Outside the Box, June 2006


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The Leverage in the System and the Weak US Dollar

June 26, 2006

In my Friday letter, "Thoughts from the Frontline," I touched briefly on the Yen Carry Trade and its effects on asset prices. Just what should investors be concerned with and profit from in a market bent on volatility and anchored by a new seat at the Fed? My good friends at GaveKal have written an excellent and timely article on global liquidity and its implications for the markets.

Charles and Louis-Vincent Gave, along with Anatole Kaletsky, are each co-founders of GaveKal, a global...

Deflating The Housing Bubble

June 19, 2006

With so many variables to weigh in on, there has been a lot of speculation going around about how Fed Chairman, Ben Bernanke, is going to fare in his rookie season. The headlines of the financial press have been filled with reports of inflation and the dollar, but what of the U.S. housing market that once demanded so much investor attention?

This week's letter is from Paul Kasriel of The Northern Trust Company. Kasriel is Senior Vice President and Director of Economic Research, responsible for...

The Perfect Value Investor

June 12, 2006

With several of the market averages racking up significant declines, many are starting to wonder if this recent drawdown will present some value opportunities. My good friend James Montier has constructed an insightful study on the characteristics of value investing.

For those who are unacquainted with Mr. Montier, he serves as the Director of Global Strategy at Dresdner Kleinwort Watterstein, a London and Frankfurt based investment bank. He is also a prolific writer and author of the book...

Moral Hazards

June 5, 2006

Any time a central bank speaks there are scores of investors lined up and waiting to listen. Each is interested in any number of tidbits that might have a plethora of implications affecting his positions and portfolio. Even after the long-winded speeches and discussions, that action does not stop as investors continue to try and anticipate the next set of policies.

My readers are well aware of how keen I find the writing to be of Paul McCulley, managing director of PIMCO. In his global central...