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Company
All Companies 3Com Corp. 3M Co Aaron’s Inc. Abertis Infraestructuras Abitibi Consolidated Inc. Absolute Invest Ltd. Absolute Private Equity Accelerate Diagnostics Access Flex Bear High Yield fund Accuride Corporation Ackerman & van Haaren Actavis plc. Adams Natural Resources Fund Inc. Adecoagro S.A. Advanced Micro Devices AdvisorShares Ranger Equity Bear ETF AerCap Holdings NV AES Corp. Aetna Africa Opportunity Fund Agco Corp. AGNC Investment Corp. Agnico-Eagle Mines Aioi Insurance Airborne Freight Corp. AK Steel Holding Corp Akamai Technologies Akenerji Elektrik Uretim A.S. Alaska Milk Alcoa Alexander & Baldwin Alibaba Group Holding Ltd Allergan Inc. Alliance Holdings GP Alliance Resource Partners LP AllianceBernstein Income Fund Allied Capital Corp. Allison Transmission Holdings Inc. Alon USA Altice N.V. Altria Group Amazon.com Ambac American Banknote Holographics American Electric Power American Greetings Corp. American International Group Ameriprise Financial Ameritrade Holding Corp. AMR Corp. Amrep Corp. AMVIG Holdings Anglo American Plc. Anglogold Anheuser-Busch InBev S.A./N.V. Annaly Capital Management Antero Midstream Partners L.P. Anthracite Capital Antofagasta Holdings AP Alternative Assets LP Apex Mortgage Capital Apollo Commercial Real Estate Finance Inc Apollo Global Management Apple Aradigm Corp. ArcelorMittal Arch Capital Group Arch Coal Ares Capital Corp. Arkema Arrow Global Group plc. Ascena Retail Group Ashtead Group plc Asia Pulp & Paper Co. Asset Acceptance Capital Corp. AT&T Inc. athenahealth Atlas Mara Co-Nvest Ltd. ATP Oil & Gas Corp. Atwood Oceanics Aurora Investment Trust plc Australia & New Zealand Banking Group AutoZone Avance Gas Holding Avianca Holdings SA Avid Technology Inc. Avon Products Axis Capital Holdings B3 S.A. - Brasil Bolsa Balcao Babcock & Wilcox Co. Badger Meter, Inc. Ball Corp. Banca Carige S.p.A Banco Bilbao Vizcaya Argentaria SA Banco Bradesco S.A. Banco de Chile Bancolombia SA Bank of America Bank of Greece Bank of New York Mellon Bank of Nova Scotia Bank of Queensland Banque Nationale de Belgique Barclays PLC Barrick Gold BASF SE Bayerische Motoren Werke AG BB&T Corp. Bear Stearns Beazer Becton Dickinson and Co. Beijing Capital International Airport Berkshire Hathaway Inc-Cl A Berry Global Group, Inc. Best Buy BHP Billiton BHP Billiton Ltd. Bitcoin Investment Trust BJ’s Wholesale Club BlackRock BlackRock California Municipal Income Trust BlackRock MuniHoldings New York Quality Fund BlackRock MuniYield Michigan Quality Fund Blackrock MuniYield New York Quality Fund BlackRock MuniYield Pennsylvania Quality Fund Blackrock MuniYield Quailty Fund BlackRock Taxable Municipal Bond Trust Blackstone Group L.P. Blackstone Mortgage Trust Blackstone/GSO Senior Floating Rate Term Fund Blackstone/GSO Strategic Credit Fund Bladex S.A. Blount International Inc. Blue Sky Alternative Investments Ltd. BNP Paribas Boardwalk Pipeline Partners Boeing BOK Financial Boulder Brands British American Tobacco Plc. Brookfield Property Partners, LP Bunge Ltd. Burger King Worldwide BW LPG C&J Energy Services Inc. C.B. Richard Ellis Cabot Oil & Gas Cairn Energy Cairn India Ltd. Calamos Convertible Fund Calavo Growers Calpine Corp. Cameco Cameco Corporation Campbell Soup Co. Canadian Apartment Properties Real Estate Investment Trust Canadian Imperial Bank of Commerce Canadian National Railway Co. Canadian Pacific Railway Ltd. Capital & Counties Properties plc Capital One Financial Corp. Capstead Mortgage Corp. Carlyle Group CarMax Inc. Carnival Cruise Lines Carrefour S.A. Carter’s Inc. Casino Guichard Perrachon SA Castle Private Equity AG Catalyst Biosciences, Inc. Caterpillar CBL & Associates Properties CBRL Group Celgene Corp. Central Securities Corp. Ceradyne Charles Schwab Charter Communications Chevron Corp. Chimera Investment China Cinda Asset Management Co. China Coal Energy Co. China Construction Bank China International Travel Service Corp Ltd China National Chemical Corp. China Shenhua Mining China Vanke Christopher & Banks Corp. Chuck E. Cheese Brands Inc. CIT Group Citigroup Clean Energy Fuels Corp. Clean Harbors, Inc. Cleveland-Cliffs Inc. CME Group CNA Financial Corp. CNH Global N.V. CNX Gas CNX Resources Corp. Coca-Cola Co. Coeur d’Alene Mines Corp. Comerica Commercial Metals Co. Commonwealth Bank of Australia Companhia Vale do Rio Doce CompuCredit Holdings Corp. Comverse Technology Con-way ConAgra Foods Concentradora Fibra Danhos SA de CV Concentradora Fibra Hotelera Mexicana SA de CV Conn’s Inc. CONSOL Energy Consolidated-Tomoka Land Co. Constellation Software Inc. Contura Energy Inc. Conversus Capital Copart, Inc. Copperbelt Energy Corp plc Coronado Biosciences Corporate Travel Management Ltd. Costco Wholesale Countrywide Credit Industries Cousins Properties Inc. Credicorp Ltd. Credit Suisse Group CreXus Investment Corp. CrossingBridge Low Duration High Yield Fund CSX Corp. Cullen/Frost Bankers Customers Bancorp, Inc. CVS Caremark Daishi Bank Danske Bank A/S De La Rue plc Deere & Co. Delek Logistics Partners L.P. Dell Computer Delta Air Lines Destination Maternity Detour Gold Corp. Deutsche Bank Deutsche High Income Opportunities Fund Deutsche High Income Trust Devon Energy Dex One Corporation Diamant Art Corp. Diamond Foods Inc. Diamond Resorts International DineEquity Dixons Carphone plc Dogan Gazetecilik A.S. Dole Food Dollar General Dollar Tree, Inc. Dorian LPG Ltd. Dorman Products DoubleLine Income Solutions Dow Chemical Downey Financial Corp. Duke Realty Corp. Eagle Bulk Shipping Inc. Eagle Point Credit Co. Inc. Eaton Vance Municipal Bond Fund Eaton Vance New York Municipal Bond Fund Eaton Vance Senior Income Trust ECA Marcellus Trust I El Paso Pipeline Partners Electrobras S.A. Eli Lilly & Co. Ellie Mae Inc. Emerald Oil, Inc. Emerson Electric Co. Emmis Communications Corp. Empresa Nacional de Telecomunicaciones SA, ENTEL Enbridge, Inc. Endo International Plc Energias de Portugal SA ENI S.p.A Ensco plc. Enstar Group Ltd. Enterprise Products Partners L.P. EOG Resources Epicor Software Corporation Equitable Group Inc. ETRACS Fisher-Gartman Risk off ETN ETRACS Fisher-Gartman Risk on ETN Euronav NV European Aeronautic Defense and Space Co. Everbridge Inc. Evercore Partners Inc. Evotec S.E. Exide Technologies Exor SpA Expedia ExxonMobil Facebook FactSet Research Systems Fairfax Financial Holdings Fairfax India Holdings Corp. Fairway Group Holdings Fannie Mae Farmer Mac Farmland Partners Inc. Fastenal Co. FedEx Corp. Fiat S.p.A. Fibra Uno Fidelity & Guaranty Life Fidelity National Financial Fifth Street Finance Corp. Fifth Street Senior Floating Rate Corp. Financial Engines First Eagle Gold Fund First Financial Bancorp. FirstFed Financial Corp. Fleetwood Corp. Flowserve Corp. Fondual Proprietatea Ford Forest City Enterprises Forestar Group Fortescue Metals Group Ltd. Fortress Investment Group Fosun International Ltd. Foundation Coal Holdings Franco-Nevada Franklin Resources Fred. Olsen Energy ASA Freddie Mac Freeport-McMoRan Copper & Gold Freescale Semiconductor Fresh Del Monte Produce Fresnillo Frontier Communications Corp. Frontline Ltd. FTSE/Xinhau China 25 Index FXCM Inc. Gannett GATX Corporation Gazprom OAO Genco Shipping & Trading Limited General Cable Corp. General Electric General Motors General Shopping Brasil S.A. Genesee & Wyoming Inc Glencore PLC Global X Uranium ETF Gold Fields Ltd. Gold Reserve Act of 1934 Goldcorp Goldcorp Inc. Goldman Sachs Group Golub Capital Goodrich Petroleum Google Great Northern Iron Ore Properties Greenbrier Companies Greenhill & Co. Greif Inc. GrubHub Inc. Grupo Financiero Galicia Grupo Nutresa SA Gunes Sigorta A.S. H&R Real Estate Investment Trust Haier Co. Ltd. Halcon Resources Hallador Energy Co. Hamilton Lane, Inc. Hancock Holding Co. Hanesbrands Inc. Hang Seng Bank Ltd HarbourVest Harman International Hatteras Financial Corp Heartland BancCorp Heartland Value Fund Hecla Mining Co. HEICO Corp. Helen of Troy Ltd. Hercules Capital Inc. Hewlett-Packard Hochschild Mining Home Capital Group Home Depot HomeAway Honam Petrochemical Horsehead Holding Corp Horsehead Holding Corp., Hospira Howard Hughes Corp. Hudson Pacific Properties Inc. Humana Inc. Hunter Douglas Huntington Bancshares Hyundai Motor Hyundai Motor Co., preferred IBM Icahn Enterprises L.P. ICICI Bank Iconix Brand Group Infosys InRetail Peru Corp. Intelsat SA Intercontinental Exchange Interest Rate Volatility and Inflation Hedge ETF International Bancshares Corp. International Paper International Seaways, Inc. Intesa Sanpaolo SpA Inversiones y Representaciones S.A. Invesco Senior Loan ETF Invesco Value Municipal Income Trust Investment Quality Municipal Trust Invitation Homes, Inc. Iron Mountain, Inc. Ironwood Pharmaceuticals iShares Floating Rate Bond ETF iShares iBoxx $ High Yield Corporate Bond Fund iShares iBoxx $ Investment Grade Corporate Bond Fund iShares International Treasury Bond ETF iShares J.P. Morgan EM Local Currency Bond ETF iShares JP Morgan U.S. Dollar Emerging Markets Bond ETF iShares National