Nov. 6, 2012, 11:35 p.m. EST
Commentary: There are plenty of choices, some not so obvious
By Jon Markman, MarketWatch
The stock market loves President Barack Obama. With all its cheating heart, and all its mercenary soul.
More than that, actually — it adores him. The love story of Wall Street and Obama is a bromance like no other, a man-crush for the ages.
Despite his threats to soak the wealthy for more taxes, despite Fed Chairman’s attack on savers, despite even his threat to kill special treatment for dividends, institutional investors have thrown themselves at Obama’s feet as they have not done in the first term of any president in the past century.
You could look it up. The S&P 500 has gained 76% since his inauguration in January 2009, while the Nasdaq 100 is up 128%.
Compare that to the S&P 500’s 13% decline and the Nasdaq 100’s 45% wipeout in the first term of his predecessor, George W. Bush; or the mere 25% gain in the first term of conservative icon Ronald Reagan; or even the 60% gain in the halcyon early 1990s in the first term of Bill Clinton.
The staggering advance of the market is probably one of Obama’s greatest accomplishments, and yet, in a rich irony, political sensitivities prevent him from bragging about it.
Reuters
The beauty part is that this was not a coincidence, beginner’s luck or a historical fluke.
The administration and the Federal Reserve run by his appointed chairman, Ben Bernanke, have systematically stuffed big banks’ pockets with cash in an unending rescue effort, slashed interest rates to the lowest levels of the past 300 years, diverted senior citizens’ savings to revive the moribund residential construction industry and showered drug makers and insurers with fresh sources of revenue from his health care overhaul.
Little wonder then that Wall Street cannot bear the idea of parting ways with the Obama administration, and thus in the past two months has thrown a tantrum to protest the surprising advancement of challenger Mitt Romney in the polls.
Now that the president has won a second term, you can expect most of the sectors that have benefited from the present administration to keep on rolling. Here are some top prospects.
Health care
The Patient Protection and Affordable Care Act, the President’s health care initiative, set out new mandates, subsidies and credits to employers and individuals to increase Americans’ access to health care. Upon its passage in March 2010, investors began boosting the shares of drug makers, insurance providers and hospitals because they all suddenly had a lot more paying customers, courtesy of the government and taxpayers.
Shares of Pfizer PFE -2.47% , for example, had fallen 50% during the eight years of the Bush Administration, January 2001 to January 2009. In contrast, its shares are up 70% during the Obama Administration, almost in a straight line. Sixty-four percent of the gains in the maker of Viagra, Zoloft and Lipitor have come since ACA passed.
Insurance provider Unitedhealth Group UNH -5.09% is up 73% since Obamacare passed. Smaller biotechs have gained a lot more, led by Alexion Pharmaceuticals ALXN -3.60% , up 252%.
Overall, SPDR Health Care XLV -2.31% , which includes all the health care stocks in the S&P 500, is up 31% since the President’s health-care law passed, vs. 27% for the broad market. It’s still a good bet going forward, as most of the benefits still lie ahead.
Nov. 6, 2012, 11:35 p.m. EST
Where to put your money now that Obama has won
Commentary: There are plenty of choices, some not so obvious
Stories You Might Like
By Jon Markman, MarketWatch
Home construction and real estate
The Obama Administration and Federal Reserve targeted the home-building industry for special attention since it is among the few industries that cannot outsource jobs overseas. The industry also provides the best income to workers without college educations. It also has a ripple effect on the economy, as new homes require paint, lumber, furniture, lawn care and the like.
iShares U.S. Home Construction ITB -0.67% offers the purest exposure to the industry. It’s up 133% during the Obama term so far, vs. 69% for the S&P 500, and is still very strong. The best individual stocks include Lennar LEN -0.15% , PulteGroup PHM -0.23% , Louisiana Pacific LPX +2.80% , Eagle Materials EXP -0.96% and M/I Homes MHO -2.10% among the larger companies as well as peripheral players like lawn-care machinery maker Toro TTC -1.37% , swimming pool supplier SCP Pool POOL -2.53% and carpet maker Mohawk MHK -1.99% .
