Juggling Dynamite

Danielle was a guest today on Talk Digital Network with Jim Goddard talking about recent developments in the world economy and markets.  You can listen to an audio clip of the segment here.

It took years of focused effort to seduce retail investors back into harm’s way.  They were hurt so badly in 2000-02 and 2007-09, it was hard to get them back.  But now, finally, after 6 long years of pumping and talking it up, little people have let down their guard once more and levered themselves up to buy stocks with the most borrowed funds in history.  Battered and broke, desperate and hopeful; dreams of striking it rich and winning, have won them back to the craps table.  Brutally short on cash, they have now literally run margin loans to the max to buy back in.  Broker/dealers are scalping the margin interest, gloating over the ‘low hangin’ fruit’ of their ‘distribution channels’, selling their customers’ order flow so that high frequency trading machines can frontrun the little people’s naive dreams of financial freedom.  All in a day’s work.

Just when bankers were worried more greater fools could not be found, they pulled them in again.   Banker/brokers are back on top, pumping and dumping, and all the while confident that the government will hold them harmless the next time it all blows up as well.  As for the little folks…well, thanks for playing.  Better luck next time.

Fredric Tomczyk, TD Ameritrade CEO, weighs in on the pulse of retail investing, and which stocks clients are buying. Apple is our most widely held stock, says Tomczyk. Here is a direct video link.

‘Millennials’ is the term for the cohort of people now age 18 to 34. There will be 75.3 million American millennials in 2015, compared with 74.9 million baby boomers between ages 51 to 69. In terms of economic impact, it is important to appreciate that the ongoing debt bomb and financial crisis are having a lasting effect on the millennials as they struggle to get an economic foothold. Millennials are under-employed and indebted with little savings.  This is bad news for economic growth, the tax base, pensions and social programs. It’s also bad news for boomers looking to fund their retirement by selling financial assets and real estate at high prices to younger buyers.

“The birth rates for women in their 20s saw a 15 percent drop from 2007 to 2012, the Urban Institute report released Tuesday found. The decrease contributed to falling birth rates for women overall, after more than three decades of relative stability…

“This is really quite big,” said Nan Marie Astone, one of the report’s authors.

However, because the big plunge in the birthrates coincided with Great Recession and the following years, “it’s hard to think that [the economic decline] wasn’t the reason,” Astone said.

Still, while every previous major economic decline has also been followed by a decrease in the birthrate among young women, “it’s not been this big” as the one identified by the new study, Astone said”.

See: Baby bust! Millennials’ birth rate drop Here is a direct video link.