Muni Bond ETF iShares New York Muni Bond ETF iShares Russell 2000 Value ETF iShares Silver Trust Isis Pharmaceuticals iStar Financial IWG, PLC J.B. Hunt Transport Services J.C. Penney J.G. Wentworth Inc. J.P. Morgan Chase Jazz Pharmaceuticals PLC JB Hi-Fi Ltd. Jefferies Group John B. Sanfilippo & Son, Inc. Johnson & Johnson Joy Global JZ Capital Partners Kala Pharmaceuticals Inc. Kansas City Southern KapStone Paper and Packaging Corp. KBR Inc. Kerry Group plc Keryx Biopharmaceuticals Keurig Green Mountain Keycorp Kilroy Realty Corp. Kimberly-Clark Kinder Morgan Energy Partners Kinder Morgan Inc. Kinetic Concepts Kinetsu Corp. Kirkland Lake Gold Ltd. KKR & Co. LP Klondex Mines Knight Capital Group Kohl’s Corp. Kone OYJ Koppers Holdings Korean Preferred Stocks Kraft Heinz Co Kroger Co. Kulicke & Soffa Lancaster Colony Corp. LandAmerica Financial Group Lanxess Lawson Software Lazard Ltd. Legg Mason Value Leggett & Platt Lehman Brothers LendingClub Lennar Corp. Leo Holdings Corp. LifeLock Ligand Pharmaceuticals, Inc. Light S.A. Lincoln National Corp. LinkedIn Corp. Linn Energy Lloyds Banking Group Loews Corp. Loma Negra Companía Industrial Argentina S.A. Lowes Companies Lufkin Industries Lukoil OAO Lumber Liquidators Holdings Luxottica M&T Bank Mack-Cali Realty Corp. Macquarie Group Limited Macy’s Inc. Manitowoc Co. MannKind Corp. Manulife Financial Market Vectors Agribusiness ETF Market Vectors Gold Miners ETF Market Vectors Russia ETF MarketAxess Holdings Inc. Marks & Spencer plc Marmara Capital Equity Fund MasTec Inc. Mastech Holdings Matthews International Corp. MBIA Inc. McDermott International McDonald’s Corp. MCG Capital Corp. Medallion Financial Corp. Medtronic Merrill Lynch Merrimack Pharmaceuticals, Inc. Metal Constructions of Greece (Metka) Methanex Corp MetLife Metropolitan West Low Duration Bond Fund MF Global holdings MFA Financial Inc. MGIC Investment Corporation MGM Energy Michael Kors Holdings Microsoft Microsoft Corp. Midas Gold Corp. Middleby Corp. Millicom International Cellular Minefinders Mitsubishi Corp. Mitsubishi UFJ Financial Group Moderna, Inc. Moelis & Co. Molson Coors Brewing Company Monadelphous Group Mondelez International Inc. Monmouth Real Estate Investment Corporation Monsanto Co. Moody's Corp. Morgan Stanley Morgan Stanley China Morgan Stanley Emerging Markets Domestic Debt Fund Mosaic Company Moscow Exchange MSC Industrial Direct Co. Muzinich Low Duration Fund MVC Capital Mytilineos Holdings Nanto Bank Nasdaq Biotechnology ETF Index Natco Group National Australia Bank National City Bank National Commercial Bank National Oilwell Varco National Retail Properties Nautical Petroleum plc Nestle SA Netflix Inc. Nevsun Resources New Fortress Energy LLC New Gold Newcrest Mining Ltd. Newfield Exploration Newmont Mining Nielsen Holdings plc Nike Nippon Active Value Fund Nissay Dowa General Insurance Nordea Bank AB Nordic American Tankers Ltd. Nordstrom Norfolk Southern Corp North Atlantic Drilling Ltd. Northern Dynasty Minerals Northern Trust Corp Northgate Minerals NovaGold Resources NOW Inc Nucor Corporation Nuveen Build America Bond Fund Nuveen Build America Bond Opportunity Fund Nuveen Floating Rate Income Fund Nuveen New York AMT-Free Municipal Income Fund Nuveen New York Dividend Advantage Municipal Fund Nuveen North Carolina Quality Municipal Income Fund Nuverra Environmental Solutions Nvidia Corp. NVR Inc. Nyrstar Oasis Petroleum Inc. Occidental Petroleum Corporation Ocean Bio Chem Ocean Rig UDW Oculus Innovative Sciences Okomu Oil Palm Plc Olin Corp. Ollie’s Bargain Outlet Holdings Inc. On Deck Capital Oneok, Inc. Opko Health Orezone Resources Orient Overseas International Ormat Technologies, Inc. Osisko Mining Owens-Illinois Oxford Lane Capital Corp. Oxford Square Capital Co. Packaging Corp. of America Pactiv Corp. Pan American Silver Par Pacific Holdings Paragon Offshore Paramount Resources Ltd. Parapet 2006 Paris Orleans SA Parkway Inc. Parsley Energy Inc. Party City Holdco Inc. PDL BioPharma Peabody Energy Corp. Peapack-Gladstone Financial Corp. Pennsylvania Real Estate Investment Trust PepsiCo Petroleo Brasileiro SA PG&E Corp. Pharmaceutical Product Development PHH Corp. Phillip Morris Phillips 66 Pico PIMCO Dynamic Credit Income Fund Ping An Bank Co. Ping An Insurance Group Co. Pioneer Natural Resources Co. Plum Creek Timber PNC Financial Services Popular, Inc. Post Holdings Inc. Potash Corp. of Saskatchewan Potlatch Corp. Power Finance Corporation PowerShares DB G10 Currency Harvest Fund PowerShares Variable Rate Preferred Portfolio ETF Prada SpA Precision Castparts Corporation Pretium Resources Principal Financial Group Procter & Gamble Progress Energy Resources Progressive Corp. Prologis Inc. Property REIT, Inc. Prosensa Holding ProShares UltraShort Lehman 20+ Treasury Prospect Capital Corp. Prosperity Bancshares Public Storage PutleGroup Qualcomm Inc. Quest Diagnostics Quicksilver Rackspace Hosting Radian Group RadioShack Corp Raiffeisen International Ralcorp Holdings Inc. Range Resources Rayonier Inc. Raytheon Co. Realogy Holdings Corp. Realty Income Corp. Redwood Trust Regions Financial Reis Inc. Reliance Industries Ltd. Repros Therapeutics Republic Services Inc. Research in Motion Resolute Energy Restaurant Brands International Inc. Restoration Hardware Holdings Richemont SA Rio Tinto Ltd. Rite Aid Rosneft OAO Rowan Companies Royal Bank of Scotland RWE AG S.A., Public Power Corp SA des Ciments Vicat Salvatore Ferragamo SpA Samsung Electronics Sangamo BioSciences Santander Consumer USA Sarepta Therapeutics Sberbank Schindler Holding AG Schlumberger Schweitzer-Mauduit International SCOR SE Seacor Holdings Seadrill Ltd. Sears Holdings SemGroup Corp. Service Corp. International Shake Shack Inc. Shaw Group Sherwin-Williams Ship Finance International Ltd. Shizuoka Bank Sichuan Expressway Signature Bank Signet Jewelers Ltd. Sime Darby Simon Property Group Singapore Airlines Sino Gold Mining SL Green Realty Corp Smithfield Foods Snap-on Inc. Societe Generale Societe Internationale de Plantations et de Finance SoftBank Group Corp. Solar Capital Ltd. SolarCity Corp. Sotheby's Southern National Bancorp of Virginia Southwest Airlines Southwestern Energy SPDR Barclays Capital High Yield Bond SPDR Bloomberg Barclays Investment Grade Floating Rate ETF SPDR Gold Shares Spirit AeroSystems Holdings Inc. Springleaf Holdings Sprint Corp. Sprott Gold Equity Fund Sprott Physical Gold and Silver Trust Sprouts Farmers Market Square Inc. St. Joe Company STAG Industrial Starwood Property Trust State Street Corp. Steel Dynamics Strongbridge Biopharma plc. Sumitomo Mitusi Financial Suncor Energy Inc. Sunrun Inc. Suntech Power Holding SunTrust Banks SuperMedia Surgutneftegas SVB Financial Group Swiss National Bank Syneron Medical Ltd. Syngenta AG T.Rowe Price Group Tahoe Resources Target Corp. Tata Motors Ltd. TCW Total Return Bond Teck Resources Teekay Tankers, Ltd. Tejon Ranch Company Templeton Emerging markets Income Fund Templeton Global Income Fund Teranga Gold Tesco plc Tesla Motors Teva Pharmaceutical Industries Ltd. Texas Capital Bancshares Texas Pacific Land Trust TGR Financial , Inc. The Fresh Market The Intertain Group Ltd. The Williams Companies, Inc. THL Credit TICC Capital Corp. Tidewater Inc. Tiffany & Co. Tile Shop Holdings Time Warner Cable Tocqueville Gold Fund Tower Hill Mines Ltd. TransDigm Group Inc. Transocean Ltd. Transportadora de Gas del Sura SA Treasury Wine Estates Trinity Industries Tupperware Brands Turkish Airlines U.S. Bancorp U.S. Filter Uber Technologies, Inc. UBS UBS AG Ultra Petroleum UltraShort FTSE/ Xinhau China 25 Proshare Under Armour Unifi Union Pacific Corp. United Company Rusal United Continental Holdings United Rentals Inc. United Technologies Unum Group Uranium Participation Corp. Valeant Pharmaceuticals International VanEck Vectors AMT-Free Long Municipal Index ETF Vanguard Value ETF Vapor Corp. Verizon Communications Viking Therapeutics, Inc. Vodafone Group Vornado Realty Trust W.R. Berkley Corp. W.W. Grainger Wal-Mart de Mexico SAB de CV Wal-Mart Stores Walgreen Walt Disney Co. Walter Investment Management Corp Wasatch Small Cap Value Fund Wasatch-Hoisington U.S. Treasury Fund Washington Federal Washington Mutual Inc. Waste Connections Waste Management Weiss Korea Opportunity Fund Wells Fargo & Company Wells Fargo Short-Term Municipal Bond Fund Class A Wendy’s Western Asset Emerging Markets Debt Fund Western Asset Global Corporate Defined Opportunity Fund Western Asset High Yield Defined Opportunity Fund Western Digital Corp. Western Refining Western Union Company Westfield Group Westlake Chemical Corp. Westlake Chemical Partners LP Westpac Banking Corp. Westshore Terminals Weyerhaeuser Corp. Whirlpool Corp White Mountains Insurance Group Whole Foods Market Williams-Sonoma Windstream Holdings WisdomTree Dreyfus Brazilian Real WisdomTree Dreyfus Chinese Yuan WisdomTree Dreyfus Indian Rupee Woodford Patient Capital Trust plc Wright Medical XTO Energy Yahoo! Yamana Gold Yandex NV YPF S.A. Yum! Brands Inc. Zillow, Inc. Zion Oil & Gas Inc. Zoomlion

