Big Issues To Focus On This Week
Here are some of the
issues that investors will be focusing on:
· Employment numbers will be coming out on Friday, so the credit marÂkets may be
moseying around until then. There is incredible demand for yield, as last week’s
jumbo junk SunGard subscription showed; this is evidence that U.S. fixed income
products are not out of favor (especially corporate), while the short end and
middle of the curve Treasury curve remains under pressure with the Fed on a
mission to deflate America’s credit binge. In fact, stock sector studies are
still in favor as interest rate sensitive areas such as real estate and
utilities lead; the equity markets are betting on stable to lower long-term
rates.
· Geopolitical: the U.S. has been getting disapproval ratings from the likes of
Japan (regarding anti-dumping legislation and trade policies), and Uzbekistan
(forced closing of U.S. air base there). While the adÂministration will not
necessarily be swayed by these developments, it is a reflection, perhaps, of the
waning strength of a superpower as it come to terms with its incredible debt
load and dependence on foreign capital to finance economic growth. Like it or
not, the fate of the U.S. economy is at the mercy of creditor nations like China
and Japan, while these exporting nations in turn rely heavily on the well-being
of AmeriÂcan consumers. It is a symbiotic relationship that we unfortunately are
not in control of. In terms of global equities, the S&P500 is relaÂtively
under-performing, despite healthy real GDP growth rates.
· ISM figures at 10 AM are anticipated to be solid.
· The price of crude oil has surpassed $60/barrel. The death of King Fahd is
actually more symbolic than relevant, as Crown Prince Abdullah has been
co-piloting Saudi energy policies since 1995. Of significance is Abdullah’s
commitment in raising daily production from 11 to 15 milÂlion bpd. However, will
this be enough to keep up with surging global demand?
· European bourses are actually regaining favor. The World Cup 2006 to be held
in Germany will attract some interest to the likes of Adidas, and certainly some
of the brewers.
Have a good day.
Richard Wiegand is President of Condor Investment Advisors
and is a fully registered investment advisor and asset manager in the State Of
Connecticut. Mr. Wiegand graduated magna cum laude from Amherst College in 1987,
where he received a B.A. with honors in Political Science. He then went on to
receive a master’s degree in International Finance from the Fletcher School of
Law & Diplomacy in 1989. Richard then embarked on a career in global fund
management in Paris and in New York. He has worked for institutional fund
managers in fixed income and equities, with both an international and domestic
focus. He started out his career in emerging market fixed income institutional
sales and then as portfolio manager at FP Consult, where he combined
macroeconomic country risk analyses with quantitative value and technical
studies.
Richard uses his quantitative skills and experience to help clients meet their
financial objectives. Rather than owning a little bit of everything simply for
the sake of diversification, Richard believes that reward to risk studies should
be done to zero in on core funds or positions that are commensurate with each
client’s risk profile and time horizon. Tactical asset allocations may also be
appropriate for certain investors, where core and peripheral allocations may be
adjusted according to market conditions. Richard has taught courses in finance
as an adjunct professor at a local university, is a member of the American
Association of Individual Investors, and coaches, referees and plays soccer in
New Canaan, Connecticut.
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