This has been an interesting year in the stock market. As the market has been lifted to all-time highs by an accommodative monetary policy and an economy starting to fire on all cylinders, long-term investors have profited handsomely during the first half of the year. A pullback in August led the Dow Jones Industrial Average to drop nearly 1,000 points before stabilizing in the 14,800 range. Despite this setback, stocks are still showing signs of strength that should last for the rest of the year. But the fuel powering the stock market has its drawbacks: Low interest rates and accommodative policy have sent yields to ultra-low levels while boosting stocks. In fact, income investors have become so frustrated by the lack of yield that this year's investing theme can be summed up in four words: the search for yield. I learned from my colleague Nathan Slaughter's Dividend Opportunities advisory that in 1984, one-year bank CDs paid an astounding 10.4%. Yields of 9% were commonplace in the stock market after the 2008 market crash. Today, the stocks in the S&P 500 index pay an average yield of just 2.02%. Even the traditional high-yield sectors, like international utilities, are only yielding about 4%. Further cementing the dire yield situation, Nathan ran a screen on all 12,592 U.S.-traded stocks and ADRs (American depositary receipts) -- and found that only 170 stocks of the 12,592 pay dividends higher than 9%. But high-yielding stocks do exist in this low-yield environment. However, before I talk about one of my favorites, it's critical to understand that with high yield comes high risk. This stock is not suited for risk-shunning conservative investors but rather for those investors who understand the risk and are willing to accept it -- in return for mind-blowing yields. My favorite stock in the ultra-high-yielding space is the agency mortgage REIT, American Capital Agency (Nasdaq: AGNC). This stock yields over 18%, which is amazing provided the low-yield environment. A REIT, or real estate investment trust, is required by law to distribute 90% of its profits back to shareholders, hence the high yields. Mortgage REITs invest in real estate mortgages, and an agency REIT is one that only invests in government-backed mortgages. This lowers the credit risk due to the government insured nature of the mortgages. Mortgage REITs typically leverage between six and 10 times their actual funding level. Money is made on the spread between the mortgage interest rate and the short-term interest rate. The wider this spread, the more money a mortgage REIT can make thus pass along to shareholders. This spread is the lifeblood of mortgage REITs and is where the risks and profits lie. Rising interest rates will negatively affect many mortgage REITs. However, those that invest in 15-year mortgages rather than the standard 30-year have a stronger chance of maintaining the high yield. American Capital Agency has transferred 42% of its portfolio to these "safer" shorter-term mortgages. This flexibility shows management's willingness to change with the environment to maintain the high yields. It is my prime reason for choosing this mortgage REIT as an investment. In addition, Gary Kain, American Capital's president and chief investment officer, gave shareholders further confidence: "The second quarter was characterized by extreme volatility in both interest rates and mortgage spreads. In response, we remained highly disciplined with respect to our risk management activities. We reduced the size of our asset portfolio, adjusted our asset composition to be more consistent with a higher rate environment, and materially increased the duration of our hedges. As a result of these actions and evolving market conditions, our exposure to higher rates is lower than it has been in years, and our 'pay-up' risk is now minimal." Looking at the nitty-gritty of the company, its investment portfolio totals nearly $92 billion of agency (government-backed) securities, including more than $14 billion of net TBA (to be announced) fair value mortgage positions. The company pays out $4.20 per share in annual dividends. It boasts a price to book ratio of 0.85 and appears well prepared to continue its high-performing dividend yields. Risks to Consider: Interest rate spread risk is the primary danger to mortgage REITs. In addition, there is a pending risk of Fannie Mae and Freddie Mac being shuttered. This means that there would be a shift in the security of the underlying mortgages. How this will affect agency mortgage REITs is not clear. The Federal Reserve's eventual exit from quantitative easing may also pose a danger to mortgage REITs. Remember, there is a high risk involved with obtaining these high yields. Action to Take --> I like American Capital Agency right now: Its price is off the highs, and the metrics currently paint a compelling picture. Other high-yielding mortgage REITs includes Annaly Capital Management (NYSE: NLY). Those who seek diversification across the high-yielding mortgage REIT space can invest in a mortgage REIT exchange-traded fund like the Market Vectors Mortgage REIT Income Fund (NYSE: MORT). This ETF consists of 14 of the highest yielding mortgage ETFs on the market; the top two holdings, as you might guess, are American Capital Agency and Annaly Capital. P.S. -- Current yields averaging 7.2%... gains of more than 127%... and 43% safer returns than traditional investing. Amy Calistri's Daily Paycheck advisory is delivering all of these things and more. Click here to see how she's doing it and how you can join her today.