Likewise the real estate industry has benefited enormously from policy over the past four years, as quantitative easing has involved directly buying securities that support residential and commercial construction. iShares Real Estate IYR -0.51% includes all the major players, including regional shopping malls specialist Simon Properties SPG -0.23% , which is up a cool 315% since Obama entered the Oval Office and still looks fine. Two new stocks with promise in the red hot mortgage servicing business are Nationstar Financial NSM -5.18% and Home Loan Services HLSS -0.52% .
Mobile communications
Obama: ‘Never been more hopeful’
After winning a second term, President Obama ends his victory speech with a vision for the country.
The Obama Administration has not promoted a coherent technology policy. But outside of a couple of attempts to rein in Google, it has not willfully attacked the tech industry either. The group has risen 114% during the four years, led by the 675% blitzkrieg of Apple AAPL -2.87% and 390% advance of Amazon.com AMZN -2.59% .
One subgroup in the industry that appears set for further improvement are the cellular tower owners. There are relatively few of them, and they get paid in part on a metered basis, so they are neutral parties that are prime beneficiaries of the explosion in mobile communications. Top names are SBA Communications SBAC +2.29% , American Tower AMT +2.17% and Crown Castle International CCI +0.85% .
For a contrarian pick over the next four years, consider a bet on a surprise resurgence at Dell DELL -3.73% or Hewlett-Packard HPQ -4.26% , which are clumsily trying to shed their personal computer legacies in favor of services, and may well find opportunities ahead.
And for the small-caps, two companies with a shot at finding success in the patchwork new world that employers and hospitals will face in health care and the digitization of medical records, consider WageWorks WAGE -0.28% and Greenway Medical Technologies GWAY -1.27% .
Financial services
Over the past four years, consumers have largely reined in their spending and streamlined their use of plastic, and that has actually benefited some of the more spry companies in the credit and transaction businesses. Delinquencies have fallen dramatically, and the use of credit cards is actually up.
We can expect a second Obama administration would attempt to reinforce these trends, and that would improve the opportunities for the industry’s leaders.
Three companies to watch on this score are Capital One Financial COF -2.44% , Discover Financial Services DFS -1.09% and Mastercard MA -1.32% . The latter is the easiest call as it will grow at a multiple of the growth of credit and debit transactions, and has largely escaped all attempts to rein in its profitability or ubiquity.
Energy
Energy producers have fared surprisingly well in the Obama years, led in part by the companies in the complex that were the most capable of staying one step ahead of the regulators and in part by the ones paying the largest dividends to yield-starved pensioners. Also companies that sell chemicals into the energy market have also fared well, as margins have improved and EPA rules have proven surprisingly restrained.
Some of the best in the energy patch are Cabot Oil & Gas COG -1.78% , and high-yielding master-limited-partnerships Plains All-American PAA -0.07% , Enterprise Products Partners EPD -1.86% , Kinder Morgan Energy KMP -1.89% , Linn Energy LINE -1.77% and refiner Calumet Specialty Products CLMT -2.78% .
• Barack Obama wins another four years
• Obama: The best is yet to come for America
• Romney urges an end to political bickering
• What Obama's victory means for investors
• Where to put your money now
• Consumer advocate Warren wins in Mass.
• Democrats keep control of Senate
• Exit poll: Most say they're not better off
• The costliest races in the House and Senate
On the chemicals side of refining, look for continued success from NewMarket NEU -1.66% , WR Grace GRA -2.82% and LyondellBasell Industries LYB -2.73% . The high-yield stocks issue new shares in secondaries fairly frequently, so wait until one of those 3% to 5% short-term setbacks to buy.
Overall, economic and political cycles suggest the first year of a second Obama Administration could be rough as investors adjust further to slowing global growth and peak earnings.
While the full second term is likely to turn out well for stocks, if you are nimble, you may wish to wait for at least one 15%-plus correction in mid-2013 to take on a full plate of risk.
A good analogy might be the second term for President Clinton. The entire four-year period yielded a very respectable 77% return for the S&P 500 and whopping 252% return for the tech-bubble Nasdaq 100. But the first two years were both marred by separate 10%-plus slides in the spring and winter.
Bottom line: Expect the market to continue its bromance with Obama in a second term, but buy into it opportunistically when panic is in the air.
