According to the Bank of England, economists assume interest rates will rise and move toward equilibrium or a ‘natural’ real rate of interest that takes into account inflation over the long term.
Contrarians probably are waiting for the other shoe – or in this case, U.S. stock markets – to drop.
If you’re not familiar with contrarian investing, the theory goes something like this: Consensus opinion is often wrong. When the majority of investors have a bullish outlook and believe stocks are going to move higher, the chances are stock values will drop. Likewise, when the majority has a bearish outlook and believes stocks are going to move lower, the chances are stock values will rise.
If you could accurately predict how share prices would move, you’d probably be quite wealthy. If you could offer insight that helps analysts and investors do a better job predicting such things, you might win the Nobel Prize. That’s what happened last week when American economists Eugene Fama and Lars Peter Hansen from the University of Chicago, and Robert Shiller from Yale University, jointly received the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2013. They were recognised for their empirical analysis of asset prices. (more…)
Curse of Chucky, Scream 2, Final Destination 5, Freddy vs. Jason… You know Halloween is nearly upon us when you can’t surf channels without finding a multitude of horror flick sequels.
The privitisation of The Royal Mail saw small investors being favoured over large. Savers who applied for up to £10,000 worth of shares in Royal Mail have ended up with fewer shares than they wanted.
If ever you wanted some proof of the global nature of the FTSE 100, then a couple of sharp reminders have been recently administered. That great, reliable Anglo-Dutch stock and stalwart of the FTSE, Unilever, was given a bashing last week; not because its products have gone wrong, after all Dove Soap, Flora and Knorr Stock cubes are still household staples. No, this time it is the effect of the emerging markets where their global and regional brands have been affected by the recent fall off in many emerging and developing national currencies.
They’re still really good at some things. For example, they have more entrepreneurs – people who organise and operate businesses – than any other country in the world. About one of every 13 Americans is an entrepreneur, according to The Economist. That’s almost 7.5 percent of the population! The Netherlands isn’t too far behind in the ratio of entrepreneurs to population at large (about 6.5 percent). However, less than 4 percent of us Brits are entrepreneurs and less than 3 percent of the citizens of France, Sweden, and Germany are so inclined.
The third quarter of 2013 held plenty of mayhem and emotion. It began with an overthrow of Egypt’s democratically-elected government and ended with the United States government at risk of defaulting on Treasury and government obligations. In between:
Americans are experiencing déjà vu all over again. Sure, the prospect of another fiscal showdown doesn’t electrify a crowd like a Rugby World Cup final against the Aussies. All the same, investors’ response to the possibility the U.S. government might partially shut down on October 1 was muted. Some U.S. stock markets gave back a little for the week; others moved higher. All remained up year-to-date.
The child benefit tax charge, introduced on 7 January, affects over one million families. A family with 2 children could see their annual spendable income drop by up to £1,752 pa in 2013/14; those with 3 children could lose £2,449 pa. At a time when prices are rising faster than incomes, it will be critical for many families to know how they’ll be affected, and what options they may have to improve their situation.
