Market Insights

Is The Ecomony Slowing Down

The question: is economic growth contracting? Answer: it certainly isn’t picking up any steam.

Last week the Commerce Department released the second revision of first quarter GDP (which was unchanged), showing that the economy grew 1.8% (a slower pace than expected).

But there’s more to the growth story that is disconcerting lately. Factory activity is showing signs of weakness.

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Chile: Time to Take Notice

The magnitude 8.8 earthquake that struck Chile in February of 2010 was the sixth largest quake on record since 1900, and it caused an estimated $30 billion in damage (the country has a $164 billion economy). But that didn’t stop the Chilean market from gaining 28% over the past year.

And while GDP contracted 2% following the disaster, it didn’t stop the Chilean economy from growing 5.2% last year, the fastest pace in 5 years.

And now Chile is expanding at an even faster speed: GDP rose 9.8% in the first quarter this year – the fastest pace in 15 years.

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A Green Light on Emerging Market Bonds

It’s been a rocky month for the markets, with the S&P 500 declining for the past three consecutive weeks. But emerging markets have bucked the trend: as of last week, the J.P. Morgan Emerging Market Index Global is up 1.2% for the month.

Is the tide shifting for emerging market debt? Typically, when investors lose confidence in the markets, emerging markets are among the first to suffer. But the debt of emerging economies has held up amid the recent volatility.

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Hewlett-Packard: A Good Value, or a Value Trap?

The third quarter is “going to be another tough quarter”, according to Hewlett-Packard CEO Leo Apothaker. The company has “absolutely no room for profitless revenue or any discretionary spending”. Managers are urged to “watch every penny”.

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Cisco: Growth is “Off the Table”

Cisco’s previous long-term annual revenue growth target of 12-17% is now “off the table”, according to CEO John Chambers. 

And growth won’t be back on the table anytime soon.  According to last week’s earnings report, while sales gained 4.8%, profits dropped 18%.  What’s more: the company announced it expects this quarter’s revenue growth to be up 2% at best…if not flat. 

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Why I Still Like China Over The Long Term



Mark your calendars for 2016.  That’s when, according to the International Monetary Fund, China will overtake the U.S.  

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Microsoft: Disappointing, Again

Is the Windows “cash cow” running out of milk? That is the question to ask when you look at Microsoft’s stock, according to one ISI Group analyst.

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Stagflation: An Ugly Word Rears its Ugly Head

Stagflation: An Ugly Word Rears its Ugly Head

Stagflation, by dictionary definition: an economic phenomenon “characterized by sluggish economic growth and high inflation” (American Heritage New Dictionary of Cultural Literacy). And in practical terms: slow growth and rising price levels is a dangerous economic mix.

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Reality Worsens in Housing

Last month I wrote a post about the reality of the housing market, and what that reality meant for home builders.  The news in the housing market was bad then.  Last week it got even worse.

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Poland: Waiting to be Noticed

The international spotlight has been occupied in the recent past by the usual suspects: China and the rest of the BRIC countries, the Euro zone countries, and lately Egypt.  And overshadowed by most of the emerging world, a country that deserved to be noticed: Poland.

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