Those that are not in the labor force outnumbered jobs created.
So really we lost 60k jobs.
Why markets celebrate this horrible reality is beyond imagination.
Comments »Monthly Archives: March 2013
Number of U.S. Gun Makers Unwilling to Sell to U.S. Government Triples
“….In just two weeks, the number of companies participating in what has been named the “Firearms Equality Movement,” has more than tripled from 34 companies to 118.
The Police Loophole lists every company and links to the statements that each has released regarding their new policies.
Wilson Combat, a custom pistol manufacturer located in Berryville, Arkansas, joined the movement on February 28 stating the following:
“Wilson Combat will no longer provide any products or services to any State Government imposing legislation that infringes on the second amendment rights of its law abiding citizens. This includes any Law Enforcement Department, Law Enforcement Officers, or any State Government Entity or Employee of such an entity. This also applies to any local municipality imposing such infringements.” …”
Comments »Sister Party of Merkel’s Christian Democrats Says Greece May Still Have to Leave the Euro
“(Reuters) – Greece remains the biggest risk for the euro zone despite a calming of its economic and political crisis and may still have to leave the common currency, a senior conservative ally of German Chancellor Angela Merkel said.
Alexander Dobrindt, general secretary of the Christian Social Union (CSU), the Bavaria-based sister party of Merkel’s Christian Democrats (CDU), has long argued that Greece would be better off outside the euro zone.
But German conservatives’ criticism of Greece has eased since the conservative-led government of Prime Minister Antonis Samaras accelerated harsh austerity measures demanded by Germany and the EU as part of its bailout program.
“The greatest risk for the euro is still Greece… I still believe that Greece’s exit would be a possible long-term alternative, for Europe and for Greece itself,” Dobrindt told Die Welt am Sonntag newspaper, according to advance excerpts of the interview released on Saturday.
“We have created a situation that gives Greece a chance to return to stability and restore competitiveness. But I still hold that, if Greece is not able or willing to restore stability, then there must be a way outside the euro zone.”
Dobrindt urged the European Commission, the EU’s executive arm, to prepare the legal ground to allow for the legal bankruptcy of a euro zone member state and its exit from the currency union.
Dobrindt’s comments contrasted with those of the CSU chairman and Bavarian state premier, Horst Seehofer, who expressed solidarity with Greece and said it was on the “right path” when Samaras visited Munich last December.
Seehofer’s conciliatory tone echoed that of Merkel who, for all her frustration with the slow pace of Greek reforms, has decided that a “Grexit” would be far more costly for Germany and Europe than pressing on with the bailout program.
Merkel is also keen to avoid renewed market turbulence in the euro zone ahead of Germany’s federal election in September. Bavaria also holds a state election in the autumn which the CSU is tipped to win….”
Comments »Not Even the Crumbs Shall Trickle Down
“Corporatism: A System Of Control Designed By The Monopoly Men Of The Global Elite
The Dow is at a record high and so are corporate profits – so why does it feel like most of the country is deeply suffering right now? Real household income is the lowest that it has been in a decade, poverty is absolutely soaring, 47 million Americans are on food stamps and the middle class is being systematically destroyed. How can big corporations be doing so well while most American families are having such a hard time? Isn’t their wealth supposed to “trickle down” to the rest of us? Unfortunately, that is not how the real world works.
Today, most big corporations are trying to minimize the number of “expensive” American workers on their payrolls as much as they can. If the big corporation that is employing you can figure out a way to replace you with a worker in China or with a robot, it will probably do it. Corporations are in existence to maximize wealth for their shareholders, and most of the time the largest corporations are dominated by the monopoly men of the global elite. Over the decades, the politicians that have their campaigns funded by these monopoly men have rigged the game so that the big corporations are able to easily dominate everything. But this was never what those that founded this country intended.
America was supposed to be a place where the power of collectivist institutions would be greatly limited, and individuals and small businesses would be free to compete in a capitalist system that would reward anyone that had a good idea and that was willing to work hard. But today, our economy is completely and totally dominated by a massively bloated federal government and by absolutely gigantic predator corporations that are greatly favored by our massively bloated federal government. Our founders tried to warn us about the dangers of allowing government, banks and corporations to accumulate too much power, but we didn’t listen. Now they dominate everything, and the rest of us are fighting for table scraps.