December 16, 1994, Vol. 12, No. 24

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Colliding weather fronts

Heightening the meteorological drama in the waning days of 1994 is a change in the political winds. We can be sure that the political winds are changing because the President of the United States is rewriting his speeches.

Turtle buys bills

William Michaelcheck was a senior executive of Bear Stearns Cos. in 1991 when he warned against the burgeoning speculation in government securities....

Trash is cash

The Sanitation Department is fighting to keep people from stealing garbage....Recyclable trash means cash these days.

Gold fantasy, 1995

An owner of gold mining stocks has a dream for the new year: a derivatives fiasco in which the world's central banks... have positioned themselves against a rising gold price. When a new bull market erupts, our man contends, the central banks will lose both face and money, and the losses of the paper currencies will be gold's gain. It is his holiday thought.

Used tissue paper

Fort Howard, the Green Bay (Wis.)-based leader in the "away-from-home" segment of the domestic tissue market (the sneezing-out market?), wants to recapitalize itself. It is proposing to raise $345 million in new equity and $1.3 billion in additional credit facilities and term loans.

On planet Tokyo

Last Friday's rescue of a pair of failing Japanese credit unions by the Bank of Japan made history: They were the first financial institutions since Yarnaichi Securities in 1965 to be plucked from the brink by the central bank itself. The intervention will prompt a new round of questions from enquiring readers about post-bubble Japan....

Closed-end leverage

Like fraternal twins, any two closed-end bond funds may look the same without being the same. Many of them are leveraged, but there are varieties of that: straight debt, reverse repurchase agreements, commercial paper, preferred stock, etc. Furthermore, the assets that a fund has borrowed to acquire may or may not be tailored to the debt employed...

Braver stands pat

"King of carry," published in the Dec. 3, 1993, Grant's, was the story of David Braver, the man who had devoted his career to leveraged bond investment. A year ago, he was buying seven-year mortgages yielding 7.15% with three-month debt costing 3.26%. Now he is not, of course....

Nuggets in the flow of funds

In counterpoint to the page one essay about financial contraction, Mergers & Corporate Policy reports a breakthrough in the direction of innovation and bravery: "A new financial firm, Greenfield Financial Advisors, is promoting the mostly untested use of capital raising secured through intangible assets," the newsletter writes.

December 2, 1994, Vol. 12, No. 23

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Misery for one and all

In financial-market terms, 1994 has been a four-season non sequitur.

Margin call central

Everyone, the bears especially, must remember that all bad things come to an end. One of these days, the last regional bank will kick the last los­ing lot of short-dated government notes out of a sealed, upper-story window.

Bull market baby

United Asset Management, Boston-­based collector of money-management firms, made its first acquisition in 1983. It added its 41st and 42nd affiliates in 1994.

