Saturday, July 31, 2010

Can Housing Lead the Recovery? - CNBC.com


Quintin E. Primo III

By: Errol Mars

Born: March 14, 1955, in Rochester, New York

Company: Capri Capital Partners, LLC

Position: Chairman, CEO

Industry: Financial Services

Country: United States


Quintin Primo is the Chairman and CEO of Capri, a major equity and debt investor in U.S. property markets he co-founded with partner Daryl J. Carter in 1992. The company has more than $2.7 billion in real-estate assets under management.

Mr.Primo has over 28 years of real estate experience including serving as Vice President for Citicorp's Chicago lending team, completing over $2.5 billion in office, retail, industrial, hotel and residential financings.

"One of the most important reasons to make money is that it gives one the ability to give more," Primo says.

Mr.Primo has an M.B.A. from the Harvard Business School and B.S. degree in Finance with Honors from Indiana University.

Mr.Primo is also on the board of the Chicago Community Trust and the University of Chicago Hospitals.


Airtime: Fri. Jul. 30 2010 | 11:08 AM ET

Discussing whether housing will indicate a recovery, with Quintin Primo, Capri Capital Partners LLC.


Can Housing Lead the Recovery? - CNBC.com

Can Housing Lead the Recovery? - CNBC.com


Quintin E. Primo III

By: Errol Mars

Born: March 14, 1955, in Rochester, New York

Company: Capri Capital Partners, LLC

Position: Chairman, CEO

Industry: Financial Services

Country: United States


Quintin Primo is the Chairman and CEO of Capri, a major equity and debt investor in U.S. property markets he co-founded with partner Daryl J. Carter in 1992. The company has more than $2.7 billion in real-estate assets under management.

Mr.Primo has over 28 years of real estate experience including serving as Vice President for Citicorp's Chicago lending team, completing over $2.5 billion in office, retail, industrial, hotel and residential financings.

"One of the most important reasons to make money is that it gives one the ability to give more," Primo says.

Mr.Primo has an M.B.A. from the Harvard Business School and B.S. degree in Finance with Honors from Indiana University.

Mr.Primo is also on the board of the Chicago Community Trust and the University of Chicago Hospitals.


Airtime: Fri. Jul. 30 2010 | 11:08 AM ET

Discussing whether housing will indicate a recovery, with Quintin Primo, Capri Capital Partners LLC.


Can Housing Lead the Recovery? - CNBC.com

Can Housing Lead the Recovery? - CNBC.com


Quintin E. Primo III

By: Errol Mars

Born: March 14, 1955, in Rochester, New York

Company: Capri Capital Partners, LLC

Position: Chairman, CEO

Industry: Financial Services

Country: United States


Quintin Primo is the Chairman and CEO of Capri, a major equity and debt investor in U.S. property markets he co-founded with partner Daryl J. Carter in 1992. The company has more than $2.7 billion in real-estate assets under management.

Mr.Primo has over 28 years of real estate experience including serving as Vice President for Citicorp's Chicago lending team, completing over $2.5 billion in office, retail, industrial, hotel and residential financings.

"One of the most important reasons to make money is that it gives one the ability to give more," Primo says.

Mr.Primo has an M.B.A. from the Harvard Business School and B.S. degree in Finance with Honors from Indiana University.

Mr.Primo is also on the board of the Chicago Community Trust and the University of Chicago Hospitals.


Airtime: Fri. Jul. 30 2010 | 11:08 AM ET

Discussing whether housing will indicate a recovery, with Quintin Primo, Capri Capital Partners LLC.


Can Housing Lead the Recovery? - CNBC.com

Can Housing Lead the Recovery? - CNBC.com


Quintin E. Primo III

By: Errol Mars

Born: March 14, 1955, in Rochester, New York

Company: Capri Capital Partners, LLC

Position: Chairman, CEO

Industry: Financial Services

Country: United States


Quintin Primo is the Chairman and CEO of Capri, a major equity and debt investor in U.S. property markets he co-founded with partner Daryl J. Carter in 1992. The company has more than $2.7 billion in real-estate assets under management.

Mr.Primo has over 28 years of real estate experience including serving as Vice President for Citicorp's Chicago lending team, completing over $2.5 billion in office, retail, industrial, hotel and residential financings.

"One of the most important reasons to make money is that it gives one the ability to give more," Primo says.

Mr.Primo has an M.B.A. from the Harvard Business School and B.S. degree in Finance with Honors from Indiana University.

Mr.Primo is also on the board of the Chicago Community Trust and the University of Chicago Hospitals.


Airtime: Fri. Jul. 30 2010 | 11:08 AM ET

Discussing whether housing will indicate a recovery, with Quintin Primo, Capri Capital Partners LLC.


Can Housing Lead the Recovery? - CNBC.com

Can Housing Lead the Recovery? - CNBC.com


Quintin E. Primo III

By: Errol Mars

Born: March 14, 1955, in Rochester, New York

Company: Capri Capital Partners, LLC

Position: Chairman, CEO

Industry: Financial Services

Country: United States


Quintin Primo is the Chairman and CEO of Capri, a major equity and debt investor in U.S. property markets he co-founded with partner Daryl J. Carter in 1992. The company has more than $2.7 billion in real-estate assets under management.

Mr.Primo has over 28 years of real estate experience including serving as Vice President for Citicorp's Chicago lending team, completing over $2.5 billion in office, retail, industrial, hotel and residential financings.

"One of the most important reasons to make money is that it gives one the ability to give more," Primo says.

Mr.Primo has an M.B.A. from the Harvard Business School and B.S. degree in Finance with Honors from Indiana University.

Mr.Primo is also on the board of the Chicago Community Trust and the University of Chicago Hospitals.


Airtime: Fri. Jul. 30 2010 | 11:08 AM ET

Discussing whether housing will indicate a recovery, with Quintin Primo, Capri Capital Partners LLC.


Can Housing Lead the Recovery? - CNBC.com

Can Housing Lead the Recovery? - CNBC.com


Quintin E. Primo III

By: Errol Mars

Born: March 14, 1955, in Rochester, New York

Company: Capri Capital Partners, LLC

Position: Chairman, CEO

Industry: Financial Services

Country: United States


Quintin Primo is the Chairman and CEO of Capri, a major equity and debt investor in U.S. property markets he co-founded with partner Daryl J. Carter in 1992. The company has more than $2.7 billion in real-estate assets under management.

Mr.Primo has over 28 years of real estate experience including serving as Vice President for Citicorp's Chicago lending team, completing over $2.5 billion in office, retail, industrial, hotel and residential financings.

"One of the most important reasons to make money is that it gives one the ability to give more," Primo says.

Mr.Primo has an M.B.A. from the Harvard Business School and B.S. degree in Finance with Honors from Indiana University.

Mr.Primo is also on the board of the Chicago Community Trust and the University of Chicago Hospitals.


Airtime: Fri. Jul. 30 2010 | 11:08 AM ET

Discussing whether housing will indicate a recovery, with Quintin Primo, Capri Capital Partners LLC.


Can Housing Lead the Recovery? - CNBC.com

Can Housing Lead the Recovery? - CNBC.com


Quintin E. Primo III

By: Errol Mars

Born: March 14, 1955, in Rochester, New York

Company: Capri Capital Partners, LLC

Position: Chairman, CEO

Industry: Financial Services

Country: United States


Quintin Primo is the Chairman and CEO of Capri, a major equity and debt investor in U.S. property markets he co-founded with partner Daryl J. Carter in 1992. The company has more than $2.7 billion in real-estate assets under management.

Mr.Primo has over 28 years of real estate experience including serving as Vice President for Citicorp's Chicago lending team, completing over $2.5 billion in office, retail, industrial, hotel and residential financings.

"One of the most important reasons to make money is that it gives one the ability to give more," Primo says.

Mr.Primo has an M.B.A. from the Harvard Business School and B.S. degree in Finance with Honors from Indiana University.

Mr.Primo is also on the board of the Chicago Community Trust and the University of Chicago Hospitals.


Airtime: Fri. Jul. 30 2010 | 11:08 AM ET

Discussing whether housing will indicate a recovery, with Quintin Primo, Capri Capital Partners LLC.