Jon D. Markman is an investment adviser, money-management consultant and best-selling author of several books, as well as the Strategic Advantage and Gemini 252 newsletters. Follow him on Twitter: @jdmarkman.
Given 2nd term, Obama now facing new urgent task
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WASHINGTON (AP) -- President Barack Obama faces a new urgent task now that he has a second term, working with a status-quo Congress to address an impending financial crisis that economists say could send the country back into recession.
"You made your voice heard," Obama said in his acceptance speech, signaling that he believes the bulk of the country is behind his policies. It's a sticking point for House Republicans, sure to balk at that.
The same voters who gave Obama four more years in office also elected a divided Congress, sticking with the dynamic that has made it so hard for the president to advance his agenda. Democrats retained control of the Senate; Republicans kept their House majority.
House Speaker John Boehner, R-Ohio, spoke of a dual mandate. "If there is a mandate, it is a mandate for both parties to find common ground and take steps together to help our economy grow and create jobs," he said.
Senate Republican Leader Mitch McConnell of Kentucky had a more harsh assessment.
"The voters have not endorsed the failures or excesses of the president's first term," McConnell said. "They have simply given him more time to finish the job they asked him to do together" with a balanced Congress.
Obama's more narrow victory was nothing like the jubilant celebration in 2008, when his hope-and-change election as the nation's first black president captivated the world. This time, Obama ground it out with a stay-the-course pitch that essentially boiled down to a plea for more time to make things right and a hope that Congress will be more accommodating than in the past.
The most pressing challenges immediately ahead for the 44th president are all too familiar: an economy still baby-stepping its way toward full health; 23 million people out of work or in search of better jobs; civil war in Syria; a menacing standoff over Iran's nuclear program.
Sharp differences with Republicans in Congress on taxes, spending, deficit reduction, immigration and more await. While Republicans control the House, Democrats have at least 53 votes in the Senate and Republicans 45. One newly elected independent isn't saying which party he'll side with, and North Dakota's race not yet called.
Votes also were being counted Wednesday in the Montana and Washington gubernatorial races.
Obama's list of promises to keep includes many holdovers he was unable to deliver on in his first term, such as rolling back tax cuts for upper-income people, overhauling immigration policy and reducing federal deficits. Six in 10 voters said in exit polls that taxes should be increased, and nearly half of voters said taxes should be increased on incomes over $250,000, as Obama has called for.
"It's very clear from the exit polling that a majority of Americans recognize that we need to share responsibility for reducing the deficit," Maryland Rep. Chris Van Hollen, the top Democrat on the House Budget Committee, told CNN. "That means asking higher-income earners to contribute more to reducing the deficit."
But Sara Taylor Fagen, who served as political director in President George W. Bush's second term, warned the current White House to pay heed to the closely divided electorate, a lesson her party learned after 2004. With more than 90 percent of precincts reporting, the popular vote went 50 percent for Obama to 48.4 percent for Romney,
"It'll be interesting if the Obama team misinterprets the size of their victory," Fagen said. "I think if you look back at history, we pushed Social Security and the Congress wasn't ready for that and wasn't going to do it. And had President Bush gone after immigration, we may be sitting in a very different position as a party."
Obama predicted in the waning days of the campaign that his victory would motivate Republicans to make a deal on immigration policy next year to make up for having "so alienated the fastest-growing demographic group in the country, the Latino community."
Former Mississippi Gov. Haley Barbour agreed that a lesson of 2012 is for his Republican Party to change the party's approach on immigration.
"Republicans say, `We don't want to reward people for breaking the law,'" Barbour told CBS. "The way we need to look at it is, how are we going to grow the American economy and where does our immigration policy fit into that?"
Even before Obama gets to his second inaugural on Jan. 20, he must deal with the threatened "fiscal cliff." A combination of automatic tax increases and steep across-the-board spending cuts are set to take effect in January if Washington doesn't quickly reach a budget deal. Experts have warned that the economy could tip back into recession without an agreement.
Newly elected Democrats signaled they want compromise to avoid the fiscal cliff.
Sen.-elect Tim Kaine, a former Virginia governor who defeated Republican George Allen, said on NBC's "Today" show that voters sent a message they want "cooperative government." But he also says the election results show that the public doesn't want "all the levers in one party's hands" on Capitol Hill.
