Layoffs in a growing economy: Good or bad?

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If you believe the press and the Fed, the unemployment rate is an important barometer of our country’s economic “health,” as low unemployment is considered a positive sign. It seems natural to think that if more people are producing goods and services, we should be more productive as a nation. But in reality, things are […]

Apple & China: Still growing strong

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After the market closed last Wednesday, Apple Inc. (NASDAQ: AAPL) reported its 2nd quarter earnings to much delight. Apple addressed a number of issues in its earnings report, including: (1)   Revenue and net income (“earnings”) per share as well as earnings forecasts for next quarter (2)   The status of its share repurchase program (3)   The […]

Food Prices on the Rise

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After years of drought across the US, South America and Southeast Asia, we’re seeing one result in the form of higher food prices, especially beef and poultry. The Bureau of Labor Statistics reported last week that food prices gained +0.4% in February, the biggest monthly increase in almost two years. After rising +6.1% in 2012 […]

Russia Bullies Ukraine–Again

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The major news story of this week concerns the Ukrainian region of Crimea, now under de facto Russian military occupation after the collapse of its government earlier this year. If you ask the Russians, they are just doing their part to stabilize an otherwise unstable country that remains under the control of an illegitimate government. […]

Japan (finally) makes its QE move

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To put it mildly, Japan—the world’s third-largest economy—has been in a rut lately. By lately we mean the past 24 years. To see how bad it’s been, look no further than a performance graph of the Nikkei 225 (Japanese stock index) below. Since closing at an all-time high of 38,916 on December 29, 1989, following […]

Back to the Fifties

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Perhaps you are old enough to remember the 1950s, a decade characterized by US dominance, technological innovation, and rapidly increasing wealth among the middle class. It was also a period of rising interest rates and robustly appreciating stock prices. I humbly submit that the current decade looks, and may continue to look, a lot like […]

2014: An Orwellian Year?

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With January 2014 now in the record books, and the first trading day of February looking particularly ugly, investors are naturally becoming worried as to what might be in store for the rest of the year. For the statistic junkies among you, the MSCI World index fell -4.4% in January, making it the worst month […]

Turkey Shoot!

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Amid the recent havoc in emerging markets, Tuesday delivered a significant (and somewhat surprising) piece of good news as Turkey raised the average rate at which banks can borrow by 2.8%. Considering that the US Federal Reserve rarely adjusts the federal funds rate by more than 0.5% at one time, this is obviously a very […]

The rout that refreshes?

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Those of you who follow the stock market, even casually, know that we’ve had a nasty two days in global equity markets, with the MSCI All-Country World index tumbling -3.5% in just 48 hours. Today was the sharpest one-day drop since last June, and the biggest weekly decline since late 2011. Moreover, the selling was […]

Quantitative Easing and Tapering are overrated

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Happy new year to everyone from KCS! We appreciate the feedback we’ve received about our eNewsletter over the past year, and hope you’ll continue to share your thoughts with us. Questions and comments are welcome, as are topic suggestions for future newsletters. A quick review of Quantitative Easing November 2008:  Federal Reserve begins buying $600 […]

2013: Year in Review

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Like most years, 2013 will leave behind its winners and its losers. Stock market participants were (for the most part) rewarded for their bullishness, especially those who have been overweighted to US stocks. Even owners of European stocks had an excellent year, which may surprise you given the mostly bad news we’ve been hearing about […]

The Standoff in Washington

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It makes sense that investors would react positively to Thursday’s news that the Obama administration and House Republicans are willing to trade a short-term debt limit increase for “separate negotiations” on a number of other budget issues, a small step in the showdown between the two sides. After all, the government was closed and (sarcastic […]

STANDOFF: CBS vs. Time Warner Cable

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Today (Monday) marks the 11th day of hostile retransmission negotiations between cable network operator CBS (NYSE: CBS) and Time Warner Cable (NYSE: TWC). Because the two sides could not reach an agreement on how much TWC will pay CBS (per subscriber per month) for access to CBS programming, today also marks the 11th day that […]

Easy money no more

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The days of loose monetary policy are officially coming to an end. We don’t know exactly when, or to what extent, this will occur, but it’s safe to say that QE3 (or, as some call it, “QE-Infinity”) will be scaled back within the next year, according to Fed Chairman Ben Bernanke. Since November 2008, the […]

Cyprus: The rule or the exception?

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To avoid the collapse of its banking system, European Union member nation Cyprus has begrudgingly accepted an unprecedented plan from the EU to raise bailout money. Normally a bailout would come in the form of the government purchasing Cypriot sovereign debt on the open market, but Cyprus is a rare case because its financial sector […]

The pot calling the kettle black

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It’s no secret that the Chinese have taken measures over the years to keep the Yuan cheap against other currencies worldwide. In his debates against President Obama, Mitt Romney even went so far as to accuse China of being a “currency manipulator.” So it comes as somewhat of a surprise that the president of China’s […]

M&A Activity in 2013

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We knew US companies weren’t going to sit on their hands (or in this situation—piles of cash) waiting for a magical uptick in sales forever, and they have finally begun taking action. While there is no hard and fast rule about M&A (mergers and acquisitions) and its effect on the overall economy, it is no […]