In early America, most states had strict laws governing the size and scope of corporations. Individuals and small businesses thrived in such an environment, and the United States experienced a period of explosive economic growth. We showed the rest of the world that capitalism really works, and we eventually built the largest middle class that the world had ever seen.
But now we have replaced capitalism with something that I like to call “corporatism”. In many ways, it shares a lot of characteristics with communism, and that is why nations such as communist China have embraced it so readily. Under “corporatism”, monolithic predator corporations run around sucking up as much wealth and economic power as they possibly can. Most individuals and small businesses cannot compete and end up getting absorbed by the corporations. These mammoth collectivist institutions are in private hands rather than in government hands (as would be the case under a pure form of communism), but the results are pretty much the same either way. A tiny elite at the top gets almost all of the economic rewards.
There are some out there that would suggest that the answer to our problems is to move more in the direction of “socialism”, but to be honest that wouldn’t be the solution to anything. It would just change how the table scraps that the rest of us are getting are distributed.
If we truly wanted a return to prosperity, we need to dramatically shift the rules of the game so that they are tilted back in favor of individuals and small businesses. A much more pure form of capitalism would mean more wealth, less poverty and a more equitable distribution of the economic rewards in this country.
But it will never happen. Most of our politicians are married to the big corporations and the wealthy elitists that fund their campaigns. And most Americans are so uneducated that they believe that what we actually have today is “capitalism” and that the only alternative is to go “to the left” toward socialism.
Very few people out there are suggesting that we need to greatly reduce the power of the federal government and greatly reduce the power of the big corporations, but that is exactly what we need to do. We need to give individuals and small businesses room to breathe once again.
With each passing year, things get even worse. In fact, the founder of Subway Restaurants recently said that the environment for small businesses is so toxic in America today that he never would have been able to start Subway if he had to do it today.
For much more on how small business is being strangled to death in the United States, please see my previous article entitled “We Are Witnessing The Death Of Small Business In America”.
What I want to do now is to discuss some of the results that “corporatism” is producing in America.
First of all, we continue to see incomes go down even though we live in an inflationary economy.
As Time Magazine recently reported, personal incomes took a huge nosedive during the month of January…
Data released by the Commerce Department last week showed that personal income fell 3.6% in January, the biggest decline in 20 years. The drop was even bigger when taxes and inflation are taken into account. Real personal disposable income fell by 4%, the biggest monthly drop in half a century.
But this is part of a longer term trend. Median household income in the U.S. has declined for four consecutive years, and it is now significantly lower than it was all the way back in 2001…
Real median US household income — that’s “real,” as in “adjusted for inflation” — was $50,054 in 2011, the most recent data available from the US Census Bureau. That’s 8% lower than the 2007 peak of $54,489.
Meanwhile, big corporations are absolutely raking in the cash. The following is from a recent New York Times article…
“So far in this recovery, corporations have captured an unusually high share of the income gains,” said Ethan Harris, co-head of global economics at Bank of America Merrill Lynch. “The U.S. corporate sector is in a lot better health than the overall economy. And until we get a full recovery in the labor market, this will persist.”
The result has been a golden age for corporate profits, especially among multinational giants that are also benefiting from faster growth in emerging economies like China and India.
Today, corporate profits as a percentage of U.S. GDP are at an all-time high, but wages as a percentage of U.S. GDP are near an all-time low.
Just check out the following chart. Corporate profits have absolutely exploded over the past decade…”
Comments »A Bull and Bear Debate on the Greenback: Schiff vs Mauldin
[youtube://http://www.youtube.com/watch?v=bNYplo-Nwlw 450 300]
Comments »Richard Bernstein Opines on the Similarities of Todays Bull Market to the Legendary Run of the 80s
“Investors often remember bull markets as days of wine and roses.
However, those fond memories are largely based on the latter stages of a bull market during which investors are convinced that there is indeed a bull market underway and that it will never end.
They seem to forget that the majority of a bull market is typically characterized by fear and indecision.
