Seymour Zises, President and co-founder of Family Management, writes bi-monthly opinions on issues and observations of relevance to clients and investors.
As the summer receded, we saw many surprises indeed. The U.S. stock market surged, despite the despair brewing from the aftermath of the hurricanes, and more quietly, from job loss and income inequality, which has taken center stage in America.
This is the net interest rate on the 10-year U.S. Treasury Note as of mid-day on the first business day of 2011. Where this rate goes is really indicative of almost everything that happens in the financial world and is reflective of so many factors. If interest rates move higher, it will either portend an economic recovery or a dollar crisis. Obviously, we prefer the former.
The problems that were with us in 2010 have not gone away. Neither has the enormous stimulus and tax relief that is being extended to all of us.
It is roughly a decade since the brewing of the financial crisis. Since that time, central banks worldwide have flooded the markets with what economists call, “helicopter money”; vast volumes of notes printed and circulated – as if flung from a helicopter – to create growth and inflation in their national economies.
Norway is the place to be! It has the highest happiness quotient of all the world’s nations. Why, you ask? Norway is politically stable and has high literacy rates, educational levels and material wealth. It also has one of the best welfare systems in the world and one of the lowest crime rates. Strong social foundations are found to bring the most contentment in life – maybe U.S. politicians can learn a thing or two if they head north.
The Dow Jones Industrial Average plowed past 20,000 this week just as the national debt is expected to cross the $20 trillion mark by the end of 2017. Both of these numbers would have been hard to fathom eight short years ago.