Preet Bharara doesn't seem to be done with Steve Cohen. In a press conference announcing a massive insider trading settlement with SAC Capital, the U.S. Attorney for the Southern District reiterated no individual is off the hook, and that their investigation remains ongoing. Steve Cohen has been accused by the SEC of failing to supervise two portfolio managers, Mathew Martoma and Michael Steinberg, who are being taken to trial by the government for insider trading. Beyond the SEC charges, Cohen will have to pay attention to the trials of his former employees, as their outcomes, or either of them choosing to cooperate with Bharara's office, could give the government a stronger case against the embattled billionaire. With 75 convictions for insider trading under his belt, Bharara is probably pretty optimistic.  Preet Bharara, United States Attorney for the Southern District of New York , when he unveiled the indictment of SAC Capital - Image credit: AFP/Getty Images via @daylife "Greed, sometimes, is not good," Preet Bharara told a room full of reporters on Monday, as he proudly announced a $1.8 billion settlement with SAC Capital which includes the firm ceasing to manage outside money. Despite scoring a high profile victory, which comes with the end of closing of one of the largest hedge funds out there, Bharara indicated his office is not done with its insider trading case against Steve Cohen's firm. The settlement documents point it out clearly, noting "this agreement does not provide any protection against prosecution or other enforcement action against the SAC Entity Defendants, any owner, shareholder, or employee of the SAC Entity Defendants or any other person." In a letter to the judges Bharara goes further, saying "the agreement provides no immunity from prosecution for any individual and does not restrict the Government from charging any individual for any criminal offense and seeking the maximum term of imprisonment applicable to any such violation of criminal law." Asked repeatedly about Cohen during the press conference, Bharara stressed that the investigation is far from over. He even noted they still had wiretaps of other individuals who haven't been charged yet. And while Cohen himself will be paying the totality of the fine from his own pocket, as he did with the previous $616 million settlement with the SEC, some could say he managed to get away. Cohen remains a multi-billionaire and hasn't been charged with any criminal wrongdoing. He will probably earn enough this year to cover the whole fine, as my colleague Nathan Vardi explained, and will still be able to manage his own fortune. Whether he'll still be able to deliver returns without the massive infrastructure is another question. It is important to note that SAC Capital admitted to having broken the law. "We take responsibility for the handful of men who pleaded guilty and whose conduct gave rise to SAC's liability. The tiny fraction of wrongdoers does not represent the 3,000 honest men and women who have worked at the firm during the past 21 years. SAC has never encouraged, promoted or tolerated insider trading," read a statement released by Cohen's hedge fund. SAC Capital, which is wholly owned and managed by Steve Cohen, agreed to plead guilty to insider trading charges, meaning its employees were engaging in criminal activity and while that doesn't directly tie in Cohen, in conjunction with the SEC's failure to supervise charges, it builds a stronger body of proof against the hedge fund manager. It's not clear whether Preet Bharara will succeed in getting Steve Cohen prosecuted for insider trading. If he had a case, he would have already brought it to court. What is evident, though, is that the prosecution will not rest until it has exhausted every option.
With the spirit of optimism that made Wells Fargo’s stagecoach a symbol of its pioneering outlook, the firm’s advisory unit has issued a manifesto of its confidence in the resilience of America’s economy for clients and prospects who may have been sitting on the sidelines in recent years. Called “A Case for America,” the new Wells Fargo Advisors report rebuts what it describes as a pervasive, media-fueled sense of pessimism that has accompanied America’s struggle to recover from “the Great Recession.” While continuing talk about a “new normal” and “the lost decade” breeds this negativity, the Wells Fargo Advisors report makes the case that profitability, innovation, resources, stability and America’s people argue instead for a broadly positive view of America’s future. The bottom line is at the very top of Wells Fargo’s argument, noting that U.S. corporate profits are at an all-time high, surpassing $1.7 trillion in 2012, accounting for more than 11% of GDP, more than twice their proportion of GDP during the recession. Indeed, last year was the third consecutive record-breaking year for after-tax profits, which hovered at around $1.3 billion before the financial crisis. U.S. corporations today are flush with cash, and more than 80% of S&P 500 companies are now paying dividends, a 13-year high. The report attributes this profitability to an improving business climate and a focus on cost containment, and notes that the U.S. has 10 companies represented among the world’s 25 most profitable—twice more than second-ranked China—led by Exxon Mobil and Apple. A second factor undergirding the strength of U.S. corporations is a culture of innovation, which is responsible for America’s No. 1 rank in research and development in eight out of 10 technology areas, according to a 2012 survey of scientists and engineers. America’s forecast spending on R&D for 2013 is nearly twice the level of second-ranked China, and American companies make up nearly half of the top 100 global innovators, according to a recent Thomson Reuters study. “Whether using a tablet, smartphone, or a PC on a wired or wireless network, you are likely using hardware, semiconductors, an operating system, and applications designed by American companies,” the report says. That innovation has spread notably into the resources sector of America’s economy, with horizontal drilling and hydraulic fracturing transforming the energy sector in recent years. Wells Fargo cites forecasts that the U.S. is now expected to surpass Russia in natural gas production around 2015 and Saudi Arabia in oil production around 2020. In agriculture, our farmers continue to preside over bumper crops that should generate $17 billion average annual trade surpluses through 2022, while U.S. companies are now making renewable products that support 100,000 jobs, according to the USDA. The long-awaited recovery in U.S. housing together with an improved banking sector spell a new stability in the economy, according to the report. Unlike the pre-crisis situation, housing is now affordable, according to an index showing that families earning the median income currently have more than sufficient income to qualify for a mortgage on a median-priced home with a 20% down payment. That together with low mortgage rates, a drop in foreclosures, tight housing supply and lower unemployment have generated a real estate recovery that appears sustainable. In the meantime, U.S. banks have been recapitalized and bank failures have declined to much lower levels than seen in the midst of the financial crisis. Annual stress tests “allow us to conclude that major U.S. banks have enough capital to potentially withstand another significant crisis,” says the report, which also states “we believe our domestic banking system is now one of the strongest in the world.” The final leg on which underappreciated U.S. strength lies is America’s relative youth compared with the rest of the world. While America is aging, and the proportion of its population aged 65 and older is expected to reach a quarter of the population by 2040, that is a far more favorable ratio than economic competitors Japan (43.3%), Germany (39%), Korea (38.6%), Canada (31.5%) or China (27.9%). Significantly, the percentage of young and working-age Americans is also expected to increase 42% through 2050, while those demographic brackets are expected to shrink in China (10%), in Europe (25%), South Korea (30%) and Japan (40%). The report also states optimistically that America still values education, and though it needs to improve in elementary science and math competitiveness, American higher education ranks among the most advanced in the world. --- Check out Niall Ferguson: 4 Reasons America Is Falling Apart.