Passing the torch

On November 16, Chase Manhattan Corp. announced its entry into the hedge-fund business because its wealthy clients were "clamoring" for it, the American Banker reported. ...

Bullish on the flu

What the cough-and-cold economy demands is low temperatures and falling costs. What it has been presented with this autumn is across-the-board levitation: in plastics, cardboard, copper, electric motors and average temperatures.

Tight squeeze

The looming shortage of vaporizer parts wouldn't worry even a bond­holder unless it were the tip of some macroeconomic iceberg. People doubt that it is, because, in the first place, the American productive apparatus is increasingly service-oriented....

Torture by rates

At about six times earnings and about one times book value, the publicly traded brokerage firms had better not represent the cutting edge of stock­market valuation. If the blue chips were valued as Wall Street is valued already, the Dow Jones Industrial Average would stand (or lie prostrate) at something like 1,300.

Fannie Mae and us

The Federal National Mortgage Association wrote to protest the characterization of its finances in our last issue. ...

World turned upside down

Preceding Tuesday's announcement that Fidelity's stock-market customers have rediscovered money-market mutual funds was the news that banks have rediscovered lending.

November 18, 1994, Vol. 12, No. 22

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Bliss is a short sale

The winner of last week's midterm elections was not so much the GOP as the composite editorial-page program of Barron's, Investor's Business Daily and The Wall Street Journal. On the day before the election, capital-gains tax relief was a gleam in a partisan eye. Twenty-four hours later, it was a looming piece of federal legislation.

Interest rates deluxe

Gordon W. Ringoen, a San Francisco investor, appeared at the Grant's conference in New York last week as a prophet and seer. He shared his latest thinking on interest rates, inflation, the yield curve and the great American institution of financial leverage.

Jesse Livermore lives

The government bond market is unregulated as to margin requirements. The stock market, an experienced reader called to insist, might as well not be. Regulation "T," he said, echoing a theme sounded in the last issue, is a dead letter for the sophisticated, leverage-seeking investor.

Values Worldwide

The name of Benjamin Graham was invoked early and often at last week's Grant's conference. Michael Katz, hedge-fund manager and value investor talked about value on the long and short sides. Marc Perkins, Palm Beach (Fla.) investment adviser, described the opportunity-laden decline of the U.S. energy infrastructure. And Christopher H. Browne, general partner of Tweedy, Browne Co., a firm that actually did business with the father of value investing, identified Graham-like themes around the world.

Down (up) with Russia

"Be patriotic," James B. Rogers Jr., investor, author ("Investment Biker") and featured luncheon speaker, beckoned the Grant's attendees. "Get some money out of the country.

Fed tightens, market doesn't

If the Federal Reserve is making it costlier to borrow (by 75 basis points on Tuesday afternoon), lenders are collectively making it easier. Thus, The Journal of Commerce reports that the return of easy credit and hungry bankers is threatening to incite a new round of shipbuilding and, therefore, inevitably a new glut.

Waiting for Signet

Consumers may be borrowing more, but that doesn't mean that the credit card purveyors are earning more. On the contrary: Net interest margins have fallen even as lending volumes have risen.

November 4, 1994, Vol. 12, No. 21

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Sell short if you can

Short-selling on the NASDAQ market has been restricted since September 6. A new rule stipulates that, for an 18-month trial period, no stock may be sold short except on an uptick (or what amounts to an uptick in over-the-counter land).

Loans to the trade

It is now the Federal Reserve's sworn cyclical duty to thwart the U.S. economy. Likewise, it is the banking system's profit-seeking opportunity to frustrate the Fed.

Leverage: 1994

The difference between the two-year note yield and the overnight borrowing rate constitutes a latent speculative itch. Given a positive spread and a bullish attitude, people will scratch it.

Euro-chemicals rally

Last June, Paul Raman, analyst with S.G. Warburg, had bullish and profitable things to say in these pages about U.S. chemicals stocks. Now he is bullish on some of the European companies--

Euro-banking suffers

In European chemicals, pricing is meager but improving. In European banking, on the other hand, pricing is meager but getting worse.

Rising temperatures

Old friends are returning to the cyclical stage: loan growth, inventory stockpiling (stuff, not securities) and a new impetus by banks to collect interest-bearing deposits.

October 21, 1994, Vol. 12, No. 20

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Stronger than the ruble, at least

Every monetary crank understands the historical tendency of paper money to become worthless. Offsetting this, however, is the tendency of people the world over to accept it--in particular the dollar, even today, in a new bear market--for what it purports to be. Bill Clinton complains that this is an age of cynicism. In monetary affairs, it is the age of faith.

Just-in-time defense

Just as Ford woke up one day without enough "revised" fuel tank assemblies to feed the production line in Kansas City, so the United States government may suddenly find itself in need of a light infantry division that it doesn't happen to have.

Cheap at 571 times

"Campbell Resources is the lowest-risk 50-cent stock you're going to find. They have an established, working mine, are trying to expand and have cash on the balance sheet."

Thats edutainment

A 1993 start-up, 7th Level is in one of the businesses that nobody much before 1993 could even have imagined would be a business. It is engaged in the interactive multimedia entertainment computer software business.

'Are we there yet?'

The No. 1 macroeconomic question has been, and still remains: Are interest rates high enough yet to turn back the global business expansion? Or, as children have asked ever since the invention of the automotive backseat, "Are we there yet?"

You can't get there

Last fall, the railroad industry warned that it was facing capacity constraints for the first time in nearly half a century. One year later, this high-grade dilemma is still unsolved.

Falling temperatures

To judge by the commodities markets, the economy is following Wall Street's instructions exactly. Over the past three months, the Goldman Sachs Commodity Index has rung up a total return of minus 8,45%, which is worse than any coupon security on the Treasury yield curve, even in this, the worst bond year ever...

October 7, 1994, Vol. 12, No. 19

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In praise of 8%

"History shows," said Business Week, winding up a cover story on the miracle workers at Fidelity Investments, "that the longer your investment horizon, the more compelling is the case for owning stocks. As long as that continues to be true, Fidelity's wondrous stock-picking machine seems likely to approach the long-elusive goal of perpetual motion."

GM capitulates

General Motors is coming to terms with a world that is neither inflationary nor disinflationary. It is--let us simplify--nondisinflationary, which only means that the good news on prices is long since out.

Aronstein on stuff

A man who has failed to raise big institutional money for his long-term commodity partnerships--failed to duplicate the fund-raising prowess of some of the ruined hedge funds--is bittersweet about rejection. Michael Aronstein, general partner of a pair of domestic commodity funds (up 25% after fees in this begrudging year), says that it's encouraging, from a contrary-opinion point of view, that so many people doubt him.

Chase for fees

In the deep of summer, LaRoche Industries, issued $100 million of junk bonds. Only an underwriter's salesman would have called them "high-yield securities."... The transaction was a throwback to boom days, first to the 1980s, when only an optimist expected cash flow to cover fixed charges, but also to the 1920s...

Battening down hatches

"The real question should not be whether the Fed will tighten," observes Tad Rivelle, fixed-income portfolio manager at Hotchkis & Wiley, Los Angeles, "but rather, is the expectation priced into the market?"

September 23, 1994, Vol. 12, No. 18

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Free advice for Warren Buffett

Long ago in 1979, when Jimmy Carter was president and inflation was king, Warren Buffett betrayed a note of exasperation in his annual letter to the shareholders of Berkshire Hathaway Inc.

Manhattan project

Like many other real-estate survivors, the Parker company owes its solvency more to what it didn't do than to what it did. Most profitably in the 1980s, it didn't borrow to buy or build at what would prove to be a spectacular, penthouse-elevation market top.

The Gladstone report

So near to the Commerce Department yet so far, Washington, D.C.-based Allied Capital Corp. is a font of information on small business. Commerce is in the economic intelligence business because it has to be. Allied is in some of the same lines of the business (anecdote collection and microeconomic analysis, especially) because it wants to be.

Inflation and default

In American banking in 1994, there is interest-rate risk and credit risk and golf, in that order.

Scratch stock

The trajectory of Cobra Golf in the stock market resembles that of a John Daly drive on the fairway, vanishing into a clear blue sky. So far, the one conspicuous difference between the stock and the drive is that the stock has been going up for a full 12 months.

