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The leveraged-up less well off and profits

Americans are borrowing more, renting more rather than owning, eating in class="mandelbrot_refrag"> restaurants more and saving less, leading inevitably to questions of sustainability. That’s true both for Americans and for the corporations whose profits they create. What’s more, the kind of financing backing all this indicates that a goodly bit of the balance sheet straining activity is concentrated lower down the income and wealth scale. Juxtapose this with vertiginous rates of corporate profitability (and intriguing hints that a top may have been hit) and you have the making of some serious upcoming tests for the class="mandelbrot_refrag"> economy and stock market.   true       First, let’s look at Americans and their cars. A record 27.9 percent of all new car sales so far this year were leases, according to Edmunds.com, while those who did decide to buy did so with record-long loan terms of 66 months on average. Interestingly, leasing, which

Silicon Valley's ageist culture is bad for workers - and business

class="mandelbrot_refrag"> Google confessed last week that it has a miserable record hiring and retaining women and minorities. The tech giant responded to public pressure - including protests led by the Rev. Jesse Jackson at the company's annual meeting - by releasing data about the gender and ethnic makeup of its workforce, and the numbers aren't pretty. Women make up just 30 percent of Google's workforce, and the company is 61 percent white. Asians represent 30 percent of Google's workers, but Hispanics represent 3 percent and African Americans just 2 percent. Yet class="mandelbrot_refrag"> Google didn't disclose one of the most important diversity statistic about its workers: their age.   true       Age plays second fiddle in Corporate America to racial and gender workforce diversity, but it needs to be addressed. The country is getting grayer; workers need - and want - to stay employed longer. "It is hard to address thes

Pimco's Gross sees 'New Neutral' real policy rate close to zero percent

Bill Gross, manager of the world's largest bond fund at Pimco, said Thursday the firm believes the 'new neutral' inflation-adjusted federal funds rate will be close to 0 percent as opposed to 2-3 percent in prior decades. "If 'The New Neutral' rates stay low, it supports current prices of financial assets," Gross said in his latest investment letter. "They would appear to be less bubbly." Pacific class="mandelbrot_refrag"> Investment Management Co, which manages $1.94 trillion in assets, introduced its new-neutral outlook in May. New Neutral suggests the global class="mandelbrot_refrag"> economy is transforming from a post-financial crisis recovery period called the New Normal in 2009, toward stability characterized by modest economic growth over the next three-to-five years. "Commonsensically it seems to me that the more finance-based and highly levered an class="mandelbrot_refrag"> economy

Brokers' slip-ups add to Wall Street's cyber-attack anxiety

The most cutting-edge technology cannot contain one of the biggest cyber hacking threats on Wall Street: sloppy actions by brokers and other industry employees. Brokerage firm workers have taped sensitive passwords to their computer monitors and stored them in binders labeled "passwords," according to officials from the Financial Industry Regulatory Authority (FINRA), Wall Street's industry-funded watchdog. Some firms give login information to temporary workers and forget to cut them off after their assignment is complete. At the regulator's conference in May, examiners traded tales of brokerage firm behaviors they had found that could lead to security breaches. One firm, for example, used the very-guessable "username" as the username and "password" for the password that gave access to the company's router, enabling access to the firm's sensitive data. The problems are coming to light as major online security breaches in other industr

Building a financial advice business you can sell

Isn't it ironic? Most independent financial advisers have no exit strategy and let their firms die through attrition, according to research from Fidelity Investments and consulting firm FP Transitions. That scenario is bad for clients, and it means advisers reap no benefits from the businesses they invested years building. A firm is an adviser’s largest asset, says Waldemar Kohl, vice president of practice management for Fidelity Institutional Wealth Services. “It’s bigger than their home, bigger than their retirement plan" so advisers should think about how they can tap that value when they leave the industry. Advisers who formulate a plan to sell - either via succession plan to employees or a family member - or to an unrelated third party, can secure a lifetime income stream and a business that continues to serve valued clients. CREATING VALUE After an adviser friend sold her practice for a significant sum, Olympia, Washington-based planner Nancy Nelson sought a valu

JPM investment bank boss says 'laser focus' on costs cuts

JPMorgan's new solo head of its investment bank said he would be "laser focused" on reducing costs as the industry is likely to face a tough couple of years in terms of growing revenues. "For the next year or two the industry's top-line will probably struggle. The long-term trends are good, but in the short term we need to adjust to the new reality," said Daniel Pinto, London-based chief executive of the corporate and investment bank (CIB) at class="mandelbrot_refrag"> JPMorgan Chase & Co ., the biggest U.S. bank by assets. Rivals including Barclays and UBS are in the process of shrinking their investment class="mandelbrot_refrag"> banks in a bid to slash costs, after a slump in trading revenues over the past year and tougher regulations are forcing banks to hold more capital and making some areas unprofitable. But Pinto, who took sole charge of CIB in March after running it for two years with Michael Cavanagh, said ther

Blackstone seeded hedge fund Sureview Capital shuts down: sources

Sureview Capital, a small hedge fund which received starting capital from one of the industry's most powerful investors, Blackstone Group, shut down last month, people familiar with the matter said on Friday. The fund was founded by John Wu with seed money from Blackstone Alternative Asset Management in 2011 and last reported assets of $427 million on a regulatory filing. At the end of the first quarter Sureview, which specialized in picking class="mandelbrot_refrag"> stocks , listed class="mandelbrot_refrag"> CBS Corp as its biggest position and said it owned shares in class="mandelbrot_refrag"> Yahoo Inc and class="mandelbrot_refrag"> Facebook Inc, all of which suffered losses in March and early April. Sureview, based in Greenwich, Connecticut, did not respond to phone calls seeking comment. The industry sources requested anonymity because class="mandelbrot_refrag"> hedge funds are private. When it la