What Happens When Artificially Low Interest Rates . . . . . Rise? Does “financial repression” have a better ring to it than “market manipulation?” If so, you’ll like this piece from today’s Wall Street Journal Op-Ed page: However well-intentioned, the Federal Reserve’s continued purchase of long-term Treasury securities risks camouflaging the country’s true cost of...Read More
Wall Street Journal: ‘Blame the Regulators’ Chutz-pah′: killing your parents, then throwing yourself on the mercy of the court because you’re an orphan. So, according to The Wall Street Journal, who’s to blame for the still-missing $1 billion of client funds at now-bankrupt MF Global? Not the company’s senior management, led by CEO Jon Corzine,...Read More
“If That Mockingbird Don’t Sing, Papa’s Gonna Buy You a Diamond Ring” You can scarcely pick up (OK, click on) an Op-Ed page these days without encountering the latest housing remedy du jour. Today’s proposal is courtesy of Alan Blinder, Princeton professor and former Federal Reserve official: As nationalized companies that dominate the mortgage market,...Read More
Floundering 529 Plans Rhode Island said its 529 plan will scale back some investors’ exposure to stocks when market turbulence picks up. —College-Saving Plans Shift to Keep Parent From Becoming Dropouts”; The Wall Street Journal (10/11/2011) Even with one of the last great tax breaks out there — zero taxes on any capital gains —...Read More
[Editor’s Note: lots of deals(!) equal few(er) posts.] A prolonged period of very low interest rates will decapitalize defined-benefit pension funds”both private and public”throughout the country. In California, for example, pension actuaries presume a yield on their asset portfolios of about 7.5% just to break even in meeting their annuity obligations, even if they were fully funded....Read More
“Agriculture is the New Golf” The sentiment is practically out of Thoreau: Why not line streets with almond and avocado trees, or replace shrubbery with cabbage and currants? Golf courses could plant their roughs with kale and corn. Lawns”where they must exist”could be edged with chives and herbs. –Stephanie Simon, “An Apple Tree Grows in...Read More
