Global Debt and the Risk to Capitalism

The Federal Reserve Open Market Committee issued its interest rate decision Wednesday afternoon,deciding to leave rates unchanged for now,and anticipating only two rate hikes this year,rather than four.They are not actively considering negative interest rates,unlike the European Central Bank,which has just implemented them.*
Markets and central banks globally are beginning to realise that there are negatives to negative interest rates,responded Bill Gross of Janus Capital Management,portfolio manager of the Janus Global Unconstrained Bond Fund and co-founder of PIMCO.It's a more dovish Fed.The Fed is still way above the market.Treasuries are fully priced at these levels.The Fed is connected to the stock market,but I don't think they're responsive to rates being at zero.It's a negative for the finance industry,for pensioners and for savers.They can't earn as much as they should.*
I think,to a certain extent,capitalism is at risk.It doesn't break down,but at the margin,it's hindered and it's hampered.The long term effect basically hampers investment by institutions like insurance companies.*
I think the Fed has an historical sense that Fed Funds should be at 3 or 4%.The real problem is,the tremendous amount of debt in the global markets.When debt gets up to a substantial level,things can de-lever.It's debt that has come to the forefront the past several years in the global economy,and that's what we need to worry about.*
An economy can't grow very fast if wages can't grow more than .6%.I think TIPS are a decent value,to the extent the Fed will reach their 2% inflation target.*
iShares TIPS Bond ETF (TIP),Janus Global Unconstrained Bond Fund;A (JUCAX)

Searching For Yield:Bank Loans,Gold and IBM

We think ultimately rates are going to be heading higher,said Mark Kiesel,PIMCO CIO and co-manager of the firm's iconic income fund,the Total Return Fund.You're better off investing in bank loans at 4-5% yield.You're not going to get that with bonds today.It's also a sign of global disinflation.With bank loans,you're investing in a structure that protects you.MGM and Hilton are offering 4-5% on bank loans.
As of 9-26,we've outperformed about 90% internationally at the Total Return Fund.TIPS,or Treasury Inflation-Protected Securities,are very cheap,favouring international markets like Brazil and Mexico.We have a great story at Total Return Fund.
Morningstar Associates gives the Total Return Fund three out of four stars and considers it to be world class.
Bank loans in the form of mortgage-backed securities are commonly in the portfolios of income funds,including the Total Return Fund.*
Most of the damage done by the Swiss central bank,which of a sudden lifted a three-year-old cap on the Swiss franc, probably occurred in retail debts.I don't think there will be anything untoward that happened to US banks.I think it just causes greater disrespect for central banks generally,said Dennis Gartman,editor of The Gartman Letter.
I've been long gold and short euros,and that's been very beneficial.I see no reason to think that strong gold's going to change.The Swiss move is going to be detrimental to their currencies and strong to gold.*
IBM reported earnings per share of 5.81,in line with the estimate.Revenue was 24.11 billion,falling a bit short of the 24.77 billion estimate.Currency fluctuations and divestitures hurt their revenue.I think it's a step in the right direction,said Daniel Ives of FBR Capital Markets.Can this company succeed in the cloud?The outlook going forward is really the elephant in the room for investors.Given the playbook,it's about IBM giving investors comfort in the cloud transition.*
PIMCO Total Return Fund Class A(PTTAX),International Business Machines(IBM),Market Vectors Gold Miners ETF(GDX)