On March 28th, 2012, while testifying before a subcommittee of the Senate Appropriations Committee, U.S. Treasury Secretary Timothy Geithner said that he is encouraging Fannie Mae and Freddie Mac to reduce the principal on a borrower’s mortgage, under certain circumstances. Over the past two years, more than 12 percent of all mortgages in the United States have been labeled delinquent or have resulted in foreclosure.
Treasury Secretary Geithner Says GSEs Should Consider Principal Reduction
Posted by bryantanalysts on March 30, 2012
http://www.bryantanalysts.com/2012/03/30/treasury-secretary-geithner-says-gses-should-consider-principal-reduction/
The Federal Reserve Moves Markets on March 13, 2012
Wall Street’s biggest headline yesterday was the release of notes from the latest Federal Open Market Committee’s (FOMC) meeting and the results of the Fed’s stress tests on America’s 19 largest banks. In the statement released by the FOMC, the Fed expects moderate economic growth over the coming quarters and expects unemployment to decline gradually but noted it is still elevated. The Fed also reiterated its federal funds target rate range of between 0 and 0.25% through late 2014. While the economic update was important, it was the results of the stress tests that generated the biggest buzz.
Posted by bryantanalysts on March 14, 2012
http://www.bryantanalysts.com/2012/03/14/the-federal-reserve-moves-markets-on-march-13-2012/
Is college tuition the next bubble?
The cost of college poses a significant threat to the health of the United States economy. The debt that students acquire through student loans is estimated to be a total of $1 trillion, 14 times more than in 1997, and is currently more than total domestic credit card debt. William E. Brewer Jr., the president of the National Association of Consumer Bankruptcy Attorneys, said, “take it from those of us on the frontlines of economic distress in America, this could very well be the next debt bomb for the U.S. economy.” College tuition has increased at approximately 8% a year since 1950, meaning that the price of college doubles every nine years. The cost of a year’s education at many private universities is almost $50,000, which includes housing and a meal plan. If tuition continues to double every nine years, the cost of a private college education for a child born today would be more than $200,000 a year, a staggering amount to say the least. In order to fully pay for college at that price, parents would have to save at least $17,018 a year and have that money earn a return of 10% a year, an almost impossible task.
Posted by bryantanalysts on February 22, 2012
http://www.bryantanalysts.com/2012/02/22/is-college-tuition-the-next-bubble/
Why you should own both Verizon and AT&T in your portfolio
Every day, there are dramatic headlines highlighting the uncertainty of the global economy. In this volatile environment it is difficult to invest long term but as any great investor knows, there is always money to be made. It is impossible to ignore the interdependence we are forming with our smartphones. In the fourth quarter of 2011 alone 157.8 million smartphones were sold domestically. Smartphones are more profitable than regular cell phones because of the data plan and AT&T (T) and Verizon (VZ) have a dominant position as America’s most utilized cell phone networks. The industry is growing fast enough that you do not need to pick one of these great communications companies to invest in; owning both in your portfolio would be a wiser decision.
Posted by bryantanalysts on February 15, 2012
http://www.bryantanalysts.com/2012/02/15/why-you-should-own-both-verizon-and-att-in-your-portfolio/
Consequences of Greek default triggering default swap payout should not be overlooked
Credit default swaps (CDS) are a type of derivate that insures against the default of an underlying security. The investor pays the underwriter a premium and in return they receive a security that pays out the face value of the underlying security if it defaults. Purchasing CDSs allow investors to hedge their risk of loss on investments such as sovereign debt. Large banks and other financial institutions purchase default swaps to hedge their exposure to Greek and other European sovereign debt.
Posted by bryantanalysts on February 1, 2012
http://www.bryantanalysts.com/2012/02/01/consequences-of-greek-default-triggering-default-swap-payout-should-not-be-overlooked/
The Fed To Keep Interest Rates at Record Lows Through Late 2014
We see US corporate bonds as a safe investment because since the financial crisis, a large number of corporations have bolstered their cash holdings making them a relatively safe investment with a larger return than Treasuries. Domestic companies that do not rely heavily on foreign demand like JetBlue present a very attractive upside for investors.
Posted by bryantanalysts on January 29, 2012
http://www.bryantanalysts.com/2012/01/29/the-fed-to-keep-interest-rates-at-record-lows-through-late-2014/
January 11, 2012 Treasury Auction Makes History
Despite Standard & Poor’s recent downgrade of United States debt, from AAA to AA+, demand for Treasuries has skyrocketed. Yesterday, the attractiveness of U.S. government debt was reaffirmed. At the second of three auctions this week the Treasury sold $21 billion of 10- year notes at 1.90 percent, a record low yield. Recently, Fitch Ratings announced that it would not downgrade France’s AAA credit standing. (News, 2012) However, speculation of a downgrade and the expectation of a worsening sovereign debt crisis in Europe strengthened the appeal of U.S. debt. (Walker, 2012) Fitch said yesterday that there is a significant chance that Italy’s credit rating will be downgraded and that Spain’s credit will be reviewed, contributing to the appeal of stable U.S. debt comparatively.
Posted by bryantanalysts on January 12, 2012
http://www.bryantanalysts.com/2012/01/12/january-11-2012-treasury-auction-makes-history/
Don’t Forget About Greece
Every time Greece receives its next installment of bailout funds, the markets take a deep sigh of relief and return to business as normal. The principle “out of sight, out of mind” may appease the financial markets, but Greece’s debt isn’t disappearing anytime soon.
Posted by bryantanalysts on January 8, 2012
http://www.bryantanalysts.com/2012/01/08/greek-default-inevitable/
Dollar Strengthens
Despite what you may have heard, U.S. gross domestic product will expand 2.1% next year, compared with 1.25% for all G-10 nations, the ten countries that agreed to make funds available to the IMF for drawing by members, according to Bloomberg’s survey of economists. This shows that the domestic economy is not as bad as the media and the general public perceives it to be.
Posted by bryantanalysts on January 4, 2012
http://www.bryantanalysts.com/2012/01/04/dollar-strengthens/