Can Housing Lead the Recovery? - CNBC.com

Can Housing Lead the Recovery? - CNBC.com


Quintin E. Primo III

By: Errol Mars

Born: March 14, 1955, in Rochester, New York

Company: Capri Capital Partners, LLC

Position: Chairman, CEO

Industry: Financial Services

Country: United States


Quintin Primo is the Chairman and CEO of Capri, a major equity and debt investor in U.S. property markets he co-founded with partner Daryl J. Carter in 1992. The company has more than $2.7 billion in real-estate assets under management.

Mr.Primo has over 28 years of real estate experience including serving as Vice President for Citicorp's Chicago lending team, completing over $2.5 billion in office, retail, industrial, hotel and residential financings.

"One of the most important reasons to make money is that it gives one the ability to give more," Primo says.

Mr.Primo has an M.B.A. from the Harvard Business School and B.S. degree in Finance with Honors from Indiana University.

Mr.Primo is also on the board of the Chicago Community Trust and the University of Chicago Hospitals.


Airtime: Fri. Jul. 30 2010 | 11:08 AM ET

Discussing whether housing will indicate a recovery, with Quintin Primo, Capri Capital Partners LLC.


Can Housing Lead the Recovery? - CNBC.com

Sunday, July 25, 2010

Goldman Sachs sent federal bailout billions overseas

by Karen Mracek and Thomas Beaumont Des Moines Register and Tribune Co. July 25, 2010 12:00 AM

Goldman Sachs sent $4.3 billion in federal taxpayer money to 32 entities, including many overseas banks, hedge funds and pensions, according to records.

Goldman Sachs revealed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley of Iowa, the committee's ranking Republican. The records were released Friday night.

Asked the significance of the list of companies, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money.

"We thought originally we were bailing out AIG. Then later on . . . we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world."

Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.

Goldman Sachs received $5.55 billion from the government in the fall of 2008 as payment for then-worthless securities it held in AIG. Goldman had already hedged its risk that the securities would go bad. It had entered in agreements to spread the risk with the 32 entities named in Friday's report.

Overall, Goldman Sachs received a $12.9 billion payout from the government's bailout of AIG, which was at one time the world's largest insurance company.

Goldman Sachs also revealed to the Senate Finance Committee that it would have received $2.3 billion if AIG had gone under. Other large financial institutions, such as Citibank, JPMorgan Chase and Morgan Stanley, sold Goldman Sachs protection in the case of AIG's collapse. Those institutions did not have to pay Goldman Sachs after the government stepped in with taxpayer money.

Shouldn't Goldman Sachs be expected to collect from those institutions "before they collect the taxpayers' dollars?" Grassley asked. "It's a little bit like a farmer, if you got crop insurance, you shouldn't be getting disaster aid."

Goldman had not revealed the names of the counterparties it paid in late 2008 until Friday, despite repeated requests from Elizabeth Warren, chairwoman of the Congressional Oversight Panel.

Grassley said, "I think we didn't get the information because they consider it very embarrassing, and they ought to consider it very embarrassing."

The initial $85 billion to bail out AIG was supplemented by an additional $49.1 billion from the Troubled Asset Relief Program, as well as additional funds from the Federal Reserve. AIG's debt to U.S. taxpayers totals $133.3 billion outstanding.

"The only thing I can tell you is that people have the right to know, and the Fed and the public's business ought to be more public," Grassley said.

The list of companies receiving money includes a few familiar foreign banks, such as the Royal Bank of Scotland and Barclays. DZ AG Deutsche Zantrake Genossenschaftz Bank, a German cooperative banking group, received $1.2 billion, more than a quarter of the money Goldman paid out.

Warren, in testimony Wednesday, said that the rescue of AIG "distorted the marketplace by turning AIG's risky bets into fully guaranteed transactions. Instead of forcing AIG and its counterparties to bear the costs of the company's failure, the government shifted those costs in full onto taxpayers."

Grassley stressed the importance of transparency in the marketplace, as well as in the government's actions.

AIG received the bailout of $85 billion at the discretion of the Federal Reserve Bank of New York, which was led by Timothy Geithner, now head of the U.S. Treasury.

"I think it proves that he knew a lot more at the time than he told. And he surely knew where this money was going to go," Grassley said. "If he didn't, he should have known before they let the money out of their bank up there."

An attempt to reach Geithner through the White House public-information office was unsuccessful.



Goldman Sachs sent federal bailout billions overseas

Goldman Sachs sent federal bailout billions overseas

by Karen Mracek and Thomas Beaumont Des Moines Register and Tribune Co. July 25, 2010 12:00 AM

Goldman Sachs sent $4.3 billion in federal taxpayer money to 32 entities, including many overseas banks, hedge funds and pensions, according to records.

Goldman Sachs revealed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley of Iowa, the committee's ranking Republican. The records were released Friday night.

Asked the significance of the list of companies, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money.

"We thought originally we were bailing out AIG. Then later on . . . we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world."

Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.

Goldman Sachs received $5.55 billion from the government in the fall of 2008 as payment for then-worthless securities it held in AIG. Goldman had already hedged its risk that the securities would go bad. It had entered in agreements to spread the risk with the 32 entities named in Friday's report.

Overall, Goldman Sachs received a $12.9 billion payout from the government's bailout of AIG, which was at one time the world's largest insurance company.

Goldman Sachs also revealed to the Senate Finance Committee that it would have received $2.3 billion if AIG had gone under. Other large financial institutions, such as Citibank, JPMorgan Chase and Morgan Stanley, sold Goldman Sachs protection in the case of AIG's collapse. Those institutions did not have to pay Goldman Sachs after the government stepped in with taxpayer money.

Shouldn't Goldman Sachs be expected to collect from those institutions "before they collect the taxpayers' dollars?" Grassley asked. "It's a little bit like a farmer, if you got crop insurance, you shouldn't be getting disaster aid."

Goldman had not revealed the names of the counterparties it paid in late 2008 until Friday, despite repeated requests from Elizabeth Warren, chairwoman of the Congressional Oversight Panel.

Grassley said, "I think we didn't get the information because they consider it very embarrassing, and they ought to consider it very embarrassing."

The initial $85 billion to bail out AIG was supplemented by an additional $49.1 billion from the Troubled Asset Relief Program, as well as additional funds from the Federal Reserve. AIG's debt to U.S. taxpayers totals $133.3 billion outstanding.

"The only thing I can tell you is that people have the right to know, and the Fed and the public's business ought to be more public," Grassley said.

The list of companies receiving money includes a few familiar foreign banks, such as the Royal Bank of Scotland and Barclays. DZ AG Deutsche Zantrake Genossenschaftz Bank, a German cooperative banking group, received $1.2 billion, more than a quarter of the money Goldman paid out.

Warren, in testimony Wednesday, said that the rescue of AIG "distorted the marketplace by turning AIG's risky bets into fully guaranteed transactions. Instead of forcing AIG and its counterparties to bear the costs of the company's failure, the government shifted those costs in full onto taxpayers."

Grassley stressed the importance of transparency in the marketplace, as well as in the government's actions.

AIG received the bailout of $85 billion at the discretion of the Federal Reserve Bank of New York, which was led by Timothy Geithner, now head of the U.S. Treasury.

"I think it proves that he knew a lot more at the time than he told. And he surely knew where this money was going to go," Grassley said. "If he didn't, he should have known before they let the money out of their bank up there."

An attempt to reach Geithner through the White House public-information office was unsuccessful.



Goldman Sachs sent federal bailout billions overseas

Goldman Sachs sent federal bailout billions overseas

by Karen Mracek and Thomas Beaumont Des Moines Register and Tribune Co. July 25, 2010 12:00 AM

Goldman Sachs sent $4.3 billion in federal taxpayer money to 32 entities, including many overseas banks, hedge funds and pensions, according to records.

Goldman Sachs revealed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley of Iowa, the committee's ranking Republican. The records were released Friday night.

Asked the significance of the list of companies, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money.

"We thought originally we were bailing out AIG. Then later on . . . we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world."

Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.

