Submitted by Michael Krieger of Liberty Blitzkrieg blog,

For those of you who remember the months following the 2008 financial crisis, one of the most viral videos out there (it has over 2 million views) was the “Peter Schiff Was Right” compilation. It consists of various clips of Mr. Schiff being prescient about the financial condition of the U.S., as talking heads on various financial shows mock him and laugh in his face.

Well, the “Peter Schiff Was Right Video Part Deux” is now out and I expect this one to go viral as well. In this case, pundits laugh at Peter’s insistence that there will be no taper and that it was all a bluff (they pull off the same bluff every year). It ends in classic fashion with Bob Pisani explaining to the dwindling audience at CNBC that “no one saw it coming.”

I guess we’re back to that again.  The next crisis can’t be far off.

 

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Original source at: zero hedge - on a long enough timeline, the survival rate for everyone drops to zero | http://www.zerohedge.com/news/2013-09-25/peter-schiff-was-right-part-deux-%E2%80%9Ctaper%E2%80%9D-edition


Chinese data has been improving lately, but some have expressed concern that this is only because the government is pumping more credit into the system, and engaging in infrastructure investment at a time when there’s already too much spare capacity.

That may be an issue, but as Markit’s Chris Williamson notes on Twitter, Chinese exports are back on the rise, per the latest Flash PMI survey.

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This certainly suggests there’s more to the recovery than just adding more capacity on top of idle capacity.

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Original source at: Markets | http://feedproxy.google.com/~r/TheMoneyGame/~3/ErIjwqZmJQE/a-good-sign-that-chinas-recovery-is-real-2013-9


What’s next for the US stock market?

Sink your teeth into this one-pager from Morgan Stanley strategist Adam Parker.

It has everything you need to get a grasp on what’s going on right here.

Screen Shot 2013 09 17 at 4.42.00 AM

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Original source at: Markets | http://feedproxy.google.com/~r/TheMoneyGame/~3/4QNgcC0DVh0/stock-market-slide-2013-9


diamonds

Depending on who you ask, you’ll get a different assessment of the economy.

“Our visit with West Coast investors this week revealed most clients have a more cautious economic outlook than we currently forecast,” wrote Goldman Sachs’ David Kostin in a new note to clients. “Most hedge fund and mutual fund clients expect growth will disappoint and is likely to be in the 2.0%-2.5% range.”

More from Kostin:

…Goldman Sachs economics research forecasts US GDP growth will accelerate during the next several quarters to a pace above 3%. We expect annual GDP growth will average roughly 3% during 2014, 2015, and 2016. The key drivers of the stronger growth include moderating fiscal drag (the fading of the impact of higher payroll taxes, government spending cuts, and the Sequester, all of which first hit in 2013). A falling savings rate will provide an additional tailwind to consumer spending in the next few years.

With this in mind, Kostin’s team is recommending the stocks of companies that have high operating leverage. These are the companies that would see earnings growth amplified as more revenue passes to the bottom line via a fixed operating cost structure. In other words, marginal increases in sales translate into accelerating gains in profits.

From Kostin:

Our top near-term recommendation is for portfolio managers to own stocks with high operating leverage. A key part of our investment thesis is that the US economy will accelerate but profit margins will remain flat as they have during the past several years. Accordingly, operating leverage becomes essential to generate EPS growth. Within their respective sectors, companies such as AMZN, R, RHI, LUV, NFLX, PXD, EOG, BRCM, BSK, and MRK have a high degree of operating leverage and are constituents in our basket. We calculate degree of operating leverage as the ratio of revenue after variable operating costs to revenue after variable and fixed operating costs.

“We expect the S&P 500 will trade at 1750 at yearend 2013 (+4.0%) and 1825 in 12 months (+8.4%),” writes Kostin.

SEE ALSO: Jeff Gundlach Warns About India And Criticizes The Fed In This Brilliant Presentation

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Original source at: Markets | http://feedproxy.google.com/~r/TheMoneyGame/~3/sDJCxZYIP3Y/goldman-10-stocks-to-own-right-now-2013-9