From Massachusetts, Elizabeth Warren said on "CBS This Morning" that those who voted for her opponent, Republican Sen. Scott Brown, expressed a desire for lawmakers to work together. She says: "I heard that loud and clear."
Obama repeated his campaign slogan of moving "forward" repeatedly in a victory speech early Wednesday in his hometown of Chicago.
"We will disagree, sometimes fiercely, about how to get there," he said. "As it has for more than two centuries, progress will come in fits and starts. It's not always a straight line. It's not always a smooth path. By itself, the recognition that we have common hopes and dreams won't end all the gridlock, or solve all our problems, or substitute for the painstaking work of building consensus, and making the difficult compromises needed to move this country forward. But that common bond is where we must begin."
Former Obama adviser Anita Dunn told "CBS This Morning" that the president made it clear in his acceptance speech that he will be reaching out, and she warned GOP House leaders, representing Ohio, Virginia and Wisconsin, to keep in mind that their voters also wanted to keep Obama.
"Clearly there's a lot of momentum and a lot of incentive for people to work together to really find answers to the challenges," she said.
The vanquished Republican, former Massachusetts Gov. Mitt Romney, tried to set a more conciliatory tone on the way off the stage.
"At a time like this, we can't risk partisan bickering," Romney said after a campaign filled with it. "Our leaders have to reach across the aisle to do the people's work."
Obama won at least 303 electoral votes to 206 for Romney, with 270 needed for victory, and had a near-sweep of the nine most hotly contested states.
Obama's re-election means his signature health care overhaul will endure, as will the Wall Street overhaul enacted after the economic meltdown. The drawdown of troops in Afghanistan will continue apace. With an aging roster of justices, the president probably will have at least one more nomination to the Supreme Court.
A second term is sure to produce turnover in his Cabinet. Treasury Secretary Timothy Geithner has made it clear he wants to leave at the end of Obama's first term but is expected to remain in the post until a successor is confirmed. Secretary of State Hillary Rodham Clinton, Obama's rival for the presidency four years ago, is ready to leave. Defense Secretary Leon Panetta isn't expected to stay on.
Some Americans were hopeful for progress in Obama's second term.
"He may not have done a great job in my mind but I kinda trust him," Jerry Shul said Wednesday morning in New York's Times Square. "And I feel like he's gonna keep trying and I feel like when people keep trying in you favor things work out. I have faith in him, I have faith he will get with the Republicans and get something done."
Elsewhere on the ballot, voters in Maine and Maryland became the first to approve same-sex marriage by popular vote while Washington state and Colorado legalized recreational use of marijuana.
Obama claimed at least seven of the nine swing states, most notably Ohio, seen as the big prize. He also prevailed in Iowa, New Hampshire, Colorado, Nevada, Virginia and Wisconsin. Romney got North Carolina.
Florida was too close to call Wednesday morning. The unofficial count had Obama with a 46,000-vote lead, but Florida historically has left as many as 5 percent of its votes uncounted until after Election Day.
Overall, Obama won 25 states and the District of Columbia. Romney won 24 states.
It was a more measured victory than four years ago, when Obama claimed 365 electoral votes to Arizona Sen. John McCain's 173, and won 53 percent of the popular vote.
Preliminary figures indicate fewer people participated this time. Associated Press figures showed that about 118 million people had voted in the White House race, but that number will rise as more votes are counted. In 2008, 131 million people voted, according to the Federal Election Commission.
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Election Year Trading Cycle Conclusion:
Next week is going to be very interesting to watch unfold. I generally do not like to trade or invest before news of this magnitude so trade smaller sizes if you do as price action could be wild.
Chris Vermeulen
Editor, the Gold and Oil Guy
Gold
Chris Ciovacco
Gold
Investing in mining stocks
Clif Droke
Chris Ciovacco
Adam Hamilton
Clif Droke
Clif Droke
A question that many are asking right now is what impact the Fed's latest monetary policy action will have on the projected deflationary scenario for 2013-14. Specifically, market participants are wondering if the Fed's monetary policy action will prevent deflation from running its course.