Goldman Sachs received $5.55 billion from the government in the fall of 2008 as payment for then-worthless securities it held in AIG. Goldman had already hedged its risk that the securities would go bad. It had entered in agreements to spread the risk with the 32 entities named in Friday's report.

Overall, Goldman Sachs received a $12.9 billion payout from the government's bailout of AIG, which was at one time the world's largest insurance company.

Goldman Sachs also revealed to the Senate Finance Committee that it would have received $2.3 billion if AIG had gone under. Other large financial institutions, such as Citibank, JPMorgan Chase and Morgan Stanley, sold Goldman Sachs protection in the case of AIG's collapse. Those institutions did not have to pay Goldman Sachs after the government stepped in with taxpayer money.

Shouldn't Goldman Sachs be expected to collect from those institutions "before they collect the taxpayers' dollars?" Grassley asked. "It's a little bit like a farmer, if you got crop insurance, you shouldn't be getting disaster aid."

Goldman had not revealed the names of the counterparties it paid in late 2008 until Friday, despite repeated requests from Elizabeth Warren, chairwoman of the Congressional Oversight Panel.

Grassley said, "I think we didn't get the information because they consider it very embarrassing, and they ought to consider it very embarrassing."

The initial $85 billion to bail out AIG was supplemented by an additional $49.1 billion from the Troubled Asset Relief Program, as well as additional funds from the Federal Reserve. AIG's debt to U.S. taxpayers totals $133.3 billion outstanding.

"The only thing I can tell you is that people have the right to know, and the Fed and the public's business ought to be more public," Grassley said.

The list of companies receiving money includes a few familiar foreign banks, such as the Royal Bank of Scotland and Barclays. DZ AG Deutsche Zantrake Genossenschaftz Bank, a German cooperative banking group, received $1.2 billion, more than a quarter of the money Goldman paid out.

Warren, in testimony Wednesday, said that the rescue of AIG "distorted the marketplace by turning AIG's risky bets into fully guaranteed transactions. Instead of forcing AIG and its counterparties to bear the costs of the company's failure, the government shifted those costs in full onto taxpayers."

Grassley stressed the importance of transparency in the marketplace, as well as in the government's actions.

AIG received the bailout of $85 billion at the discretion of the Federal Reserve Bank of New York, which was led by Timothy Geithner, now head of the U.S. Treasury.

"I think it proves that he knew a lot more at the time than he told. And he surely knew where this money was going to go," Grassley said. "If he didn't, he should have known before they let the money out of their bank up there."

An attempt to reach Geithner through the White House public-information office was unsuccessful.



Goldman Sachs sent federal bailout billions overseas

Goldman Sachs sent federal bailout billions overseas

by Karen Mracek and Thomas Beaumont Des Moines Register and Tribune Co. July 25, 2010 12:00 AM

Goldman Sachs sent $4.3 billion in federal taxpayer money to 32 entities, including many overseas banks, hedge funds and pensions, according to records.

Goldman Sachs revealed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley of Iowa, the committee's ranking Republican. The records were released Friday night.

Asked the significance of the list of companies, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money.

"We thought originally we were bailing out AIG. Then later on . . . we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world."

Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.

Goldman Sachs received $5.55 billion from the government in the fall of 2008 as payment for then-worthless securities it held in AIG. Goldman had already hedged its risk that the securities would go bad. It had entered in agreements to spread the risk with the 32 entities named in Friday's report.

Overall, Goldman Sachs received a $12.9 billion payout from the government's bailout of AIG, which was at one time the world's largest insurance company.

Goldman Sachs also revealed to the Senate Finance Committee that it would have received $2.3 billion if AIG had gone under. Other large financial institutions, such as Citibank, JPMorgan Chase and Morgan Stanley, sold Goldman Sachs protection in the case of AIG's collapse. Those institutions did not have to pay Goldman Sachs after the government stepped in with taxpayer money.

Shouldn't Goldman Sachs be expected to collect from those institutions "before they collect the taxpayers' dollars?" Grassley asked. "It's a little bit like a farmer, if you got crop insurance, you shouldn't be getting disaster aid."

Goldman had not revealed the names of the counterparties it paid in late 2008 until Friday, despite repeated requests from Elizabeth Warren, chairwoman of the Congressional Oversight Panel.

Grassley said, "I think we didn't get the information because they consider it very embarrassing, and they ought to consider it very embarrassing."

The initial $85 billion to bail out AIG was supplemented by an additional $49.1 billion from the Troubled Asset Relief Program, as well as additional funds from the Federal Reserve. AIG's debt to U.S. taxpayers totals $133.3 billion outstanding.

"The only thing I can tell you is that people have the right to know, and the Fed and the public's business ought to be more public," Grassley said.

The list of companies receiving money includes a few familiar foreign banks, such as the Royal Bank of Scotland and Barclays. DZ AG Deutsche Zantrake Genossenschaftz Bank, a German cooperative banking group, received $1.2 billion, more than a quarter of the money Goldman paid out.

Warren, in testimony Wednesday, said that the rescue of AIG "distorted the marketplace by turning AIG's risky bets into fully guaranteed transactions. Instead of forcing AIG and its counterparties to bear the costs of the company's failure, the government shifted those costs in full onto taxpayers."

Grassley stressed the importance of transparency in the marketplace, as well as in the government's actions.

AIG received the bailout of $85 billion at the discretion of the Federal Reserve Bank of New York, which was led by Timothy Geithner, now head of the U.S. Treasury.

"I think it proves that he knew a lot more at the time than he told. And he surely knew where this money was going to go," Grassley said. "If he didn't, he should have known before they let the money out of their bank up there."

An attempt to reach Geithner through the White House public-information office was unsuccessful.



Goldman Sachs sent federal bailout billions overseas

Goldman Sachs sent federal bailout billions overseas

by Karen Mracek and Thomas Beaumont Des Moines Register and Tribune Co. July 25, 2010 12:00 AM

Goldman Sachs sent $4.3 billion in federal taxpayer money to 32 entities, including many overseas banks, hedge funds and pensions, according to records.

Goldman Sachs revealed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley of Iowa, the committee's ranking Republican. The records were released Friday night.

Asked the significance of the list of companies, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money.

"We thought originally we were bailing out AIG. Then later on . . . we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world."

Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.

Goldman Sachs received $5.55 billion from the government in the fall of 2008 as payment for then-worthless securities it held in AIG. Goldman had already hedged its risk that the securities would go bad. It had entered in agreements to spread the risk with the 32 entities named in Friday's report.

Overall, Goldman Sachs received a $12.9 billion payout from the government's bailout of AIG, which was at one time the world's largest insurance company.

Goldman Sachs also revealed to the Senate Finance Committee that it would have received $2.3 billion if AIG had gone under. Other large financial institutions, such as Citibank, JPMorgan Chase and Morgan Stanley, sold Goldman Sachs protection in the case of AIG's collapse. Those institutions did not have to pay Goldman Sachs after the government stepped in with taxpayer money.

Shouldn't Goldman Sachs be expected to collect from those institutions "before they collect the taxpayers' dollars?" Grassley asked. "It's a little bit like a farmer, if you got crop insurance, you shouldn't be getting disaster aid."

Goldman had not revealed the names of the counterparties it paid in late 2008 until Friday, despite repeated requests from Elizabeth Warren, chairwoman of the Congressional Oversight Panel.

Grassley said, "I think we didn't get the information because they consider it very embarrassing, and they ought to consider it very embarrassing."

The initial $85 billion to bail out AIG was supplemented by an additional $49.1 billion from the Troubled Asset Relief Program, as well as additional funds from the Federal Reserve. AIG's debt to U.S. taxpayers totals $133.3 billion outstanding.

"The only thing I can tell you is that people have the right to know, and the Fed and the public's business ought to be more public," Grassley said.

The list of companies receiving money includes a few familiar foreign banks, such as the Royal Bank of Scotland and Barclays. DZ AG Deutsche Zantrake Genossenschaftz Bank, a German cooperative banking group, received $1.2 billion, more than a quarter of the money Goldman paid out.

Warren, in testimony Wednesday, said that the rescue of AIG "distorted the marketplace by turning AIG's risky bets into fully guaranteed transactions. Instead of forcing AIG and its counterparties to bear the costs of the company's failure, the government shifted those costs in full onto taxpayers."