Sentiment during the early and middle stages of a bull market is usually clouded by the bad experiences of the prior bear market. Investors are often hesitant to invest in equities for fear of another bear market. Yet, they see higher returns on stocks than the returns they are getting on their more defensive securities. The emotional tug-of-war between fear of another bear market and greed of missing out on higher returns tends to keep most investors sidelined for most of a bull market.
This cycle has certainly been no different. The S&P 500® has produced a total return of more than 140% since the market trough in March 2009, but many investors still do not even believe that a bull market is underway. Investors continue to search for 5% yields and seemingly ignore the much higher total returns that stocks have been producing.
Another 1980s bull market?
We have thought for some time that the current bull market might be one of the strongest of our careers, and could potentially rival the 1980s bull market. Although this current cycle’s construction is quite different from the 1980s bull market, there are many aspects of this market that are curiously similar.
Investors did not fully embrace the 1980s bull market until several years after it began. Institutional investors did not fully appreciate the opportunities in equities until late-1985/early-1986 when oil prices collapsed, and it became clear that inflation was not going to constrain equity returns. Individual investors largely stayed in money market funds and bonds until early-1987 when they were lured into the equity market by January 1987’s 13% one-month return. Individual investors then entered the stock market in droves just in time for the 1987 Crash.
Similar to what is keeping investors on the sidelines during the current bull market, investors stayed out of the 1980s bull market for so long because there were many issues that investors thought were insurmountable. Table 1 highlights some of the issues that caused investors to forego for many years investing in the 1980s bull market. The irony is that they are largely the same as today’s concerns.
Of course, there are subtle differences between the 1980s concerns and today’s. In the 1980s, investors were worried that the Fed might tighten too much. Today, investors are concerned the Fed might ease too much. In the 1980s, it was Democrats who were concerned about budget deficits. Today, it is Republicans. The sovereign debt problems during the 1980s were largely associated with Latin America. Today, such concerns generally focus on Europe. In the 1980s, investors were concerned with Social Security bankrupting the nation. Today, it is Medicare and Medicaid.
Focusing on these differences, though, may miss the point. Investors were scared about a broad range of issues during the 1980s bull market, and the list of concerns is nearly identical to today’s list of concerns. Despite what many might suggest, the uncertainties associated with the current cycle are not unique….”
Full article and comparisons
$GS Has 12 of the Cheapest Stocks for Your Consideration
“The S&P 500 booked a nice 13 percent return in 2012.
For 2013, Goldman Sachs‘ equity strategy team expects the index to climb to 1,575 by year-end.
However, they obviously expect some stocks to do better than others.
The firm’s new “US Monthly Chartbook” includes a list of the 40 stocks with the most upside opportunity relative to Goldman analysts’ price targets.
We pulled the top 12 stocks, which offer 30 to 50 percent upside relative to their recent prices.
Comments »The Topix Sees its Best Run Since 1987
“International investors who propelled the biggest rally for Japanese shares since 1987 would have earned almost as much in the Standard & Poor’s 500 Index once the yen’s 16 percent tumble is taken into account.
The Topix Index, the country’s broadest equity measure, has climbed 41 percent in the 74 days since the rally began in November. After adjusting for the yen’s depreciation against the dollar, the return shrinks to 18 percent, or three percentage points more than the S&P 500 (TPX), according to data compiled by Bloomberg. This year’s 18 percent advance in the Nikkei 225 Stock Average (NKY) falls to 6.8 percent in dollar terms, less than the 8.8 percent increase by the U.S. benchmark index.
Foreign investors who bought a net 4.19 trillion yen ($43.9 billion) during the rally’s first 16 weeks are repeating a pattern that has occurred during advances since at least 1997. The erosion highlights the hazards of the world’s third-largest equity market, where prices have moved in the opposite direction of the yen 67 percent of the time the last four months.
“People just simply keep looking at the return and not paying attention to the risks,” Malcolm Polley, who manages $1.1 billion as chief investment officer at Stewart Capital Advisors LLC in Indiana, Pennsylvania, said in a March 6 phone interview. “You’re trying to make your money on the currency side and the market side, but the outcome is only good if you make the right call on the market and on the currency.”
Weekly Gain…”
Comments »China Industrial Output Much Weaker Than Expected
“China’s stocks fell, heading for their longest losing streak in three months, as the country’s industrial output had the weakest start to a year since 2009 and lending and retail sales growth slowed.
