Eyes on Fed after ECB, other bank stimulus moves-Reuters

The United States Federal Reserve Board building is shown in Washington October 28, 2014. REUTERS/Gary Cameron

By Caroline Valetkevitch

NEW YORK (Reuters) - The Federal Reserve could be key for Wall Street next week as investors get to hear from the U.S. central bank for the first time since a series of moves by its global peers, including the European Central Bank's massive stimulus plan.
Thursday's larger-than-expected stimulus package from the ECB lifted U.S. stocks, helping indexes post gains for the week after three straight weeks of losses.
But the increased stimulus measures from the ECB and elsewhere globally, including the Bank of Canada, may make it tougher for the Fed to move ahead with its own plan to start raising interest rates by mid-year, lest U.S. economic policy move out of sync with the rest of the world.
"Global central policy is not one of their mandates, but I think they have to acknowledge it, because this is not just global economic headwinds, this is actually the moves of other central banks. They've got to take that into account," said Erik Davidson, chief investment officer for Well Fargo Private Bank in San Francisco.
Should the United States raise rates when other major developed economies are being more expansive, that could boost the dollar, putting further pressure on commodity prices - which because they are denominated in dollars become more expensive for non-U.S. investors - and adding to the threat of deflation.
The Fed is expected to reiterate that those global risks have not yet put the U.S. recovery or the Fed's rate plans off track when it issues its policy statement at the close of its two-day meeting on Wednesday.
The timing of the Fed's eventual rate move has been a top concern for investors. Stocks rallied when the Fed said after its December meeting that it would take a patient approach toward raising interest rates and gave an upbeat assessment of the U.S. economy.
The sharp decline in oil prices that began last June and worries about deflation could keep the Fed on hold for longer, analysts said.

"It bodes well for the Fed to be patient," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York. "There's no inflation here; the problem is deflation. If oil prices were to go lower, that could create more of a problem."

THE ATTRACTION OF EUROPEAN SHARES

At the same time, more money has been moving from the U.S. market into European stocks as a result of the ECB measures, adding to concerns for U.S. stock investors.

Sharp declines in the euro (EUR=), which hit an 11-year low against the dollar on Friday, make European stocks cheaper, especially compared with U.S. equities.
Flows into EPFR Global's European regional equity funds rose to one-year highs in the week leading up to the ECB announcement, EPFR Global said. Exchange-trade funds tied to Europe rallied following the ECB move this week. The SPDR Emerging Europe ETF (GUR.P) jumped 3.7 percent this week, its biggest weekly gain since September.

Investors will also be watching elections Sunday in Greece. With the leftist Syriza party - which has pledged to scrap austerity measures and secure a debt write-off - leading in polls, the euro may see further pressure.

Underpinning the argument for U.S. stocks, though, is the growing strength of the U.S. economy while overseas economies have been weakening.

"European equities will likely improve in the short term, but in the medium term equity performance is likely to be tied to the performance of the real economy," Rob Waldner, chief strategist at Invesco, wrote in a note this week.

Next week also marks one of the busiest weeks for fourth-quarter U.S. earnings, with 141 S&P 500 companies slated to report. Among them are several top technology names including Apple (AAPL.O) and Microsoft (MSFT.O).

With fourth-quarter earnings projected to grow 10.6 percent, tech is expected to be a bright spot in an earnings season that has been lackluster thus far.

Profit growth expectations for S&P 500 companies, now at 3.3 percent, are down sharply since the start of the fourth quarter following a big drop in forecasts for energy company earnings.

(Reporting by Caroline Valetkevitch; Editing by Leslie Adler)

People the driver of businesses - Odunze Reginald C

Speaking before American Bankers Association in San Francisco, Robert Schuller asked them the following questions”1) what are we in this business for anyway? 2) If we keeping going at it the way we are, will we get what we are going after? 3) If we succeed in reaching our goals, will be satisfied- and proud of how we did it? Then he ended it by saying, “Remember that at the bottom line of your business of banking, there are no numbers, only people.”