Grassley stressed the importance of transparency in the marketplace, as well as in the government's actions.

AIG received the bailout of $85 billion at the discretion of the Federal Reserve Bank of New York, which was led by Timothy Geithner, now head of the U.S. Treasury.

"I think it proves that he knew a lot more at the time than he told. And he surely knew where this money was going to go," Grassley said. "If he didn't, he should have known before they let the money out of their bank up there."

An attempt to reach Geithner through the White House public-information office was unsuccessful.



Goldman Sachs sent federal bailout billions overseas

Goldman Sachs sent federal bailout billions overseas

by Karen Mracek and Thomas Beaumont Des Moines Register and Tribune Co. July 25, 2010 12:00 AM

Goldman Sachs sent $4.3 billion in federal taxpayer money to 32 entities, including many overseas banks, hedge funds and pensions, according to records.

Goldman Sachs revealed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley of Iowa, the committee's ranking Republican. The records were released Friday night.

Asked the significance of the list of companies, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money.

"We thought originally we were bailing out AIG. Then later on . . . we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world."

Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.

Goldman Sachs received $5.55 billion from the government in the fall of 2008 as payment for then-worthless securities it held in AIG. Goldman had already hedged its risk that the securities would go bad. It had entered in agreements to spread the risk with the 32 entities named in Friday's report.

Overall, Goldman Sachs received a $12.9 billion payout from the government's bailout of AIG, which was at one time the world's largest insurance company.

Goldman Sachs also revealed to the Senate Finance Committee that it would have received $2.3 billion if AIG had gone under. Other large financial institutions, such as Citibank, JPMorgan Chase and Morgan Stanley, sold Goldman Sachs protection in the case of AIG's collapse. Those institutions did not have to pay Goldman Sachs after the government stepped in with taxpayer money.

Shouldn't Goldman Sachs be expected to collect from those institutions "before they collect the taxpayers' dollars?" Grassley asked. "It's a little bit like a farmer, if you got crop insurance, you shouldn't be getting disaster aid."

Goldman had not revealed the names of the counterparties it paid in late 2008 until Friday, despite repeated requests from Elizabeth Warren, chairwoman of the Congressional Oversight Panel.

Grassley said, "I think we didn't get the information because they consider it very embarrassing, and they ought to consider it very embarrassing."

The initial $85 billion to bail out AIG was supplemented by an additional $49.1 billion from the Troubled Asset Relief Program, as well as additional funds from the Federal Reserve. AIG's debt to U.S. taxpayers totals $133.3 billion outstanding.

"The only thing I can tell you is that people have the right to know, and the Fed and the public's business ought to be more public," Grassley said.

The list of companies receiving money includes a few familiar foreign banks, such as the Royal Bank of Scotland and Barclays. DZ AG Deutsche Zantrake Genossenschaftz Bank, a German cooperative banking group, received $1.2 billion, more than a quarter of the money Goldman paid out.

Warren, in testimony Wednesday, said that the rescue of AIG "distorted the marketplace by turning AIG's risky bets into fully guaranteed transactions. Instead of forcing AIG and its counterparties to bear the costs of the company's failure, the government shifted those costs in full onto taxpayers."

Grassley stressed the importance of transparency in the marketplace, as well as in the government's actions.

AIG received the bailout of $85 billion at the discretion of the Federal Reserve Bank of New York, which was led by Timothy Geithner, now head of the U.S. Treasury.

"I think it proves that he knew a lot more at the time than he told. And he surely knew where this money was going to go," Grassley said. "If he didn't, he should have known before they let the money out of their bank up there."

An attempt to reach Geithner through the White House public-information office was unsuccessful.



Goldman Sachs sent federal bailout billions overseas

Goldman Sachs sent federal bailout billions overseas

by Karen Mracek and Thomas Beaumont Des Moines Register and Tribune Co. July 25, 2010 12:00 AM

Goldman Sachs sent $4.3 billion in federal taxpayer money to 32 entities, including many overseas banks, hedge funds and pensions, according to records.

Goldman Sachs revealed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley of Iowa, the committee's ranking Republican. The records were released Friday night.

Asked the significance of the list of companies, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money.

"We thought originally we were bailing out AIG. Then later on . . . we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world."

Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.

Goldman Sachs received $5.55 billion from the government in the fall of 2008 as payment for then-worthless securities it held in AIG. Goldman had already hedged its risk that the securities would go bad. It had entered in agreements to spread the risk with the 32 entities named in Friday's report.

Overall, Goldman Sachs received a $12.9 billion payout from the government's bailout of AIG, which was at one time the world's largest insurance company.

Goldman Sachs also revealed to the Senate Finance Committee that it would have received $2.3 billion if AIG had gone under. Other large financial institutions, such as Citibank, JPMorgan Chase and Morgan Stanley, sold Goldman Sachs protection in the case of AIG's collapse. Those institutions did not have to pay Goldman Sachs after the government stepped in with taxpayer money.

Shouldn't Goldman Sachs be expected to collect from those institutions "before they collect the taxpayers' dollars?" Grassley asked. "It's a little bit like a farmer, if you got crop insurance, you shouldn't be getting disaster aid."

Goldman had not revealed the names of the counterparties it paid in late 2008 until Friday, despite repeated requests from Elizabeth Warren, chairwoman of the Congressional Oversight Panel.

Grassley said, "I think we didn't get the information because they consider it very embarrassing, and they ought to consider it very embarrassing."

The initial $85 billion to bail out AIG was supplemented by an additional $49.1 billion from the Troubled Asset Relief Program, as well as additional funds from the Federal Reserve. AIG's debt to U.S. taxpayers totals $133.3 billion outstanding.

"The only thing I can tell you is that people have the right to know, and the Fed and the public's business ought to be more public," Grassley said.

The list of companies receiving money includes a few familiar foreign banks, such as the Royal Bank of Scotland and Barclays. DZ AG Deutsche Zantrake Genossenschaftz Bank, a German cooperative banking group, received $1.2 billion, more than a quarter of the money Goldman paid out.

Warren, in testimony Wednesday, said that the rescue of AIG "distorted the marketplace by turning AIG's risky bets into fully guaranteed transactions. Instead of forcing AIG and its counterparties to bear the costs of the company's failure, the government shifted those costs in full onto taxpayers."

Grassley stressed the importance of transparency in the marketplace, as well as in the government's actions.

AIG received the bailout of $85 billion at the discretion of the Federal Reserve Bank of New York, which was led by Timothy Geithner, now head of the U.S. Treasury.

"I think it proves that he knew a lot more at the time than he told. And he surely knew where this money was going to go," Grassley said. "If he didn't, he should have known before they let the money out of their bank up there."

An attempt to reach Geithner through the White House public-information office was unsuccessful.



Goldman Sachs sent federal bailout billions overseas

Goldman Sachs sent federal bailout billions overseas

by Karen Mracek and Thomas Beaumont Des Moines Register and Tribune Co. July 25, 2010 12:00 AM

Goldman Sachs sent $4.3 billion in federal taxpayer money to 32 entities, including many overseas banks, hedge funds and pensions, according to records.

Goldman Sachs revealed the list of companies to the Senate Finance Committee after a threat of subpoena from Sen. Chuck Grassley of Iowa, the committee's ranking Republican. The records were released Friday night.

Asked the significance of the list of companies, Grassley said, "I hope it's as simple as taxpayers deserve to know what happened to their money.

"We thought originally we were bailing out AIG. Then later on . . . we learned that the money flowed through AIG to a few big banks, and now we know that the money went from these few big banks to dozens of financial institutions all around the world."

Grassley said he was reserving judgment on the appropriateness of U.S. taxpayer money ending up overseas until he learns more about the 32 entities.

Goldman Sachs received $5.55 billion from the government in the fall of 2008 as payment for then-worthless securities it held in AIG. Goldman had already hedged its risk that the securities would go bad. It had entered in agreements to spread the risk with the 32 entities named in Friday's report.

Overall, Goldman Sachs received a $12.9 billion payout from the government's bailout of AIG, which was at one time the world's largest insurance company.