Ping An Bank Co. led lenders lower after the nation’s new loans last month trailed analyst estimates. Liquor maker Sichuan Swellfun Co. dropped among consumer companies after the country’s retail sales growth in the first two months was the smallest for that period since 2004.
“The economic recovery is weaker than expected,” said Wang Zheng, Shanghai-based chief investment officer at Jingxi Investment Management Co., which manages $120 million. “Investors are worried that stocks may already have moved ahead of fundamentals.”
The Shanghai Composite Index (SHCOMP) dropped 0.8 percent to 2,299.17 at 9:39 a.m. local time, trimming its gain since last year’s Dec. 3 low to 17 percent. The CSI 300 Index (SHSZ300) declined 1.2 percent to 2,588.31. The Hang Seng China Enterprises Index (HSCEI) added 0.1 percent in Hong Kong. The Bloomberg China-US 55 Index (CH55BN) rose 1 percent in New York on March 8.
The Shanghai index retreated 1.7 percent last week on concerns the government will tighten monetary policy and regulators will allow the resumption of initial public offerings.
Industrial production climbed 9.9 percent in the first two months and retail sales rose 12.3 percent, the statistics bureau said over the weekend, trailing economists’ estimates. New local-currency loans in February fell to 620 billion yuan ($99.6 billion), the People’s Bank of China said, less than the estimates of 27 out of 28 analysts in a Bloomberg News survey.
Banks, Insurers…”
Comments »Friday’s Top Hybrid Movers
On the Matter of Yachts
“Why are citizens of the developed world looking a gift horse in the mouth? The Dow Jones Industrial Average rallied beyond 14,300 points this week, passing the highs it reached in 2007 just as the world economy was starting to wobble. Sure, there are reasons to be sceptical about the Dow. It is weighted, rather arbitrarily, by share price. But at least it is a quantifiable index of something. We look at 1954 – the year the Dow returned to its 1928 pre-depression high – as marking an epoch. And yet, this week, investors and pundits warned us not to read too much into it.
They have a point. In the half-decade since the western financial system almost collapsed, the relationship between stock markets and the “real” economy has seemed more tenuous. The Dow owes some of its robustness to expectations of a strong Friday employment report.
Then again, European stocks rose to a four-year high following a rise in unemployment to 11.9 per cent. Other solid-looking economic correlations are melting into air. The US property market rebounded in 2012, according to the Case-Shiller index, but the Yale economist who devised it, Robert Shiller, warned in January: “Any short-run increase in inflation-adjusted home prices has been virtually worthless as an indicator of where home prices will be going over the next five or more years.”
Part of the reason people get less giddy about the Dow than they did five years ago is because they have learnt a bit about inequality. They suspect, more than they used to, that significant developments in the economy go on over their heads. What looks like a recovery, a rally or an increase in consumer confidence may just be the effect of elites passing money among themselves.
Most western leaders hold power today because they weren’t in power during the bleakest days of September 2008. (Germany is the important exception.) They claimed a mandate for radical action, but the economy stumped them. So they have been radical on non-economic matters instead: Barack Obama with healthcare reform, David Cameron with gay marriage and Ireland’s Enda Kenny with abortion. If you were to examine their rhetoric of a few years ago, you might suspect these initiatives were hocus-pocus. Their economic policies don’t differ much from those of their predecessors.
The West’s leaders are vulnerable to the accusation that the policies they lay out on behalf of society as a whole are benefiting only a small group. Joseph Stiglitz, the Nobel Prize winning economist, accuses the Obama administration of trying to rebuild the economy from the top down, not the bottom up. The Occupy movement and the Spanish indignados filled squares with young people eager to make a similar point. Last summer the leftwing Syriza movement won a quarter of the seats in the Greek parliament. In effect, party leader Alexis Tsipras asked Greeks not to take seriously the warnings that Greece would be cut off from the European financial system if it rejected austerity, arguing that they were cut off from the fruits of the system anyway. The strong performance of Beppe Grillo in Italy’s elections is a sign other countries’ voters are willing to call the system’s bluff……”
Comments »Gangsta 2 Banksta: The Four Horseman of the Apocalypse
[youtube://http://www.youtube.com/watch?v=eyCpidT53nY 450 300] Comments »
$MCD Accused of Exploiting Cultural Exchange Students
“For Argentine college student Jorge Rios, a U.S. government cultural-exchange program had huge appeal: He would earn money and use it to explore the country. But after spending $3,000 to participate, Mr. Rios said he found himself at the mercy of aMcDonald’s Corp. MCD +1.67% franchisee who was his employer and landlord.
