FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.
Market Euphoria Over Fiscal Cliff Deal Won’t Last Long (Advisor Perspectives)
Global markets rallied after the House approved the fiscal cliff bill late last night. But Charles Lieberman at Advisors Capital Management warns that this euphoria won’t last long. “The investment implications of the deal are quite positive for the near term, but far less clear looking out over a few months. Euphoria over avoiding the fiscal cliff should enable equities to perform well over the next several weeks, while bond yields should rise. Economic growth prospects have also improved. That’s precisely how the markets behaved on Monday, as the politicians appeared to be making progress towards a deal.
This euphoria won’t last long, however. Negotiations need to start soon, since late February will arrive fairly soon and politicians will be quite distracted over the next few weeks by the activities that normally surround the seating of a new Congress and the appointment of new key personnel in the Administration, such as Secretaries of State and defence. The market volatility that we experienced in recent weeks should return by mid-February, as the budget battles resume.”
The Most Important Finance Books Ever Written (Business Insider)
As we begin the new year, Business Insider published its list of the investment books that should top your reading list. This includes Benjamin Graham, ‘The Intelligent Investor’ which Warren Buffett has described as the best book about investing that has ever been written, George Soros, ‘The Alchemy of Finance’, and Charles Mackay’s ‘Extraordinary Popular Delusions and the Madness of Crowds’.
Morgan Stanley: The BRIC Era Is Over (Foreign Affairs)
Despite many still betting on emerging markets, Morgan Stanley’s Ruchir Sharma writes that the BRIC era could be over. “The new normal in emerging markets will be much like the old normal of the 1950s and 1960s, when growth averaged around five per cent and the race left many behind.
…There is a lot less foreign money flowing into emerging markets. The global economy is returning to its normal state of churn, with many laggards and just a few winners rising in unexpected places.”
8 Forecasts For Fund Investors In 2013 (Marketwatch)
Chuck Jaffe at Marketwatch sees 8 trends in the mutual fund business in 2013. 1) Some big names could move into ETF’s, something that Vanguard has a patent on till 2019, if the SEC allows them to. 2) Active mutual funds will be converted to ETFs. 3) “New ETFs will ignite a price war”. 4) “Renewed talk about 10-year returns”. 5) Reforming money funds. 6) Among investors, fund investors will be least-worried about changes in tax rates. 7) “A derivative blow up”. 8) Investors in bond funds will realise they aren’t good safe havens.
Byron Wien Reveals Surprises For 2013 (Business Insider)
Byron Wien has published his 10 surprises for 2013 that have an over 50 per cent probability of happening, and that are bearish for American investors. These surprises include the S&P falling below 1,300, crude oil tumbling to $70 a barrel, the Shanghai Composite surging over 20 per cent on reforms and steady growth in China.
New Book ‘Pound Foolish’ Slams The Financial Advice Industry (Investment News)
Pound Foolish the latest book by Helaine Olen slams the financial advice industry. Olen argues that advisers aren’t usually on the side of their clients, lambasts “personal finance-celebrities”, and writes that the rise of the industry has come hand in hand with a stagnation in salaries, poor pensions and the rising cost of education and health care.