Archive for the ‘Education’ Category
Posted by Larry Doyle on March 12th, 2009 6:30 PM |
The world of insurance occupies almost every corner of our lives. Life, home, auto, disability, long term care, personal articles. Rather than addressing what is insured, an easier question may be to ask what isn’t insured.
Given the intricate web of products and accompanying risks, we clearly are not currently dealing with your grandfathers’ insurance companies.
All that said, insurance is a relatively simple business. A policy is underwritten, premiums are collected and invested, and on and on we go. In fact, with major policies incorporating outsized risks, insurers can “lay off” risk with reinsurers, such as Munich Reinsurance, Swiss Reinsurance, and General Reinsurance. One would think this should be a steady and stable, if not quiet, industry. It would be such if companies did not reach for outsized returns through ever greater risks, primarily in the products in which they invested. While The Quiet Company, Northwestern Mutual invests primarily in high quality corporate bonds, entities like AIG trafficked in esoteric CDS. Hartford Financial Services played in the lower credit sectors of the commercial mortgage space, sub-prime mortgages, and junk bonds. (more…)
Tags: AIG, commercial real estate, corporate bonds, Fannie Mae, Freddie Mac, General Reinsurance, Hartford Financial Services, insurance companies, junk bonds, Met Life, Munich Reinsurance, Northwestern Mutual, reinsurers, Risk, sub-prime mortgages, Swiss Reinsurance
Posted in American Consumers, Banking Institutions, Credit Risk, Current Affairs, Economy, Education, Fannie Mae, Freddie Mac, General, Insurance Industry, Wall Street | 4 Comments »
Posted by Larry Doyle on March 11th, 2009 5:06 PM |
With stock markets down 15-20% on the year and 50% over the last 14 months, everybody in the market is asking the same question, “where can I put my money?” While many asset managers are touting the equity markets as a great buy at these levels, cooler and calmer heads are stating that the economy and markets are likely to have a slow recovery. The question screams where to put one’s money to earn more than the pittance offered in bank checking and savings accounts.
I read a very informative piece in today’s WSJ, Locking In Returns You Like. First off, this piece is very user friendly. It provides a wealth of information and links to websites which will provide good market insight.
Over and above referencing some quality products (GNMAs, TIPS, municipals), it also broaches the topic of laddering which I believe is a very valuable technique in building a bond portfolio.
Additionally, the article highlights FPA New Income Fund which is managed by one of our Economic All-Stars Bob Rodriguez. (I have no professional relationship with anybody on this site!!)
I think you will find this article a very valuable resource and I would recommend putting it in the “save” column for future reference. As you review the products highlighted and topics broached, please do not hesitate to ask anything you may not fully understand.
LD
Tags: asset managers, checking accounts, Economy, FPA< Bob Rodriguez, GNMAs, laddering, markets, municipals, stock markets, TIPS, Wall Street Journal
Posted in American Consumers, Banking Institutions, Economy, Education, Equity Markets, Ginnie mae, Government funds, Risk, Wall Street | 1 Comment »
Posted by Larry Doyle on March 10th, 2009 11:19 AM |
I very much appreciate reading material written by people whom I perceive as having no agenda. I have tried to bring people like this (including Ray Dalio, Paul Keating, Bob Rodriguez, Steve Rehm, Kevin Doyle, Vaclav Klaus, and many others) to Sense on Cents because I firmly believe we all become more educated and informed in the process. Please let me know if and when you perceive me, any of the pieces to which I link, or radio guests on NQR’s Sense on Cents as not dealing totally in the truth. Constructive criticism is always appreciated and will make for a better site.
Along with the aformentioned, I have also previously remarked on my high regard for John Mauldin, one of our Economic All-Stars. John himself possesses an insightful global perspective and has a circle of friends and confidantes that are simply off the charts.
In John’s weekly Outside the Box, he shares with us the perceptions of Michael E. Lewitt. Mr. Lewitt writes at length on topics we have covered here previously, but his level of detail and thoughtful analysis are well worth the read.