The answer to the above question holds profound implications for investors in stocks, commodities and real estate. If the Fed is serious about its commitment to stopping deflation at any cost, it could potentially put the brakes on the deleveraging process and hold off a deflationary nightmare for a few more years. The emphasis here is on the word "potentially," for it's still very much in doubt that the Fed's efforts will suffice for reasons we'll discuss here.
The long-term deflationary cycle of 120 years is just two short years from bottoming, which means the proverbial finish line is in sight. The bad news is that two years can seem like an eternity when the deflation cycle is ravaging the global economy, as it's expected to do in 2013-14. Even the slightest hesitation or deviation from the central bank's aggressively loose monetary policy would allow the floodtide of deflation to overwhelm the financial market and economy.
Next year is a critical one for the economy as it marks the start of the final "hard down" phase of the 60-year/120-year economic cycle due to bottom in late 2014. If the Fed and the other major central banks (notably the ECB) take their foot off the monetary accelerator for even a minute it will allow deflation to overspread the global economy, potentially reversing the recovery of the last four years.
It would be tempting to conclude that the Fed's commitment to stimulating the U.S. economy through its recent "quantitative easing" (QE3) effort along with the ECB's pledge to rescue the euro zone economy will keep the global economy on an even keel through the end of 2014 when deflationary risks are greatest. If China, Europe and the U.S. all shared the same commitment to fighting deflation through loose monetary policy it might be possible to engineer a soft landing for the global economy. Standing in the way of this, however, is a troubling lack of coordination on the part of the three major central banks. It's for this reason that the deflationary scenario is still likely to prevail by 2014.
Take for instance the stated intention of the European Central Bank (ECB) to stabilize the euro zone economy through large scale bond purchases. ECB President Mario Draghi recently announced the ECB would do "whatever it takes" to end the euro zone debt crisis. That announcement coincided with the launching of a $650 billion bailout fund earlier this month. But while the European Stability Mechanism, or "bazooka," as it has been nicknamed, is meant to help struggling European countries by extending loans or making bond purchases, its implementation is a far cry from what has been promised. Since EU member countries have been slow to provide start-up reserves, the fund will only have about $100 billion by 2014, according to reports. As one source pointed out, "That suggests that troubled countries like Spain may not get much help in the meantime."
Spanish Prime Minister Mariano Rajoy was elected just under a year ago on an austerity ticket. His government has signed off on a belt-tightening program worth over 60 billion euros through to the end 2014 to cut the country's deficit. But as Reuters observed, "the spending cuts have dented investment while tax rises have hit consumers' pockets and driven prices higher." Think of austerity as oxygen deprivation for a hospital patient who's in desperate need of air. By refusing the life giving oxygen to a dying patient, both Rajoy and Draghi are exposing Spain to the ravages of the 120-year cycle decline as we head closer to the fateful year 2014. While this may bode well for the gold price as investors seek out financial safe havens, it won't bode well for the euro zone economy or the people of those countries.
Shortly after ECB President Mario Draghi made his "whatever it takes to save the euro" statement, Sy Harding of Street Smart Report pointed out that "whatever it takes" didn't include cutting interest rates to also stimulate the euro zone economy. "Concerns are already rising that its announced program of unlimited bond-buying may even worsen the euro zone's recession, since the program requires governments that request the debt bailout to adopt and adhere to strict austerity measures in order to qualify for bond-buying, including reducing government spending and cutting wages, pensions, and services even further." All of these things are deflationary and will constrict the euro zone economy instead of expanding it.
The Kress 120-year cycle due to bottom in late 2014 is the nemesis of central banker. Although bankers like Draghi and Bernanke instinctively recognized the deflationary undercurrents of the times, their reactions in trying to stop deflation are becoming increasingly ineffective. As David Knox Barker put it in a recent issue of his Long Wave Dynamics Letter, "It is the mandate of the central banks to maintain price stability and maximum employment. The problem of course is that by pursuing these mandates with monetary policies, coupled with fiscal policies, the problems of price instability and unemployment are exacerbated."
Barker also points out that central bankers are engaged in a potentially lethal balancing act between private sector deleveraging (i.e. deflation), monetary stimulus and austerity. An example of consumer deleveraging can be seen in the following chart. After the 2008 credit crisis, U.S. households cut their debt down to pre-recession levels as of late 2012. Home mortgages, credit card debt, and most other consumer liabilities have drifted back to 2006 levels, according to Moody's. But as Bob Prechter of Elliott Wave International has said, credit contraction is ultimately the "kiss of death" for a consumer based economy like the U.S. Barker also notes that without central bank intervention, private sector deleveraging would have been much more profound.
