Sam Zell: “The Stock Market Feels Like The Housing Market Of 2006”
Zerohedge has pulled out some choice quotes from a CNBC interview with Sam Zell and David Rosenberg
Rosenberg: “Not surprising the market rises even in the face of bad ISMs, worse jobs, and worse NFIB data, because Japan and the US are embarking on a gargantuan quantitative easing that is the linchpin behind the stock market.”
Zell: “We’re debasing our currencies around the world.. which ultimately translates into a lot of inflation.”
Zell: “What we are seeing here is like a giant tsunami of liquidity.”
Zell: “The current stock market feels like the housing market of 2006. Everybody can’t afford to miss it.”
Zell: “We are suffering through another irrational exuberance.”
The interview is a great watch and fairly short at 7 minutes long.
Bankable Insights: Overcoming Anxiety Is Key to Investment Success
Anxiety and fear of loss cause investors to make irrational decisions within markets. Investors have a herd mentality, if everyone is selling, they need to sell too, before they lose any more of their investment. Taking control of your emotions during the investment process can be one of the more rewarding experiences (financially and emotionally) an investor can have. The CFA Institute’s blog has a nice rundown on some of the lessons we can learn about emotional investing.
Increase in Participants Taking Loans from Their 401(k) Plans, Wells Fargo Finds
During Q4 2012, the number of individuals taking loans from their 401(k) increased by 28% and the average loan balance increased by 7%. Most of the participants taking loans tend to be older, however younger participants that are taking loans take out a higher percentage of their account. Please, only take a loan from your 401(k) as a last resort, as the opportunity cost is very high.
Permanent? That’s Five Years Under Obama Estate Tax Plan
Planners nationwide breathed more easily after the fiscal cliff deal. Congress prevented the estate tax exemption from reverting back to $1 million and the tax to 55%. Instead they maintained the exclusion at $5 million, indexed it to inflation, and only raised the estate tax to 40% from 35%. President Obama’s new proposal would renege on that deal. A lower exclusion that is not inflation-indexed will start to hit more and more individuals as inflation takes its toll. This is another method by which Congress hopes to stealth-tax the upper middle class.
Leaked Fed Minutes Sparks New Concern About Secret Distribution List
The Fed minutes are one of the most watched economic releases in the world. The Fed’s interventionist policies have a huge impact on the economy, therefore the minutes of the Fed’s meetings are market moving. This week, an early leak of the Fed’s minutes has led many to ask if the Fed may have a separate distribution list for lobbyists and privileged firms. It will be interesting to see what is uncovered in the coming months. This is either a massive scandal or an egregious error by the Fed.