CFA Society Chicago NewsBrief
Mar. 11, 2014

Will Obama's nominee as next commodities cop play it tough?
The Associated Press via Crain's Chicago Business
When President Barack Obama's choice to head an agency that oversees some of the riskiest corners of the financial world faces senators, one question could dominate: Will he be as aggressive as his predecessor in holding big Wall Street banks to stricter standards? The nominee, Timothy Massad, has been tapped to be the next chairman of the Commodity Futures Trading Commission, which regulates futures and options markets.More

She has advised the Federal Reserve, and now she's here to answer your questions
CFA Chicago
Diane Swonk, Chief Economist at Mesirow Financial, is one of the most respected economists in the world and among the most quoted in the financial press. In addition, as advisor to the Federal Reserve Board and regional Reserve Banks, she is a Fed insider who can offer valuable insights on FOMC decisions, as well as economic trends. Join CFA on March 26 at 12 p.m. at The Chicago Club for the Distinguished Speaker Series featuring Diane Swonk.More

Rosenberg's forte for forecasting
CFA Chicago
Join CFA Chicago on Tuesday, April 29 from 12 - 1 p.m. for the Distinguished Speaker Series featuring David Rosenberg, Chief Economist and Strategist for Gluskin Sheff and Associates. Fees for members are $45 dollars, the student-members fee is $10, and non-members are welcome to join for $55. This series also qualifies for credit under the guidelines for the CFA Institute Professional Development Program.More

Utilize all of the tools in your professional toolbox
CFA Chicago
Meet with representatives from Chicago's top investment firms at one of our most popular career development events of the year. Representatives from Kaplan Schweser will also be present to provide candidates with information on their CFA review courses and services. Join CFA Chicago on March 21 at 11 a.m. at The Standard Club for endless networking opportunities, speed resume critiques, speed LinkedIn profile critiques and for more information on the CFA Chicago eMentor program.More

Shadow banking is hurting China's banks — and that's a good thing
CFA Institute's Enterprising Investor
You’ve read all sorts of warnings about the coming car wreck that is shadow banking in China. Several shadow banking products are reportedly on the brink of default, and the fear is this will have a domino effect in the banking sector, the local economy, and the global recovery. No doubt shadow banking in China is large (30 percent of total banking assets, according to JPMorgan’s estimates) and carries unknown risks. But China’s problem is not shadow banking itself, it is a dysfunctional credit system.More

How safe are your investments, really?
The Wall Street Journal
Money managers point to historical data going back to the 1920s to show that in the past stocks have produced total returns of about 10 percent a year over the long term and bonds, about 5 percent mdash; meaning a standard "balanced" portfolio of 60 percent stocks and 40 percent bonds would earn just over 8 percent a year. (Naturally, their legal departments quickly add that the past is no guide to the future.) Are these forecasts realistic? Are they sensible? Are they even based on actual logic or a correct reading of the past data? Wall Street strategists Rob Arnott and the late Peter Bernstein, in research published just after the 2000 dot-com crash, explained the dangers of trying to extrapolate from the past.More

Playing it safe
Redeye Chicago
Kids these days, right? The under-35 “millennial generation” is “lazy, entitled, selfish and shallow,” according to Time. “They often are unable to think for themselves,” reports slate.com. “They don’t necessarily understand the value of money because many of them have no experience with it, and yet, incredibly dichotomously, they think they deserve to be highly paid,” says Business Insider. But recent data reveal that, at least when it comes to money, millennials are far more careful than their “spoiled” reputation would suggest — and that will reshape the economy, for better or worse, experts say. More

Bitcoin's return on investment may be the education it provides
Chicago Tribune
The good thing about the bad things involving bitcoins lately is the way they're testing the concept of a digital currency. Also, it's not your money. For those who have invested in bitcoins, well, you're learning something too. If you fear your bitcoins vaporized when the Japan-based Mt. Gox exchange collapsed, you might be sore and sue, as one Chicago-area resident has done in U.S. federal court.More

USB's Weber sees dollar rising as central banks enter new phase
Bloomberg Businessweek
UBS AG Chairman Axel Weber said he expects the euro and yen to weaken against the dollar because the world’s three major central banks are on different paths. The Bank of Japan, the European Central Bank, and the U.S. Federal Reserve have entered a “new phase,” Weber, a former president of Germany’s Bundesbank, said in an interview with Bloomberg Television. The Fed has started to allow interest rates to rise by reducing its bond purchases and will continue to do so, said Weber, 57More

Gluskin's David Rosenberg: 'I don't think inflation is dead'
Money News
When it comes to inflation, David Rosenberg, chief economist at Gluskin Sheff + Associates, isn't running with the pack. "Everybody has concluded that inflation is dead," he told Bloomberg TV. "I don’t think inflation is dead." While the 0.4 percent February increase in average hourly earnings announced recently is just "one data point," Rosenberg says, "a lot of wage pressure is coming out of selected industries." More

US public pensions need more than investment windfall
Chicago Tribune
Double-digit annual returns for most U.S. public pension systems over the past two years have done little to shrink the yawning deficits facing many of them after a decade of inadequate funding, according to analysts and recent data. Thanks to a robust stock market, most systems have enjoyed windfalls recently, with investment returns far exceeding projections. Even so, many are still struggling with shortfalls. In some cases, they have worsened as state contributions fail to keep pace with what is needed to pay beneficiaries.More

Will Obama's nominee as next commodities cop play it tough?
The Associated Press via Crain's Chicago Business
When President Barack Obama's choice to head an agency that oversees some of the riskiest corners of the financial world faces senators, one question could dominate Will he be as aggressive as his predecessor in holding big Wall Street banks to stricter standards?More

Is there value in financial advisers who get it wrong?
Chicago Tribune
This could be the moment when you discover that the emperor has been without clothes. Certainly, that was the image of the Federal Reserve as transcripts of its meetings in the early days of the 2008 financial crisis were released recently and unveiled the naked truth.More

Obama taps Chicagoans to help tackle financial literacy
Crain's Chicago Business
President Barack Obama has pulled in three Chicago financial entrepreneurs for his Council on Financial Capability for Young Americans. The organization was formed last year with the goal of promoting financial literacy among youth.More

Report: Fed shifting plans for unwinding stimulus
Fox Business
The Federal Reserve is moving away from its original plan to unwind its unprecedented stimulus policies initiated in the wake of the 2008 financial crisis and shifting toward a new complex, long-term strategy, according to a report in the Wall Street Journal. Here’s how the Journal’s John Hilsenrath explains the transition.More

Jobless claims hit 3-month low, but February job growth was likely weak
Wall St. Cheat Sheet
Juxtaposed against the dismal picture of February economic activity painted by several recent reports, data released by the Department of Labor’s Bureau of Labor Statistics on recently showed that initial applications for unemployment benefits declined by 26,000 new claims to a seasonally adjusted 323,000, the lowest level recorded since the end of November and a strong enough decline to reverse the previous week’s jump.More