Month: September 2012

By The Sizemore Letter

This is a few years old now, but it still gets a laugh out of me.

With the focus on the Fed and quantitative easing these days, it’s worth another watch.

Related posts:

• The Ghosts of Milton Friedman and John Maynard Keynes

With the visible growth of stock trading business, trade aspirants are looking for a platform to imbibe the right strategies. The whole idea is to brush up FX trading talent and attract profitable deals eventually.

What exactly do you need to trade professionally? Sharp trading skills, apt trading tools and pragmatic approach are some of the basic requisites of stock trading, but, all these traits can be obtained only through a trade platform. The website which is equipped with all the necessary tools meant for reference prior to trading forex has been termed as trade platform. These trading zones or platforms may differ from their counterparts’ trade portals due to the utilization of effective software package. As a matter
of fact, foreign exchange is an intricate system full of various currencies’ transaction. Therefore, it is highly advisable for the trade aspirants to join a trading platform according to their needs initially in order to shed all the inhibitions regarding the risks of FX market through broker’s consultant. Hang on! The role of broker needs to be addressed here, to understand the aforementioned statement. Precisely, the forex broker plays an unmatched role in cementing the users’ confusion with former’s due attention as well as guidance.

In addition, when you shortlist the options of these portals for trade, your focus must be clear and determined. It is this very determination that fetches you one of the best trading platforms further enhancing your performance. The trading tools and indicators offered by these platforms are no doubt, tested for their functionality prior to grouping them under trade resources. Basically, the websites which have been designed to serve the purpose of Forex traders comprise of user-friendly interface. Due to
this attribute, these platforms of FX trade are popular among individuals seeking suitable guidance in terms of stock trading and likewise. Generally, Etoro, Metatrader 4 or MT 4,  Forexyard and Finexo are few of the common FX trading platforms which have been preferred by the trade enthusiasts. Extracting the best deal through their services is the primary goal of these traders.  Apart from this, the companies which support the necessities of currency trading, are being listed among the resourceful
demands of traders or trading groups.

United World Capital is one such company that provides tools for analysing the market updates through its practical interface. The entire procedure of grooming, assigning demo account to buying the FX services from Forex currency trading platforms is totally systematic to avoid any interruption while dealing with currencies’ transactions. It is worth adding that the services of a trading platform must deliver beneficial results by quoting the real-time value of chosen pair of currency as visible in the market. The services of FX market are accessible to the users for 5 days in a week, though it is opened throughout the day from Monday to Friday. Furthermore, the subscribed trade platform ought to be geared up with customer support every time, so that, the FX traders can get their queries resolved smoothly. This help and guidance of broker is effectual for trade aspirants who are in their phase of learning Forex tactics. Last but, not the least, stock or currency trading is a framework of strategies which need to be utilized  precisely by enrolling with the trade platform.

About Author:

Brown Hazle is an experienced forex broker and recommends UWCFX. Currently she is writing on forex trading, online future trading platform, swap free account . For more detail about the company Visit: http://www.uwcfx.com/en/

AUDUSD stays above a upward trend line on 4-hour chart, and remains in uptrend from 1.0167. Initial support is at the trend line, as long as the trend line support holds, further rise could be expected after a minor consolidation, and next target would be at 1.0700 area. Key support is at 1.0425, only break below this level could signal completion of the uptrend.

Forex Signals

By. Jen Alic of Oilprice.com

People often ask me why the West doesn’t attempt a Libya-style intervention in Syria. After all, things are going so well in Libya. Oil production is up. But oil production is merely a mirage, as is security in Libya, which was doomed from the day one PG (post-Gaddafi) because of the way it was “liberated”.

Last Wednesday, US envoy to Libya Christopher Stevens was killed along with three other American diplomats in a rocket attack on the US consulate in Benghazi.

What about the oil, that global elixir? Well, the violence will not bode well for Libya’s production ambitions, coming at a time when the country looked prepared for a boost in output and was banking on this for economic growth.

Security was already dubious at best, and now international oil companies will be more reluctant than ever. Those that are already there-Germany’s Wintershall AG, Italy’s Eni and France’s Total-will be seeking to beef up security and have already started sending some of their workers home.