U.S. crude oil supplies dropped 2.8 million barrels (0.8%) for the week ending July 19, according to an Energy Information Administration report (link opens a PDF) released today. After dropping off 1.8% the previous week, this report puts crude oil supplies on a month-long shrinking trend. However, this week's milder draw is primarily due to the aftereffects of a larger downward trend, since refinery inputs fell 206,000 barrels per day (bbpd) and imports rose 327,000 bbpd. The latest crude supply number is 4.2% below year-ago levels.
 Source: eia.gov. Gasoline inventories fell 0.6% after heading up 1.4% the week before. Demand for motor gasoline is up a seasonally adjusted 3.1% over the last four weeks, and supplies remain "above the upper limit of the average range." After increasing $0.147 the previous week, pump prices bumped up $0.043 to a national average of $3.682 per gallon. Compared to the same time last year, consumers are paying an average $0.188 more per gallon.  Source: eia.gov. Distillates supplies fell 0.9% after a 3.2% gain the previous week. Distillates demand is up a seasonally adjusted 17.8% over the last four weeks, and supplies are edging closer to the lower limit of the average range for this time of year.  Source: eia.gov. -- Material from The Associated Press was used in this report. link
We are in the midst of an inevitable transition to a new energy system that will look fundamentally different from the one we have today. In the video below, Motley Fool contributor Sara Murphy offers her take on whether the beneficiaries of this shift will be the big, familiar energy giants we all know or small innovators that arrive on the scene to shake things up. Another company is ready for the new face of energy, and it's been slipping under Wall Street's radar for months. It won't stay hidden much longer. Forward-thinking energy players like GE and Ford have already plowed sizable amounts of research capital into this little-known stock... because they know it holds the key to the explosive profit power of the coming "no choice fuel revolution." Luckily, there's still time for you to get on board if you act quickly. All the details are inside an exclusive report from The Motley Fool. Click here for the full story!
Facebook (NASDAQ: FB ) held its first shareholder annual meeting as a public company yesterday, and clearly a lot of investors don't get the social networking giant. Some of the questions asked during the Q&A, as retold by Financial Times, seemed more along the lines of pointless venting than actual dissection. Will the stock bounce back? Will Facebook offer phone support for older users confused with the site? Why is the news feed showing ads? Should investors form a committee to review Facebook's stance on public policy issues? I wasn't there, but I can imagine CEO Mark Zuckerberg's inner monologue as retail investor after retail investor asked unanswerable or ignorant questions. Why did we have to go public? What have we done wrong? Are our users smarter than our shareholders? It's true that Facebook has been a dud of an investment. The shares have lost 37% of their value since going public 13 months ago. The market has rallied in that time. However, it's not Facebook's fault that underwriters -- drunk on hype -- were able to price the social networking website operator's offering at an unjustifiable price. Facebook has actually done little wrong since going public. Fears of Facebook's popularity peaking have been rebuffed with every passing quarter. It's growing at a heady clip, and that's not going to end anytime soon. Analysts see revenue and earnings per share climbing 26% and 35%, respectively, next year. Facebook even got a timely analyst nod earlier this week. Stifel's Jordan Rohan points out if we look out to his 2015 estimates, Facebook is trading at a slightly lower EBITDA multiple than Google (NASDAQ: GOOG ) -- 10 for Google and 9.4 for Facebook -- even though Facebook is expected to be growing a lot faster in the coming years. He's right, but we also have to remember that Rohan downgraded Google two years ago on fears of the Facebook threat. It's a theme that may come into play eventually, but for now Google's the one trading near last month's all-time high. Facebook may one day be more powerful than Google if it's able to effectively monetize its growing Rolodex of knowledge on its billion active users without alienating them. However, Zuckerberg also has a higher risk of obsolescence than Big G. For now, the best bet has to be on Facebook having a merrier shareholder meeting next year. The stock's valuation is still not cheap, but it's no longer ridiculous. Facebook is just starting to monetize mobile and video monetization will inevitably follow. The next few quarters should be strong, and Facebook will naturally get a boost when it's added to the S&P 500 later this year. Zuckerberg's probably just hoping that a better stock price brings out better questions from its investors next year. After the world's most hyped IPO turned out to be a dud, many investors don't even want to think about shares of Facebook. But there are things every investor needs to know about this revolutionary company. The Motley Fool's newest premium research report shows that there's a lot more to Facebook than meets the eye. Read up on whether there is anything to "like" about it today to determine if Facebook deserves a place in your portfolio. Access your report by clicking here.