Goldman Sachs also revealed to the Senate Finance Committee that it would have received $2.3 billion if AIG had gone under. Other large financial institutions, such as Citibank, JPMorgan Chase and Morgan Stanley, sold Goldman Sachs protection in the case of AIG's collapse. Those institutions did not have to pay Goldman Sachs after the government stepped in with taxpayer money.

Shouldn't Goldman Sachs be expected to collect from those institutions "before they collect the taxpayers' dollars?" Grassley asked. "It's a little bit like a farmer, if you got crop insurance, you shouldn't be getting disaster aid."

Goldman had not revealed the names of the counterparties it paid in late 2008 until Friday, despite repeated requests from Elizabeth Warren, chairwoman of the Congressional Oversight Panel.

Grassley said, "I think we didn't get the information because they consider it very embarrassing, and they ought to consider it very embarrassing."

The initial $85 billion to bail out AIG was supplemented by an additional $49.1 billion from the Troubled Asset Relief Program, as well as additional funds from the Federal Reserve. AIG's debt to U.S. taxpayers totals $133.3 billion outstanding.

"The only thing I can tell you is that people have the right to know, and the Fed and the public's business ought to be more public," Grassley said.

The list of companies receiving money includes a few familiar foreign banks, such as the Royal Bank of Scotland and Barclays. DZ AG Deutsche Zantrake Genossenschaftz Bank, a German cooperative banking group, received $1.2 billion, more than a quarter of the money Goldman paid out.

Warren, in testimony Wednesday, said that the rescue of AIG "distorted the marketplace by turning AIG's risky bets into fully guaranteed transactions. Instead of forcing AIG and its counterparties to bear the costs of the company's failure, the government shifted those costs in full onto taxpayers."

Grassley stressed the importance of transparency in the marketplace, as well as in the government's actions.

AIG received the bailout of $85 billion at the discretion of the Federal Reserve Bank of New York, which was led by Timothy Geithner, now head of the U.S. Treasury.

"I think it proves that he knew a lot more at the time than he told. And he surely knew where this money was going to go," Grassley said. "If he didn't, he should have known before they let the money out of their bank up there."

An attempt to reach Geithner through the White House public-information office was unsuccessful.



Goldman Sachs sent federal bailout billions overseas

Slow recovery may signal weak stocks

by Russ Wiles The Arizona Republic Jul. 25, 2010 12:00 AM

The current economic recovery has been weaker than normal coming out of a recession. Which raises the question: Are stock-market investors facing subpar returns for the next several years?

The headwinds from the debt overhang, real estate and banking woes, an aging population, possible tax hikes and other obstacles present some stiff challenges.

While viewpoints vary, the general mood indeed seems to be one of reduced expectations.

"If we're paying off all that debt from before and not taking on as much debt now, our economic growth will be slower," said Steve Puhr, an investment consultant and former portfolio manager and analyst who lives in Anthem.

"Retail investors, who are now less willing to take risks, will be slow coming back to stocks."

Puhr sees stocks posting average annual returns of 5 to 7 percent or so over the next decade. While not disastrous, that would be well below long-term average of around 10 percent.

With performance likely to be on the weak side, Puhr suggests investors make sure they're not paying too much in the way of shareholder-borne costs that can trim returns.

Many others also see subpar returns in a lackluster economic climate.

"Returns might be less than the normal historic average around 10 percent a year," said Keith Wibel at Foothills Asset Management in Scottsdale.

He sees stocks generating returns of 6 to 7 percent, including dividends. "That's not great but not horrible, either," he said.

Jeremy Grantham, chief investment strategist at asset-management firm GMO, expects "high quality" large stocks - those with low debt, strong franchises and other admirable qualities - to return about 7.3 percent a year above the inflation rate over the next seven years and stocks in emerging markets to perform almost as well, at 6.6 percent above inflation.

Given his inflation forecast of 2.5 percent a year on average, that implies nominal returns of 9 to 10 percent - not bad.

But Grantham expects other equity groups to lag considerably, including large stocks at 2.9 percent above inflation and small stocks at just 1.1 percent above inflation, which would equate to nominal returns in the range of 3 to 5 percent a year.

Grantham is even more uninspired about bonds, expecting certain categories, such as U.S. Treasuries, to post slightly negative results ahead.

"Fixed income is desperately unappealing," he wrote recently.

But not everyone agrees that slow economic growth, if it indeed persists, will translate into low stock-market returns.

For example, the Vanguard Group sees returns coming in at fairly normal levels in coming years.

"In light of the secular economic headwinds . . . this expectation for stock returns may come as a surprise," Vanguard said in a new report. "However, investors must recognize that low (economic) growth expectations for the U.S. and developed markets do not necessarily correlate with low stock returns going forward."

Rather than the economy, Vanguard cites market valuations such as dividend yields as more critical in predicting returns.

Consensus expectations for the economy already tend to be reflected in stock prices and thus have little impact on future returns, Vanguard argues.

The company sees a better than a 60 percent chance that U.S. stocks will post average returns between 4 and 16 percent annually over the next decade and a better than a 50-50 chance that equities in developed foreign markets will do the same.

Vanguard warns against betting the farm on stocks in emerging nations, even though their economies could be relatively robust, since prices already reflect this.

Vanguard also expects bond returns to be subdued, likely averaging between 2 and 5 percent annually in coming years, including interest.

Speaking of bonds and stocks, researchers at Ibbotson Associates last year issued a report expressing their belief that stocks will outperform fixed-income investments in the years ahead, even though bonds had just beaten stocks over the prior decade.

The firm still clings to that view.

"Long term, we continue to think that, with yields where they are, it's unlikely bonds will outperform stocks over a 10-year horizon," said Tom Idzorek, Ibbotson's chief investment officer.

While he cited concerns about the impact a dull economic recovery might have on stock returns, Idzorek discourages investors from trying to time the market for this or other reasons.

"People should be more concerned about whether they have an appropriate mix of stocks, bonds and cash," he said.

And that means a portfolio they can live with, even when the economy is just limping along.



Slow recovery may signal weak stocks

Slow recovery may signal weak stocks

by Russ Wiles The Arizona Republic Jul. 25, 2010 12:00 AM

The current economic recovery has been weaker than normal coming out of a recession. Which raises the question: Are stock-market investors facing subpar returns for the next several years?

The headwinds from the debt overhang, real estate and banking woes, an aging population, possible tax hikes and other obstacles present some stiff challenges.

While viewpoints vary, the general mood indeed seems to be one of reduced expectations.

"If we're paying off all that debt from before and not taking on as much debt now, our economic growth will be slower," said Steve Puhr, an investment consultant and former portfolio manager and analyst who lives in Anthem.

"Retail investors, who are now less willing to take risks, will be slow coming back to stocks."

Puhr sees stocks posting average annual returns of 5 to 7 percent or so over the next decade. While not disastrous, that would be well below long-term average of around 10 percent.

With performance likely to be on the weak side, Puhr suggests investors make sure they're not paying too much in the way of shareholder-borne costs that can trim returns.

Many others also see subpar returns in a lackluster economic climate.

"Returns might be less than the normal historic average around 10 percent a year," said Keith Wibel at Foothills Asset Management in Scottsdale.

He sees stocks generating returns of 6 to 7 percent, including dividends. "That's not great but not horrible, either," he said.

Jeremy Grantham, chief investment strategist at asset-management firm GMO, expects "high quality" large stocks - those with low debt, strong franchises and other admirable qualities - to return about 7.3 percent a year above the inflation rate over the next seven years and stocks in emerging markets to perform almost as well, at 6.6 percent above inflation.

Given his inflation forecast of 2.5 percent a year on average, that implies nominal returns of 9 to 10 percent - not bad.

But Grantham expects other equity groups to lag considerably, including large stocks at 2.9 percent above inflation and small stocks at just 1.1 percent above inflation, which would equate to nominal returns in the range of 3 to 5 percent a year.

Grantham is even more uninspired about bonds, expecting certain categories, such as U.S. Treasuries, to post slightly negative results ahead.

"Fixed income is desperately unappealing," he wrote recently.

But not everyone agrees that slow economic growth, if it indeed persists, will translate into low stock-market returns.

