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@theMarket: Markets Celebrate Fourth of July
By Bill Schmick,
10:43AM / Friday, July 03, 2020
The continuing gain in jobs cheered equity markets on Thursday, just before the holiday weekend. Given the surge in virus cases in more than half of the United States at the same time, some investors were dumbfounded. They just don't get it.   The nation added 4.8 million jobs in June, which was better than expected. It was the second month in a row that the employment data surprised investors by beating expectations. Remember, however, that this data is backward looking. The bounce back in the economy as a result of re-opening businesses resulted in these upside labor surprises. Readers should expect those employment gains to moderate next month for some obvious

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The Retired Investor: Big Banks & Big Brother
By Bill Schmick,
04:43PM / Wednesday, July 01, 2020
It is an interesting time for bank stocks. In the aftermath of two federal regulatory actions last week, the money-center banks are becoming more public than private institutions.   First the good news. Federal banking regulators announced that they are relaxing provisions of the Volcker Rule, which was an important part of the Dodd-Frank Act of 2010. Readers might recall that act was passed in the aftermath of the financial crisis. It was meant to prevent another "too big to fail" scenario within the nation's banking system.   A key provision of the act prevented banks from using their own funds to invest in risky assets such as derivatives,

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@theMarket: The Virus Versus the Fed
By Bill Schmick,
05:22PM / Friday, June 26, 2020
Bulls and bears are in a tussle. Market averages reflect the battle that is moving stocks down, up, and then sideways throughout the week. It is a phase where investors are in a data-dependent mood and the data isn't all that good.   The bears are watching the COVID-19 cases climb higher every day, which threatens to trash their expectations for a "V" shaped recovery. The bulls, meanwhile, aren't too worried. They are banking on the Federal Reserve Bank's promises to keep pouring added stimulus support into the financial markets just in case the virus pushes the economy further toward the brink.   It did not have to be this

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The Retired Investor: Corporate Debt & the U.S. government
By Bill Schmick,
11:12AM / Friday, June 26, 2020
The pandemic and its impact on the American economy required a drastic response from both the federal government and the Federal Reserve Bank. One of the most controversial, but necessary, steps taken by the Fed was to not only purchase private-sector debt, but implicitly guarantee that debt.   In addition, both fiscal and monetary stimulus has been pouring into the economy in an effort to defend jobs and stave off bankruptcy for thousands of small businesses. While some worry about the inflationary effects this may have down the road, the attitude of most economists is that we will worry about that later, if it becomes a problem.   In my last column, I

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The Retired Investor: Inflation, a Factor to Forget?
By Bill Schmick,
12:12AM / Friday, June 19, 2020
It has been a long time since we have seen a rise in the inflation rate of any magnitude. As a result, most investors have largely dismissed inflation as a near-term concern. But that doesn't mean we have vanquished this troublesome variable from the financial equation forever.     There is a reason that inflation fears have subsided. Ever since the Financial Crisis, when central banks and governments dumped trillions of dollars into the world's economies, investors feared that all this money would re-ignite the inflation fire. It didn't happen. Instead, the inflation rate moderated, and in some countries began to drop. Rather than worry about

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