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Investment Research Since 1978

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Trade War Cooling Chinese Demand for American Housing?

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For some time now Chinese demand for American real estate has accounted for a big part of the buying in some markets. Now, with a trad war escalating between China and the United States, it appears that some Chinese buyers may be pulling back. CNBC's Grace Shao reports: Chinese home buyers last year ponied up much less cash in the U.S. as the trade war continues to escalate between the world’s two largest economies. As President Donald Trump and President Xi Jinping prepare to meet this week, there are worries that decline in spending could extend further. U.S. property sales to Chinese … [Read more...]

Does that Local Business Google Found for You Even Exist?

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Tech solutions have made many aspects of life easier, but sometimes that ease of use also leaves tech open to exploitation. Google Maps is facing a problem in which some companies showing up on its maps don't exist at all, and other exist purely to perpetrate fraud. At The Wall Street Journal, Katherine Bindley discusses fake listings: Some fake business listings might just be a popular search term or phrase. The address might be occupied by an entirely different company, or it might not exist at all. The phone number might route you to a marketing firm, known as a lead-generation business, … [Read more...]

Bigger Funds Are not always Better Funds

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In the low rate environment that has followed the financial crisis, big institutional investors have looked to alternative investments like private equity to generate returns large enough to fund promised payouts. The problem is, that once a fund gets big enough, the number of options it has for meaningful investment becomes limited. Dick Young explained this phenomenon in his popular post on the Crisis at Vanguard. Now, after plaguing the largest mutual funds for years, the problem of getting too big is hitting private equity funds. Miriam Gottfried reports at The Wall Street Journal: The … [Read more...]

Would You Hire an Advisor to Buy Your Next Car?

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Raise your hand if you enjoy the car buying experience? Anybody? The consumer car buying experience is widely regarded as one of the worst there is. The Internet has made things a little bit easier, as you can now do some basic research so you don’t have to walk blindly into the dealership, but the dealer still has the upper hand. If you try to negotiate a price on your trade-in for example, the dealer will budge less on the new car you are trying to buy. If you are leasing, the dealer may give you a good price on the new car and your trade, but he’ll jack up the lease … [Read more...]

Has the Fed Lost Control of Short-term Interest Rates?

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Phil Gramm and Thomas R. Saving make the case in The Wall Street Journal that the Fed Funds rate is no longer in the driver's seat of the monetary policy car, and that instead the rate the Fed pays on excess reserves has become much more important. With that rate guided by movements in Treasury markets, the authors wonder if the Fed has lost control of short-term interest rates altogether. They write: The rate the Fed pays on reserves has eclipsed the fed-funds rate as its key monetary tool, with a much more direct influence over the money supply. If the interest rate on reserves is set … [Read more...]

Is Never Ending Stimulus the New Normal?

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Many astute market observers maintain the central banks are never going to be able to stop printing money and stimulating. The Fed finished its wind-down of QE in September, but quickly shifted back to a dovish stance in January. The ECB ended its bond buying program in December, but today assured markets more stimulus is on the way. Those market observers predicting never ending stimulus are looking more and more correct. The BOJ, BOE, and Fed all meet this week. Expect more of the same. Paul Gordon and Piotr Skolimowski report for Bloomberg: European Central Bank policy … [Read more...]

Surprise! Even Kids Don’t Like YouTube Kids

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If I told you kids don't like to be restricted or fed substandard entertainment, would you be surprised? The answer is obviously no, but somehow Google and tech media seem to be taken aback by kids' preference of the main YouTube app over the walled-garden of YouTube Kids. Bloomberg's Mark Bergen and Lucas Shaw report: In late May, the advocacy group Common Sense Media held a summit on “digital well-being.” Attendees gathered inside the Computer History Museum in Mountain View, California, to debate the long-term effects of apps, services and electronic devices once hailed as revolutionary. … [Read more...]

As Businesses Tie Themselves to Facebook, They Wonder is it an Anchor or Balloon?

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  Visa, Mastercard, and other businesses are incorporating their operations more and more with Facebook, but with all the media scrutiny and scandal surrounding the social network, is it an anchor that will pull them down, or a balloon that will lift them up? Facebook Inc. gained as much as 2.5%, making it one of the few tech names moving higher in early Friday trading, after reports that it’s making progress toward its cryptocurrency ambitions. A group of payments and other companies, including Visa, Mastercard, PayPal and Uber, agreed to invest about $10 million each in a … [Read more...]

Value Has Never Been Less Valued

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Value stocks are trading at their steepest discounts to the market in history. Chris Matthews reports for MarketWatch: That’s according to an analysis by J.P. Morgan’s chief U.S. equity strategist, Dubravko Lakos-Bujas, who wrote in a Thursday note to clients that “value is currently trading at the biggest discount ever, and offers the largest premium over the last 30 years.” Value investing is a strategy whereby investors look for stocks that are underpriced relative to a fundamental analysis of the companies worth, and one that was made famous by Berkshire Hathaway chief executive Warren … [Read more...]