In a well-supported article by zerohedge.com, the author suggests a “fix” to the current problems with price-to-earnings (P/E) multiples. Among the questions answered are: Can P/Es tell us anything about stock valuations during periods of earning recessions? Is a bear market closer than we think? If so, when is the best time to buy? What do today’s inflated valuations mean for long-term returns? Why are outcomes so different when earnings are adjusted to account for mean reversion? The philosophy and figures are more than interesting when examined across a nearly 100-year sample, as this review does. You can read the…
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Watch Out, Wall Street! The Federal Reserve, a Primary Banking Regulator, is Trying Harder to Spot Speculative Excesses Peter Eavis at The New York Times Dealbook reports: In a speech on Thursday, governor Jeremy C. Stein, who joined the Fed last year, focused on parts of the financial markets that show signs of overheating. He went into considerable detail, citing metrics that appear designed to spot bubbles. Specifically, Mr. Stein raised a red flag about junk bonds and mortgage-backed securities, and how investors are financing their purchases of such assets.
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Details Found in IRS Explanation Issued Wednesday; $20,000 Figure Based on a Family of Four. In a final regulation issued Wednesday, January 30, 2013, the Internal Revenue Service (IRS) assumed that under Obamacare the cheapest health insurance plan available in 2016 for a family will cost $20,000 for the year. Under Obamacare, Americans will be required to buy health insurance or pay a penalty to the IRS. The news was reported by Huffington Post, CNS News, Catholic News, Investment Watch, Economonitor, Naked Capitalism, Investor Village, and more. The Journal of Accountancy offered detailed analysis of the new regulations, and NPR weighed in…