The Daily Middle

Archive for February, 2010

“From the beginning Clinton aimed to reassure powerful forces on Wall Street and he did so with a key appointment. Rubin is the best known financier in the country at that point because he had run the legendary Goldman Sachs. Bob Rubin was Bill Clinton’s emissary on Wall Street, he placed great trust in Bob Ruben and Bob Rubin’s view of financial markets and financial regulation. He had an enormous amount of credibility because he was a business success and Democratic administrations always seem to worship people who can excel at business. At the White House and as Treasury Secretary, Rubin found an unlikely ally. Clinton had asked Alan Greenspan to stay on. Bob Rubin and Alan Greenspan were very much in lock-step. They had very similar views on Wall Street…”

Hello Everybody,

America is in trouble – big trouble. And Washington is at fault.

Remember those irresponsible financial policies that contributed to the collapse of Wall Street? Those are the exact same policies that our government is practicing today. And they are driving our country into a hole we won’t be able to dig out of.

Someone needs to reign in government spending and keep that addiction in check. That someone is me.

I have no political ambitions. I’m running for the U.S. Senate because I’m a patriot. I recognize how desperately our country is in trouble. And I have the experience and skill set necessary to save the United States of America.
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From: Daily Finance

Maybe you’re sitting on the ETF sidelines. You haven’t jumped in yet, but you’re thinking about it. Or maybe you’re among the masses clamoring for the latest and greatest ETF. Either way, ETFs may be a bit mysterious to you. You kind of know how to play the mutual fund game, but what are the rules of successful ETF investing?

Follow these tenets, and you’ll be off to a strong start in the ETF world.

1. Remain Focused. What are you trying to achieve? Does the ETF you’re looking at help achieve that goal? “If not, why are you looking at it? Don’t get distracted with stories and ideas that don’t help meet your objectives,” says Robert Jergovic, chief investment officer of CLS Investments.

Narrow your opportunity set. “What are your options? What ETFs are available that meet your particular investment need?” asks Jergovic. Start your portfolio construction by considering your long-term financial plan — that is what should drive your asset-allocation decisions. Your goals, state of life, and other considerations will determine which “buckets” you need to invest in — stocks, bonds, commodities, real estate, etc. — and how much should be in each bucket. You can use ETFs to fill your buckets, says Jerry Miccolis, chief investment officer of Brinton Eaton.

2. Define Your Diversity Goals. Diversification means more than selecting different asset classes to invest in. “It means diversifying your portfolio across different investment styles (tactical, strategic, fundamental, technical, long-only or long/flat or long/short), asset classes and regions of the world,” explains Noah Hamman, founder and CEO of AdvisorShares. “Make sure to not own too many of the same type of ETFs, giving you exposure to the same asset class, unless they are materially different,” he adds.

3. Look Under the Hood. Some ETFs use cap-weighted baskets of securities, others use fundamental-weighted baskets, and some even use derivative products. Moreover, some rebalance fairly frequently, while others do so only on an annual basis. In fact, a few never do. There are even some now that use an active or quasi-active management style. “Each investment approach carries with it very different risk/return profiles and tax consequences,” says David Twibell, president of wealth management for Colorado Capital Bank.

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From: Moneynews

China will continue to sell U.S. Treasuries in the future, says Jim Rogers, co-founder of the Quantum Fund.

China will unload more debt as the “euro scare” continues, he said.

The government reported that appetite for Treasuries declined by the largest amount in December as China reduced its allocation by $34.2 billion to $755.4 billion. Japan made a similar move and lowered its amount by $11.5 billion to $768.8 billion.

“I am surprised China has not dropped more,” Rogers told CNBC.

The United States should be concerned about this change in investments, he said.

