Pimco Fund Manager Arnott Joins Bear Camp

by Stan Luxenberg

Pimco's Robert Arnott, Legend Financial Advisors' Louis Stanasolovich and the editors of the influential No-Load Fund Analyst say it may be years, or even decades, before stocks return to their historic highs, making bonds more attractive investments.

After last year's stock-market crash, the long-term average returns of equities fell into the single digits. Large-company shares returned an annual average of 9.6% from 1926 through 2008, according to Ibbotson Associates. The gap to bonds has all but evaporated.

Financial advisers for years have clung to a key belief: Over the long term, stocks outdo bonds. While equities may suffer periodic slumps, they also produce tremendous growth. Now a growing minority of advisers and portfolio managers is taking a different view.

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Searching for the Roots of a Recovery

by Will Swarts

Stocks came into last week having gained 30% from the bottom they hit in early March. But as the week progressed, and traders were presented with a mixed bag of economic and corporate data, it became apparent the rally was quickly losing steam. It didn’t help that on Thursday and Friday Chrysler and General Motors (GM: 1.18, +0.09, +8.25%) announced they would end relationships with almost 2,000 of their dealers. When the closing bell rang on Friday the Dow Jones Industrial Average had shed 300 points, or 3.5% for the week.

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Brazil and China eye plan to axe dollar

By Jonathan Wheatley in São Paulo

Brazil and China will work towards using their own currencies in trade transactions rather than the US dollar, according to Brazil’s central bank and aides to Luiz Inácio Lula da Silva, Brazil’s president.

The move follows recent Chinese challenges to the status of the dollar as the world’s leading international currency.

Mr Lula da Silva, who is visiting Beijing this week, and Hu Jintao, China’s president, first discussed the idea of replacing the dollar with the renminbi and the real as trade currencies when they met at the G20 summit in London last month.

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Beijing’s stimulus measures questioned

By Jamil Anderlini in Beijing

China’s much vaunted Rmb4,000bn economic stimulus package is being delayed by local governments unable to raise their share of financing, according to a report from the state auditor.

The survey, published on Monday, is the first official indication that China’s stimulus measures have not been as effective as the government claims.

The auditor said in some cases local governments had stumped up less than half the funds they had promised for projects in their jurisdictions, even though Beijing had transferred 94 per cent of the money earmarked by the central government for the stimulus plan.

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Economic Recovery Still Months Away: Roubini, Rogoff

The U.S. economy isn't likely to recover for months, and even then will remain weak for a long time, two well-known economists told CNBC.

Nouriel Roubini, co-founder and chairman at RGE Monitor, also known as Dr. Doom, and Kenneth Rogoff, professor at Harvard University's Department of Economics, both said the economy still faces serious challenges.

"People talk about a bottom of the recession in June, but I see it more like six to nine months from now," Roubini said. "The green shoots everyone talks about are more like yellow weeds to me."

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China, el año para entrar

En el escenario de incertidumbre económica que se vive en la actualidad, los expertos de Invesco creen que la economía y la bolsa china estarán entre las primeras en recuperarse, gracias a sus fuertes fundamentales y a su tendencia de crecimiento a largo plazo. En opinión de esta gestora, existen cuatro señales que deben de seguirse para confirmar la recuperación: la mejora de la demanda local y de las exportaciones; el crecimiento de la liquidez global y local; la revisión de los beneficios empresariales y, por último, pero no menor, las valoraciones.

En la primera de ellas, los efectos de las políticas monetarias y fiscales sobre la economía del país asiático serán claves para la recuperación de la demanda local. La confirmación de que se ha tocado el mínimo en el crecimiento interno o en las exportaciones será una buena señal de entrada.

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Oil Spike Raises Portfolio Questions

By DAVE KANSAS

Oil prices have shot higher in recent weeks as investors anticipate a rebound in the global economy. While many economists expect the economic rebound to be tepid at first, that has not slowed the advance in oil.

For individual investors, the rise in oil prices means it's a good time to think about the role commodities should play in your portfolio. In the wake of the global financial crisis, commodity prices plunged. Now that the economy is starting to come off the mat, those prices have started rising.

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George Soros Q1 Portfolio

George Soros is a macro investor, the trend in his portfolio is worth following. This is his Q1 portfolio update. He is so bullish with oil that he puts almost 50% of money there. He is also heavy weighted with consumer services and commodities. George Soros owns 92 stocks with a total value of $3.2 billion. These are the details of the buys and sells.

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