In 2012 variable annuity cases were the only class of security where arbitration cases increased. Recently, Diany Nygaard, a Kansas City, MO based lawyer said she has been “besieged” by investors claims, as reported in The WSJ. “[Brokers] will stand up in front of a room and sell what they tell people are tax free, high income, you-can’t-lose-your-money investments…That’s the shtick.” Investors in variable annuities are at the mercy of the issuing insurance company. Take a look at the chart below. It’s an ETF of insurance companies. It gives you a snapshot of how they performed when times … [Read more...]
Archives for January 2014
Yesterday’s Winners: Best Buy Edition
We all know the adage, “yesterday’s winner is today’s loser,” or some variation thereof. That’s why it’s no surprise to see Best Buy tanking on the back of a sales report that showed its holiday revenue results coming up short. Investors punished Best Buy shares after the report was released, driving them down over 28.5% at last look. This is probably hard to believe for some because Best Buy was one of the S&P 500’s top performing components in 2013. But those who think back just a little further will remember that Best Buy seemed on the verge of bankruptcy in 2012. The moral of … [Read more...]
VIDEO: Faber: Fed Policy Has Led to Global Problems
Who Will Buy Your Stocks?
Zero Hedge highlighted a striking statistic on its website last Wednesday. A chart with data from Investors Intelligence showed that survey reporting bullish sentiment over 60%, and bearish sentiment in the tank. There are four times as many bulls as bears—a high that goes back almost three decades and covers two of the largest asset bubbles in history. Investors are more euphoric than they were at the height of the dotcom and real estate bubbles. With so many bulls already all-in on the stock market, who are the buyers that are going to drive prices up from today’s already lofty levels? … [Read more...]
The Cold Hard Economy
Whenever bouts of cold or precipitation hit the country it is inevitable that publicly traded companies’ managements will regale quarterly analyst conference calls with the news that weather played a detrimental effect on earnings in the quarter. We think we speak for the entire analyst community when we say “save it.” Fear mongers are already playing up the bout of cold hitting the country this week. Over at CNBC, Steve James writes: The record cold spell that has half the country in the deep freeze could cost the U.S. economy up to $5 billion. That's because millions of Americans … [Read more...]
Calling the Crash of ‘29
If you look at a enough charts it’s not hard to draw historical comparisons to fit your frame of mind. After reading an article comparing this market to 1928-29 I was reminded of Roger Babson, founder of my alma mater Babson College who correctly called the crash of ’29. His “ten commandments” ring true even today. Babson authored more than forty books on economic and social problems, the most widely read being Business Barometers (eight editions) and Business Barometers for Profits, Security, Income (ten editions). Babson also wrote hundreds of magazine articles and newspaper columns. He was … [Read more...]
VIDEO: Gold Restrictions Fuel Black Market in India
Bloomberg: -- The Indian government wants to cut gold imports to 800 tons by the end of the financial year, down more than five percent from the previous period. The restrictions are aimed at closing a widening current account deficit but, as Paul Allen reports, the authorities are facing a tough and traditional foe. (Source: Bloomberg) UPDATE: 12/7/2016 Fergal O'Connor writes at The Conversation: The Indian government has been trying to reduce its citizen’s demand for imported gold through a number of means over the last few years. This is part of a wider crack down on currency used in … [Read more...]