If the picture was not clear from the onset of the post-Gaddafi atmosphere, it certainly came into focus earlier this summer when protests over parliamentary elections forced the temporary closure of the el-Sider oil terminal, the country’s biggest.

Anyone who thinks that Libya will be a secure oil frontier after the formation of a new government next summer is mistaken. The road to destruction runs from Afghanistan to Benghazi (incidentally, the oil-producing region), branching off to southern Iraq and Pakistan’s tribal regions.

So, you ask, what about the controversial anti-Islamic movie apparently put together by an Israeli-American real estate developer with too much time on his hands?

According to Jellyfish Operations – a private intelligence and analysis boutique that has spent much time dissecting the intervention in Libya and the conflict in Syria-the anti-Islamic movie is a red herring in all of this.

Speaking to Oilprice.com, Jellyfish President Michael Bagley said that while the movie is being upheld as the root cause of the intensifying protests and the death of the US envoy to Libya, it has only served to give added momentum to another more important development.

“The key to all of this is al-Qaeda’s second in command, Abu Yahya al-Libi, who was killed by a US drone attack in Waziristan on 4 June,” Bagley said. “The real catalyst for the attack in Libya and the unrest that has spread to Yemen, was a lengthy video released by al-Qaeda leader Ayman al-Zawahiri, marking the anniversary of 9/11 and admitting to the death of al-Libi, who is Libyan.”

“This was a very powerful call to avenge al-Libi’s death,” Bagley said, “and it came only 24 hours before the attack on the US consulate in Benghazi.”

To put this into perspective, let’s reminisce a bit about al-Libi, whose past is a roller coaster, enemy-foe ride with the US.

Al-Libi was captured in the “war on terrorism” in Afghanistan in 2002 and held for three years in Kabul’s high-security Bagram prison. Against all odds, he escaped in 2005.

In 2011 he resurfaced again, but this time as a friend to Washington who had decided that it was no longer friends with Gaddafi, despite all the efforts leading up to this to rebuild relations after that nasty Lockerbie business and all the sanctions. So here is al-Libi again, but this time around his terrorist inclinations are a bonus rather than a liability: He fights alongside intervention forces to oust Gaddafi.

With Gaddafi gone, al-Libi once again became a liability so he was taken out by a drone in Pakistan.

This brings us back to the present, with al-Zawahiri on the rampage and Libyan’s wise to their liberators.

“This is a cut and dry example of the backfire of the US intervention strategy,” Bagley said. “Let’s hope it isn’t attempted in Syria.”

The post-Gaddafi Libya is not real. It’s a dangerous fabrication of materials stuck together by the glue of dubious alliances with jihadists who are cut loose with their weapons once the immediate goal (Gaddafi’s demise) was achieved. Forget about the oil for now.

Source: http://oilprice.com/Geopolitics/Africa/Libya-Doomed-from-Day-One.html

By. Jen Alic of Oilprice.com

By Central Bank News
    The issuance of international debt securities, such as bonds and collateralized securities, fell in the second quarter of 2012 due to a plunge in issuance by financial institutions, especially euro area banks, the Bank for International Settlements (BIS) said.
    Global gross issuance of international debt securities fell 30 percent to $1.83 trillion in the second quarter from the first. Taking account of repayments, net issuance plunged by 92 percent to $63 billion, the smallest amount since the second quarter of 1995, the BIS said in its September Quarterly Review.
    Net issuance declined across the globe, with European issuers making net repayments of $92 billion while issuance by U.S. nationals was cut in half to $50 billion and that from emerging market borrowers fell 40 percent to $75 billion.

    BIS said the decline may reflect a front-loading of issuance to the first quarter by banks who wanted to take advantage of the European Central Bank’s longer-term refinancing operations (LTROs).
    “Moreover, funding conditions in global debt markets deteriorated in the second quarter on revived market tensions in the euro area, weaker than expected economic data in the United States, and worries about the growth outlook in emerging markets, especially China,” BIS added.
    As a whole, corporate issuers cut issuance by 10 percent to $144 billion. But among corporates, U.S. issuers raised an additional 17 percent, or $88 billion, in the second quarter, taking advantage of investors’ appetite for investment grade bonds while interest rates are low. European corporate issuers decreased their issuance by 35 percent to $37 billion.
    Click to the read the September 2012 BIS Quarterly Review.