This week, he and 14 other foreign students demonstrated outside a McDonald’s after filing complaints with the State Department and Labor Department saying they were exploited at fast-food outlets in the Harrisburg, Penn., area and housed in substandard conditions. The students were on a three-month J-1 visa for work and travel.
Reached on his cellphone on Thursday, Andy Cheung, the owner of the Harrisburg McDonald’s locations, said he was too busy to comment. A McDonald’s spokeswoman said the Oak Brook, Ill., chain is looking into the claims and, on behalf of Mr. Cheung, added, “The well-being of my employees is a top priority. The employees that are working in my restaurants as part of a guest worker program are no exception.”
As Congress debates an immigration overhaul, the controversy in Pennsylvania highlights the challenges of creating and managing any new visa program, particularly for temporary workers. Arizona Sen. John McCain said this week that working with labor to revamp visa programs has emerged as one of the toughest issues in discussions over a framework to provide legal status with a pathway to citizenship for the 11 million immigrants living in the U.S. illegally.
It also illustrates the challenges that employers, especially in businesses that rely on low-skilled labor, face as they struggle to fill jobs amid a crackdown on those that hire illegal immigrants.
The Harrisburg students arrived in the U.S. under the auspices of the Summer Work Travel Program, which the State Department’s website says provides the opportunity “to experience and to be exposed to the people and way of life in the United States.” In recent years, however, critics say it has served to supply low-wage labor for ski resorts, car washes and fast-food outlets from Colorado to North Dakota and New England.
“This is a cheap-labor program, nothing more,” said Carl Shusterman, a Los Angeles immigration attorney and former Immigration and Naturalization Service official. “Since when is flipping burgers a cultural exchange?”
Immigration attorneys said the J-1 visa program doesn’t face the same oversight as other temporary-worker programs, such as the H-1B, commonly used to bring in skilled workers, or the H-2A, for seasonal agricultural laborers. About 109,000 students came to the U.S. on the Summer Work Travel Program in 2011…..”
Comments »$GS Says We May Have Moved Over the Hump Away From Fiscal Contraction
“…..Prior to the jobs report, we saw really nice numbers on ISM Manufacturing, ISM Services, consumer credit, and initial jobless claims.
Goldman Sachs is starting to get excited and take note. Here’s a segment from a new note, which was posted on Calculated Risk:
In our annual forecast rollout last November, we predicted that the US economy would move “over the hump” of fiscal contraction, with still-sluggish growth in most of 2013 followed by a gradual acceleration to an above-trend pace in late 2013 and 2014. But the recent data raise the tantalizing prospect that the “hump” may already have occurred. … The most visible data point is the strong February employment report showing a nonfarm payroll gain of 236,000 and a drop in the unemployment rate to 7.7%. But arguably the more important one is the apparent resilience of consumer spending despite the $200bn tax increase that took effect in January. … In our view, it is still too early to close the books on the early-2013 consumption slowdown. After all, we only have auto sales and consumer confidence in hand for February so far. And we still think that the weakness in federal spending will restrain growth in coming quarters. But if consumption picture holds up in light of upcoming data, a modest upward adjustment to our growth forecast would probably make sense.
Of course, the sequestration has just barely begun…”
Comments »The Bow Tie Stands Strong
“Jim Rogers decries the growing uncertainty and recklessness of global central planners as the world enters uncharted financial markets:
For the first time in recorded history, we have nearly every central bank printing money and trying to debase their currency. This has never happened before. How it’s going to work out, I don’t know. It just depends on which one goes down the most and first, and they take turns. When one says a currency is going down, the question is against what? because they are all trying to debase themselves. It’s a peculiar time in world history.
