Bankocracy

Miss a Little … Miss a Lot

"Goldman Sachs and Franklin Templeton recently published separate studies that analyzed investment returns over the 20-year period from 1992-2011. The results were astounding — even for me, a 30-year market veteran. During this 20-year period, made up of 5,046 trading days, the market returned an average of 7.81 percent per year. However, if you missed the 10 best days during those two decades, your annual return dropped to 4.14 percent. If you missed the best 30 days, your average annual return actually turned negative — coming in at -0.39 percent. And if you missed the best 40 days, your returns fell even further to -2.31 percent." Continue reading →

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Sam Zell says sell

"At least one notable investor thinks we may be in bubble trouble again. Sam Zell on Thursday at the SALT hedge fund conference in Las Vegas said stocks are due for a fall. The legendary real estate investor thinks the market is out of touch with what is really going on in the economy. 'Right now you are buying at an all-time high,' says Zell. 'And there are times when stocks hit a high, and then go higher, but that's when you have a good economy.' By contrast, Zell said the companies he runs and looks at are still struggling to increase sales. Zell said he was worried about problems in the Middle East and recent aggressive efforts by the Bank of Japan." Continue reading →

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Where’d All the Fear Go?

"There are periods when a given market pegs so far to one extreme or the other that it becomes hard to ignore. Such is the case with the market that measures fear – known by stock investors the world over as 'VIX.' VIX is telling us that fear – at least as it relates to stock prices – is dirt cheap. With what we know about markets and human nature, we do not expect fear to remain cheap forever. VIX is the symbol for the Chicago Board Options Exchange (CBOE) Volatility Index. It measures the volatility embedded into options traded on the S&P 500 (SPX) and reflects investors' 30-day consensus view of the future." Continue reading →

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Is This the Best Time for Investors? Don’t Bet On It.

"The stock market is expecting a massive new economic boom, with accelerating growth, widening prosperity and expanding profit margins. Meanwhile, the bond market sees the economy remaining in a funk, with slow growth, widespread unemployment and low inflation. Obviously, they can't both be right. Ominously, though, they could both be wrong. For the first time in 50 years, U.S. investors in a balanced portfolio of stocks and bonds face the near-certainty that they will lose money on a large chunk of their investments, after accounting for inflation—and a significant risk that they will lose money on all of them." Continue reading →

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Credit Union: Bitcoin’s New Best Friends?

"The Internet Archive Federal Credit Union would like to help both the people who are setting up bitcoin exchanges and those who want to do business with them, navigating them through the regulatory landscape by setting up accounts that follow know-your-customer laws. Modell would also like to work to set up low-cost, overnight transfers between bitcoin exchanges and the bank accounts of their customers. This would be a much cheaper alternative to wire transfers, which can cost more than forty dollars each. Finally, Modell says the credit union may extend credit lines up to $5000 to individuals that are investing in bitcoin through these exchanges." Continue reading →

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Invest Like a Euro Zone Refugee

"The world is now witnessing a new refugee movement … but it’s not happening where you might think. These new refugees are not fleeing a war-torn province, or trying to escape from under the boot of a tyrant. They don’t need government aid. And they aren’t physically leaving their homes… Rather, these refugees are Italians, and they are fleeing their banks and their economy. Valter Badariotti, a banker with two small children, is one of the euro zone refugees. So is filmmaker Franco Fracassi. Both are worried about Italy’s economic deterioration and political morass. Sound familiar? It should … because it’s not far from what’s happening in the U.S." Continue reading →

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Nigel Farage Bashes Tax-Advantaged Hypocritical European Politicians

"If we look at the EU officials who work for the European Commission and the European Parliament, the highest category [the most common grade is AD12] are people that earn a net take home pay of just over 100 thousand pounds a year. And yet under EU rules they pay tax of 12 per cent. It is tax fraud on an absolutely massive scale. And Mr Barroso I would say to you, how can that be deemed to be fair? How can people out there struggling - the 16 million people unemployed in the eurozone - how can they look at these institutions, not only paying people vast sums of money but allowing them tax and pension benefits on a scale not seen anywhere else in the world?" Continue reading →

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Austria Turns Rat Fink

"Europe moved closer to ending banking secrecy on Wednesday after Austria dropped objections to sharing data on foreign depositors and the EU focused on negotiating a similar agreement with Switzerland. 'It's a bad day for tax cheats,' Austrian Chancellor Werner Faymann told reporters at a meeting of EU leaders to discuss fighting tax fraud. 'We will act jointly and I believe we will manage the exchange of data by the end of the year.' Luxembourg and Austria had not wanted to reveal the names of account holders to other countries and instead allow banks to withhold tax, but under pressure from their European partners both have now agreed to." Continue reading →

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US Department of Treasury Targets Bitcoin Poker Sites

"In March, FinCEN exercised its power under the Bank Secrecy Act to clarify its position on convertible virtual currencies. The clarification means bitcoin poker sites that accept US players could find themselves in hot water if they facilitate the transfer of convertible virtual currency, which occurs whenever a player gains from or loses to another bitcoin poker player. Regardless of where they are based, bitcoin poker rooms could face prosecution under 18 USC 1960 (prohibition of unlicensed money transmitting businesses). The legislation was originally written to combat money laundering, but the clarification by FinCEN brings bitcoin services within its scope." Continue reading →

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