The Economy and Markets

Analysis of the economy, markets and politics relating to investment ideas and strategies.

Obama vs. Romney: How Eric Cantor for Vice President Could Sway the 2012 Election

A political question that may influence financial markets is who will win the White House in 2012.  In addressing that, I argued in an earlier post that Mitt Romney is most likely to emerge as the Republican pick based on the Republican Party’s historical preference for candidates who fall short of the nomination after fighting…


Moody’s Reviews U.S. Sovereign Credit Rating for Potential Downgrade

Today, Moody’s Investors Services (MCO) placed the U.S. Government’s bond rating on review for a possible downgrade, substantially increasing the possibility that one of the major credit rating agencies would downgrade the United States’ credit outlook or credit rating, as I warned here on in December 2010.  Neither action has occurred yet, so an…


Obama vs. Romney: An Early Election 2012 Analysis

Now that the 2010 congressional mid-term elections are over, investors are naturally turning their head to the next big contest on the political horizon:  Who will win the White House in 2012?  While it’s obviously too early to make a serious prediction, a confluence of political and economic factors show why the President could face…


Will Congress’s Debate on Extending Unemployment Insurance Benefits Give the Stock Market a Post-Election Hangover?

It’s in vogue these days to assume that Republican victories in the upcoming mid-term elections will boost the market.  With the Dow Jones Industrial Average breaking above 10,700 again and seemingly within reach of 11,000, some of that sentiment may already be priced in to equity prices.  But even if the political winds shift markedly…


Why Deflation Fears are Also Exaggerated

In October 2009, I argued-so far correctly-that hyperinflation concerns in the United States were exaggerated.  Now fear of deflation is increasingly in vogue, but there’s a case that those fears are overstated too. It’s true that the potential for deflation probably was underestimated in some quarters.  Conventional wisdom said that mortgage rates would rise earlier…