In management we talk about the 4M’s of management, namely the man, money, material and machines. Man has been the driving force that moves these other M’s to a profitable venture. Disciplines are interwoven, Marketing is eclectic i.e. it borrows from the various fields of learning just as any other discipline.

And in Marketing, people have been an important element in the expanded 4ps of marketing which gave rise to 8 Ps of marketing. People is an important p in the 8 ps of marketing because it drives the remaining 7ps of marketing to achieve maximum profitability i.e. cost reduction and profit maximization which is the basic philosophy of any organization.

In pension administration just like  any other business, it is the people that drives these organizations to the level at which it is expected. In looking at people as it relates to pension marketing and administration, it is imperative we look at the most important person in an organization the leadership.

Leadership

Leadership is of paramount importance in pension marketing and administration, the chief executive is the chief marketer and also the chief image maker of the organization.  Image is everything. He is the eye with which the public sees the organization. Warren Bennis in his book” on becoming a leader “noted that there is clear cut distinction between manager and leader.  He pointed out 4 clear distinctions and they are:

“The manager imitates, the leader originates,

  The manager focus on system and structures, the leader focuses on people

The manager relies on control, the leader inspires trust

The manager maintains, the leader develops”

Bennis concluded that “effective management and leadership mean that the theories and ideas should work well with the employees with a strong direction resulting in effective implementation.”

In my own observation, there are traits of good leadership. A good leader should have these 5ps of leadership and they are as follows:

Principle

Passion

Product Knowledge

Purpose

Perseverance.

In conclusion, it should be noted that the most important of all these 5ps is passion; the Webster’s dictionary defines passion “as an emotional response”

In selling people and businesses are won in the heart of the customer. This is because passion produces a positive response and it is in fact infectious. All dies without passion.

Concluding it should be noted that people is the driving force of any business and the play maker for the transformation of businesses around the globe.

 

Culled from pensionsbenefit.blogspot.com

Oil Jumps as Saudi King’s Death Spurs Speculation Over Policy-Ben Sharples in Melbourne

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Photographer: Brendan Smialowski/AFP/Getty Images

King Abdullah of Saudi Arabia speaks before a meeting with the U.S. Secretary of State at his private residence in the Red Sea city of Jeddah on June 27, 2014.

Oil jumped after the death of King Abdullah of Saudi Arabia, the biggest producer in the Organization of Petroleum Exporting Countries.
Futures rallied as much as 3.1 percent in New York and 2.6 percent in London after the Saudi royal court announced the death in a statement. Crown Prince Salman bin Abdulaziz will succeed Abdullah on the throne. The kingdom, the world’s largest crude exporter, led OPEC’s decision to maintain its oil-production quota at a meeting in November, exacerbating a global glut that’s driven prices lower.
“The passing of King Abdullah is going to increase uncertainty and increase volatility in oil prices in the near term,” Neil Beveridge, a Hong Kong-based analyst at Sanford C. Bernstein & Co., said by phone. “I wouldn’t expect a change in policy in the near term to be known, but the passing comes at a challenging time for Saudi Arabia.”
Oil fell almost 50 percent last year as the U.S. pumped at the fastest rate in more than three decades and OPEC resisted calls to cut output. Crude stockpiles in the U.S., the world’s biggest oil consumer, rose by 10.1 million barrels through Jan. 16, the Energy Information Administration reported on Thursday. That was the biggest volume gain since March 2001.

Policy Uncertainty

West Texas Intermediate for March delivery climbed as much as $1.45 to $47.76 a barrel in electronic trading on the New York Mercantile Exchange and was at $47.16 at 1:39 p.m. Singapore time. The contract dropped $1.47 to $46.31 on Thursday. Total volume was about 49 percent above the 100-day average. Prices have decreased 3.1 percent this week.
Brent for March settlement advanced as much as $1.28 to $49.80 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $2.34 to WTI, compared with $1.04 on Jan. 16.
King Abdullah oversaw a fivefold expansion in the size of the Arab world’s biggest economy and met the Arab Spring with a mixture of force and largesse. He died after almost a decade on the throne. He was born in 1924.
“The market is reacting bullishly to this news because it may usher in a period of uncertainty as far as Saudi policies going forward as new leadership takes over,” said Andy Lipow, the president of Lipow Oil Associates LLC, an energy consultant in Houston, Texas.