    www.CentralBankNews.info
    

By Central Bank News
    International lending by banks rose slightly in the first quarter of 2012, reversing a $811 billion plunge in the fourth quarter, helped by a stabilization of lending among banks and a rebound in lending to emerging markets, the Bank for International Settlements (BIS) said.
    But despite a $126 billion, or 0.4 percent, overall increase in cross-border lending in the first quarter from the fourth, international lending remains subdued from a longer term perspective, BIS said in its latest quarterly review of international banking and financial market developments.
    As an example of the vitality of lending prior to the onset of the global financial crises, cross-border lending in the first quarter of 2007 had rocketed $2.2 trillion, BIS data shows.
     Figures from banks in the 44 countries that report to the Swiss-based BIS showed that lending to non-banks rose $154 billion, or 1.4 percent, in the first quarter of 2012, helped by a 3.1 percent rise in lending to emerging economies.

    Credit extended to non-banks in Latin America, which includes offshore centres in the Caribbean, showed “the largest absolute increase since the start of the BIS international banking statistics.”
    Cross-border interbank lending stabilized in the first quarter following a severe contraction in the fourth quarter, with 1.7 percent rise in lending to euro area banks as wholesale funding markets reopened following the European Central Bank’s longer term refinancing operations (LTROs).
    However, BIS pointed to the “distinct north-south divergence in cross-border lending to euro area banks.”
    While cross-border claims on banks in Germany surged by $271 billion (or 26 percent, – the highest quarterly growth rate in more than 20 years – interbank lending to banks in Ireland, Italy, Spain, Portugal and Greece decreased.
   International lending – especially from German and French banks – to residents of those five southern European countries shrank by $92 billion, or 4.7 percent, adjusted for foreign exchange effects, with lending to banks down 11 percent and to the public sector down by 5.4 percent.
    “Overall, the figures suggest that the two three-year LTROs conducted by the ECB in 2011 and 2012 did not unlock new foreign financing to these countries,” BIS said.
    Meanwhile, banks were eager to lend to residents in emerging markets, with lending rising $86 billion, or 2.8 percent, after a drop of $77 billion in the previous quarter.
    “It was the first expansion in three quarters, a possible indication of how these economies benefited from improving market conditions in the first quarter of 2012,” BIS said.
    Cross-border claims on emerging market banks rose $41 billion, or 2.5 percent and lending to non-banks rose by $45 billion or 3.1 percent.
    The increased lending to emerging markets was driven by banks in Asian offshore centres and from banks in the United Kingdom while euro area banks held their lending to emerging market steady following a fall in the fourth quarter.
    The Asia-Pacific region attracted 79 percent of the total rise in lending to emerging economies, with lending to China rising $54 billion, or 11 percent, primarily driven by interbank lending that rose 14 percent.
    Click to read the September 2012 BIS Quarterly Review.
 
    www.CentralBankNews.info

By Central Bank News

Article by Investment U

Have you ever been trapped in automobile purgatory? It’s when you’re in a car with no satellite radio, no iPod docking station, or suitable CDs to play. You’re forced to station surf on the public radio airwaves.

Once in a while you find a gem from your days in high school on some out-of-state station that gives you about two and a half minutes of memories. Then, it’s back to pushing the tune button.

Last Saturday, while I was pushing radio buttons, I came across a financial program expressing the plight many retirees currently find themselves in. They have a lack of options in investing rollovers and other retirement funds. Europe, the U.S. debt problem and miniscule rates of return have many of them terrified.

But this program was offering some light at the end of the tunnel. They had a new “safe and secure” solution to all of their problems. It’s called the “Private Pension Plan.” I’ve dealt with pension plans before – but this was new.

The wealth management company who was sponsoring the show didn’t give the name of the company providing this product… or many details. But this is what they did say the plan offered:

• Guaranteed upfront bonus of up to 10%
• Guaranteed returns for income
• Guaranteed protection of your principal
• Guaranteed lifetime income for you and your spouse

At that point, I knew exactly what they were talking about. This had nothing to do with ERISA qualified pension plans. They were talking about annuities. More accurately, with the description they gave, a fixed-index annuity.

Just a New Marketing Tactic

The fact is these are nothing new… This re-labeling move may be due to the bad reputation these products received during the height of the economic downturn.