For example, the Vanguard Group sees returns coming in at fairly normal levels in coming years.

"In light of the secular economic headwinds . . . this expectation for stock returns may come as a surprise," Vanguard said in a new report. "However, investors must recognize that low (economic) growth expectations for the U.S. and developed markets do not necessarily correlate with low stock returns going forward."

Rather than the economy, Vanguard cites market valuations such as dividend yields as more critical in predicting returns.

Consensus expectations for the economy already tend to be reflected in stock prices and thus have little impact on future returns, Vanguard argues.

The company sees a better than a 60 percent chance that U.S. stocks will post average returns between 4 and 16 percent annually over the next decade and a better than a 50-50 chance that equities in developed foreign markets will do the same.

Vanguard warns against betting the farm on stocks in emerging nations, even though their economies could be relatively robust, since prices already reflect this.

Vanguard also expects bond returns to be subdued, likely averaging between 2 and 5 percent annually in coming years, including interest.

Speaking of bonds and stocks, researchers at Ibbotson Associates last year issued a report expressing their belief that stocks will outperform fixed-income investments in the years ahead, even though bonds had just beaten stocks over the prior decade.

The firm still clings to that view.

"Long term, we continue to think that, with yields where they are, it's unlikely bonds will outperform stocks over a 10-year horizon," said Tom Idzorek, Ibbotson's chief investment officer.

While he cited concerns about the impact a dull economic recovery might have on stock returns, Idzorek discourages investors from trying to time the market for this or other reasons.

"People should be more concerned about whether they have an appropriate mix of stocks, bonds and cash," he said.

And that means a portfolio they can live with, even when the economy is just limping along.



Slow recovery may signal weak stocks

Slow recovery may signal weak stocks

by Russ Wiles The Arizona Republic Jul. 25, 2010 12:00 AM

The current economic recovery has been weaker than normal coming out of a recession. Which raises the question: Are stock-market investors facing subpar returns for the next several years?

The headwinds from the debt overhang, real estate and banking woes, an aging population, possible tax hikes and other obstacles present some stiff challenges.

While viewpoints vary, the general mood indeed seems to be one of reduced expectations.

"If we're paying off all that debt from before and not taking on as much debt now, our economic growth will be slower," said Steve Puhr, an investment consultant and former portfolio manager and analyst who lives in Anthem.

"Retail investors, who are now less willing to take risks, will be slow coming back to stocks."

Puhr sees stocks posting average annual returns of 5 to 7 percent or so over the next decade. While not disastrous, that would be well below long-term average of around 10 percent.

With performance likely to be on the weak side, Puhr suggests investors make sure they're not paying too much in the way of shareholder-borne costs that can trim returns.

Many others also see subpar returns in a lackluster economic climate.

"Returns might be less than the normal historic average around 10 percent a year," said Keith Wibel at Foothills Asset Management in Scottsdale.

He sees stocks generating returns of 6 to 7 percent, including dividends. "That's not great but not horrible, either," he said.

Jeremy Grantham, chief investment strategist at asset-management firm GMO, expects "high quality" large stocks - those with low debt, strong franchises and other admirable qualities - to return about 7.3 percent a year above the inflation rate over the next seven years and stocks in emerging markets to perform almost as well, at 6.6 percent above inflation.

Given his inflation forecast of 2.5 percent a year on average, that implies nominal returns of 9 to 10 percent - not bad.

But Grantham expects other equity groups to lag considerably, including large stocks at 2.9 percent above inflation and small stocks at just 1.1 percent above inflation, which would equate to nominal returns in the range of 3 to 5 percent a year.

Grantham is even more uninspired about bonds, expecting certain categories, such as U.S. Treasuries, to post slightly negative results ahead.

"Fixed income is desperately unappealing," he wrote recently.

But not everyone agrees that slow economic growth, if it indeed persists, will translate into low stock-market returns.

For example, the Vanguard Group sees returns coming in at fairly normal levels in coming years.

"In light of the secular economic headwinds . . . this expectation for stock returns may come as a surprise," Vanguard said in a new report. "However, investors must recognize that low (economic) growth expectations for the U.S. and developed markets do not necessarily correlate with low stock returns going forward."

Rather than the economy, Vanguard cites market valuations such as dividend yields as more critical in predicting returns.

Consensus expectations for the economy already tend to be reflected in stock prices and thus have little impact on future returns, Vanguard argues.

The company sees a better than a 60 percent chance that U.S. stocks will post average returns between 4 and 16 percent annually over the next decade and a better than a 50-50 chance that equities in developed foreign markets will do the same.

Vanguard warns against betting the farm on stocks in emerging nations, even though their economies could be relatively robust, since prices already reflect this.

Vanguard also expects bond returns to be subdued, likely averaging between 2 and 5 percent annually in coming years, including interest.

Speaking of bonds and stocks, researchers at Ibbotson Associates last year issued a report expressing their belief that stocks will outperform fixed-income investments in the years ahead, even though bonds had just beaten stocks over the prior decade.

The firm still clings to that view.

"Long term, we continue to think that, with yields where they are, it's unlikely bonds will outperform stocks over a 10-year horizon," said Tom Idzorek, Ibbotson's chief investment officer.

While he cited concerns about the impact a dull economic recovery might have on stock returns, Idzorek discourages investors from trying to time the market for this or other reasons.

"People should be more concerned about whether they have an appropriate mix of stocks, bonds and cash," he said.

And that means a portfolio they can live with, even when the economy is just limping along.



Slow recovery may signal weak stocks

Slow recovery may signal weak stocks

by Russ Wiles The Arizona Republic Jul. 25, 2010 12:00 AM

The current economic recovery has been weaker than normal coming out of a recession. Which raises the question: Are stock-market investors facing subpar returns for the next several years?

The headwinds from the debt overhang, real estate and banking woes, an aging population, possible tax hikes and other obstacles present some stiff challenges.

While viewpoints vary, the general mood indeed seems to be one of reduced expectations.

"If we're paying off all that debt from before and not taking on as much debt now, our economic growth will be slower," said Steve Puhr, an investment consultant and former portfolio manager and analyst who lives in Anthem.

"Retail investors, who are now less willing to take risks, will be slow coming back to stocks."

Puhr sees stocks posting average annual returns of 5 to 7 percent or so over the next decade. While not disastrous, that would be well below long-term average of around 10 percent.

With performance likely to be on the weak side, Puhr suggests investors make sure they're not paying too much in the way of shareholder-borne costs that can trim returns.

Many others also see subpar returns in a lackluster economic climate.

"Returns might be less than the normal historic average around 10 percent a year," said Keith Wibel at Foothills Asset Management in Scottsdale.

He sees stocks generating returns of 6 to 7 percent, including dividends. "That's not great but not horrible, either," he said.

Jeremy Grantham, chief investment strategist at asset-management firm GMO, expects "high quality" large stocks - those with low debt, strong franchises and other admirable qualities - to return about 7.3 percent a year above the inflation rate over the next seven years and stocks in emerging markets to perform almost as well, at 6.6 percent above inflation.

Given his inflation forecast of 2.5 percent a year on average, that implies nominal returns of 9 to 10 percent - not bad.

But Grantham expects other equity groups to lag considerably, including large stocks at 2.9 percent above inflation and small stocks at just 1.1 percent above inflation, which would equate to nominal returns in the range of 3 to 5 percent a year.

Grantham is even more uninspired about bonds, expecting certain categories, such as U.S. Treasuries, to post slightly negative results ahead.

"Fixed income is desperately unappealing," he wrote recently.

But not everyone agrees that slow economic growth, if it indeed persists, will translate into low stock-market returns.

For example, the Vanguard Group sees returns coming in at fairly normal levels in coming years.

"In light of the secular economic headwinds . . . this expectation for stock returns may come as a surprise," Vanguard said in a new report. "However, investors must recognize that low (economic) growth expectations for the U.S. and developed markets do not necessarily correlate with low stock returns going forward."

Rather than the economy, Vanguard cites market valuations such as dividend yields as more critical in predicting returns.

Consensus expectations for the economy already tend to be reflected in stock prices and thus have little impact on future returns, Vanguard argues.

