“The two things you’ll never be without: your reputation and your credit rating. You can destroy them both in an instant and spend the rest of your life trying to get them back." — Larry Winget The company known as “Fitch Ratings” was founded on Christmas Eve 1914 as The Fitch Publishing company. In 1914, […]
Category
Debt
Here's the "Smoking Gun" in America's $70 Trillion Collapse
I entered the corridors of Wall Street as a twentysomething greenhorn in the late 1990s.
I had a mentor at a big hedge fund on Lexington Avenue, who told me if you can't explain even the most complex markets with "a few graphs and a crayon," then you aren't serving your clients.
Most of our clients, many of whom made their fortunes outside of the trading pits, didn't have the time or patience to be impressed by financial "Masters of the Universe"-types spewing out fancy acronyms and bragging about the latest "arbitrage play" in some asset-backed security packaged by a Big Six bank.
Instead, clients wanted to see the big picture, the current picture, to better understand the probabilities of the future picture in common-sense clarity.
Such blunt speak appeals to instinct and sanity.
More importantly, it can mean the difference between keeping and growing your wealth in the worst of times, or losing everything.
And because every investor – not just the ultra-high net worth folks – deserves that same respect and that same actionable moneymaking, capital-preserving intelligence, I've gathered up some charts that show "with a few graphs and some crayon," the sheer size and full financial impact of what's about to happen here.
Make no mistake: The pros I know from my days managing money on Wall Street know this is coming.
What "Other People's Money" Can Tell Us About Ours
No matter how bullish they may be, every investor must come to terms with the fact that this bull market, the longest in postwar history, is well over nine and a half years old now.
For that reason alone, it's important that we continue to look objectively at potential signals out there that might indicate the market becoming overextended to the upside.
Now, if you've been with us a while, it won't surprise you at all to learn that I look at thousands of charts each week. So, when a graphic hits my screen that I think is particularly useful, I like to pass it on.
I've found some charts that give us a top-down, "30,000-foot" view of the margin debt in play on the U.S. stock markets.
Margin debt is just money that is borrowed to buy stocks; most retail accounts can borrow 100% of their account balance to buy additional stock – at fairly low interest rates, too.
So why are we peeking at other people's money?
Well, analysts use margin debt as one measure of market participants' risk appetite. That "zest" for risk – or aversion to it, as the case may be – is a pretty good indicator of how much buying or selling you can reasonably expect in the short term.
Because it's important, margin levels are a never-ending grist for the article mill. In fact, you may have read some articles worrying about the fact that margin debt is at all-time absolute highs.
Do This Before the $170 Trillion Global Debt Trap Sinks the Markets
A worsening global debt trap will make it much harder, if not impossible, for the world's central banks to respond to the next major financial crisis.
Ten years of low interest rates and money-pumping policies of central banks were intended to lift us out of the last financial crisis. But those policies also encouraged businesses and individuals to acquire mountains of debt. Now the central banks are stuck with no ammunition to fight the next crisis. But investors can take steps to protect their money.
[CHART] How the United States' Skyrocketing Debt Is Threatening Your Money
On Jan. 20, 2017, the day President Trump took office, total U.S. federal debt tallied up to a staggering $19.9 trillion, nearly double the $10.6 trillion marked on Jan. 20, 2009, when President Obama was sworn in.
That trend will continue…
Why Gymboree Could Be Headed for a Fate Worse Than Bankruptcy
Gymboree's fate could be much worse than just filing for bankruptcy…
The struggling children's specialty retailer is more likely to liquidate entirely and be eaten up by competitors if it can't score a lifeline on its debt load.
Here's why that could happen, and more importantly, how you can benefit...
Global Markets Mostly Higher After Mildly Dovish FOMC Minutes
(Kitco News) – World stock markets were mostly firmer overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins. Major U.S. stock indexes are at record highs.
Debt Ceiling 2017: How Congress Created an Even Bigger Problem
Last week (May 3), Congress averted a government shutdown by passing a stop-gap spending bill.
But investors need to be aware the "debt ceiling 2017" was left unsolved, and that will create a much bigger problem later…
The Puerto Rico Debt Crisis Explained
The Puerto Rico debt crisis has reached a point where only help from Washington can save it.
As Congress considers a bill to allow Puerto Rico to deal with its debt, Americans rightfully have a lot of questions about how and why this happened – and how it will affect them.
That's why we've put together this Q&A about the situation.
Here's the Puerto Rico debt crisis explained...
Taxpayer Bailout Imminent If Congress Doesn't Save Puerto Rico... Now
A taxpayer bailout to keep Puerto Rico from drowning in its own debt is imminent unless Congress acts fast.
But there's one major "sticking point" keeping Congress in limbo.
Here's more on what needs to happen... right now...