Four years ago the Securities Exchange Commission cracked down on abusive sales practices targeting seniors. It seemed that fixed-index annuities were one of the investment products found in the midst of senior investment fraud. I think there was even a sting operation on NBC’s Dateline. That’s when things have gotten out of hand.

So, if you hear this term going forward, here’s what you need to know.

First of all, don’t get confused. A fixed index annuity can also be referred to as an equity-index annuity. Many fixed-index annuities on the market are set up where they have two phases. The first is called the accumulation phase. This is when you’re supposed to let your money grow and earn interest. The other part of this process is the payout phase.

That’s when you get your withdrawals.

Like a traditional fixed annuity, it guarantees your principal. This vehicle doesn’t act like most securities or mutual funds. The premium deposited into a fixed-index annuity is guaranteed to never go down because of the market.

This vehicle also guarantees you will get at least a guaranteed minimum interest rate that’s written into the contract. Remember that the guarantees in the contract are backed by the insurance company’s claims-paying ability.

Are Fixed-Index Annuities Good for Me?

I started in the financial services industry back in 1997 and concentrated for years in retirement planning and products. And over that time I found a great many different opinions on annuities. Some think they are really good. Some think they’re horrible. But as it applies in most cases, the answer depends on the investor, investors and/or their specific situation.

So what I’ll do is give you the pros and cons, and then you can decide if it’s worth a second look.

Here are the pros:

• What you initially put in is safe and guaranteed to grow at a contracted rate. The contract you sign with the insurance company will tell you the minimum amount you can expect when the surrender (or accumulation) period is over.
• Just like all annuities, your money grows tax-deferred.
• Many times a “new base contract value” can be locked in if the index the vehicle is based upon does pretty well over a certain period. This helps you by securing a new guaranteed basis during market upticks.

Here are the cons:

• One con is called the capitalization rate. All fixed-index annuities will have a maximum amount of interest that will be credited to the account. They can be calculated monthly or annually. This means that if the market index returns more than your maximum, you don’t get the difference.

• Also, there are participation rates. Once again, all contracts tell you specifically the percentage of the index gain that will be credited to the account. Usually this will be somewhere from 60% to 100%. Here’s a quick simple example. So, if the index goes up 10% and the contract has a 70% participation rate, the account will be credited with 7% interest.

• Fixed-index annuities usually have long surrender periods. Your money will be tied up or you will have to pay a fee if you surrender your contract.

• Be weary of how your return is accredited to your account. This can significantly affect the annuity’s performance. The two most popular methods are monthly averaging and point-to-point. Averaging will take the monthly index average and credit that to your account. The point-to-point method will take the starting and ending values of the index and figure out the total return to the annuity. This can be done on a monthly or annual basis.

And What You Must Remember…

I’ve made an attempt to simplify the basics of fixed-index annuities. I mentioned that the radio show talked of up-front bonuses. That’s not a typical option. The aforementioned are the basics.

Also, remember that these products are insurance contracts, so expect them to be complicated. Also, being insurance contracts, they can also come with riders that can include other guarantees and options. There was no way to even attempt to touch on everything out there available. As with anything, just make sure to read all the fine print before entering one of these contracts.

Hope this may clear some things up.

Good Investing,

Jason

Article by Investment U

Article by Investment U

According to a recent study from U.S. audit, tax and advisory services firm KPMG, over the past 17 years, hedge funds have actually outperformed equities, bonds and even commodities.

What’s more, The Wall Street Journal reports, the hedge fund industry is expected to more than double in size over the next five years to over $5 trillion in assets.

I don’t know about you, but if hedge funds have earned investors more profits than bonds, stocks and commodities, and are only expected to continue growing, wouldn’t it be beneficial to know what these funds are buying and why?

Of course it would.

And here’s the best part for regular investors.

Any hedge fund with over $100 million in U.S.stocks under management is required to file a Form 13F with the Securities and Exchange Commission (SEC). (Read more about Form 13Fs here.)

In fact, in June, Global X launched an ETF dedicated specifically to following the biggestU.S.stock holdings of a number of top hedge funds.

In just over three months, the fund has already ticked up 11%. And if past performance is any indication, there’s much more room for growth.

It’s called the Global X Top Guru Holdings Index ETF (NYSE: GURU).