“The U.S. should be worried about everyone lightening up – not just China,” Rogers said.
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Elizabeth Warren,

“If you aren’t a commercial Real Estate Developer, you may think, ‘not my problem.’ I wish that were so. A big enough wave of commercial mortgage defaults would trigger economic damage that would touch the lives of every American. Empty offices, empty hotels, empty stores could lead directly to job losses. Banks that suffer losses or fear they might could grow even more reluctant to lend which could make it even harder for you to get a loan. The largest loan losses are projected for 2011 and beyond. But the stress test conducted on big Wall Street banks last year examine their stability only through 2010. Even more significantly, Community Banks tend to hold much greater concentrations of commercial Real Estate than big Wall Street banks. But Community Banks never underwent any stress tests at all.”

Ron Paul,

“If you look at history, revolutions do occur periodically, but they don’t occur without the support of the young people. And I think that ’s what I’m sensing. But I think in the last campaign, there was a bit of confusion they were demanding change and Obama was saying change, and a lot of them didn’t look into the significant changes that he wanted and now I think now they’re more frustrated than ever. So hopefully we can influence them to think about the revolution that I’ve been talking about, and that is moving in the direction of the Constitution. You know you say I’ve handed out copies of the Constitution. Any time a young person comes to my office I always give them a copy of the Constitution, I always tell them I want you to read this because I can’t get anybody else to read it and it’s on the house floor. It’s a pretty good guideline.”

From: Slate.com

A Parable About How One Nation Came to Financial Ruin.

Many people, particularly foreigners with savings to invest, regarded this situation as disgraceful. After all, they reasoned, it was just common sense for lenders to avoid gambling addicts. As a result, almost all foreigners avoided holding Basicland’s currency or owning its bonds. They feared big trouble if the gambling-addicted citizens of Basicland were suddenly faced with hardship.

And then came the twin shocks. Hydrocarbon prices rose to new highs. And in Basicland’s export markets there was a dramatic increase in low-cost competition from developing countries. It was soon obvious that the same exports that had formerly amounted to 25 percent of Basicland’s GDP would now only amount to 10 percent. Meanwhile, hydrocarbon imports would amount to 30 percent of GDP, instead of 15 percent. Suddenly Basicland had to come up with 30 percent of its GDP every year, in foreign currency, to pay its creditors.

How was Basicland to adjust to this brutal new reality? This problem so stumped Basicland’s politicians that they asked for advice from Benfranklin Leekwanyou Vokker, an old man who was considered so virtuous and wise that he was often called the “Good Father.” Such consultations were rare. Politicians usually ignored the Good Father because he made no campaign contributions.

From: Business Insider

Despite all the wild stories you have already heard about China, expect the nation to keep blowing your mind.

That’s because not only is China enormous and highly diverse, but most importantly, it’s rapidly changing.

Thus China’s future already looks far different today than even five years ago. It’s surely not your father’s ‘Red China’, or even your older brother’s ‘Made in China’…

Read the 15 Facts

Ron Paul,

“Fiat monies never last, they always collapse. Empires always collapse for financial reasons. We didn’t lose a war against the Soviets and the Soviets weren’t beaten by [our] military, they were beaten financially; thats the way it’ll eventually come down and the world will change. We’re on the verge of it, that’s what the signs are telling us. That this debt cannot be sustained and the debt is run up by two grips in Washington; they compromised, and run it up for domestic reasons and foreign policy.”

This is Part 2 of 2 for Ron Paul. If you missed Part 1, click here.

Peter Schiff,

“Wall Street doesn’t just want confidence, they want recklessness, they want extravagance. They want consumers out there spending money, that’s why they’re worried about confidence. They want to know that people are confident that even though there’s a lot of people unemployed and even thought they might lose their jobs, even though they’ve lost their home equity and they have no savings, Wall Street wants everybody spending money anyway. The reality is, that’s not what we want. Consumers shouldn’t be confident, if anything, their over-confidence is why we’re in trouble, they spent money they didn’t have. They believed in a false recovery or a false prosperity that wasn’t genuine. I don’t want consumers being confident. I want them being worried, and they should be. I mean there’s no reason, why should they have confidence in this economy? They should be saving their money. And even if they had confidence in the future, they should still save because they’re broke.”

You can find more free services for global investors, and learn about the Euro Pacific advantage, at www.europac.net. You can learn more about Peter Schiff’s Senate Campaign at www.SchiffForSenate.com