With interest rates still hovering just above zero and growing concerns over an unavoidable uptick in inflation, many investors are anticipating that the Federal Reserve will have no choice but to raise rates from their historically low levels in the near future. Ben Bernanke, the Chairman of the Fed, recently unveiled a strategy to unwind and exit some of the many programs that the Fed rolled out after the market crash of 2008. These programs quickly grew the Fed’s balance sheet to over $2 trillion and Bernanke has vowed to shrink this number but he currently finds himself in a precarious position that is sure to alienate some no matter how the Chairman exits the programs. “If the Fed seeks to shrink its balance sheet quickly, Bernanke could be blamed for taking losses,” writes Kevin Hall. “If the Fed’s balance sheet stays large, critics may see this policy change as a subsidy in the payment of high interest rates to banks.” This delicate balancing act will be a difficult test for Bernanke, who must also juggle the threat of a double dip with the risks of inflation eroding the purchasing power of ordinary Americans and driving away foreign creditors. [click to continue…]
Sino-American relations are quickly reaching a breaking point, as the Obama administration continues to spar with the People’s Republic of China over a variety of issues. The first clash was seen in the tariffs proposed on Chinese steel pipe manufacturers last year, followed by another dispute related to tire producers shortly thereafter. The Chinese took a hard line approach in their response, threatening to apply similar duties to American products such as agricultural goods, much to the dismay of American producers. Although tempers cooled over the winter, tensions are heating up between these two economic rivals following a series of recent developments. [click to continue…]
Barack Obama’s first year in office has, by most accounts, been a mixed bag. The massive $787 billion stimulus plan helped to avoid an even deeper recession, but failed to impact joblessness in any meaningful way. Instead of seeing a downturn in the unemployment rate as promised, Americans have seen the rate grow to double [...]
Despite strong performances from U.S. equity markets in 2009, many businesses are yet to see a noticeable uptick in activity, as consumers have been slow to loosen the pursestrings and begin spending again. With unemployment rates above 10% and rising (regardless of what the “official” numbers indicate), many retailers have struggled, and many had been [...]
Following a year that saw some of the worst performances in recent memory, many asset classes have bounced back in 2009. But some have performed better than others, and as the year draws to a close we take a look at some of the best-performing ETFs. The year’s top gainers include a few of the [...]
A critical five-week stretch for retailers has gotten off to a slow start, and news that November sales results missed analyst expectations have added further weight to an already sagging sector. Retail sales reports from the Black Friday weekend have done little to inspire confidence, and now many retailers are reporting that they came up [...]
In the latest sign that this recovery just might have some staying power, several major retailers reported strong earnings reports for the third quarter. But along with these pleasant surprises came warnings of tough times ahead, indicating that forecasts for the upcoming holiday remain murky. The major retail earnings announcements made so far this week [...]
Over the last year, swine flu has been the news story that just won’t die. After an early initial scare, H1N1 faded into the background of the minds of many for several months, before returning in full force as flu season approached. Of course, the threat posed by the disease never really diminished, and health [...]
Retail stores have been among the hardest hit by the recent global recession, but it appears that finally some relief may be in sight. For the first time in 13 months retail sales rose, finishing up 1.1% in September. More big-ticket sales, a later Labor Day, and poor 2008 September numbers all contributed to the [...]