Sears Holdings (NASDAQ: SHLD ) disappointed nearly everybody, including CEO Eddie Lampert, when it delivered a net loss on the recently ended quarter. As with many big-box stores, Sears is attempting to reverse current consumer trends and remain relevant in a new shopping paradigm. However, after it divested itself of its most prized possessions in the form of a spinoff, the real value behind Sears is not in its turnaround efforts, but its real estate -- a common thesis. In light of the fact that the company has a very appealing portfolio of land, does the recent dip in stock price create an opportunity for real-estate-hungry investors? Let's take a look. It's good to have land!
Amid the many concerns investors and analysts have about Sears' future, liquidity nears the top of the list. While I would not dispute that the company's operating performance is weak and looks to remain that way for some time, I do not share the concerns over debt obligations. Part of this stems from the fact that Lampert is at the helm -- a master capital allocator, regardless of your opinions on his performance as chief executive. But more comforting than Lampert's presence is the real estate portfolio -- some 250 million square feet of prime real estate. Perennial cheerleader Lampert believes it is worth a total of $20 billion or more (implying $80 per square foot, on average). Even if he is wrong by... oh, let's say 57% (the difference between the company's enterprise value and the real estate value Lampert alleges), that still leaves the company with more than enough to cover debt obligations. Still, though, operating performance has been weak. In the recent quarter, sales dropped more than 8 points to a loss of $279 million, or $2.63 per diluted share. Last year, the company brought in a net gain of $189 million. EBITDA went negative to a loss of $8 million, compared to $160 million in the year-ago quarter. Comparables dropped 3.6%, driven by unseasonably cool weather in the early spring. Investors should note that the company did have a lone, but still shining, star -- a 20% increase in Sears.com and Kmart.com sales. It's a confusing situation for investors. Value-oriented pickers are likely salivating over the gross difference between market value and the real estate portfolio alone, but how does it come into play with the operating business -- where cash burn has sped up and the items within that valuable real estate seem to be gathering dust? Downsizing
The stock may be experiencing a sort of reverse growing pain. As Lampert noted in the earnings release, closures of underperforming stores were responsible for $375 million in lost sales, with another $19 million due to foreign exchange rates. While it doesn't make for an appealing headline, the slimmer Sears will be able to leverage that real estate more effectively in the future. The company is also looking to raise an additional $500 million, possibly via sale or merger. A writer at Investopedia noted that a J.C. Penney (NYSE: JCP ) –Sears combination has more merits than most would imagine, though I am not sure that two wrongs make a right at this point. A merger of the two would create a real estate behemoth, trumping other department stores' square footage (combined) by a long shot. Whether the company sells itself or not, its valuation remains incredibly low. Should price-conscious investors take the bait? Better options
In short, I prefer both Sears Hometown and Outlets (NASDAQ: SHOS ) and Sears Canada (TSX: SCC ) for their stronger operating prospects, especially those of the former. Sears Hometown has a long growth runway for its appliance stores, and its ongoing conversion to franchise-owned stores makes for better gross margins, as well as shifts many up-front costs to the individual store owner. Sears Canada is in the midst of a major renovation -- pumping money into stores while shrinking employee count. Sears Canada trades at a fraction of one-year sales and will benefit from even a modest turnaround in store performance. As it has been for some time, Sears Holdings is a bargain if the company can manage just a slight turnaround in its operating performance. There is little question that its real estate is being offered for a fraction of its value -- the market just seems to be waiting for that space to be better utilized. Still, the company's future is uncertain, and investors would sleep better looking at the Sears' spinoff and independently traded subsidiary. Read more on those stories here and here. How does JCP look lately?
J.C. Penney's stock cratered under Ron Johnson's leadership, but could new CEO Mike Ullman present the opportunity investors have been waiting for? If you're wondering whether J.C. Penney is a buy today, you're invited to claim a copy of The Motley Fool's must-read report on the company. Learn everything you need to know about JCP's turnaround -- or lack thereof. Simply click here now for instant access.
