Financial Sense Newshour
Jim is pleased to welcome back Steve Forbes, Chairman, CEO, and Editor in Chief at Forbes Media and an internationally respected authority in the worlds of economics, finance, and corporate leadership. They cover a number of issues, including the recent plunge in gold, the Fed’s manipulation of the economy and the potential for future inflation, and the government’s relentless search for more revenue to raise federal spending. Mr. Forbes believes there is a determination in Washington to increase taxes on wealth, following the French model.
Jim welcomes Dan Steffens, the President of Energy Prospectus Group (EPG), a networking organization based in Houston, Texas. Dan publishes EPG’s newsletter, “The View From Houston”. Dan discusses his views on natural gas, and lays out the case for higher natural gas prices ahead. Dan and Jim also discuss the energy stocks, and Dan advises investors to look for companies that balance natural gas and oil production, and can switch back and forth as market conditions warrant.
This week Jim and Cathlyn discuss the dilemma of those sitting on the sideline in cash. When is the right time to make a move? They illustrate the issue by discussing the case study of a retired couple, David and Michelle, who are unhappy with the meager returns on cash and CDs, but have not been ready to make a move into the market. Jim lays out a strategy to boost their income, but warns that time may be running short for income investors. This week’s guest is Peter Bell, president & CEO of the National Reverse Mortgage Association.
Jim welcomes back Shelley D Moen CMT, Senior Market Strategist at Vermilion Technical Research, LLC. Shelley tells Jim that this is the best she has felt about the market since the bottom in 2002. She notes the Dow Theory buy signal, and believes this market has room to move higher.
In this week’s first topic on the Big Picture, Jim looks at the global problem of low interest rates for investors, and how difficult it is for those who need interst income to survive. Jim sees time running out in that any significant yield in the future will come with higher risk.
Jim is pleased to welcome Jeffrey Saut, Managing Director of Research at Raymond James Financial. Jeff mentions that many investment managers and other professionals are feeling “performance pressures” from having missed the recent rally, as well as others that have underperformed by emphasizing international equities over US-focused equities. Jeff does not think the dividend play of recent years is extended, as payout ratios average only 32% of earnings on the S&P index, compared with historical norms of 50% payout ratios.
Jim is pleased to welcome back Michelle Caruso-Cabrera, an award-winning financial television journalist working for CNBC. Michelle and Jim discuss her on-the-ground reporting from Cyprus during its financial crisis. She believes Cyprus was treated unfairly by the European powers, and didn’t receive the same treatment as Greece, which was kept afloat with massive bailouts. Michelle notes that Cyprus runs on its banking system, and Cyprus was treated as an off-shore tax haven, not a sovereign country. She also points out that Cyprus did not cut government spending, but raised taxes instead. Michelle also discusses the European economy and the chances of the Euro surviving longer term.
Jim welcomes Ronald Stoeferle, publisher of the respected annual report, “In Gold We Trust”, and a gold fund manager in Vienna, Austria. Ronald tells Jim that we were close to a run on the bullion banks during the recent chaotic drop in gold. He also sees a growing movement to remove gold from the financial system, as paper gold is creating too much counterparty risk, as witnessed by the Dutch bank ABN Amro’s recent gold default. Ronald sees the divergence between paper gold plunging in price and record demand for physical gold as a loss of confidence in the banking system by the public. The next issue of “In Gold We Trust” will be published in June.
Jim welcomes Joseph Dancy, Manager LSGI Venture Fund, and Professor at SMU Cox School of Business in Texas. Joe sees a discrepancy between energy company performance and share prices, as most major oil producers have underperformed the S&P 500 Index. Joe notes that the global demand for oil is rising relentlessly through industrialization and growth in China, India and other developing nations. With record oil company revenues and growing global demand likely to continue, Joe sees a much more positive performance for the energy sector looking ahead.
This week on the Lifetime Income Series, Jim and Cathlyn discuss the very important topic of compound interest, once famously called “the eighth wonder of the world” by Albert Einstein. Jim and Cathlyn offer examples to explain the concept and why it is so important to start early, invest wisely and stay disciplined.