I own the dollar, not because I have any confidence in the dollar and not because it’s sound – it’s a terribly flawed currency – but I expect more currency turmoil, more financial turmoil. During periods like that, people, for whatever reason, flee to the U.S. dollar as a safe haven. It is not a safe haven, but it is perceived that way by some people. That’s why the dollar is going up. That’s why I own it. Will I own it in five years, ten years? I don’t know.
It makes it extremely difficult for the investor looking for acceptable risk/reward, or the saver looking to protect their purchasing power; as in Rogers’ view, all options have their problems:
I own gold and silver and precious metals. I own all commodities, which is a better way to play as they debase currencies. I own more agriculture than just about anything else in real assets because of the reasons we discussed before. We were talking before about the risk-free or worry-free investment. Even gold: the Indian politicians are talking about coming down hard on gold, and India is the largest buyer of gold in the world. If Indian politicians do something — whether it’s foolish or not is irrelevant — if they do something, gold could go down a lot. So I own it. I’m not selling it. But everything has problems.
To Rogers, the bigger danger that concerns him is the hollowing out of the ‘saving class’ resulting from this situation. Central planners’ policies are punishing the prudent in favor of rescuing the irresponsible. This has happened before in world history, and the aftermath has always had grievous economic, social — and often human — costs:
Throughout our history – any country’s history – the people who save their money and invest for their future are the ones that you build an economy, a society, and a nation on…..”
Comments »Making Sense of the Stress Tests, Which Bank is “Safer”
Before you make a leap into bank stocks you need to watch this video and judge for yourself what the stress tests mean for the banking system. Given this video i would say the stress tests are for your confidence more than anything relating to reality.
“NEW YORK (Reuters) – The newest stress tests for U.S. banks produced scores that are at odds with other measures of lenders’ safety, in another sign that some institutions may be too big for regulators to understand and executives to manage.
For example, Citigroup Inc, which has been bailed out multiple times by the U.S. government, showed up on the score sheets posted by the Federal Reserve on Thursday as being clearly safer than JPMorgan Chase & Co.
That conclusion is at odds with the views of investors, bond analysts and credit-rating agencies, as well as when measured by a yardstick regulators themselves want to use in the future.
“At the end of the day, there is a legitimate question about the ability of regulators to fully evaluate $2 trillion institutions because of the complexity and exposures they have,” said Fred Cannon, director of U.S. research at Keefe, Bruyette & Woods.
On Thursday, the Federal Reserve reported the latest results of the tests that began after the 2007-2009 financial crisis to determine if banks have enough capital to withstand a severe economic crisis. The Fed concluded that the banks are in “a much stronger position” than before the financial crisis in 2008.
While experts are not arguing with the fact that the banks are better capitalized now and that the system is safer than it was in the run-up to the financial crisis, some of the numbers the regulators published left analysts and bank executives groping for explanations. The test raises questions about the ability of regulators to head off the next big threat to the financial system because of the complexity of the institutions…..”
Comments »
With New Highs in the Markets Should You Jump in or Dip Your Big Toe?
“NEW YORK (Reuters) – The Dow’s run to record highs in the stock market’s rally this year may not mean it’s time for investors to go on a buying spree.
Instead, many financial advisers are telling clients to go easy, whether they’re just getting back into stocks or seeking to add to equity positions.
Questions over how much higher the market can go have kept caution in play, with some technical indicators suggesting the market is overbought.
But the case for investing in stocks is strong, they said, particularly given signs of more strength in the economy, especially Friday’s jobs report, which showed a much higher-than-expected 236,000 workers added to the payrolls in February.
“We’re telling clients to take a more defensive approach to the market right now,” said Frank Fantozzi, chief executive of Planned Financial Services, an independent wealth manager in Cleveland.
Yet stocks remain a better choice than other asset classes, he said.
“If I had to pick a category, I’d still be looking at equities,” Fantozzi said. “We still think the market is going to post positive gains for the year.”
On Tuesday, the Dow Jones industrial average <.dji> broke through levels not seen since 2007 and continued to mark new record highs the rest of the week. The Dow is now up 9.9 percent since December 31.
The broader Standard & Poor’s 500 <.spx> on Friday ended less than 1 percent away from its record close of 1,565.15, which it reached on October 9, 2007. The S&P 500 is up 8.8 percent since the end of 2012.
