The U.S trade deficit widened to a nine-month high in January, with import
prices reaching their fastest rate of growth in nearly a year. Is this a
harbinger of a further decline in the dollar, and how will that affect my
dollar-denominated holdings abroad?
Industrial metal prices have hit multiyear highs recently, buoyed by stronger
economic growth, low interest rates and the weak U.S. dollar. Among such
commodities as aluminum, copper, lead, tin and nickel, which ones are close to
peaking and which still have some upside?
The rally in
poor credit-quality corporate bonds has lowered the credit spreads between
investment-grade and junk bonds to levels not seen since the mid-1990s. With
default rates and projected high-yield losses dropping, how strong is the
possibility of further relative appreciation?
As technology stocks continue their rebound, the wireless industry seems
particularly active. A deal-making free-for-all is underway, yet new entrants
continue to pour into the market and new technologies are creating a fiercely
competitive arena. Where are the best investment opportunities in this
space?
Japan has been buying U.S. dollars and debt at such
astronomical levels as to effectively subsidize our budget and trade deficits
and help keep our interest rates low. We could be in for a serious macroeconomic
shock if Japan halts its spending spree. How vulnerable are my holdings in
bonds, mortgage-backed securities and currencies?
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