Prieur’s readings (September 19, 2009)

By Prieur du Plessis, on September 19th, 2009 posted in: Investment, Markets, Money

This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy.

• Spencer (Angry Bear): Stock market when EPS growth turns positive, September 18, 2009.
Unless the economy-market is on the verge of a major unforeseen calamity S&P 500 earnings per share growth will turn positive in the fourth quarter. Generally analysts are positive on the market because they expect very strong earnings growth in 2010. This will be the twelfth time since 1950 that earnings growth has turned positive.

• Jennifer Hughes (Financial Times): Risks of treading in the tracks of fallen angels, September 19, 2009.
Talk about recovery and equity, not bond markets, are the classic upside bet. But this is not likely to be a strong, rapid recovery; instead, most economists are forecasting something far more tentative and fragile. In these conditions, even stock investors would do well to keep an eye on what the corporate bond market is saying.

• Edmund Andrews and Louise Story (The New York Times): Fed considers sweeping rules to regulate pay at banks, September 19, 2009.
The Federal Reserve and the Treasury are preparing broad new rules that would force banks to rein in practices that made multimillionaires out of many financial executives during the housing bubble, officials said. The rules depart from the hands-off approach that dominated bank regulation for the last three decades, but are not as strict as proposals from some European leaders and suggestions from some members of Congress angered by the financial troubles of the last year.

• Randall Forsyth (Barron’s): Take this monetary system, please, September 17, 2009.
The current exchange-rate regime can’t go on, but what’s the alternative?

• CNNMoney.com: CNN Poll: US still in a serious recession, September 17, 2009.
Poll says 86% of Americans believe the U.S. is still in a recession, while Fed chairman is more optimistic.

• Antonio Fatas (Morningstar): Did economists ever get it right?, September 17, 2009.
Did economists miss the mark on forecasting the recession? Will they be better the next time around?

• Minneapolis Fed (via Fullermoney): Paul Volcker in conversation with Gary Stern, July 2009 [PduP: A bit old, but still worth a read.]

• Keith Bradsher (The New York Times): Recovery picks up in China as US still ails, September 17, 2009.

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