with their own money, is set to take effect July 21, whether or not regulators have a final rule in place, according to the 2010 Dodd-Frank financial overhaul law. Federal Reserve Chairman Ben Bernanke … …READ MORE
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US Housing Week
For the US markets, the next 5 days will be saturated with housing data. From NAHB on Monday to building permits on Tuesday to existing home sales on Wednesday to new home sales on Friday, all are expected to show positive readings. The newsflow in the markets this week will focus on the good news that housing may finally be contributing to GDP and there will the subsequent focus on companies related to this from home builders to building material suppliers.
Of course, we need housing to stabilize to steady consumers and home owners from needing to deleverage further. You’ll … …READ MORE
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China Housing Weak
This weekend, China released their 70 city housing statistics and they were the weakest since they started the series in 2011. New home prices fell in 27 out of 70 cities in China from a year earlier with 6 cities unchanged. As most know, Chinese property prices have increase significantly over the last 10 years and the government in 2011 attempted to slow down the rise by regulation, interest rate increases and reserve requirement increases. China recently cut the reserve requirement and this sparked a belief that more easing would come to aid housing. However, Premier Wen Jiabao told lawmakers … …READ MORE
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Apple and the Dividend Yield Question
Today, Apple Inc. announced it plans to pay a $2.65 dividend and return some of the massive $97.6 billion in cash and investments they own back to shareholders. The stock is up on the news. Given this development, I thought it might be helpful to review what the latest research is on stocks and how stocks create returns for investors.
Recently, the Research Foundation of the CFA Institute released an excellent group of papers under the heading of, “Rethinking the Equity Risk Premium.” Editors P. Brett Hammond, Jr., Martin L. Leibowitz, and Laurence B. Siegel approached this issue by asking … …READ MORE
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Money in Motion Currency Trades
On Friday, we discussed FOMC and what big events were coming up for the week. Here are the notes for the trades:
“Given the ….. NFP data and …unemployment rate, the FOMC meeting next week will have lots of focus.”
I THINK FOMC/BERNANKE CONTINUE TO TALK DOWN QE3.
ON WENDESDAY (March 7th) , I RECOMMENDED SELLING EUR/USD AT 1.3275
IF YOU MISSED THAT ENTRY POINT, BUT STILL WANT IN, I CONTINUE TO LIKE THIS TRADE.
SELL EUR/USD
ENTRY 1.3170
S/L 1.3275
T/P1.2875
Also, here’s the trade for Insomniac’s Delight:
OVERNIGHT TRADING OPPORTUNITIES
NEXT WEEK (March 12-16th)
DATE TIME EVENT
MARCH … …READ MORE
Global Earnings Upgrades
According to the FT, aanalysts last week upgraded more companies’ earnings forecasts globally than they downgraded for the first time since May last year. “After 41 weeks of consecutive downgrades, net earnings per share revisions for next year turned positive powered by a surge in upgrades of Japanese companies and industrial groups…..Analysts cut their earnings estimates for most of last year as they worried whether companies could continue to maintain strong profitability in the face of weak economic growth. But since bottoming out in October, at the same time as stock markets, analysts have gradually become more bullish, buoyed by … …READ MORE
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Federal Backing to Housing Grows
Yesterday, President Obama held a press conference. It was telling that of all the questions asked by the media only one scratched the surface on the economy and no one asked about housing. The President did release his new plan to aid the housing market. Here’s what the WSJ said: “In what it described as part of an initiative to lift the housing market, the Obama administration said Tuesday that it would make refinancing less expensive for certain borrowers with mortgages backed by the [FHA]. ‘It’s like another tax cut that will put more money into people’s pockets,’ Obama said … …READ MORE
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