Name that outlier

"M-2 growth has never been as low as it is today with 85% operating rates." So says Nancy Lazar, economist at 1ST, in her new Weekly Money Report.

September 9, 1994, Vol. 12, No. 17

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Reaching for risk

While vacationing on Martha's Vineyard last month, President Bill Clinton played golf with Warren Buffett and William Gates Jr., both members of the billionaires' club, a nontraditional Democratic constituency. Although opposed to the rich in other settings, Clinton has shown himself, in general, to be a man of the bull market.

Spare a worker? a train?

In the United States, the money supply is very nearly stationary, the pace of car sales is weaker, the gait of new-job creation is slower, and Gap Inc., of all the dynamic retail chains, has reported a 5% drop in same-store sales for August. All of these facts fit the bond bulls' view of a national economy that is obediently slowing in response to a tightening Federal Reserve policy.

Mortgaging the market

As of a month ago, the Federal Reserve's own picked government bond dealers were heavily in debt, borrowers against their own securities. The dealer-borrowing data are always a month old and, therefore, not a certain guide to the future, but the reflex response of the 39 reporting firms is evidently to enjoy the hospitality of the positively sloped yield curve.

Evasive action

The Federal Reserve has raised the cost of bank reserves, but banks have reduced their need for them. The federal funds rate has risen, but so has the volume of non-reservable deposits--notably, the dollars borrowed by banks, both foreign and domestic, from their own overseas offices. Domestic bank deposits, in the meantime, have scarcely grown at all.

'Virtual' sales

As men and women of the world, the readers of Grant's will sympathize with the corporate insider who wishes that the Securities Act of 1933 and the Securities and Exchange Act of 1934 had never been written into law and that Albert Wiggin, the portly, self-dealing chairman of the Chase National Bank, had never been born. Wall Street understands, too...

Prosperity lays siege

Is there too little money and credit? In the United States, the pricing of certain kinds of bank loans--e.g., credits to companies of "near-investment grade" standing--continues to suggest the opposite.

August 12, 1994, Vol. 12, No. 16

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High rates, many trucks

Over a five-minute period, the president of a Rhode Island-based automotive supply company counts the trucks that are going his way and then he multiplies by 12. That gives him an hourly rate of flow. Over the years, he told Grant's, 500 trucks per hour has been his average sighting. Last week he saw 660 an hour. "I haven't seen so many tractor trailers on the Ohio Turnpike in years," he said.

Cheap $2 stock

To a partisan, William Jefferson Clinton may resemble James Earl Carter, but to nobody, not even Rush Limbaugh, does the Clinton inflation prognosis begin to suggest the Carter inflation record. Where has inflation gone, and when is it coming back? Is it ever coming back?

Alaskan stall speed

Lodged inside the unfathomable Bloomberg machine is a corporate history of Alaska Air Group (how do they get it all into such a little box?). Alaska Airlines, the company's principal operating subsidiary, is the 10th largest U.S. carrier, serving a half- dozen Western states and eight foreign cities...

Marking to 'model'

The theme of the annual conference of the International Swap and Derivatives Association is usually a derivative itself. It is derived from the temper of the times. Thus, last year's topic: "New Products and New Participants." And this year's: "Independent Risk Oversight: Risk Measurement and Management."

Focus on Kokomo

This just in from Kokomo, Ind.: The cost of newsprint to the Kokomo Tribune went up by 7% on August 1 after rising by 7% last March. In 1993 it did not go up at all. "Unfortunately," says the Tribune's publisher, Arden Draeger, "I see the prices continuing to increase in the near future."

Searching the cellar

What would the banking system do with more money? On the available evidence, it would lend it at spreads thinner than Kate Moss. Thus, to compensate for the rise in rates and the drop in activity, residential mortgage lenders have begun to relax terms and conditions. . .

July 29, 1994, Vol. 12, No. 15

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Paradise lost

So big is a $6.6 trillion economy that a documentable anecdote is available to support every sane forecast. Bulls and bears can match each other by the hour, strong rubber prices being entered into evidence against weak lumber prices, or a hopeful downturn in agricultural tractor inventory being set against a worrisome drop in agricultural equipment retail sales. It can go on all night.

Flight to plain vanilla

In money-market mutual funds, the obvious hasn't happened. Short-term rates have risen and equity mutual-fund values have fallen, but money-fund assets haven't expanded. In fact, May's total taxable money-fund assets ($466.2 billion) were lower than April's ($477.5 billion); we can't wait to see June's, which are due any day.

Silver-linked preferred

The accompanying table constitutes a triumph of investment cryptography: We have cracked a new issue of silver-indexed preferred from Freeport-McMoRan Copper & Gold via Lehman Brothers et al.

Prosperous winds

The news about the futures market in the Baltic Freight Index is not only that it is going up. The greater news may be that it even exists.

Adventure stock

"Russia is in very serious trouble," said Aleksandr I. Solzhenitsyn, recently returning to Moscow from a 20-year exile and after a two-month railroad journey across the nation that, under different management, had kicked him out. "There are groans bellowing across this country."

Dollar mountain rises

For every dollar's worth of government securities that the Federal Reserve bought in the past year, foreign central banks bought more--$2.20, at least.

Opaque Texas buildings

It's official: You can no longer figuratively see through the Dallas skyline. According to a new municipal appraisal, the city's property values rose fractionally in 1993. It was the first such increase in six years.

The Angel indicator

As filtered through a friend, word from a top Fed insider is that one policy, at least, is foreclosed for the August 16 FOMC meeting. That is whatever policy Wayne Angell, former Fed governor turned noisy Wall Street economist, is predicting that the Fed will adopt.

July 15, 1994, Vol. 12, No. 14

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Let's just say, (jc + b) x gwm=(c + bn) x ag

If the 1990s are shaping up to be a repeat of the 1970s, the Clinton administration is destined to become the financial heir of the Carter administration. Scott E. Smith, a paid-up subscriber from Chicago who insists that he really doesn't mind that the yen puts he bought on the say-so of this publication have gone to 3-3/4 from 12 in only seven months, contributed this interesting formula.

Prime-time Moscow

"Russia is like a black hole; it's sucking up everything into the market. Companies can't produce quickly enough; capacity can't increase quickly enough."

The Hurwitz factor

Maxxam Inc., a possible investment for the 1990s, has a balance sheet from the 1980s. The company's principal owner, Charles E. Hurwitz, 53 years old, is himself a man of the 1980s--a takeover artist, leverage artist, entrepreneur, one-time owner and director of a failed Texas S&L and former investment-banking client of the former Drexel Burnham Lambert.

Air cargo soars

Good news from Main Street in the July 7 Journal of Commerce: Cargo volumes and rates are beginning to pick up for U.S. passenger airlines and freight forwarders after four turbulent years marked by stagnant growth and increasing competition.

Hedging against plastic

Advanta Corp., the Horsham (Pa.) credit-card purveyor, is forming a $100 million venture-capital partnership "to seek out private equity investment opportunities in the financial and information-services industries." Evidently, it's diversifying against the day when credit cards become obsolete...

One bond too many

When Jeffrey Sachs, erstwhile adviser to Russia, stood up in London the other day to call for the creation of a bankruptcy court for insolvent governments, the global bear bond market instantly came into sharper focus. Given the growing weight of debt and the absence of help from a new inflation (help, that is, from the borrowers' point of view), the possibility of public-sector default no longer seems outlandish...

Interest-rate dependency

The reader who provoked this table, Marc Perkins, chairman of Perkins Capital Advisers, Palm Beach, Fla., says that the numbers are reminiscent of another cycle. As the savings-and-loan industry was felled by high interest rates in the late 1970s, he contends, so Wall Street is at risk in the mid-l990s.

Hello, John Templeton

Signs of the times: A pair of funds dedicated to investing in biotechnology are getting out of the business.

Sportsmen take heart

Even now, the bond market is irrepressible. As recently as 1989, the so­-called primary government bond dealers together borrowed nothing to finance their own position-taking.