Market ‘Tensions’

King Salman, in his previous capacity as crown prince, read a speech on behalf of the monarch on Jan. 6 that confirmed the continuity of Saudi oil policy in the face of market “tensions” caused by slow growth in the global economy.
A key indicator will be whether Salman, 79, retains the oil minister, Ali al-Naimi, who has driven decision-making since 1995. Al-Naimi, who turns 80 this year, has said he’d like to devote more time to his other job as the chairman of the science and technology university named after the late sovereign.
“There’s the possibility that Ali al-Naimi could be replaced as oil minister,” said Phil Flynn, a senior market analyst at the Price Futures Group in Chicago. “The biggest concern is uncertainty. But, because the world is awash in oil, the reaction was muted.”
The king’s death also raises the question of whether instability across the Middle East will intensify, according to Flynn. King Abdullah had “done a good job trying to subdue” insurgents in the country, and Saudi Arabia may face increasing pressure from them now that he’s gone, he said.

Global Supplies

Middle East nations account for half of OPEC’s 12 members. The group, which supplies about 40 percent of the world’s oil, maintained its collective production target at 30 million barrels a day at a Nov. 27 meeting in Vienna. Output averaged 30.2 million in December, data compiled by Bloomberg show. Saudi Arabia pumped 9.5 million a day last month.
“Any form of economic instability after the death of the king will create a little bit of uncertainty,” said Jonathan Barratt, the chief investment officer at Ayers Alliance Securities in Sydney. “The market is exceptionally short, so even if there’s a bit of a slight err, you could see a rally of some substance. The supply story is still out there.”
U.S. crude inventories have risen to 12 percent above the five-year average for this time of year, based on Thursday’s report from the EIA, the Energy Department’s statistical arm. Production surged to 9.19 million barrels a day through Jan. 9, the most in weekly records dating back to January 1983.
In China, crude imports from Saudi Arabia climbed to 4.52 million metric tons in December, up 13 percent from the previous month, data from the General Administration of Customs in Beijing show. The Asian nation is the world’s second-largest oil consumer, according to the International Energy Agency.

Source Bloomberg

The gains of pension Reform Acts 2004 and 2014-Odunze Reginald C

   

“Those who love money will never enough” Ecclesiastics (5 VS 10) and Kiyosaki   (1990:70) noted that the world of money is filled with crooks, con-men and charlatans”

Before mismanagement of public fund especially pension fund has been the characteristics and bane of most African countries and Nigeria in particular. The National Provident Fund Act of 1973 and the NSITF Act of 1003 all failed because of mismanagement.  And the inert desire to get rich quick has led to emergence of financial crime which includes mismanagement of pension fund.

And therefore the need to protect these fund against such.  In an article captioned “ PenCom  Assures security of Retirement Saving” Dina ( 2011:36 ) noted that “since the pensioners will utilize the fund at the end of their working life, it becomes imperative that adequate measures be taken for its protection”

The provisions of 2004 PRA  and the Amended 2014 Pension Reform Act which through its regulatory body PenCom has in built checks and balances  to safeguard these funds. This is step in the right direction.

The regulator noted that in order to keep track of the activities, the PFAs and the PFCs  are required to make a regular report of their activities to PenCom. They are also required to maintain a statutory reserve of 12.5 percent of their net profit after tax with the regulatory body.