While many economists tried to put a positive spin on the reduction of private sector debt, others are more skeptical. Kenneth Rogoff of Harvard University Nathan Sheets of Citigroup say the deleveraging process still has years to run. They note that while debt as a share of income is down, the second quarter's 113 percent was above the 94 percent average since 1980. Sheets says the ratio will likely fall "some years" to about 100 percent.
As for the extensive stimulus measures of the Fed, central bankers are perplexed why this historic money creation hasn't resulted in inflation. The reason is simple: the main force of long-term deflation as governed by the 120-year cycle is still in play and is acting as a massive counterweight to bankers' attempts at re-inflating the credit balloon.
"In the U.S. the austerity comes in 2013," writes Barker. "It could tip the apple cart." The evidence strongly suggests that the crashing wave of the Kress 120-year cycle in 2013-2014 will do just that.
One more factor in our analysis of the debt/deflation cycle should be mentioned: China. Bloomberg Businessweek magazine reported that Chinese factories are now experiencing wholesale-cost deflation for the first time since 2009. Bloomberg also reported that Song Guoquig, an adviser to the Peoples Bank of China, says deflation is a real possibility for China in 2013.
Writing in Reuters, Andy Mukherjee recently observed concerning China: "In an excessively leveraged economy, even small price decreases can cause large increases in bad loans and financial stress." This assessment can be equally applied to the U.S. and explains why the Fed is so eager to pump liquidity in the face of Kress cycle deflationary pressures.
The ultimate failure of the Fed's response to global deflation will likely be caused by the lack of cohesion and coordination among the monetary policies of the world's largest central banks. Between Europe's bank pushing for greater austerity measures and the U.S. hoping to avoid the same, it's clear that the bankers are no longer on the same page. This confusing mixture of deflationary and inflationary monetary policies will only exacerbate the final "hard down" leg of the Kress mega cycle into 2014.
Clif Droke
2014: America’s Date With Destiny
Take a journey into the future with me as we discover what the future may unfold in the fateful period leading up to – and following – the 120-year cycle bottom in late 2014.
Picking up where I left off in my previous work, The Stock Market Cycles, I expand on the Kress cycle narrative and explain how the 120-year Mega cycle influences the market, the economy and other aspects of American life and culture. My latest book, 2014: America’s Date With Destiny, examines the most vital issues facing America and the global economy in the 2-3 years ahead.
The new book explains that the credit crisis of 2008 was merely the prelude in an intensifying global credit storm. If the basis for my prediction continue true to form – namely the long-term Kress cycles – the worst part of the crisis lies ahead in the years 2013-2014. The book is now available for sale at:
http://www.clifdroke.com/books/destiny.html
November 7, 2012
The Three Items Every Investor Needs to Be Aware of Going Forward
The Obama Administration has won its second term. And now that the election is over we can come to grips with the fact that nothing has been fixed and that the math is impossible both in Europe and here.
First and foremost, Greece is out of money... again.
The country is currently embroiled in a new 48 hour strike to protest the next wave of austerity measures which will be voted on today in order for Greece to qualify for the next round of bailout funds.
The bailout in question, €31.5 billion, was actually due five months ago but was not paid as Greece has failed to meet budgetary requirements. Without this money the country will run out of funds by November 16. We'll see how this pans out but suffice to say the same issues (Greece is broke and will remain in the EU as long as it gets money) are still in play. None of them are good.
Then of course there is Spain, which continues to present impossible ideas to deal with its impossible economic situation. The country currently has just €37 billion in cash lying around. With this, it somehow plans on buying €60 billion worth of bad bank assets.
This is doable over time... provided that Spain doesn't have a single other problem occur. Unfortunately, we're up to five regions requesting bailouts leaving just €3 billion in funds available for any other regions that face a shortfall (there will be more).
Meanwhile, Spanish banks continue to draw over €400 billion from the ECB... up from €300+ in June. And on top of this, the country needs to raise €207 billion next year while keeping rates low.