 Alamy Ebola may be grabbing all the headlines and stirring up lots of fear, but the virus that presents the biggest threat to America's workers and businesses is far less exotic: It's the flu. "The impact on business can be anything but mild" from a widespread flu outbreak, according to John Challenger, chief executive of the global outplacement firm Challenger, Gray & Christmas. The Centers for Disease Control says seasonal flu outbreaks cost the nation $10.4 billion on average in direct costs such as hospitalizations and outpatient visits. Challenger, citing government statistics, says the indirect costs, such as the lost worker productivity, can cost the economy about $7 billion a year. Employees are likely to lose 111 million work days, and for those without paid sick leave, that means lost wages. According to the CDC, 5 percent to 20 percent of the American population contracts the flu each year, with more than 200,000 people hospitalized and 36,000 killed. (Some doubt the magnitude of the death stats, but the economic impact is undeniable.) The height of the flu season usually runs from December through February, but outbreaks can begin as early as October. Workers and employers can help limit the spread of the virus, but Challenger warns that most employers react too late, after an outbreak is underway. The CDC recommends a flu vaccine each year for everyone 6 months of age or older, and the Affordable Care Act makes it free under most health plans. What Companies Should Do Experts recommend some simple prevention measures, such as frequently washing hands, disinfecting of work surfaces and replacing meetings with conference calls. Challenger also recommends the employers encourage sick workers stay home to avoid spreading the disease and tell them that they can do so without risk. "Employers have to create an environment that says when you're sick, you should stay home. You're not putting your job at risk." "It's only good business to plan for the issues your workforce is likely to face and take steps to deal with those issues," he said. "There are lots of issues that go into what makes people happy in their job in terms of environment, and this is becoming a big issue in people's mind. Does the company have a germ-free environment?" He says a company the promotes wellness, including steps to prevent the spread of the flu, sends a message to employees that it cares about their health and well-being. More from Drew Trachtenberg
•Stocks Surge as Wild Week on Wall Street Continues •Dow Has Fallen More Than 1,000 Points in Less Than a Month •Expect a Fare War Now That Southwest Can Spread the LUV
 World's hottest diamond markets HONG KONG (CNNMoney) A diamond is forever ... especially in China. Global diamond jewelry sales hit a record $79 billion last year, led by strong interest from the Chinese for the rare gem, according to a report from De Beers. Polished diamond sales in China rocketed by 14% last year alone, double the pace of growth seen in the U.S. Overall, sales of diamond jewelry to the Chinese have been the fastest growing in the world, averaging about 21% a year over the last decade. China now accounts for 13% of global demand, up from just 3% in 2003. The U.S. is still the world's largest diamond market but companies such as De Beers are increasingly looking to China for growth. As disposable incomes rise, Chinese consumers are driving global markets for luxury products, including expensive watches, handbags, cars and diamonds. China now accounts for nearly one-third of global luxury purchases, according to the report. China is still seeing much higher than average growth in diamond sales, even though some luxury segments have been hurt by a government anti-corruption campaign, and a slowing economy.
Among investment managers there are generally two camps of stock pickers. There are Benjamin Graham value investors, who do intense fundamental analysis in search of stocks selling well below their own calculations of intrinsic value, and then there are quants, who rely on probabilities and computer screens of publicly available data on thousands of stocks in an effort to produce winning portfolios. Both strategies can be successful, but rarely do the two groups mix in practice. It's kind of like the differences between Christianity and Judaism. They have different liturgies, but their end games are identical. On the 15th floor of a Los Angeles office tower not far from UCLA's Westwood campus, there's a fast-growing money management firm that has achieved a kumbaya equilibrium between managers who practice the art of deep value investing and math nerds who are immersed in the science of quantitative analysis. The firm is Causeway Capital Management, and it's headed by a value-quant matchmaker named Sarah Ketterer. Today Ketterer, 53, is probably the most successful female money manager in the business. In the last 18 months assets in her firm have more than doubled, from $16 billion to $33 billion, thanks largely to the company's stellar performance. For example, her firm's flagship mutual fund, Causeway International Value, has a five-year average annual return of 14% versus 10% for its benchmark index. The $6 billion fund gained 25% in 2012 and another 24% in 2013. 
Sitting in the firm's sunny L.A. conference room wearing a red leather jacket and sporting a brown pixie haircut, Ketterer is determined to convince a visitor of the firm's team approach. But if it were not for her own serendipitous path into the business of money management, this successful quant/value experiment might have never occurred. Ketterer comes from West Coast investing royalty. She is the daughter of John Hotchkis, 81, one of the founders of asset management giant Trust Company of the West as well as of über-successful value boutique Hotchkis & Wiley. After a few boring summer jobs in the back office of her father's firm, Sarah wanted nothing to do with stock picking. She started at Stanford as a premed student, switched to political science and economics, and eventually went to Dartmouth for an M.B.A. After business school she took a job in corporate finance at Bankers Trust in New York. But instead of becoming enamored by big mergers and investment banking, she shifted her focus to data–or more precisely, the Tower of Babel that was the state of European company databases in the late 1980s. "I remember visiting a company in Italy that made sports equipment, and they were pulling their data out of a drawer, and I was thinking, What are they doing? This is not good," says Ketterer. "I think he was smoking, too." So Ketterer quit her M&A advisory job to create a new company that would scrub and organize European data and sell it to investment managers. Her first stop was her father's firm, Hotchkis & Wiley, back in L.A. But instead of seeding her business or becoming a client, her father and his partner, George Wiley, asked her to join the firm and help them start a new international equity arm. "I had never really thought of being in asset management before that," says Ketterer, "but I had spent a lot of time in Europe talking to database owners. I recognized that the data was imperfect, and it struck me as quite obvious that there must be price inefficiencies in these markets." Ketterer's career pivot inadvertently set her on a path to developing a new model of money management and ultimately prompted her and her Irish-born comanager, Harry Hartford, to break away from Hotchkis & Wiley (then owned by Merrill Lynch) and start their own internationally focused asset management firm in 2001. In data-lover Ketterer's value-investing operation, numbers geeks share equal power with the tire-kicking fundamental analysts, and not a single stock can be purchased unless a consensus is arrived at by the team. Indeed, all picks must first pass muster with the quants, who screen 3,000 global stocks with market caps greater than $1 billion each week. "They are looking for a subset of stocks that are already biased to outperform the market," says Ketterer. In other words, which stocks are selling at historically low enterprise value (market capitalization plus debt) to cash flow multiples and are beginning to see positive earnings estimate momentum from the most statistically accurate brokerage analysts. They also seek companies that are returning capital to shareholders, mostly through dividends or buybacks. "We identify stocks that others are truly not interested in, when earnings look flat and there seems to be no prospect of improvement on the horizon," says Ketterer.