July 1, 1994, Vol. 12, No. 13

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Paper assets of the future

As a last resort, the Federal Reserve Board might consider printing the U.S. dollar on corrugated paper, waste corrugated paper, linerboard or 200-pound test corrugated box, useful materials with a demonstrated ability to appreciate without central bank support.

Desert Storm II

Viewers who tuned into "20/20" Friday night just for the segment on the toxic bacteria that eats human flesh (broadcast in living color) missed what may prove to be a landmark geopolitical interview.

Your curious government

Yesterday was the deadline for telling the Treasury Department how many foreign investments you own. Let us say that you are an American investor, subject to the Constitution, the Paperwork Reduction Act of 1980 and the other laws of the land, and that you own a certain substantial minimum of foreign securities and/or short­-term foreign investments.

Peso lending riot

Question: If the rate of bank lend­ing were 20 times faster than the growth of the real economy in which the lending took place, would that be bullish or bearish for the economy and markets of the country in question? Answer: It would be bullish until the day it stopped. Then, the next day, it would start to become bearish.

Wall Street agronomist

The coffee-killing Brazilian frost is a parable of cycles. For years, as the coffee bear market ground on, growers despaired, and they skimped on maintenance (Grant's, January 28)..."When you take a crop that hasn't been fertilized for four years and was unhealthy to begin with because of a lack of care, the damage could be untold." Nowadays, the bond market watches the grain market.

Thundering assets

Merrill Lynch's announced assault on the corporate-lending business may or may not electrify the securities industry, but it almost certainly will baffle the banking industry.

The World at Work: None for the bears

Whether it's because of their furry ears or the horrific losses they bore in 1991-93, the professional short sellers continue to lack investment charisma.

The World at Work: Conspiracy central

Rumors fly because they are lighter than air, and the skies were thick with them on Monday and Tuesday.

The World at Work: Lend to whom?

Numbing accounts of the Japanese deflation--the word, in the case of Japan, has literal accuracy--continue to fill the excellent Nikkei Weekly.

The World at Work: Wind from the left

The new temporary chief of the French Socialist Party (the incumbent stepped down after the socialists' drubbing in the recent European elections) is lifting his voice for the old col­lectivist ways.

The World at Work: Irrepressible

According to Advisers Capital Management, New York, last week's auctions of two- and five-year notes were heavily purchased "on specula­tion that the Federal Reserve would continue buying." The 1991-93 spec­ulative impulse dies hard.

The World at Work: Correction

The Speaker of the House of Representatives has not, after all, been indicted (Grant's, June 17). Our apologies to the innocent man, Thomas S. Foley (D., Wash.).

Sell it to the foreigners

The essence of inflation is a redun­dancy of dollars, but how do we count the dollars? One handy method is to consult the rates of growth of the familiar monetary aggregates...

June 17, 1994, Vol. 12, No. 12

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Happy birthday, you old bat

The Bank of England, dowager of central banks, ancient protector of the coin of the realm, agent of devalua­tion, gentlemen's club and bawdy house, entertained more than 100 of the world's central-bank governors in London last week on the occasion of its 300th birthday.

What a card

In just nine months, from June 1993 to March 1994, the assets of First USA grew by 67% while its credit-card loans leapt by 87%. If the Dallas­based credit-card purveyor were an Olympic long jumper, could it pass a steroid test?

No brakes

Ted Eckstein, chief executive officer of a national supplier of used auto parts-Rebuilders Automotive Supply Co. of Cranston, R.I.--and a paid-up subscriber, says that business is (a) terrific, and (b) suggestive.

Up and down, pro and con

Speakers at the Grant's conference spanned the spectrum of ideology and interest rates. Sir Alan Walters, of AIG Trading Group, predicted a trend of rising real rates, "probably for the rest of this decade," but not because of inflation.

Think weak

Susan M. Sterne, fast friend of this publication, certified caller of macro­economic turns and the almost certain winner of The Wall Street Journal's bond-yield guessing contest for the first half of 1994, told the Grant's con­ference that the U.S. economy is laboring.

Up with Russia

The Firebird Fund lost no money in the hedge-fund debacle of last February and March because it had putting its modest first few millions of dollars to work in its chosen theater of operations: the Russian stock market.

Look who’s lending

Waterhouse Securities, the stock brokerage firm that the stock market used to love (Grant's, Oct. 10, 1993 ), is going to open a bank...

June 3, 1994, Vol. 12, No. 11

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Exit, central banks

For most of the 200 years before the start of the great bond bull market of 1981, paper money was condemned as a heresy. No orthodox creditor would readily accept payment in a form of money that did not clink on a counter. Now turn on the television...

Yo, moron!

"We're not trying to outsmart the smart guys. We're trying to sell bonds to the dumb guys."

Funds push higher

The big tent of monetary theory has room enough for the monetarists and the Keynesians, for the Crips and the Bloods and for those who are merely confused.

Nothing down: nothing

The new face of credit is the 100% loan-to-value loan. A pair of paid-up subscribers -- as solvent as the readers of any other publication available through the U.S. mails, perhaps even more so -- have seen them with their own eyes.

Aronstein loads up

Except that commodity prices tend to fall over the long run (tending to revert to the cost of production, which itself is usually falling), except that futures trading is inherently leveraged, and except that commodity bull moves hit like hail storms, futures markets constitute the perfect outlet for patient, value-seeking, long-term capital...

Flying milk jugs

The issue isn't whether industrial commodity prices are rising. The question is who will pay the freight and how will the rise be accounted for...w

Liquidity turns moist

Despite ample provocation, no international financial panic occurred in the early 1990s. It could have, but didn't, begin in Japan, the provider of almost half of the international bank credit in the late 1980s. Real-estate depressions struck far and wide, yet a worldwide run on illiquid institutions didn't start in Scandinavia, the U.S...

Calls on a hope

Like an ancient veteran of D-Day, the Carlyle Real Estate Limited Partnership-XIII has visibly been through the wars.

Latest shortage: bankers

A friend at one of the big banks bet­ter known for its trading prowess than for its book of corporate underwriting business brings news: suddenly, there aren't enough loan officers on the premises...

May 20, 1994, Vol. 12, No. 10

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The future in detail

"We're looking at an old-fashioned physical squeeze," said a London coffee analyst as the bond market prepared for lift-off Tuesday. "Roasters and traders haven't needed to hold security stocks until now, and suddenly they've found there isn't enough coffee around."

A very robust error

On page one of the April 8 issue ("Revenge of the margin clerks"), we incorrectly stated that the credit-risk portion of Salomon Brothers' derivatives book at year-end 1993 was $42.5 billion. In fact, the firm says, it amounted to $8.6 billion. Equity capital was $5.3 billion.

Standing behind Kidder

No more high-minded than the next fellow, we, too, have been asking incendiary questions about Kidder Peabody.

State of Main Street

The Fed may have its beige book, but Grant's has its David Gladstone, and our source is livelier than theirs.

Whiff of 'nonrecourse'

A paid-up, non-hallucinating subscriber reports that the Bank of Boston is weighing the resumption of non-recourse lending to real-estate developers. In other words, it is contemplating loans to real-estate people who do not agree to sign their own names...

Cranes over London

The heretofore unimaginable, from the May 12 Bloomberg screen: Across the street from the Bank of England, speculative development is returning to London as demolition is set to begin on one of its most controversial office developments.

Wheat: Back to '72?

In Russia this season, tank production is rising but wheat production is falling. The official economy of the former Soviet Union, as distinct from the thriving "black" economy, is seized by a "nonpayments" crisis - the Dun & Bradstreet version of hell, in which businesses just stop remitting funds...

Brand new Bundesbank?

When Hans Tietmeyer, president of the Bundesbank, declared last month that "too strong an appreciation of the D-Mark, against the dollar, for example, is not in the interests of our economy," monetary purists raised one eyebrow...

The cycle in brief

The yield curve became positively sloped — the two-year yield rising above money-market interest rates — in the last days of 1989. For almost 414 years, it has paid to borrow short and lend long, but it has not paid equally well in all theaters of financial operations.

May 6, 1994, Vol. 12, No. 09

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A gift from the bear: real yields

When Wall Street rediscovered the magic of speculating on government securities with borrowed money in the spring of 1991, the Treasury's two-year note yielded not quite one percentage point more than the overnight lending rate.

