Lifecos Realistic About Future of Interest Rates

“Lifeco investors have seen shares sink since the financial crisis rocked markets and interest rates hit record lows. Now, the head of two of the country’s largest lifecos are warning it could be another three years until they see a meaningful turnaround,” Canada’s business and financial news outlet BNN reported in an online article. The article continued, “‘We’re cautiously optimistic [on the Canadian economy], but we are planning for interest rates being at persistently low levels for a considerable period of time,’ Kevin Dougherty, president of Sun Life Financial Canada” “‘What happened in the second quarter, interest rates got to unprecedented levels, you could go back 100 years and not find long-term interest rates at the levels they hit in the second quarter.'” Read the full article here for more analysis. | Raymond Matt, CFP, CLU, TEP, CHS

86-year-old Greek Banker at the Heart of Libor?

“Minos Zombanakis, born 86 years ago on a Greek island, remembers the birth of the interest rate benchmark now at the heart of a global rigging scandal well. ‘I was, more or less, if you excuse the lack of modesty, the one who started the whole thing,’ he laughs, speaking by telephone from his village among citrus orchards in Crete. Zombanakis was running the newly-opened London branch of Manufacturer’s Hanover, now part of JPMorgan, when the bank organized one of the first syndicated loans pegged to what he dubbed a London interbank offered rate (Libor) in 1969,” Kirstin Ridley and Huw Jones write in a Reuters online article which discusses the scandal-laden birth of LIBOR. Read the full article here. | Raymond Matt, CFP, CLU, TEP, CHS

Euro Zone Economy Taking Baby Steps

“The euro zone is inching towards a new plan to tackle its debt crisis in a three-dimensional game of chicken among all the main players. The European Central Bank’s heavily qualified offer last week to step in and buy bonds to bring down the borrowing costs of Spain and Italy was the latest gambit in this game,” Paul Taylor of Reuters writes this week in an all encompassing analysis of the Euro Zone economic situation as it is this summer. Taylor continues, “Expect things to get worse in the markets, in political arm-wrestling and perhaps on the streets of Athens and Madrid before decisive action is forthcoming in late September.” Read full article here. | Raymond Matt, CFP, CLU, TEP, CHS

AIG Bailout Working, The Washington Post says

This week The Washington Post’s Charles Lane wrote an opinion piece explaining how the AIG bailout, which was so venomously despised by so many in 2008, has started to show signs of working.

“Well, don’t look now, but the AIG bailout is working. On Friday, the Treasury announced that it was selling $5 billion worth of AIG stock, its fourth such sale, bringing its stake in the company down to 55 percent. Treasury made $300 million on the transaction, consistent with the fact that markets value the stock above the government’s $28.72 break-even share price. Contrast bailed-out GM, where Treasury will cash out at a loss in almost any realistic stock-price scenario.” Read the full article here. | Raymond Matt, CFP, CLU, TEP, CHS

Rover ‘Curiosity’ To Learn of Mars’ Past

Science buzz over the weekend was intense as NASA’s latest rover sent to Mars successfully landed on our neighbour planet. As we blogged about in the past Curiosity is carrying a Canadian made “geology instrument that will enable the rover to determine the chemical composition of the rocks and soil”, a very important element to the mission. A main goal of this robotic excursion is to discover what Mars was like in the past, whether water was present and subsequently if living organisms existed, an impossibility without the previously mentioned geology instrument. CBS news reports: “In a show of technological wizardry, the robotic explorer Curiosity blazed through the pink skies of Mars, steering itself to a gentle landing inside a giant crater for the most ambitious dig yet into the Red Planet’s past. Cheers and applause echoed through the NASA Jet Propulsion Laboratory late Sunday after the most high-tech interplanetary rover ever built signaled it had survived a harrowing plunge through the thin Mars atmosphere. ‘Touchdown confirmed,’ said engineer Allen Chen. ‘We’re safe on Mars.'” Exciting stuff! | Raymond Matt, CFP, CLU, TEP, CHS

Top American Social Critic & Novelist Gore Vidal Dies

This week Gore Vidal, one of America’s top social critics and novelists, passed away leaving behind a legacy of sharp criticism and wit. “He died at his home in Los Angeles on Tuesday evening, with the cause of death believed to be complications from pneumonia. Gore Vidal produced 25 novels, including the best-selling Burr and Myra Breckenridge, more than 200 essays and several plays,” The BBC reports … read the full article here. Vidal was a man of many memorable quotes, one stands out, “When anyone says to me, ‘Can you keep a secret?’ I say, ‘Why should I, if you can’t?'” The following video shows Vidal in his element speaking with rival contemporary Norman Mailer during an interview on the American talk show The Dick Cavett Show.  | Raymond Matt, CFP, CLU, TEP, CHS

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