The company sees a better than a 60 percent chance that U.S. stocks will post average returns between 4 and 16 percent annually over the next decade and a better than a 50-50 chance that equities in developed foreign markets will do the same.

Vanguard warns against betting the farm on stocks in emerging nations, even though their economies could be relatively robust, since prices already reflect this.

Vanguard also expects bond returns to be subdued, likely averaging between 2 and 5 percent annually in coming years, including interest.

Speaking of bonds and stocks, researchers at Ibbotson Associates last year issued a report expressing their belief that stocks will outperform fixed-income investments in the years ahead, even though bonds had just beaten stocks over the prior decade.

The firm still clings to that view.

"Long term, we continue to think that, with yields where they are, it's unlikely bonds will outperform stocks over a 10-year horizon," said Tom Idzorek, Ibbotson's chief investment officer.

While he cited concerns about the impact a dull economic recovery might have on stock returns, Idzorek discourages investors from trying to time the market for this or other reasons.

"People should be more concerned about whether they have an appropriate mix of stocks, bonds and cash," he said.

And that means a portfolio they can live with, even when the economy is just limping along.



Slow recovery may signal weak stocks

Slow recovery may signal weak stocks

by Russ Wiles The Arizona Republic Jul. 25, 2010 12:00 AM

The current economic recovery has been weaker than normal coming out of a recession. Which raises the question: Are stock-market investors facing subpar returns for the next several years?

The headwinds from the debt overhang, real estate and banking woes, an aging population, possible tax hikes and other obstacles present some stiff challenges.

While viewpoints vary, the general mood indeed seems to be one of reduced expectations.

"If we're paying off all that debt from before and not taking on as much debt now, our economic growth will be slower," said Steve Puhr, an investment consultant and former portfolio manager and analyst who lives in Anthem.

"Retail investors, who are now less willing to take risks, will be slow coming back to stocks."

Puhr sees stocks posting average annual returns of 5 to 7 percent or so over the next decade. While not disastrous, that would be well below long-term average of around 10 percent.

With performance likely to be on the weak side, Puhr suggests investors make sure they're not paying too much in the way of shareholder-borne costs that can trim returns.

Many others also see subpar returns in a lackluster economic climate.

"Returns might be less than the normal historic average around 10 percent a year," said Keith Wibel at Foothills Asset Management in Scottsdale.

He sees stocks generating returns of 6 to 7 percent, including dividends. "That's not great but not horrible, either," he said.

Jeremy Grantham, chief investment strategist at asset-management firm GMO, expects "high quality" large stocks - those with low debt, strong franchises and other admirable qualities - to return about 7.3 percent a year above the inflation rate over the next seven years and stocks in emerging markets to perform almost as well, at 6.6 percent above inflation.

Given his inflation forecast of 2.5 percent a year on average, that implies nominal returns of 9 to 10 percent - not bad.

But Grantham expects other equity groups to lag considerably, including large stocks at 2.9 percent above inflation and small stocks at just 1.1 percent above inflation, which would equate to nominal returns in the range of 3 to 5 percent a year.

Grantham is even more uninspired about bonds, expecting certain categories, such as U.S. Treasuries, to post slightly negative results ahead.

"Fixed income is desperately unappealing," he wrote recently.

But not everyone agrees that slow economic growth, if it indeed persists, will translate into low stock-market returns.

For example, the Vanguard Group sees returns coming in at fairly normal levels in coming years.

"In light of the secular economic headwinds . . . this expectation for stock returns may come as a surprise," Vanguard said in a new report. "However, investors must recognize that low (economic) growth expectations for the U.S. and developed markets do not necessarily correlate with low stock returns going forward."

Rather than the economy, Vanguard cites market valuations such as dividend yields as more critical in predicting returns.

Consensus expectations for the economy already tend to be reflected in stock prices and thus have little impact on future returns, Vanguard argues.

The company sees a better than a 60 percent chance that U.S. stocks will post average returns between 4 and 16 percent annually over the next decade and a better than a 50-50 chance that equities in developed foreign markets will do the same.

Vanguard warns against betting the farm on stocks in emerging nations, even though their economies could be relatively robust, since prices already reflect this.

Vanguard also expects bond returns to be subdued, likely averaging between 2 and 5 percent annually in coming years, including interest.

Speaking of bonds and stocks, researchers at Ibbotson Associates last year issued a report expressing their belief that stocks will outperform fixed-income investments in the years ahead, even though bonds had just beaten stocks over the prior decade.

The firm still clings to that view.

"Long term, we continue to think that, with yields where they are, it's unlikely bonds will outperform stocks over a 10-year horizon," said Tom Idzorek, Ibbotson's chief investment officer.

While he cited concerns about the impact a dull economic recovery might have on stock returns, Idzorek discourages investors from trying to time the market for this or other reasons.

"People should be more concerned about whether they have an appropriate mix of stocks, bonds and cash," he said.

And that means a portfolio they can live with, even when the economy is just limping along.



Slow recovery may signal weak stocks

Slow recovery may signal weak stocks

by Russ Wiles The Arizona Republic Jul. 25, 2010 12:00 AM

The current economic recovery has been weaker than normal coming out of a recession. Which raises the question: Are stock-market investors facing subpar returns for the next several years?

The headwinds from the debt overhang, real estate and banking woes, an aging population, possible tax hikes and other obstacles present some stiff challenges.

While viewpoints vary, the general mood indeed seems to be one of reduced expectations.

"If we're paying off all that debt from before and not taking on as much debt now, our economic growth will be slower," said Steve Puhr, an investment consultant and former portfolio manager and analyst who lives in Anthem.

"Retail investors, who are now less willing to take risks, will be slow coming back to stocks."

Puhr sees stocks posting average annual returns of 5 to 7 percent or so over the next decade. While not disastrous, that would be well below long-term average of around 10 percent.

With performance likely to be on the weak side, Puhr suggests investors make sure they're not paying too much in the way of shareholder-borne costs that can trim returns.

Many others also see subpar returns in a lackluster economic climate.

"Returns might be less than the normal historic average around 10 percent a year," said Keith Wibel at Foothills Asset Management in Scottsdale.

He sees stocks generating returns of 6 to 7 percent, including dividends. "That's not great but not horrible, either," he said.

Jeremy Grantham, chief investment strategist at asset-management firm GMO, expects "high quality" large stocks - those with low debt, strong franchises and other admirable qualities - to return about 7.3 percent a year above the inflation rate over the next seven years and stocks in emerging markets to perform almost as well, at 6.6 percent above inflation.

Given his inflation forecast of 2.5 percent a year on average, that implies nominal returns of 9 to 10 percent - not bad.

But Grantham expects other equity groups to lag considerably, including large stocks at 2.9 percent above inflation and small stocks at just 1.1 percent above inflation, which would equate to nominal returns in the range of 3 to 5 percent a year.

Grantham is even more uninspired about bonds, expecting certain categories, such as U.S. Treasuries, to post slightly negative results ahead.

"Fixed income is desperately unappealing," he wrote recently.

But not everyone agrees that slow economic growth, if it indeed persists, will translate into low stock-market returns.

For example, the Vanguard Group sees returns coming in at fairly normal levels in coming years.

"In light of the secular economic headwinds . . . this expectation for stock returns may come as a surprise," Vanguard said in a new report. "However, investors must recognize that low (economic) growth expectations for the U.S. and developed markets do not necessarily correlate with low stock returns going forward."

Rather than the economy, Vanguard cites market valuations such as dividend yields as more critical in predicting returns.

Consensus expectations for the economy already tend to be reflected in stock prices and thus have little impact on future returns, Vanguard argues.

The company sees a better than a 60 percent chance that U.S. stocks will post average returns between 4 and 16 percent annually over the next decade and a better than a 50-50 chance that equities in developed foreign markets will do the same.

Vanguard warns against betting the farm on stocks in emerging nations, even though their economies could be relatively robust, since prices already reflect this.

Vanguard also expects bond returns to be subdued, likely averaging between 2 and 5 percent annually in coming years, including interest.

Speaking of bonds and stocks, researchers at Ibbotson Associates last year issued a report expressing their belief that stocks will outperform fixed-income investments in the years ahead, even though bonds had just beaten stocks over the prior decade.

