News You Can Use: Want an Active Investment Manager? Here’s What to Look For

IF there is one warning label that seems to have little effect, it is the one on the bottom of a securities prospectus: “Past performance is no indication of future results.” Yet according to a NY Times report investors regularly ask for a mutual fund’s track record over one, three, five years or more before putting their money in. Sure, the fund may keep going up, and the past performance is an indicator. But what happens if the fund starts to drop? Should the investor sell, or hang on because the fund did well in the past?

A report released this week from Barclays Wealth and Investment Management, “The Science and Art of Manager Selection,” aims to lay out the risks of trying to read past performance into future returns when selecting active managers — as opposed to passive management of your money through index and exchange-traded funds…

Read all about it at http://www.nytimes.com/2012/03/31/your-money/what-to-look-for-in-an-active-investment-manager.html

Rich People Are Simply Not As Interested In Working With The Biggest US Brokerage Firms Anymore

Reuters says that the biggest U.S. brokerages have set their sights set on attracting the wealthiest Americans, but a new study concludes a growing number of multi-millionaire households are taking their money elsewhere.

The share of high net worth customers' assets held by the top four brokers -- Morgan Stanley Smith Barney, Merrill Lynch, Wells Fargo Advisors and UBS Wealth Management Americas -- has fallen since the financial crisis and will continue to fall, research firm Cerulli Associates said in a report on Wednesday.

That market share, which peaked at 56 percent in 2007, fell to 45 percent last year and is expected to drop to 42 percent by 2014. The companies together had $2.1 trillion in assets from clients with at least $5 million to invest.

Boutique firms, trust companies, family offices and private-client businesses owned by rival investment banks are gaining those clients over the bigger brokerage houses…...

Wait...wait...there's more at http://www.reuters.com/article/2012/03/29/us-brokerages-marketshare-idUSBRE82S0T320120329

A Sign of the Times: Big Hiring is Back at US Colleges

According to Reuters hiring is back in a big way on many college campuses, one of several signs a recovery in the U.S. jobs market is gaining traction. After four years during which many students graduated to find no job and had only their loans to show for their studies, most college campuses are teeming with companies eager to hire. A survey by the National Association of Colleges and Employers (NACE) found 2012 hiring is expected to climb 10.2 percent, above a previous estimate of 9.5 percent.

Companies such as General Electric, Amazon, Apple and Barclays Global are looking for new staff, even if some firms remain below the pre-recession levels of new hiring.

In another sign of the recovery, some first-time job seekers are receiving multiple offers. At University of North Carolina-Chapel Hill, the career service office has seen up to now a 7.4 percent increase in the number of interviews of students by potential employers from last year and the number of companies seeking to recruit for full-time jobs is up 9.2 percent. Undergraduate business majors reporting full-time job offers is up about 10 percent.

Career experts at a dozen of U.S. schools said they have seen an increase of 15 to 30 percent in the number of companies attending campus career fairs. At University of Florida, the fall career fair garnered 15 percent more companies in attendance than in 2010. And 150 companies asked to conduct interviews versus about 100 in recent years, said Ja'Net Glover, associate director of employer relations at the school. The increase in demand was so significant that it was the first time in years the school had to use both the first and second floors of the school's basketball facility for interviews....


Learn more at http://www.cnbc.com/id/46918154

Wells Fargo opens business for the ultra-wealthy

According to a report from Reuters Wells Fargo & Co (WFC.N) opened its new Abbot Downing business on Monday, officially merging two of its wealth management units under a new brand it hopes will expand its market share of America's richest families.

The new business, catering to ultra-high-net-worth individuals and families with $50 million or more in investable assets, resulted from the combination of Wells's Family Wealth unit and its Lowry Hill subsidiary. The name Abbot Downing comes from the 19th-century New Hampshire builder of the stagecoaches that have come to represent Wells Fargo.

Since Wells first publicly announced the planned merger in November, the combined business has grown roughly 20 percent to $32.9 billion in client assets under management. In those five months, Steiner said the group had added five billionaires and 13 individuals with $100 million or more in investable assets to its client base…

Find out more at http://www.reuters.com/article/2012/04/02/us-wellsfargo-abbotdowning-idUSBRE83103220120402

Huge NYT Exposé: Why The Fiscal Timebomb Will Explode Next Year

Nobody wants much to think about it yet, but it's well understood by everyone in Washington and on Wall Street, that a potentially massive fiscal problem is looming for the economy next year. The issue is divided into three parts:

Sometime in late 2012 or early 2013, Congress will have to approve another debt ceiling hike.

At the same time, all of the Bush tax cuts are set to expire -- not just the tax cuts for the rich.

Thanks to the last debt ceiling deal, some big time spending cuts are due to go into effect starting in 2013. In theory, these could be reversed by Congress, but in the context of everything else it will be challenging.

Trying to figure out how it will shake down is especially difficult since it's an election year. But in the worst case scenario we could have bracing austerity (tax hikes and spending cuts) coupled with another heart-stopping debt ceiling fight. Or we could have some kind of reversal of the spending cuts and a debt ceiling fight, and perhaps another downgrade from ratings agencies, another potential confidence blast.

Read more: http://www.businessinsider.com/nyt-on-who-killed-the-debt-deal-2012-3#ixzz1qrVU7Biw

GOLDMAN: The Next 24 Hours Will Be Critical!

Goldman's Dominic Wilson is out with a new note offering guidance to investors on whether to finally jump off the stock market, and get more bearish, Businessinsider reports.

Here's the key threshold: We think that risk assets are likely to move higher as long as US data remain consistent with GDP growth of somewhat more than 2%.
The next several hours may be decisive...

Given more mixed news in March, and the likelihood that weather-related boosts will fade in the month or two ahead, the stakes have been raised for the releases over the next 24 hours. At the risk of oversimplification, if the ISM and global PMIs bounce convincingly, we think the market is likely to be able to make fresh highs. If instead we see a second month of declines, we are likely to turn more cautious. So basically, huge hours ahead, starting with the Chinese PMI tonight, and ending with US ISM numbers tomorrow morning…..

Read more at http://www.businessinsider.com/goldman-the-next-24-hours-will-be-critical-for-the-global-economy-2012-4

Stocks: The Likelihood of Yet Another Spring Slide?

The stock market has just had its best first quarter since 1998. Businessweek reports that this is now the third year in a row that stocks have started off on a tear, with the Standard & Poor’s index of 500 stocks gaining 12 percent so far. In 2010, the S&P 500 added 4.8 percent through March; in 2011, it rose 5.4 percent in the first quarter. In both years, by the end of April, the market had started to lose steam. The question is: Are we in for another spring swoon?

Jeffrey Kleintop, chief market strategist for LPL Financial (LPLA), thinks the answer is yes, although he doesn’t believe it will fall as hard as it did in the last two years. In his March 26 weekly market commentary (PDF), Kleintop writes: “On April 23, 2010 and April 29, 2011, the S&P 500 made peaks that were followed by 16-19% losses that were not recouped for more than five months.” In a phone interview, Kleintop said that he thinks the S&P will decline by 5 percent to 10 percent from the end of April through the middle or the end of summer 2012….

Find out more at
http://www.businessweek.com/articles/2012-03-30/stocks-yet-another-spring-slide