Our Perspective

  • This is indeed a pretty complex topic. However, we are of the opinion that inflation is (in the words of Milton Friedman) "always and everywhere a monetary phenomenon"—too much money chasing too few goods. We do not believe that inflation is a near-term problem. While the money supply has grown in the form of banking reserves (through the various asset purchase programs, Quantitative Easing I & II), much of that money remains as excess reserves on deposit with the Fed. In other words, the...
    Post date: : 10/23/2011 - 8:00pm
    Category: Our Perspective
  • Yesterday saw what can only be described as a precipitous drop in the stock markets:  The Dow dropped by over 400 points, and the S&P fell to its lowest point for the year.  With markets already reeling and battered by bad news, it can feel like we are going through another 2008.  While there are many reasons to worry, there are also reasons to think that this will be a soft patch, and a temporary setback rather than another crash: China is still experiencing an economic slowdown. Their...
    Post date: : 09/22/2011 - 8:00pm
    Category: Our Perspective
  • This past month has been no stranger to bad news. From fiscal issues, to political hurdles, to economic woes, August saw it all—and we would be lying if we said we are not relieved to finally be turning our calendars to September. The month’s start was marked by worry surrounding the issue of the US debt ceiling. We watched as the government struggled to come to agreement over how to raise the debt ceiling before facing technical default. Even after a deal was reached, the frenzy did not go...
    Post date: : 09/08/2011 - 8:00pm
    Category: Our Perspective
  • After what was a devastating week for many stock market investors, US Treasury credit was downgraded on the night of Friday, August 5, by Standard & Poor’s. It was knocked down a notch from the highest rating, AAA, to AA+. According to a New York Times article quote, Standard & Poor’s made the statement, “The downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and...
    Post date: : 08/10/2011 - 8:00pm
    Category: Our Perspective
  • The stock market took no prisoners yesterday, August 4, as the Dow dropped more than 500 points, and only 3 of the S&P 500 stocks finished up for the day.  While we think the words panic and rout are too strong, it was disconcerting to say the least, and investors seemed to agree, as they were gripped with worry that the US and global economies were headed toward recession.  While we concede that there is a lot to worry about—Europe’s debt crisis, the survival of the euro and the euro zone...
    Post date: : 08/04/2011 - 8:00pm
    Category: Our Perspective
  • One could think the Apocalypse was approaching, the way the debt ceiling fiasco has lit up the news as of late. A divided government, underwhelming leadership from both sides of the debate, and prospects unfamiliar to our country’s fiscal history—the depiction has not been a pretty one, by any stretch of the imagination. Even after coming to a tentative agreement to raise the debt ceiling through 2012, along with about $1 trillion in spending cuts, and even more long term cuts, the US has not...
    Post date: : 08/02/2011 - 8:00pm
    Category: Our Perspective
  • What is the time limit for the debt ceiling? Officially, the Treasury reached its debt ceiling on May 16.  However, the government has been able to conserve cash and free up some capacity.  This has bought Congress some time to reach a consensus, but because the government operates at a deficit, we are eating through the capacity and, despite cash conserving measures, will reach the debt ceiling by August 2.  What are Republicans and Democrats saying? While both Republicans and Democrats are...
    Post date: : 07/25/2011 - 8:00pm
    Category: Our Perspective
  • We understand the anxiety of hearing economic concerns in the news every day, and the all too familiar fears it can elicit, given what happened in our economy just a few years ago. Recent economic turbulence, cited in headlines and talking points daily, has certainly rubbed off on the stock market. Although still positive for 2011, as of June 20th, the S&P 500 Index was down -4.86% for the month of June, after being down -1.13% for the month of May. Nonetheless, in the quarter to date, our...
    Post date: : 06/23/2011 - 8:00pm
    Category: Our Perspective
  • On May 16, 2011 the U.S. reached its debt limit of $14.3 trillion. With the subsequent possibility that the U.S. will be unable to issue further debt, and may even undergo a technical default, there has been a lot of discussion, and hype about raising the debt ceiling. You may be hearing mixed messages about the debt ceiling and the impact of default. Here are answers to some questions you may have about the debt limit.[i] What is the Debt Limit? The federal debt limit was created in 1917 with...
    Post date: : 06/07/2011 - 8:00pm
    Category: Our Perspective
  • In the aftermath of a hard-hitting recession, states and localities are still feeling the heavy pressures of decreased revenues, and as a result, many have raised fears of being unable to alleviate operating deficits in order to maintain a balanced budget for the 2012 fiscal year. High rates of unemployment have only worsened the problem. Particular municipalities, including California and Illinois, have gained increased attention lately for their more extreme budgetary deficits. Such...
    Post date: : 02/21/2011 - 7:00pm
    Category: Our Perspective

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