The firm still clings to that view.

"Long term, we continue to think that, with yields where they are, it's unlikely bonds will outperform stocks over a 10-year horizon," said Tom Idzorek, Ibbotson's chief investment officer.

While he cited concerns about the impact a dull economic recovery might have on stock returns, Idzorek discourages investors from trying to time the market for this or other reasons.

"People should be more concerned about whether they have an appropriate mix of stocks, bonds and cash," he said.

And that means a portfolio they can live with, even when the economy is just limping along.



Slow recovery may signal weak stocks

Slow recovery may signal weak stocks

by Russ Wiles The Arizona Republic Jul. 25, 2010 12:00 AM

The current economic recovery has been weaker than normal coming out of a recession. Which raises the question: Are stock-market investors facing subpar returns for the next several years?

The headwinds from the debt overhang, real estate and banking woes, an aging population, possible tax hikes and other obstacles present some stiff challenges.

While viewpoints vary, the general mood indeed seems to be one of reduced expectations.

"If we're paying off all that debt from before and not taking on as much debt now, our economic growth will be slower," said Steve Puhr, an investment consultant and former portfolio manager and analyst who lives in Anthem.

"Retail investors, who are now less willing to take risks, will be slow coming back to stocks."

Puhr sees stocks posting average annual returns of 5 to 7 percent or so over the next decade. While not disastrous, that would be well below long-term average of around 10 percent.

With performance likely to be on the weak side, Puhr suggests investors make sure they're not paying too much in the way of shareholder-borne costs that can trim returns.

Many others also see subpar returns in a lackluster economic climate.

"Returns might be less than the normal historic average around 10 percent a year," said Keith Wibel at Foothills Asset Management in Scottsdale.

He sees stocks generating returns of 6 to 7 percent, including dividends. "That's not great but not horrible, either," he said.

Jeremy Grantham, chief investment strategist at asset-management firm GMO, expects "high quality" large stocks - those with low debt, strong franchises and other admirable qualities - to return about 7.3 percent a year above the inflation rate over the next seven years and stocks in emerging markets to perform almost as well, at 6.6 percent above inflation.

Given his inflation forecast of 2.5 percent a year on average, that implies nominal returns of 9 to 10 percent - not bad.

But Grantham expects other equity groups to lag considerably, including large stocks at 2.9 percent above inflation and small stocks at just 1.1 percent above inflation, which would equate to nominal returns in the range of 3 to 5 percent a year.

Grantham is even more uninspired about bonds, expecting certain categories, such as U.S. Treasuries, to post slightly negative results ahead.

"Fixed income is desperately unappealing," he wrote recently.

But not everyone agrees that slow economic growth, if it indeed persists, will translate into low stock-market returns.

For example, the Vanguard Group sees returns coming in at fairly normal levels in coming years.

"In light of the secular economic headwinds . . . this expectation for stock returns may come as a surprise," Vanguard said in a new report. "However, investors must recognize that low (economic) growth expectations for the U.S. and developed markets do not necessarily correlate with low stock returns going forward."

Rather than the economy, Vanguard cites market valuations such as dividend yields as more critical in predicting returns.

Consensus expectations for the economy already tend to be reflected in stock prices and thus have little impact on future returns, Vanguard argues.

The company sees a better than a 60 percent chance that U.S. stocks will post average returns between 4 and 16 percent annually over the next decade and a better than a 50-50 chance that equities in developed foreign markets will do the same.

Vanguard warns against betting the farm on stocks in emerging nations, even though their economies could be relatively robust, since prices already reflect this.

Vanguard also expects bond returns to be subdued, likely averaging between 2 and 5 percent annually in coming years, including interest.

Speaking of bonds and stocks, researchers at Ibbotson Associates last year issued a report expressing their belief that stocks will outperform fixed-income investments in the years ahead, even though bonds had just beaten stocks over the prior decade.

The firm still clings to that view.

"Long term, we continue to think that, with yields where they are, it's unlikely bonds will outperform stocks over a 10-year horizon," said Tom Idzorek, Ibbotson's chief investment officer.

While he cited concerns about the impact a dull economic recovery might have on stock returns, Idzorek discourages investors from trying to time the market for this or other reasons.

"People should be more concerned about whether they have an appropriate mix of stocks, bonds and cash," he said.

And that means a portfolio they can live with, even when the economy is just limping along.



Slow recovery may signal weak stocks

Slow recovery may signal weak stocks

by Russ Wiles The Arizona Republic Jul. 25, 2010 12:00 AM

The current economic recovery has been weaker than normal coming out of a recession. Which raises the question: Are stock-market investors facing subpar returns for the next several years?

The headwinds from the debt overhang, real estate and banking woes, an aging population, possible tax hikes and other obstacles present some stiff challenges.

While viewpoints vary, the general mood indeed seems to be one of reduced expectations.

"If we're paying off all that debt from before and not taking on as much debt now, our economic growth will be slower," said Steve Puhr, an investment consultant and former portfolio manager and analyst who lives in Anthem.

"Retail investors, who are now less willing to take risks, will be slow coming back to stocks."

Puhr sees stocks posting average annual returns of 5 to 7 percent or so over the next decade. While not disastrous, that would be well below long-term average of around 10 percent.

With performance likely to be on the weak side, Puhr suggests investors make sure they're not paying too much in the way of shareholder-borne costs that can trim returns.

Many others also see subpar returns in a lackluster economic climate.

"Returns might be less than the normal historic average around 10 percent a year," said Keith Wibel at Foothills Asset Management in Scottsdale.

He sees stocks generating returns of 6 to 7 percent, including dividends. "That's not great but not horrible, either," he said.

Jeremy Grantham, chief investment strategist at asset-management firm GMO, expects "high quality" large stocks - those with low debt, strong franchises and other admirable qualities - to return about 7.3 percent a year above the inflation rate over the next seven years and stocks in emerging markets to perform almost as well, at 6.6 percent above inflation.

Given his inflation forecast of 2.5 percent a year on average, that implies nominal returns of 9 to 10 percent - not bad.

But Grantham expects other equity groups to lag considerably, including large stocks at 2.9 percent above inflation and small stocks at just 1.1 percent above inflation, which would equate to nominal returns in the range of 3 to 5 percent a year.

Grantham is even more uninspired about bonds, expecting certain categories, such as U.S. Treasuries, to post slightly negative results ahead.

"Fixed income is desperately unappealing," he wrote recently.

But not everyone agrees that slow economic growth, if it indeed persists, will translate into low stock-market returns.

For example, the Vanguard Group sees returns coming in at fairly normal levels in coming years.

"In light of the secular economic headwinds . . . this expectation for stock returns may come as a surprise," Vanguard said in a new report. "However, investors must recognize that low (economic) growth expectations for the U.S. and developed markets do not necessarily correlate with low stock returns going forward."

Rather than the economy, Vanguard cites market valuations such as dividend yields as more critical in predicting returns.

Consensus expectations for the economy already tend to be reflected in stock prices and thus have little impact on future returns, Vanguard argues.

The company sees a better than a 60 percent chance that U.S. stocks will post average returns between 4 and 16 percent annually over the next decade and a better than a 50-50 chance that equities in developed foreign markets will do the same.

Vanguard warns against betting the farm on stocks in emerging nations, even though their economies could be relatively robust, since prices already reflect this.

Vanguard also expects bond returns to be subdued, likely averaging between 2 and 5 percent annually in coming years, including interest.

Speaking of bonds and stocks, researchers at Ibbotson Associates last year issued a report expressing their belief that stocks will outperform fixed-income investments in the years ahead, even though bonds had just beaten stocks over the prior decade.

The firm still clings to that view.

"Long term, we continue to think that, with yields where they are, it's unlikely bonds will outperform stocks over a 10-year horizon," said Tom Idzorek, Ibbotson's chief investment officer.

While he cited concerns about the impact a dull economic recovery might have on stock returns, Idzorek discourages investors from trying to time the market for this or other reasons.

"People should be more concerned about whether they have an appropriate mix of stocks, bonds and cash," he said.

And that means a portfolio they can live with, even when the economy is just limping along.



Slow recovery may signal weak stocks

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