And then of course there is the US...
The US re-entered recession in June 2012. And we are now facing the fiscal cliff again with the threat of tax hikes hitting in early 2013. We also have $16 trillion in debt and are running our fourth $1+ trillion financed by the US Federal Reserve which bought over 70% of all US Treasury issuance last year.
Speaking of the Fed, Obama's win means Bernanke's job is secure at least until he decides he wants to step down... which if he has any sense he'll do so that the disaster waiting to unfold can happen on someone else's watch.
That someone else will likely be Janet Yellen, the current Vice Chair of the Fed, who is an even bigger dove/fan of money printing than Bernanke (she said that QE 3 would "benefit the world," a truly staggering claim given the increase in inflation both in the US and especially in emerging markets).
What does this mean?
Simple... the very same problems that the world faced on November 5, 2012 remain in place. And we now know that those in power (Bernanke and Draghi) favor money printing over everything else. So the cost of living/ inflation will continue to rise and the world will lurch ever closer to the great debt implosion that will eventually take down the financial system.
Now more than ever, investors need to get access to high quality guidance and insights. There sheer magnitude of the issues the global financial system is facing is enormous!
Obama re-election protest escalates at Univ. of Mississippi; racial slurs, 2 arrests reported
By Associated Press, Updated: Wednesday, November 7, 7:46 PM
JACKSON, Miss. — A protest at the University of Mississippi against the re-election of President Barack Obama grew into crowd of about 400 people with shouted racial slurs as rumors of a riot spread on social media. Two people were arrested on minor charges.
The university said in a statement Wednesday that the gathering at the student union began late Tuesday night with about 30 to 40 students, but grew within 20 minutes as word spread. Some students chanted political slogans while others used derogatory racial statements and profanity, the statement said.
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The incident comes just after the 50th anniversary of violent rioting that greeted the forced integration of Ole Miss with the enrollment of its first black student, James Meredith.
Ole Miss Chancellor Dan Jones promised an investigation and said “all of us are ashamed of the few students who have negatively affected the reputations of each of us and of our university.”
On Wednesday night, about 700 people held up candles and called for racial harmony outside the administrative building at the university in Oxford, countering Tuesday’s protest over Obama’s re-election.
Police were initially alerted to Tuesday’s uproar by people who saw Twitter posts about it. The students were told to leave, but about 100 came back later. One person was charged with public intoxication and another with failure to comply with police orders. There were no reports of injuries or property damage.
Rumors about the situation were fueled on Twitter after the university’s student journalists posted a video referring to the gathering as “riots.” The student newspaper posted a video of the crowd, but much of what the students said in it is unintelligible other than the “Hotty Toddy” cheer, which is common at football games and other school gatherings.
One picture that spread rapidly on social media shows people burning an Obama campaign sign, but the university hasn’t confirmed that the picture was taken on campus. The chancellor said some photos shared on social media showed things that were not seen by police on campus, but the reports of uncivil language and racial slurs appeared to be accurate.
Some students and teachers used social media to condemn the conflict.
Ellen Meacham, an Ole Miss journalism instructor, posted on Facebook that “anyone who calls that a riot has never read or heard anything about 1962.”
She was referring to when Meredith became the first black student to enroll at the university on Oct. 1, 1962. Federal authorities deployed more than 3,000 soldiers and more than 500 law enforcement officers to Oxford during the integration. An angry mob started an uprising that killed two white men. More than 200 people were injured. Ole Miss sponsored lectures and other events this year to commemorate the 50th anniversary.
“Now, 50 years later, about 2 percent of the overall student body goes out to protest when their guy doesn’t win the presidency and a portion of that small percentage displays the ugly strain that still infects too many in our student body,” Meacham wrote.
In a state with a 37 percent African-American population, Ole Miss now has a black enrollment of about 16.6 percent. The current student body president, Kim Dandridge, is the fourth black person elected to the post.
Jones said the campus was back to normal Wednesday.
The university was planning an event for Wednesday evening called the “We are One Mississippi Candlelight Walk” to condemn the protest, according to Thomas J. “Sparky” Reardon, vice chancellor for student affairs.
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Associated Press writer Emily Wagster Pettus contributed to this report.
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