Investment/Trends

Americans Gambling on Rates With Most ARMs Since 2008

"In the second year of the U.S. housing recovery, the loans that helped trigger the housing bust are making a comeback. Applications in late June rose to the highest level since 2008 after the Federal Reserve sent fixed rates surging by signaling it may curtail bond buying credited with pushing borrowing costs to the cheapest on record. The average 30-year fixed-rate mortgage jumped 1.2 percentage points in mid-July from May to the highest level in two years, adding about $200 a month to payments on a $300,000 mortgage. ARMs, loans with interest rates that adjust after initial fixed periods, usually of five, seven or 10 years, contributed to soaring defaults in 2008." Continue reading →

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No Free Sun for You! Why Arizona Wants to ‘Tax’ Solar Power

"On July 12, Arizona’s largest electric utility announced a plan to drastically change net-metering, the way in which homeowners and businesses with solar rooftops sell excess power back to the grid. Net-metering is the foundation for all solar leasing; without it, solar companies can’t entice homeowners with the promise of 'cut your electric bill, no money down' but instead would rely on sales of expensive systems. The proposal would slap existing solar-paneled homeowners with a fee of up to $100 per month for the privilege of selling excess power back to APS. If you don’t already have solar panels, you can never share in net-metering as we know it." Continue reading →

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2013 Bitcoin Mid-Year Review and Outlook

"The past six months may one day prove to be among the most important in bitcoin’s history. As global events sparked increasing need for frictionless wealth transfers, bitcoin’s popularity ballooned and ignited a conversation that will likely continue to flourish in the years to come. Growth in bitcoin’s value was outpaced only by the incredible interest from entrepreneurs, investors and the press. In this 27-page report we cover the major events from the first half of 2013 and what to look out for in the months ahead." Continue reading →

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Bitcoin gets big bets from Silicon Valley

"Dot-com pioneers and fresh-faced 20-somethings alike are founding companies to help transact the virtual currency. Are those chasing Bitcoin headed for a gold rush, or fool's gold? Nick Holland, a Javelin Strategy analyst in Boston, is among those who believe math-based currencies like Bitcoin, which enable transactions from one user to another without official oversight or high fees, could upset the centuries-old tradition of paper money -- much as user-generated Wikipedia all but replaced the venerable Encyclopaedia Britannica." Continue reading →

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Spanish Pension Raids Spell Bad News for Bond Sales

"Spain’s Treasury may find one of its best customers less eager to buy its bonds as budget woes lead Prime Minister Mariano Rajoy to raid a government piggy-bank for a second year. Created in 2000 to guarantee pension payments in times of hardship, the 59.3 billion-euro ($78 billion) Fondo de Reserva was tapped for the first time in December for 7 billion euros to fund Christmas bonuses and a monthly increase for retirees. Further withdrawals will have taken an additional 4.5 billion euros by the end of this month, helping to pay for pensioners’ summer bonuses and tax refunds." Continue reading →

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‘Neighbor vs. neighbor’ in US cities, Meredith Whitney says

"Meredith Whitney painted a dire picture in a CNBC interview Wednesday of cities slashing services and communities battling for mere survival. The financial advisor and analyst said the financial woes facing bankrupt Detroit will become common around the country as local governments do whatever they can to escape onerous debt burdens. 'I think you're going to see a real issue of neighbor against neighbor on these very issues,' she said during a 'Closing Bell' conversation. 'That has been glossed over for years. What's at stake are social services we count on.'" Continue reading →

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The Gold Roller Coaster

"Gold is not a stock. It does not behave as a stock, and its rewards are not delivered in the manner of stocks. In watching the ups and downs of gold, this is the most important fact to remember. To be sure, some investors treat gold in the same way as a stock – trying to guess its fluctuations – selling after a rise and buying following a correction. However, gold is not like a stock, in that it does not pay dividends. It does not rise and fall based upon the performance of any company. And it is relatively finite. There can be no stock splits. Gold's true value is not as a trading commodity, but as a means to preserve wealth." Continue reading →

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The Curiously Uncurious Ben Bernanke

"If I were chairman of the Federal Reserve and didn't understand the forces that move gold, learning about them would be near the top of my to-do list, if for no other reason than a large swath of the investment community uses gold as a barometer to evaluate how good a job I'm doing. Bernanke's clueless quote paints a stark contrast between the academic and real world. Upon observing the recent correction in the price of gold, how many asset managers do you think threw their hands up in confusion and proclaimed that no one can possibly know what's going on, so why even try?" Continue reading →

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Are You Ready for This Coming Disaster?

"Interest rates will remain at low levels for a very, very long time. The Fed will remove the stimulus in baby steps because it has no other choice. Any significant moves would send world markets into a tailspin. When the money printing finally stops, the Fed will still keep interest rates at zero for a while, just to make sure the economy can stand on its own feet. Only then – and if everything goes well – will the Fed slowly begin to hike rates. Most bubbles burst when the Fed starts to move rates above the inflation rate. As you can see in the chart above, that’s what happened in 2006. But, the Fed will only do that when inflation starts to get out of control." Continue reading →

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CNY Challenges EUR For Second Largest Bitcoin Exchange Volume

"Since the beginning of this year, China has played an increasingly important role in the digital currency universe. After state-run CCTV ran a documentary about bitcoin in May, Chinese adoption grew dramatically. At the time it was unknown whether the interest spike would be a mere blip in bitcoin’s history or a trend that would continue into the future. Since beginning the year at just over one percent of total bitcoin trading volume, CNY trading has recently ballooned to 10% of the total market, claiming the title of second largest bitcoin trading volume for 13 out of 23 days so far in July." Continue reading →

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