Day 1: Recap of Afternoon TD Ameritrade Speakers
Ricky attended the TD Ameritrade Institutional National Conference in Orlando and below are highlights from day 1 afternoon speakers and sessions. This includes a panel discussion with three large mutual fund managers and an update from the TD Bank president.
Equity Opportunities for 2010 and Beyond
A panel discussion with three managers from Gabelli Funds, Royce Funds, and Brandes.
General take away from the group of three fund managers:
1. Where is the economy headed?
70% of our economy is consumer driven. The consumer is paying off debt and not spending. Consumers must be employed to spend and therefore unemployment is a threat. Running out of time to create jobs. If jobs don’t manifest, then housing market will take a swoon and the stock market will take a hit.
2. Is the market overvalued?
Not overvalued, but easy money has been made. Going forward, opportunity will be found in pockets with likely in emerging markets and international small caps. (Of course, these are fund managers speaking, so each touted their ability to “pick stocks” in places where they see opportunity. Their words, “this is a stock pickers market.” My question? For people who make their money “picking stocks”, when is it not a “stock pickers” market?) Recession and bear markets always end, we just don’t know when.
3. Where are interest rates going?
Up, but don’t know when. Upward pressure on interest rates because economy is improving. New job growth will come from “green” jobs over next 20 years. The monster of job growth. Interest rates not likely to increase this year.
Ed Clark, President TD Bank Financial Group, Canada
1. What is the source of economic problems in the US?
• Security dealers way over leveraged with no attachment to collateralized capital backing. They guaranteed themselves and that was backed by their own paper i.e., Bear Sterns.
• US has a dysfunctional mortgage system.
2. Health of Economy?
• Canada continues to boom.
• Myth that the rest of the world can prosper with a sick US, not going to happen.
• US still the biggest and best economy.
• Glass-Steagall Act? Can’t put the genie back in the bottle. US was only country with separation rules for banks, insurance, securities.
o Mid 70’s rule change minimized the amount of capital required to back banks and securities firms.
3. How to get back on track?
• Fix the capital rules for dealers.
• Let the dealers agree and abide by those rules.