Dear Class of 2014: We regret to inform you that the nation's job market continues to force college graduates to take jobs they're overqualified for, jobs outside their major, and generally delay their career to the detriment of at least a decade's worth of unearned wages. Good luck on your continued job search. A job rejection letter to this year's graduates, who are now supposed to be starting their first truly independent adult years, might as well go something like that. The latest jobs report for April gave grads a puzzling picture. Employers added the most jobs in more than two years, 288,000. Unemployment dropped from 6.7% to 6.3%, the first time it was that low since September 2008. Young adults still face higher unemployment, but the rate for 25-29 year-olds fell from 7.5% in March to 6.9%. The unemployment rate for those 20-24 dropped from 12.2% to 10.6%. Still, the portion of Americans 25-34 who were working in April fell to a five-month low of 75.5%, down from 75.9% in March. "The entire drop (in unemployment) was due to people dropping out of the labor force, in particular young people," says Heidi Shierholz, a labor market economist who writes an annual report on the state of employment for young adults for Economic Policy Institute. And despite the number of jobs added last month, Shierholz calls the gradual improvement "agonizingly slow." Seniors who graduate over the next several weeks are poised to be yet another product of a depressing economic cycle that isn't their fault, but that they may never fully recover from. They and other recent graduating classes entered college and subsequently the labor market amidst a panoply of converging circumstances that will inevitably set them back: rising tuition, their parents' decreasing ability to pay that tuition, fewer jobs after graduation, and lower wages for the jobs that are available. In Shierholz's paper on this year's graduates, released early this month, she and her colleagues write that "the ! Class of 2014 will be the sixth consecutive graduating class to enter the labor market during a period of profound weakness." subhed High unemployment for young adults during and after recessions is not a new phenomenon. Bureau of Labor Statistics data compiled by EPI show that the unemployment rate for those under 25 is typically at least twice the national average, because they are so new to the job market, lack experience, and may be the first let go when a company has to downsize in hard economic times. Still, previous generations didn't experience the fallout as harshly or for nearly as long as the current one, Shierholz says. "It's never been this bad," she says. "How long we've had elevated unemployment is unprecedented." That hasn't dampened students' spirits at least. A majority, or 84%, of this year's graduating class expects to find a job in their chosen field, according to an employment survey released this month by consulting firm Accenture. That seems to align with attitudes on campuses. Lisa Severy, director of career services at University of Colorado Boulder, says this year's class is less anxious than past year's graduates about their job prospects, and has been more eager to attend career events. "They seem more excited, hopeful, and enthusiastic," she says. Their optimism may only be slightly warranted. A survey on recruitment trends by the Collegiate Employment Research Institute at Michigan State University finds hiring for bachelor's degrees this year is up 7%. That's relatively in line with increases in previous years though. The research institute calls the 3% overall growth in the college labor market "modest." And many employers continue to seek students whose skills tend to be in high demand no matter what: business, engineering, and accounting majors. Madison Piercy, a senior double majoring in electrical engineering and computer science at Boulder, had her fair share of suitors this year. The 21 year-oldwas pursued by In! tel, Micr! osoft, and Noble Energy before accepting a positionat MIT Lincoln Laboratory, a federally funded research center at Massachusetts Institute of Technology.  Madison Piercy just graduated from University of Colorado, Boulder and has a job with MIT Lincoln Laboratory starting in June. She was pursued by Microsoft, Intel, and Noble Energy.(Photo: Solay Howell for USA TODAY) But most grads aren't in Piercy's position. In the two years since Rebecca Mersiowsky graduated from Radford University in Radford, Va., she's worked at a beach club on Martha's Vineyard, as a substitute teacher in Fredericksburg, Va., and as a sales associate at a boutique in Boston, where she lives now. The 24 year-old, who graduated with a degree in communications, has had no luck finding a job in public relations. In the meantime, she convinced her employer at the boutique in Beacon Hill to let her take on the shop's blog and social media. She works up to 35 hours a week as a sales associate and blogger, but the shop can't afford to hire her full-time. "I don't think frustrated even begins to describe it," Mersiowsky says of her plight. "It's really scary when I think about my graduating class and how now, two more of those classes have come out and have entered the workforce and that puts me behind them. I feel like I am being set back with every passing day." subhed As so many students approach graduation without a job, moving back home has become a given, as opposed to a last resort. Taylor Maycan, a former USA TODAY intern, graduated early from Northwestern University in March and moved home to Houston to live with her parents while she looks for a job. Until then, she babysits and does other odd jobs to make money. "It's s! tressful.! No one wants to graduate and not have a job lined up," she says. "You want to be able to say, I graduated and here's what I'm doing next. It's kind of tough to say, I graduated from this great school and I have no idea what I'm doing now." Hers is a reality many college students have come to accept as the logical next step after graduation. Evan Feinberg, president of youth advocacy organization Generation Opportunity, says it's "probably the most difficult compromise my generation has been forced to make. It's really hard to get started on your own." Maycan still has a hopeful attitude about finding employment and has accepted she may have to adjust her expectations about her first job. Still, the consequences of a late career start could be life-long. Studies show that entering the labor market during a recession can affect your earnings for the next 10-15 years, depending on the industry you work in and how long you are unemployed or underemployed. And Shierholz says even that time estimate may be optimistic, given most studies on so-called "wage scarring" are on graduates who entered the labor market during the early 1980s recession, which was "long and severe" but "nothing like the one we're in," she says. Severy sees evidence that the market may be improving, at least in some areas. The career center at Boulder has received so many job postings from employers this year, sometimes between 100 and 150 a day, that Severy hired one of this year's graduates to manage the postings full time. As a whole though, graduates continue to struggle. "Unfortunately for young Americans," Feinberg says, "the recession never ended."