Daddy's margin call

Like sex, the margin call is an ancient institution, possibly as old as debt itself. The bond liquidation of 1994 has a rich American lineage, one that reaches back to the Civil War, to the aftermath of World War I and to the ostensibly serene years of the second Eisenhower administration....

Better balance sheets

How economically toxic is the rise in interest rates? Is the U.S. economy still so leveraged, four years after the crest of the 1980s' debt troubles, that a 75 basis-point tightening of money- market interest rates can poison a living and breathing business expansion?

Stuff the ballot!

In Mexico, Brazil, Britain, Germany and the province of Quebec, candidates not at all resembling Ronald Reagan and Margaret Thatcher lead the fields in scheduled or prospective 1994 elections. If the global financial markets are nervous, not all the blame can attach to interest rates.

Inflation: a sub-surface sighting

What inflation, exactly? M-3, the all­encompassing measure of bank liabilities, has stopped cold in the past three months...

April 22, 1994, Vol. 12, No. 08

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A vote for Main Street

For more lush years than Wall Street deserved, the Federal Reserve System was loose but the banking system, real-estate-laden and undercapitalized, was tight. Interest rates declined, but a reluctance to lend in America was complemented by a disinclination to borrow. Lending did not expand, as it customarily does, but contracted instead. But now the Fed is tightening as the banks are loosening.

Watch this currency

Is the French franc launched on a new crisis? Are French politics? At 3.43 to the mark on Tuesday, the franc was quoted within a pip of its former 3.4305 floor in the European rate mechanism.

Leasing prosperity

First came the Henry Ford automobile, plain and black. Then came the automobile loan, conservative and short. Now -- an automotive revolution for the 1990s -- comes the lease. As hedge funds speculated in the two­-year note, so consumers may drive away a Chevrolet, with little or no money down.

What price anarchy?

News of the possible lifting of the threatened Zulu boycott of next week's first all-race South African elections sent South African securities higher on Monday.

Up from zero

Caustic soda, a chemical used in the production of alumina, textiles, pulp and paper, suffered the ultimate bear­market indignity last summer. It actually traded at zero.

Worse for wear II

Morgan Stanley Leveraged Equity Fund II, sponsor of the aborted Sullivan Communications financing (Grant's, February 11), now brings to market the Jefferson Smurfit Corp., a highly cyclical, highly fragile St. Louis-based boxboard and paper­products maker.

Orange County tale

It stands to reason that the only elected Democrat in Orange County, Calif., is the manager of the county's highly leveraged, multibillion-dollar, fixed-income investment funds, and he is running for office against a Republican in the middle of a bear market. The lucky man is Robert L. Citron, age 68.

'We're still alive'

David Braver, president of Braver, Stern Securities Corp., a paid-up subscriber and, on behalf of the individuals whose money he manages, one of the biggest and most successful practitioners of the art of leveraged bond investing, was rueful but undefeated Tuesday....

April 8, 1994, Vol. 12, No. 07

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Revenge of the margin clerks

Wall Street always promised that the bond market would head off the next inflation at the pass by forcing a timely rise in interest rates. What the brokers and their hired economists never explained, however, was that the margin departments, not the "bond-market vigilantes," would precipitate the selling.

Bears strike out

The break in the stock market has punished the obvious suspects. Far more interesting is the identity of the group that it so far has failed to reward: professional short sellers.

North and South

Bears are massing along the Canadian and Mexican borders. The Bolsa, paying no heed to the rally on Wall Street, fell by 1.4% on Tuesday to a new 1994 low after dropping by more than 6% on Monday. "Although U.S. bond prices rose today and interest rates dropped," Bloomberg reported from Mexico City, "investors are convinced the Mexican government will be forced to increase domestic interest rates to keep foreign capital in the country."

Busted-convert watch

One fine day, perhaps, the convertible bond or preferred stock of your dreams will be quoted at 50 cents on the dollar. Its yield will be high and its conversion premium will be low, but the buyers will be absent instead of grateful. Value is the gift of bear markets, and we are trying to plan ahead.

Wages of fear

The municipal bond market -- overleveraged in its own way, short of both buyers and dealer capital, hard-­hit by fund liquidations -- may prove once and for all that cash has a place in even the best portfolio.

Cash: still trash

At the top of the stock market -- historians will have to try to understand the state of mind -- cash was the lowliest investment asset available. Unlike stocks and bonds, which always seemed to appreciate, Treasury bills never doubled or tripled or constituted the object of a hostile tender offer. They fulfilled no investment function except as a kind of talisman to ward off loss.

Back to the boom?

From Phoenix comes news that interest rates don't constitute the top potential brake on a very pretty local housing market. The No. 1 looming prospective impediment is the price of land....

London, Paris, etc.

Like Elaine Garzarelli, Grant's has its indicators, and we never take our eyes off them. London is our leading indicator of worldwide inflation (despite the huge devaluation of the pound sterling in the fall of 1992 and the brisk progress of the British business expansion...

What they hate

Was it purely an accident that the oil market went up last Monday as nearly every other market in creation went down? A knowledgeable friend speculates not....

Peeling leverage

A modest rise in overnight interest rates touched off one of the greatest bond market explosions in living memory. Is the coast clear, or has the use of speculative leverage merely been shifted, not reduced?

March 25, 1994, Vol. 12, No. 06

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Bigger than a house

The balance sheet of the largest brokerage house in the United States, Merrill Lynch & Co., grew by 43% in 1993. Measured in dollars, its overall assets climbed to $153 billion from $107 billion in 1992.

To the barricades!

To Jean-Marie Eveillard, president of the SoGen Funds, instantly goes the Grant's conference prize for the shortest time elapsed between forecast and validating outcome.

Le test case

The bracing smell of tear gas in Lyon conjured up monetary memories as well as political ones. A great financial consequence of the student riots of 1968, as middle-aged radicals will never forget, was the devaluation of the franc in 1969.

Bullish on oil

As the Federal Reserve has raised the federal funds rate, so another great and dignified governmental body, the Organization of Petroleum Exporting Countries, would like to raise the crude-oil price.

Yields actually vanish

What drives the average American saver out of the bank and into the stock market? Every schoolboy knows that the answer is 3% CD rates. Perhaps, then, every schoolboy would care to explain why utility stocks go begging at 6-1/2%...

The spring is leverage

American self-esteem was the poorer for a riveting remark at the conference delivered by Stephen M. Peck, general partner of SMP Associates L.P., a New York hedge fund.

Veneroso loves silver

Bullish on things, Frank A.]. Veneroso was not impartially bullish on everything. "When you look at a commodity market to decide whether it's bullish or bearish," he told the Grant's conference, "there are really two variables you want to look at.

Paint does too peel

"Real estate investment trusts are a joke," Adam Glick, our real-estate speaker, told the conference crowd, "and when I say a joke, I don't mean a joke rhetorically, I mean a specific joke, and I'd like to tell it," which he did...

Credit stirs faintly

Not only is it hard to make money in anything nowadays (year-over-year rates of return in the long bond and the Goldman Sachs Commodity index are 3.18% and minus 8.06%, respectively, according to our handy table), but also it is difficult to sustain one's favorite prejudices.

March 11, 1994, Vol. 12, No. 05

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Spare a dollar for gold

Nothing becomes gold so much as its lengthening list of detractors. The Wall Street Journal, the world's central banks and a number of formerly wealthy and handsome hedge-fund investors are on record with bearish words or deeds. We ourselves got off a skeptical piece on gold-mine equity valuations at what would prove to be the top of the current upswing...

The lever flips

Nomenclature will hold no interest for the victims, but the survivors may be pleased to know that the recent bond wreck probably will go down in history as a panic, not a crash.

Anecdote central

David Gladstone, president of Allied Capital Corp., Washington, D.C., has an economic seat on the aisle, and he says that the view is improving. Allied lends to, and invests in, small businesses: 900 or 1,000 of them, mostly east of the Mississippi.

Repo man gets busy

The Texan known as "Bulldog," skip tracer and automobile repossession man, says that his business is turning up. The reason that Bulldog is bullish on the repo trade will come as food and drink to the still-solvent bondholders. It is because he thinks that the economy is weakening.

