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Stimulus money flows to savings

Households save and invest in equities

Household savings rise in 2009

Government economic stimulus programs that have sent money directly to US households have resulted in more saving and less spending.

Low interest rates have encouraged individuals to move from debt instruments into equities.

Should extreme government spending programs lead to inflation, as expected, the 2009 recovery in equity prices may prove unsustainable.

Featured articles on inside pages

Stock buybacks

Buybacks + options + hedge funds

Stock buyback programs are a legalized form of market manipulation, sanctioned under SEC Rule 10b-18 and that serve to drive up the price of a company's stock and to give false value to executive stock options.
More ...

Securities Analysis

Is big bank complexity irreversible?

The root problem with big banks today is organizational and product line complexity. Excessive complexity in banks can be traced to the reorganization of Citibank in 1956, under Walter Wriston, following the advice of McKinsey and Company.
More ...

US Politics

Why are the Super-Rich often liberals?

If we are to believe the old adage that, 'people vote their pocketbooks', why are so many of the Super-Rich ardent supporters of the Democratic Party? Why do the liberal Super-Rich seem to act in a way that is so contrary to their selfish interests and economic well-being? Here I show how capital flow analysis of the Federal Reserve flow of funds accounts provides an answer to this apparent conundrum. More ...

US equities

GAO pooh-poohs a Boomer bust

In 2006, the GAO issued a report saying that the retirement of the Baby Boomers should not have a negative effect on stock prices. This article reviews the GAO reasoning and concludes that the conclusion is not credible. More ...

US Bonds

The collapse of the dollar and US bonds?

The extreme spending of the Obama government, combined with irresponsible bank lending policies promoted by Barney Frank and Chris Dodd, portend rising interest rates, the collapse of the bond market, and the end of dollar supremacy. More ...

World Economy

What Is ‘International Liquidity’?

It used to be that the term 'international liquidity' meant the relative amount of resources available to a nation's monetary authorities that could be used to settle a balance of payments deficit. In the days of the gold standard, this would mean access to gold that could be used to redeem a nation's currency held by foreigners. More ...

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Capital Flow Watch has hundreds of articles on economics and investments.

Articles have excerpts on the front pages, and on tag, category, search and archive pages.


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October 2009
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Stock Quotes

DJIA10213.62  chart -0.56%
NASDAQ2179.76  chart +0.04%
S&P 5001071.69  chart -0.37%

Ftse 1005195.28  chart -0.31%
Dax6005.16  chart -1.15%
Cac 403526.12  chart -1.15%

Nikkei 2259179.38  chart -1.96%
Hang Seng Index20981.82  chart -0.43%
Straits Times Ind2936.48  chart -0.35%

Eur To Usd1.27  chart -0.35%
Usd To Jpy85.58  chart -0.35%
Gbp To Usd1.55  chart -0.35%

2010-08-20 16:03