 Virginie Maisonneuve, one of the four new deputy CIOs at Pimco. Bloomberg News Pacific Investment Management Co., the world's biggest bond manager, named four deputy chief investment officers in an overhaul of its leadership team after Mohamed El-Erian's decision last week to step down as chief executive officer. Mark Kiesel, global head of the corporate bond management group; Virginie Maisonneuve, global head of equities; Scott Mather, head of global fund management; and Mihir Worah, head of the real return group will join Dan Ivascyn and Andrew Balls as deputy CIOs, Newport Beach, Calif.-based Pimco said in a statement Wednesday. (Don't miss Pimco's other expansion plan: Gross vows to diversify: Pimco to launch 19 active ETFs) Pimco has reorganized its senior leadership to emphasize the depth of its investment talent after the resignation of Mr. El-Erian, who shared the role of co-chief investment officer with co-founder Bill Gross. Mr. El-Erian was widely viewed as Mr. Gross's heir apparent and had led Pimco push to diversify beyond bonds into equities and non-traditional fixed income. (Bloomberg News) Like what you've read?
LOS ANGELES -- BMW finally is set to put its futuristic i3 battery car into U.S. showrooms, offering a truly peculiar option for an electric car -- a gas engine. The company showed off the car today at the Los Angeles Auto Show; on Tuesday it hosted a drive for journalists of a fleet of them from Marina Del Rey on the shore to the downtown L.A. site of the show. For $3,850 more than the price of the car you can have a 650 cc, two-cylinder BMW motorcycle engine. It's a so-called range extender. It fires up and runs a generator when the battery pack gets low. Not new. That's how the Chevrolet Volt works. But offering it as a stand-alone option is unique. Volt and other extended-range electrics have the auxiliary gasoline power built in, period. It's part of the basic design. BMW thinks most people will buy the i3 as a pure electric when it goes on sale next April on the east side of the U.S. and May in the West. That setup, BMW says, should have a range of 80 to 100 miles. But for those with serious range anxiety the range-extender option roughly doubles how far you can go before the needs fuel of some kind. A 2.4-gallon gasoline tank feeds the motorcycle engine and a fresh charge -- three hours using a 240-volt circuit to fill a completely drained battery pack -- tops off the feeds the batteries. The automaker, at a briefing here before reporters drive the a fleet of identical i3 subcompacts to downtown Los Angeles, said the gas engine never drives the wheels, it only runs a generator to keep the battery pack from completely discharging. Base price is $42,275 including $925 destination and excluding any tax credits. The i3 comes in three trim levels -- or "worlds" in i-lingo: Base is Mega. Mid-level is Giga. High-end models, like all those in the test fleet here, are called Tera. Tera interior uses leather on seats, "active" wool and kenaf on door panels. Kenaf is a "cotton-based, hemp-like" material that has the look of old felt or packing ma! terial. "Active" wool is blend of virgin wool and recycled plastic drink bottles. Eucalyptus wood is used for some dashboard surfaces. BMW says the i3 weighs a little more than 2,700 pounds, making it the lightest car the company has sold in the U.S. since the 1991 3-series. The trim weight gives the car strong acceleration -- standstill to 60 mph in 7.2 seconds -- from the electric motor's modest 170 horsepower, 184 pounds-feet of torque. The exterior is thermoplastic, similar to General Motors discontinued Saturn cars. The panels will deform if they hit something, then spring back into shape -- at low speed, anyway. Underneath is a carbon-fiber reinforced plastic skeleton. That's mainly why the car weigh what it does. Carbon fiber -- it's what many fishing rods are made from -- is strong without being heavy. Race cars use the material to keep weight down. Rear doors on the four-door, four-passenger car are hinged at the rear, so open toward the back in a so-called suicide-door pattern. When the front and rear doors both are open, there's no middle pillar so it's easier to maneuver into and out of the car. But rear riders need front passengers to open their doors before the back doors can be unlatched. Keeps the kids in place until you're ready to help them out. But could be annoying to older passengers impatient to get out and get on with things. Three driving modes are supplied. Comfort it the normal setting. EcoPro changes the throttle and other settings and should boost range 12%, says Jose Guerrero, in charge of BMW i-series products. EcoPro plus cuts back throttle response even more, tries to keep accessories turned off to save the battery and should boost range another 12%, he says.
