We do not highlight much in the way of stock or fund recommendations, but we do appreciate the tone of this one. James Altucher in RealMoney.com notes an interesting situation brewing with the MBIA Capital/Claymore Managed Duration Investment Grade Municipal Fund (MZF). An activist hedge fund is agitating to reduce the discount on this closed-end muni fund. Altucher likes the situation so much that,
I’d buy this for my mother — what higher recommendation could I make?
Daniel Gross in Slate.com notes another reason (beside the cars) to hate General Motors (GM). GM apparently does not think its boards needs an experienced auto executive with a substantial financial interest in the company on its board:
Given the crisis atmosphere, you would think GM might welcome to its board somebody like York, a former chief financial officer at Chrysler and IBM and a veteran of corporate turnarounds. And yet the board, which presided over a series of management missteps, is fighting Kerkorian. It is apparently trying to prevent one of the few people willing to make a huge financial bet on GM’s future from gaining representation on the board.
Kunal Kapoor at Morningstar.com highlights some surprising mutual fund statistics, including:
The percent of assets dedicated to equities by Vanguard Asset Allocation (VAAPX). This is only the seventh time in the model’s 30-year history that it has been 100% in stocks.
Another startling statistic. Zachery Kouwe in the New York Post reports that buyout kings, Kohlberg Kravis Roberts & Co. (KKR) is amassing a $10 billion buyout fund. But that is not the shocker. The shocker is that,
So far this year, KKR has paid out $349 million to Wall Street investment banks for merger advice, IPO underwriting and debt financing, according to data firm Dealogic.
Thomas Friedman’s book “The World is Flat” has garnered a fair amount of attention for its analysis of the rapidly globalizing economy, and has appeared on a number of “best books of 2005” lists. Apparently for some it appears to be a bit too utopian. William Pesek Jr. in Bloomberg notes a prominent rebuttal of the book’s themes. Stephen Roach of Morgan Stanley (MWD) feels,
“The image of a `flat world’ is more appropriate for the end-game of globalization,” Stephen Roach, Morgan Stanley’s New York-based chief economist, wrote in a recent report. “In my view, that ideal state is decades into the future — if that. In the meantime, the global economy is distinguished far more by its disparities and tensions, and how the resulting imbalances are likely to be vented in world financial markets.”
Friedman’s book does indeed explore how destabilizing the opening of economies and flow of capital and jobs from one nation or continent to another can be. Yet Roach, in his report that reads like a rebuttal of Friedman’s book, has a point when he argues “globalization may well be a win-win in the long run, but in the here and now it’s profoundly asymmetrical.”
Globalization and technology will continue to cause various upheavals in the short run, but the long term future holds promise.