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Showing posts from August, 2014

Stock market bubble warnings grow louder

By Matt Egan

Some of the brightest minds in finance are sounding the alarm about a stock market bubble. They aren't warning of an imminent crash, but their comments should remind investors that the current bull market -- over five years long -- can't last forever.

1. Nobel Prize-winning economist Robert Shiller: Valuations at "worrisome" levels.

"The United States stock market looks very expensive right now," Robert Shiller wrote in a recent column for The New York Times.

Shiller, a Yale University professor who is often cited as one of the most influential people in economics and finance in the world, created a metric that compares stock prices with corporate profits. The metric recently climbed above 25. That level has only been surpassed three times since 1881: 1929, 1999 and 2007.

Steep market tumbles followed each instance, including the bursting of the dotcom bubble in the early 2000s. The Nasdaq still hasn't fully recovered from that me…

Smart investors ignore the news

Chuck Jaffe You can read the headlines, just don’t trade on them If the market is making your head swim, you may be able to solve the problem by turning off, tuning out and dropping out of the 24-hour news cycle. 
That’s an odd suggestion coming from someone who works in the media, but what makes it doubly strange is that it’s prompted in part by the website I trust like no other, MarketWatch.com. Beyond simply being my employer, I trust the site because I know personally the quality people and journalists my fellow staffers are. 
But, last month, MarketWatch set a site record for the number of unique visitors to its news pages, which set me to wondering what kind of messages we were sending to both new and increasingly active visitors at a time when they were presumably drawn in looking for some measure of market guidance to calm their nerves or keep them on top of the financial news. 
In the old days of newspapers, I would have gone through a s…

The Recession's Over: Clean Your Financial House and Win

If you were an operations leader during the 2008 Financial Crisis and deep ensuing recession, you probably spent a lot of time on the phone like I did, literally begging vendors and business partners not to cancel credit lines or change payment terms vital to keeping a business afloat.

If that's the case, none of us were alone as total credit market debt held by American businesses peaked in 2008; contracting by $247.7 billion in 2009, the worst year of the downturn; not reaching 2008's levels again until 2011 or 2012.

So what happens when nearly a quarter of a trillion dollars in business credit is siphoned out of the economy in one year, customers pay you slowly for past business, banks stop lending, and customers stop buying new products?

Welcome to the world American COO's, CFO's, and CEO's faced just a few years ago: a period of intense struggle and fight or flight mode for many of us.

Thankfully, business lending regained traction, increasing fr…