If you're a small-business owner, I'm sure you'll relate to my morning: • Inbox with 115 new e-mails. STORY: Digital tools play role in small-biz growth
VIDEO: Smart ways to handle small-biz finances • Important customer with a difficult question about a big order. • 10 a.m. conference call with a hot prospect. • A new employee needing training. • A meeting about updating one of our products. • Someone tweeting me. • A phone call to my accountant about taxes. And my column is due this afternoon. Wow! So much to do, so little time. Every small-business owner faces the same dilemma: How do we ever manage to get anything finished with so many things on our to-do list? Small-business owners and entrepreneurs constantly are being tugged in many directions, so they need to make the most of almost every minute. I've come up with 20 time-saving tips for your small business:  Taking the time to create a to-do list can save time in the long run.(Photo: Getty Images) 1. Create a to-do list, perhaps using an app like todoist, Any.do, Wunderlist or Carrot, which turns your to do list into a somewhat mean game. 2. Turn off your e-mail. Set times to deal with email; don't continually interrupt your day. Unsubscribe from newsletters you don't read. 3. Go to the cloud. Move key business processes to Internet-based services instead of running them on site. You can run payroll, arrange shipments, retrieve files, and much more from wherever you are, whenever you need. You'll also eliminate a lot of information technology maintenance and down time. 4. Don't micromanage. Hire people you trust and trust them. Train employees, encourage them to ask questions, provide! feedback, then get out of the way and let them do their jobs. 5. Tackle the most important thing first. Take care of your most critical item first thing in the morning. That not only gets it done while you're fresh, but you'll procrastinate less on other items. 6. Give yourself deadlines. Often your most important tasks don't have time-specific due dates. Prioritize them by setting hard deadlines. 7. Handle mail once. Whether snail mail or e-mail, deal with it as you read it: Respond, delete, file or delegate. 8. Limit social media. Is social media worthwhile for your business? If not, cut it out during the day. If yes, limit time on social media sites to 30 minutes or less daily. Use tools such as Hootsuite, TweetDeck and Buffer to schedule posts. 9. Stop surfing the Web. Don't kid yourself. It's not research; it's procrastination.  Make deadlines for yourself even if they aren't set in stone.(Photo: Sven Hoppe, Getty Images) 10. Close other browser windows and programs. Try to do one thing at a time until completion. 11. Get help. Just because it's your business, you don't have to do it all. Hire others to do your bookkeeping, administrative tasks, errand running, customer support. Check out services like TaskRabbit for local errand runners. 12. Make appointments with yourself. Set aside time to address important tasks and don't allow interruptions. 13. Create templates for forms or letters you use repeatedly, such as invoices, statements, proposals, product descriptions, letters of agreement. 14. Accept credit cards. And use mobile payment-processing apps like Square, Intuit's GoPayment and PayPal Here. Spend less time on invoices, deposits, collections. 15. Don't talk. In o! ur open o! ffice, a quick question can turn into a long conversation. We schedule "library hours," to be quiet and tend to our work. 16. Create operations manuals. Jot down the steps you or a staff member takes to complete critical tasks, so you don't have to re-invent each process every time. 17. Prepare standard responses. You probably receive many of the same questions from prospects or customers. Create cut-and-paste answers and phone scripts for you and your staff. 18. Clean off your desk. Focusing is easier when you have only the thing you're working on in front of you. 19. Be tough on meetings. Meetings can be useful, but they need structure. Be clear about what you need to accomplish, start and end on time, and cut off people who like to talk. 20. Use technology. You're still doing your accounting, payroll, invoices, timekeeping, expense reporting, orders — whatever — by hand? Really? Cut it out. If this long list makes you feel even more overwhelmed, just start with three time-saving tips you think you can use immediately. Once you've saved time, you can go back and try some more. Rhonda Abrams is president of The Planning Shop and publisher of books for entrepreneurs. Her most recent book is Entrepreneurship: A Real-World Approach. Register for Rhonda's free newsletter at PlanningShop.com. Twitter: @RhondaAbrams. Facebook: facebook.com/RhondaAbramsSmallBusiness.Copyright Rhonda Abrams 2013.
| Chemocentryx (CCXI) | Bvf Part L P Il | BO | 325,635 | 1,936,126 | | Golub Cap (GBDC) | Golub D | CEO,DIR,BO | 31,504 | 533,993 | | Aircastle (AYR) |
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) is set to trade ex-dividend on January 21. The drugstore offers a dividend yield of 1.61% based on Wednesday's closing price of $68.29 and the company's quarterly dividend payout of 27.5 cents. Dividend.com currently rates CVS as “Neutral” with a DARS™ rating of 3.4 stars out of 5 stars.
