Joel Goyette and Margaret Cooley walked into the open house for a two-bedroom 1920s Craftsman in Berkeley, California, and knew they’d found their dream house. So did 10 other couples.
Having lost out in two bidding wars, the couple decided to try to connect with the sellers over more than money. Neighbors had told them about all the restoration work the owners had done, including five weekends stripping interior doors down to old-growth Douglas fir. They learned how close-knit the neighborhood was, with "meals shared, tools borrowed" and how "people overall looked after each other," says Goyette.Read more »
Simpler is often better for individual investors, so the new and fast-growing hedged exchange-traded fund raises a question: Is packaging institutional-style trades into ETFs and offering them at low cost to the masses democratic or dangerous?
These products let investors bet on an asset -- Japanese stocks, for example -- while getting rid of a risk in the trade that they don't want, like exposure to the yen. After starting in equities, hedged ETFs have infiltrated every asset class and grown 1,000 percent to $15 billion since the start of 2013. And to answer the question, making these trades available to retail investors is democratic. And dangerous.Read more »
Markets got a shot of espresso this morning -- a double shot actually. Both capital goods orders ex-defense and durable goods orders rose more than expected during January, according to data released by the Commerce Department.
Capital goods represent spending by corporations and durable goods represent spending by individuals. In his latest book "Unleashing the Second American Century," Milken Institute fellow Joel Kurtzman cites cheap energy, educated labor and manufacturing expertise as key drivers over the next decade. Today's better-than-expected results across both sectors speak to Mr. Kurtzman's uniquely American organic growth opportunity. The combination also bodes well for investors who are long. Spending trends have correlated positively over time with stocks.Read more »
Here's one positive thing about bank fees: They unite almost everyone, at least in shared hatred.
Few fees have a more unifying effect than overdraft fees -- charges banks levy when adequate funds aren't available. U.S. banks are fighting regulators' proposals to collect more data on overdraft fees, Bloomberg's Carter Dougherty reports. Overdraft fees totaled $17 billion in 2011, and the Center for Responsible Lending worries fee collections could creep higher. It may not be clear how much the fees boost banks’ bottom lines, but it's obvious that customers are paying annual percentage rates above 4,000 for so-called "protection" from overdrafts.Read more »
Five stocks and one common denominator: momentum.
The team at Ned Davis Research (www.ndr.com) highlights momentum in this morning's report as the single important theme for stock selection in the current market. The five companies offered as examples have all strongly outperformed the broad market over the past year, driven by comparable momentum on the bottom line. More to the point, they've grown earnings faster than what analysts had forecast. NDR believes this single distinguishing factor is especially important now.Read more »
In an effort to brush up on my fundamental stock analysis skills, I recently read “Fire Your Stock Analyst! (Analyzing Stocks On Your Own),” by Harry Domash. Along with lots of useful definitions and examples, the book provides a long and exhaustive scorecard for figuring out if a stock is a growth or value opportunity. That scorecard has 11 sections, each containing multiple financial metrics -- good for analysis, but not something most investors want to slog through.
And so the book does (unwittingly) make a case for investing in fundamentally weighted stock ETFs, which filter and weight stocks on measures like revenue, earnings, cash flow, a mix of those and more. These ETFs have brought in $48 billion in new cash since the start of 2013. They're often called “smart beta” ETFs -- with beta describing a broad market return like that of the S&P 500 Index -- and marketed as a way to beat the market.Read more »
Consumer speed bumps mean we all need to drive carefully.
While not stunning developments, each indicates a degree of softness in consumer behavior. They also reinforce consensus estimates for gross domestic product to remain below 3 percent through next year, based on the 88 economists tracked monthly by Bloomberg. It's the "new normal" first described a year ago by Pacific Investment Management Co. founder Bill Gross, where the U.S. economy still isn't accelerating at the rate typically seen after recession, and sub-par growth is likely to remain for some time (hence the Fed's low rates for longer, by the way).Read more »
When Barrow Barre quit her job as a pathologist in New Orleans to raise her newborn twins the 37-year-old told her husband Gregg he’d have to start saving more for their retirement. His response: “Retirement? "I’m going to have to work till I’m dead!”
Barrow is part of a wave of parents having children into their mid-40s. In 2005, the year she gave birth, the mean age of mothers at first birth was about 25. In 2012, as birth rates fell to a new low among women in their early 20s, the birth rate for women between the ages of 35 and 39 rose 2 percent, according to the Centers for Disease Control and Prevention. The birth rate for women aged 40 to 44 has risen by two percent annually since 2000.Read more »