Topics covered include: (more…)
Tags: Bank Nationalization, bankruptcy, Bob Rodriguez, depression, eastern Eurrope, economic policies, GM, John Mauldin, Kevin Doyle, market outlook, Merrill LYnch, Michael Lewitt, Obama budget, Outside The Box, Paul Keating, Ray Dalio, recession, Steve rehm, Vaclav Klaus
Posted in American Consumers, Auto Industry, Bailout, Bank Nationalization, Banking Institutions, Barack Obama, Bob Rodriguez, Business, Commerce, Economic Stimulus, Economy, Education, Employment, Equity Markets, Obama Administration, Risk, Stimulus Plan, Stimulus Tax Package, Unemployment, Wall Street | 6 Comments »
Posted by Larry Doyle on March 9th, 2009 3:35 PM |
A great American and loyal reader (thanks FL) shared a report recently produced by not-for-profits Essential Information and The Consumer Education Foundation. This report, Sold Out: How Wall Street and Washington Betrayed America, has gotten little to no attention in the general media. What a shame. I find of particular interest the fact that a number of the currently discussed regulatory changes are directly addressing the points highlighted in this report. I personally view these proposed regulatory changes as substantiating this report and adding credibility to its effort. For the naysayers in the audience, I would ask you to review the report and reconsider your assessment.
I was struck a month ago by the incriminating statements put forth by Senator Chuck Hagel and CIA head Leon Panetta, which I highlighted on February 16th in Legalized Bribery. Those statements bluntly indict our massive system of lobbying, political fundraising, and the quality of those running for elected office! In light of that article, I am more and more convinced that our elected officials have turned their offices into massive for profit machines at the expense of our public well being.
I commend the authors of this report, Roger Weissman and James Donahue, for taking the time and making the extensive effort to expose the truth. The full report, 231 pages in length, spares no detail. In studying it, I found the information and analysis riveting. Let me try to summarize it for you. (more…)
Tags: Arthur Levitt, California electricity crisis, CFTC, Chris Cox, Chuck Hagel, Citibank, derivatives, Enron, Essential Information, Fannie Mae, FDR, Freddie Mac, Glass-Steagall, greed, James Donahue, Leon Panetta, media complex, Merrill LYnch, off-balance sheet accounting, Paul Volker, Phil Gramm, President Clinton, regulation, Roger Weissman, The Consumer Educational Foundation, Travelers, Wall Street, Washington
Posted in American Consumers, Bank Failure, Banking Institutions, Barack Obama, Business, Christopher Dodd, Chuck Hagel, Chuck Schumer, Congress, Credit Derivative Swaps, Current Affairs, Democratic Party, Economy, Education, Equity Markets, Fannie Mae, FINRA, Freddie Mac, General, Housing Crisis, Insurance Industry, Leon Panetta, Lobbyists, Obama Administration, Rahm Emanuel, Republicans, Reputation, Wall Street | 14 Comments »
Posted by Larry Doyle on March 8th, 2009 7:22 AM |
I had a conversation last week with a recent college graduate working in the finance industry. He was recently laid off. Understandably, he was somewhat miffed and unsettled. I was happy to talk to him. My first statement to him was that he has approximately another 40 work years in front of him. Given the length of time and the dramatic changes ongoing in our economic landscape, I offered that this was actually an interesting time to be in the job market because change creates opportunity. His initial deadpan response was not unexpected and actually hoped for. I did not want to be merely a shoulder for him to lean on and commiserate. I advised him that his next job would not necessarily find him, he must find it. In that spirit, I enthusiastically apprised him to actively engage people in dialogue and conversations.
I told him to not even look for interviews but first and foremost to gather information. Utilizing a variety of networks (friends, family, college alums, neighbors, cold calls), I strongly impressed upon him that he needed to remain engaged. (more…)
Tags: career planning, cold calls, college graduate, discipline, downsizing, Economy, interviews, networks, resume, upgrade, Wall Street Journal, work
Posted in American Consumers, Commerce, Economy, Education, Employment, Unemployment, Wall Street | 5 Comments »
Posted by Larry Doyle on March 6th, 2009 5:36 PM |
In reading a fair amount of market analysis and listening to a number of policy wonks, it strikes me that more and more people feel the Obama administration is neither focused nor properly staffed. In Treasury, Secretary Geithner is largely working on his own!! What happens in situations like that? Not surprisingly, Obama himself and his secretaries are not fully informed and say and do things haphazardly.
For those who are wondering what I am doing writing about politics while I navigate the economic landscape, well, risk comes in many shapes and sizes. The risk of an unfocused and thinly staffed administration is a huge risk. Let’s review one specific company that was literally blindsided by the administration.