Valuations remain relatively attractive. The S&P 500’s forward 12-month price-to-earnings ratio, a commonly used measure to value stocks, is at 13.8 percent, still below its historic average P/E of 14.8 percent, based on data going back to 1968, Thomson Reuters data showed….”
Comments »Drink Up
“Harvard scientists said they have settled a debate over whether a compound found in red wine activates a gene that keeps cells healthy.
Researchers repeated a 10-year old study using a new method to validate earlier findings that resveratrol turns on a gene that recharges mitochondria, tiny structures that produce fuel for cells. By revving up mitochondria, the agent may protect against aging-related diseases, said David Sinclair, a Harvard Medical School genetics professor and the study’s senior author.
Sinclair’s earlier research was disputed in studies in 2009 and 2010 saying that resveratrol only activated the gene, a sirtuin called SIRT1, in experiments that used a synthetic fluorescent chemical to track activity. Since these chemicals aren’t found in cells or nature, other studiessaid the effect would only work in lab tests and not in humans. The new study, published today in the journal Science, got rid of the chemical.
“Controversy is a difficult thing to deal with, and I hope this paper gives some clarity to the field,” Sinclair said in a telephone interview.
The Harvard group set out to see if the effect was an artifact of the synthetic chemicals or was something that occurred naturally as well. They swapped out the fluorescent chemicals for a group of naturally occurring amino acids, including tryptophan, and found resveratrol did activate SIRT1.
Resveratrol Drugs
Sinclair’s earlier work led to the formation of Sirtris Pharmaceuticals which focuses on developing drugs from resveratrol. GlaxoSmithKline Plc (GSK) acquired the company in 2008 for $720 million. A little more than two years later, Glaxo shelved development of the lead compound from that acquisition, SRT501, when the medicine didn’t appear to work well enough in cancer patients and worsened kidney damage.
Resveratrol is currently being tested in at least two dozen clinical trials to gauge its effects on human health. It’s also packaged as a natural supplement, with $34 million in U.S. sales last year, according to the Nutrition Business Journal….”
Comments »Barron’s: DOW 15k in 2013 and a 50-50 Shot at DOW 18k for 2014
“Chances are good that the Dow Jones Industrial Average will finish the year above 15,000—and the odds are 50-50 it could approach 18,000 by the end of 2014.
Did the Dow Jones Industrial Average really hit new highs last week? Practitioners of the dismal science might answer: Not so fast. When the value of an asset rises more slowly than the rate of inflation, then in economic parlance, real gains should be distinguished from nominal. In real terms, a Dow of more than 15,651.80 would have been required for the average to exceed its October 2007 peak.
Inflation was one reason Barron’s called its own forecast “conservative” when it put the odds last February at seven chances in 10 that the Dow would reach 15,000 by year-end 2013 (“Enter the Bull,” Feb. 13, 2012). The story also spoke of Dow 17,000 occurring in the same two-year time frame—a less conservative target, but with a 50-50 shot. Both those targets, with the assigned probabilities, remain relevant for 2013, since they are based on patterns of market history that still apply.
Even with the Dow reaching a nominal record of 14,329 last Thursday, the performance of the market over the past five years is still below par. That bodes well for the bulls. Lower-than-average returns over five years are generally followed by higher-than-average returns over the following two years.
Accordingly, the Dow has four chances in five that it will be flat or higher by year-end 2014, and a 50-50 chance of approaching 18,000 over the same time frame.
TO SPEAK IN THIS WAY about the odds on future trends in stock prices may sound—well, odd. The probabilities are not as statistically sound as, say, the odds of coming up heads four times in a row on a coin toss. Rather, these market odds are derived from long-term market patterns whose source is University of Pennsylvania’s Wharton School finance professor Jeremy Siegel, author of the aptly titled best seller, Stocks for the Long Run…..”
Comments »Bill Gross Upgrades U.S. Growth to 3%
“Bill Gross, whose Pacific Investment Management Co. coined the phrase “new normal” in 2009 to describe an era of subpar growth and a diminishing role for developed economies, sees the U.S. outlook brightening — at least for 2013.
Gross, co-chief investment officer of Pimco, doubled his forecast for growth in U.S. gross domestic product to 3 percent for this year, up from the firm’s December forecast of 1.25 percent to 1.75 percent in 2013….”