Double-Digit Gains in Just Three Months

Let’s face it, if you’re not rich, you won’t be investing in a hedge fund anytime soon.

Truth is, the SEC won’t even allow you to invest in hedge funds unless you can prove you’re an “accredited investor.” That means you must have a net worth of more than $1.5 million, or income in excess of $200,000 in each of the last two years.

On top of this, they typically charge clients a 2% management fee and a 20% performance fee.

It adds up to a lot of money that most people don’t have.

But thanks to 13F filings, every quarter, investors can see exactly what these managers are buying and selling, and can piggyback their picks for steady and solid gains, year after year.

I’m talking about following the moves of funds like Paulson & Co., David Einhorn’s Greenlight Capital, and Daniel Loeb’s Third Point. And that’s just to name a few…

But it doesn’t stop there.

Following the Gurus to Even Higher Gains

Global X’s Guru ETF follows 68 different hedge funds.

What are they investing in?

Well, here’s a look at their top 10 holdings in terms of market value:

CNN Money reports, “According to backtesting results, the ETF would have climbed roughly 30% annually during the past three years, beating the S&P 500’s 22% average yearly gain…”

It’s worth noting, GURU allocates over half of its holdings to the technology, financial and industrial sectors.

This shows these are clearly the places most hedge fund managers believe have the most potential for gains in the future.

Not everything about GURU is money in the bank, though.

Perhaps the biggest drawback is its expense ratio of 0.75%. The average expense ratio for ETFs is currently just about 0.55%.

But thus far, its performance has been well worth the higher-than-average fees. And at the end of the day, having a free look into what many of the most successful hedge fund managers are buying today is of great value just by itself.

Bottom line: Whether you want to buy shares of GURU or just use it to see which stocks hedge funds are trading, this is one ETF you’ll want to keep on your radar.

Good Investing,

Mike

Article by Investment U

Article by Investment U

Finally, after years of campaigning, debates and never-ending television coverage, the November elections are upon us. Who will win and will it make any difference in your investments?

Yes and yes!

Will President Obama win re-election, or will Governor Romney occupy the White House in January?

Right now Intrade, the political futures market, shows Mr. Obama as the heavy favorite by 58% to 42%.

But much could change between now and November 6, and Intrade has had a checkered past in its ability to predict winners…

A better record has been recorded by several economists who have developed economic models that have been surprisingly accurate.

And all of them agree: President Obama is in serious trouble and is likely to lose in November!

Here are the results of four of the best forecasters in the business:

1. Two political scientists at the University of Colorado, Ken Bickers and Michael Berry, used their economic indicator model to predict who would win in November. Their model has correctly predicted the outcome of the past eight elections, and this year they predict a big Romney victory with nearly 53% of the vote, with Romney winning almost all the swing states.

2. Nigel Gault, the chief U.S. economist at HIS Global Insights, a Boston-based research firm, uses proprietary methods and various economic variables, shows the president in even worse shape. The high unemployment rate (8.1%) is a “crucial variable,” he states, and based on his model, Obama will garner only 45.4% of the popular vote.

3. Two economists, David Rothschild of Microsoft Research and Patrick Hummel of Google, have created a model that is both political and economic, and they too show President Obama losing.

4. Ray C. Fair, the Yale economics professor, has developed a successful prediction model that covers elections since 1916. His model depends entirely on the strength of the economy. Right now he has Romney leading by only one percentage point, 50.5% to Obama’s 49.5%, but he says there is a 2.5% “standard error,” so the election is “too close to call.”

What Does This Mean

I am convinced that a Romney victory would be extremely positive for Wall Street, as his election bodes well for maintaining low taxes on capital gains and dividends, oil and gas stocks, and he’s viewed as more “pro-business” than President Obama.

And the best way to play a Romney victory… Buy Northern Oil & Gas (NYSE: NOG), a fast-growing energy play in the Midwest. Main Street Capital (NYSE: MAIN), a business development company is another good choice. And for Eaton Vance Floating Rate Fund (NYSE: EFT), a prime rate fund that will benefit from rising interest rates, an economic recovery will result in higher rates.

Heck, these stocks may also do well in an Obama second term.

Good Investing, AEIOU,

Mark

Article by Investment U