The Student Loan Marketing Association was the largest provider of student loans in the country. This company, like every consumer finance company, has been very negatively effected by the shutdown of the asset-backed securitization market. That said, what the Obama administration’s budget proposal did to current SLMA shareholders and bondholders is nothing short of devastating. (more…)
Tags: asset-backed securitization, Bloomberg News, consumer finance, Friedman Billings Ramsey, market analysis, Obama Administration, policy, SLMA, Treasury Secretary
Posted in American Consumers, Barack Obama, Commerce, Economy, Education, Employment, Equity Markets, Obama Administration, Risk, Wall Street | 5 Comments »
Posted by Larry Doyle on March 6th, 2009 12:40 PM |
I am going to assume that for the general public, the term Fibonacci Retracements is not part of the normal vocabulary. In helping people navigate the economic landscape, allow me to introduce you to a basic Wall Street practice utilized by many traders. Every investor can benefit from a basic understanding of this concept.
Major market indices trade based on fundamental analysis (cash flow, asset/liability, earnings ), technical analysis (price regressions), and psychology (measure of bullishness vs bearishness). Our friend Fibonacci falls into the technical analysis camp. I do not want to get overly involved in the arcane aspects of this concept, but it can be very useful in assessing market levels and market directions. (more…)
Tags: DJIA, Fibonacci, fundamental analysis, major market indices, psychology, technical analysis, traders, Wall Street
Posted in Economy, Education, Equity Markets, Wall Street | 5 Comments »
Posted by Larry Doyle on March 5th, 2009 3:49 PM |
In the midst of this economic turmoil in which many people are increasingly cash constrained, a cottage industry has developed which preys on the most vulnerable in our society. This industry facilitates short term loans in exchange for the borrower’s paycheck or tax refund.
The companies that participate in this lending should not only be outed but they should also be prosecuted for this activity.
Bloomberg writes how More Americans Turn to Tax Refund Loans to Pay Monthly Bills. With implied rates of interest on these loans from 50% to 500%, this is loan sharking at its worst!! Where are the Better Business Bureau and Attorney Generals when you really need them? (more…)
Tags: Attorney Generals, Better Business Bureau, Bloomberg, debt management, Economy, loan sharking, predatory lending, short term loans, tax refund
Posted in American Consumers, Bank Failure, Banking Institutions, Business, Commerce, Credit Card companies, Current Affairs, Economy, Education, Mortgage Crisis, Unemployment | 3 Comments »
Posted by Larry Doyle on March 5th, 2009 12:45 PM |
I had written that yesterday’s 2-3% upward move in the market was very likely a Dead Cat Bounce. Well, that cat is burrowing further into the ground as markets have more than fully retraced yesterday’s upward move and are making new lows. This type of price action, known as lower highs and lower lows, confirms bearish trends.
I hope our readers know that all financial information you could possibly want is on the Market Data tab on the Sense on Cents header. That resource provided by the Wall Street Journal is not only a great way to get a quick and comprehensive snapshot of all sectors of the market, but also a great way to keep your brokers and financial planners on their toes and working for you!!
Let’s take a quick look at the markets and then I will offer some commentary. (more…)
Tags: 2nd liens, banks, bonds, brokers, China, commercial real estate, commodities, corporate bonds, financial information, financial planners, GE Capital, General Electric, insurance companies, loan modification, market data, municipal bonds, Nouriel Roubini, stocks, trends, Wall Street Journal
Posted in China, Commerce, Congress, Current Affairs, Deficit, Economic Stimulus, Economy, Education, Equity Markets, Housing Crisis, Infrastructure, Insurance Industry, Mortgage Crisis, Mortgages, Real Estate, Unemployment, Wall Street | 1 Comment »
Posted by Larry Doyle on March 3rd, 2009 11:00 AM |
As I continue to develop the product at Sense on Cents, I will look to deliver a variety of angles and perspectives on the markets, the economy, and the world of global finance. On that note, my friends at 12th Street Capital are willing to allow me to share their insights into the mortgage market.
In the spirit of full disclosure, I have no professional relationship with 12th Street Capital. My brother, Kevin Doyle, works at 12th Street and is gracious enough to allow me to share this commentary with you, my readers. As we look to navigate the economic landscape, I thought this 12th Street piece may prove insightful. While there are some technical terms used in this piece, I do not want to edit and have it lose its integrity. Any questions, please do not hesitate to ask!!
Enjoy….and thank you 12th Street!! (more…)
Tags: 12th Street Capital, CDO, Economy, Global Finance, helocs, Kevin Doyle, mortgage market, subordinate bonds, subprime, Wall Street trading
Posted in American Consumers, Banking Institutions, Barack Obama, Business, Commerce, Congress, Credit Card companies, Economy, Education, Hedge Funds, Mortgage Cram-Down, Mortgage Crisis, Mortgages, Risk, Unemployment, Wall Street | 2 Comments »
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