Short the peso

Election year in Mexico (as we only began to explore in the last issue) is a time for democratic tradition, of which the greatest is that the governing party always wins. So rigidly observed is this precedent that when the incumbents did briefly appear to have come in second in 1988, it was only a matter of time before the results were recalibrated and the party was declared to have come in first after all.

Let's count money

What is wrong with the money supply, and is it (whatever it is) catching? Does it validate the Grant's commodity-price outlook or the economic observations of Bulldog, the repo man? We ask because money is not doing what we thought it would do. In a proper cyclical expansion, bankers would be lending and the monetary aggregates would be percolating.

Central banks buy Treasurys

"Based on recent growth of output and average cash balances, growth of the monetary base should be reduced immediately by two percentage points. The monetary base should grow at no more than an 8% annualized rate."

February 25, 1994, Vol. 12, No. 04

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The force of gravity in bonds

At a glance, the break in bond prices last week seemed all out of proportion to the monetary cause. On February 4, the federal funds rate was pushed up by 25 basis points, to 3-1/4%. By Tuesday, the 30-year bond yield had risen by 30 basis points, to 6.60%. More than one authority called the reaction unfathomable. What is the Federal Reserve in business to do except beat inflation to the punch?

Down on the Bolsa

Exactly according to bullish script, the Mexican stock market did not collapse following the January 1 outbreak of armed revolt in the southernmost state of Chiapas. What the bulls do not usually talk about, however, is one official source of this strength: A Mexican government agency was buying stock along with the optimists from the private sector.

The inner chairman

What Alan Greenspan really thinks is that the consumer price index has become so bollixed up that it no longer reflects the true rate of price inflation. Also, that the economy is closer to full employment than it might appear. All in all, according to people who had the opportunity to hear him out before his recent Humphrey-Hawkins testimony, the first 25 basis-point tightening will certainly not be the last.

No mutual funds

Roosevelt Savings Bank, based in the seasonally leafy Long Island suburb of Garden City, is as conspicuous for what it sells as for what it doesn't. What it doesn't sell is mutual funds. In this eccentricity it is as different from Wells Fargo, Mellon, Citibank et al. as it is possible for a bank to be in 1994.

Sell the yen (II)

Absolutely rejecting the simplifying lead of the Roosevelt Savings Bank, Bankers Trust has introduced a new deposit with a return based on fluctuations of the Japanese yen and the Thai baht.

Oiling the imagination

What does the lagging oil price signify for the future of the commodity markets and specifically for energy markets? The second-best answer is that, in the past, pronounced weakness in the oil market in relation to commodities spelled bullish things for oil -- both for oil and oil stocks. (The very best, at least the most honest, answer would be, pure and simple: "Who knows?")

Just the facts

Any time now, the monetary data will begin to confirm the Grant's world view -- stronger loan demand, more credit creation, faster monetary growth -- but it didn't last week.

February 11, 1994, Vol. 12, No. 03

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Morgan Stanley has a dog

Not just anyone may purchase the new junk bonds of Sullivan Communications or its subsidiary, Sullivan Graphics. This rare opportunity is available only to qualified institutional investors. Perhaps the stewards of other people's money are more discerning than amateur investors. Or, just possibly, they are less discerning.

Boss indicator brightens

The results of the latest Korn/Ferry International Index of Executive Hiring will cheer and astonish anyone who has come to believe that white­collar firings will go on unabated...

Too late for Ed

Gary C. Bialis, a Santa Barbara, Calif., investor and commodity speculator and paid-up subscriber, has a close friend in the food business.

1980s' debt rerun

Slipping in under the wire of a 3% federal funds rate, Renaissance Communications -- ticker symbol "RRRR" on the NASDAQ information highway -- went public last Thursday.

'So what?' he asks

The 25 basis-point rise in the federal funds rate caused Robert L. Marks, a New York-based consulting economist, not one moment of professional anguish last Friday morning. The truth is that he didn't see the news cross the tape.

Platinum primer

The last issue of Grant's, while waxing bullish on platinum, was all but silent on how to express that idea in the marketplace.

Accept no substitutes

A reader, citing an informed, anonymous source, says that counterfeit $100 bills are pouring into Russia, Eastern Europe and the Middle East, regions where dollars frequently constitute the de facto local currency.

Consumers revert to type

"NA," a lay term, means "not available." Fred D. Kalkstein, who kindly runs down the various monetary data now so gapingly absent from these tables, reports that the Federal Reserve of St. Louis (his source of numbers) is undertaking a wide-ranging revision.

Business anecdotes: a midwinter bouquet

Is there no hope for the global economy?

January 28, 1994, Vol. 12, No. 02

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How contrary can we get?

Very, if we try. One of the events that definitely will not occur in 1994, according to Wall Street pari-mutuel clerks, is economic recovery in Europe and Japan. We may therefore conceive that it might.

Onward, to excess!

"Investors Bid Up Bank Bonds, Now Perceived as Safe Haven," said a headline in the January 20 American Banker. For the incredulous reader, an analyst offered an explanation: "There's been a flight to safety in the bank sector and away from industrials and utilities."

Rigs redux

For a number of disinflationary years, the leasing of offshore drilling rigs has been an unprofitable, sometimes a hopeless, line of business, but for Chiles Offshore Corp., 1993 shapes up as a kind of miracle. For the first year since 1989, the company says, it expects not to show a net loss.

Achtung! Morgan Stanley

The owner of an orphaned East German cosmetics company is a New York art collector who heard the crash of the Berlin Wall all the way from his lower-Manhattan apartment.

Last acceptable vice

The price of coffee has been too low for too long. Outlook: bullish. The prices of coffee-related equities have been too high for too long. Outlook: bearish. The busy reader may stop right there.

Central bank take-out

If the Chinese economy can survive a coming assault of official American assistance, it may be able to survive anything. On Monday, The Wall Street Journal broke the two-pronged deflationary news that Alan Greenspan is planning a trip to Beijing...

How to be short

Selling borrowed shares of stock -- the classic short sale -- may or may not be profitable, but it is no longer state-­of-the-art. In this, the age of derivatives, a speculator may design his own put.

January 14, 1994, Vol. 12, No. 01

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Confessions of a gold bull

Gold stocks have many fine attributes -- the readers of Grant's own them, for example -- but value is no longer high on the list. Seasoned analysts will debate the merits of competing techniques of mine valuation.

Bank failures crash

American credit, which spent the late 1980s and the early 1990s in traction, is up and around again, its vital signs in order and the gleam restored to its eye. Perhaps before long it can resume a life of sin.

ABC's of firing

What stock buyback announcements were to the wake of the 1987 stock-market panic, corporate layoff announcements may be to the aftermath of the 1990-91 recession: No self-respecting corporate CEO refuses to make one.

Billions buy beans

It has not gone unnoticed in bond-land that the Chinese and the Indians and the Russians outnumber the Americans, that Chinese wages are lower than the developed world's wages or that the Third World is growing faster than the first. . . . For ourselves, we have been wondering if the bulls haven't overlooked one important detail.

Theoretical postcript

Concerning the possibility of inflation in a low-wage economy — China's prices are rising by 20% a year, or more ...

Fifth Avenue rallies

The rich, too, must live somewhere. They must find an apartment, buy it, renovate it and furnish it, not forgetting to dress the walls in silk. What makes the rich so very different is that they don't need to finance it — at the better Manhattan addresses, in fact, they may not finance it. It is a bull market in rich peoples' apartments...

Frugality ticks down

Not only is Fifth Avenue rallying but also warehouse-club retailing is fading and circulation of the Tightwad Gazette, a monthly newsletter published in Leeds, Maine, is peaking — peaked, in fact, two years ago. Altogether, asceticism is backpedaling....

Up with inertia

Even today, some $80 billion of high-coupon, early-1980s-vintage mortgage securities are still outstanding. Why they are still unpaid is a mystery, but it is also, in the opinion of Andrew Kowalczyk, an opportunity. . . .

Bullish on junk

The steel-scrap market had a better year in 1993 than some of the less successful hedge funds. . . .

Defusing defeasance

The Federal Reserve -- the accompanying picture is worth a paragraph, at a minimum -- has lately reduced the rate at which it buys Treasury securities. However, this marginal slowdown is a pale shadow of the expected reduction in the volume of purchase in 1994 by state and local governments.