These checks and balances are meant to give the contributors and the retiree’s rest of mind and ensures the availability of these fund to the retirees at the point of retirement.

reginaldodunze.blogspot.com

The need for Additional Voluntary Contribution -Odunze Reginald C

Donna Rosato in an article captioned “5 secrets to a happy retirement” observed that “No doubt about it: More money makes you happier. Once you amass a comfortable nest egg, though, the effect weakens, says financial planner Wes Moss. For his recent book, You Can Retire Sooner Than You Think: The 5 Money Secrets of the Happiest Retirees, Moss surveyed 1,400 retirees in 46 states. The happiest ones had the highest net worths, but Moss found that money’s power to boost your mood diminished after $550,000”

The idea of voluntary contribution will increase the pension pot and stems from the inability of the pension pot to take care of the pension’s expectations, expenditures, medical expenses and other issues arising from the pension contributions.

Most retirees often discover that their pension Pot is not enough to carry them through  and that bring us to the idea of voluntary contribution. Most retirees develop one problem or the other when they discovered that their pension pot is not enough to carry out coupled with the rising cost of living and the sudden realization that the money they saved will not be able to cater for their old age.

Old age is what people pray for  right from their upward age of 15 years and I wonder why people feel terrible uncomfortable on advancing old age. The result has been that bleak rather than happiness.

And according to Richard Evans in an article in the Telegraph Newspaper he noted that “more than a million people have started a self-invested personal pension or Sip since their introduction in 1989, although many run their Sipp with help from a financial adviser.
These plans offer a simple and tax-efficient means to save in a wide variety of investments, from shares and bonds to cash and even, for more sophisticated investors, assets such as commercial property.”

The pension Reform Act 2004 and the pension Reform Act 2014 was explicit on that and it states in section 9 subsection 5 , Any employee to which the act applies may in addition to the total contribution being made by him and his employer make voluntary contribution to his retirement savings account.

The need for voluntary contribution came as a result of the insufficiency of pension contribution and the inability of some private sectors to pay accrued pension rights. The need for accrued pension stems out of the desire of the Federal Government to cater for the period preceding 2004, where an employee have put in number of years to the organization. But a situation where the organization  refused to provide for such accrued right , what do the retiree do,  of course nothing , but if there is additional voluntary contribution , it can take of any shortfall in the expectation   of the retirees pension pot.

Retirees should make it as a duty to check their pension from their Pension Fund Administrators or they make use online pension calculator which has in built mechanism capable of calculating the contributor’s likely expected values and returns based on a projected interest rate and value.

In voluntary contribution, the amount is irrelevant, it is better to start small, so that you don’t feel unsafe especially when your salary is meager, and couldn’t carry you through.

reginaldodunze.blogspot.com

The impact of customer’s satisfaction in the Pension Industry-Odunze Reginald C

Image credited to ftadvisers

Napoleon Hill devoted over twenty five years of his life to trying to discover why so few men succeed and so many fail. Le Boeuf (1987:133). He went on to say that he interviewed and studied the lives of numerous great achievers from all walks of life such as Andrew Carnegie, Thomas Edison and Woodrow Wilson and presented the essence of his findings in his classic bestselling “Think and grow Rich”

One of Hill’s best recommendation is to cultivate the idea and habit of rendering more and better service than that for which you are paid” and before you realized it the world is willingly paying you for more than you do” today we call that building perceived value, seventy years ago Napoleon Hill called it “the law of increasing returns” Le Boeuf (op cited)

Pension Fund Administrators are all offering the same service, a homogenous service and the service is basically the following:

Retirement Savings Account

Investment of the contributor’s and retiree’s fund

Customers support services and relationship management

Retirement seminars, pension forums and enlightenment programmes.

Therefore the extra mile the PFAs goes in satisfying the customers will go a long way in enhancing customer’s loyalty. Customer loyalty is essential for the pension fund administrator because it gives the edge they need in the event of the regulatory body National Pension Commission, PenCom, lifting the transfer window.

National Pension Commission ,PenCom has stated that the pension fund is now far in excess of 4.5 Trillion Naira that is good for investment in other sectors of the economy, but analyst are of the view that with the rate of corruption investing such fund may the debar the pensioners from the accessing their fund at the point of retirement.

The desire of the PFAs will be to retain their customers and possibly acquire new ones in the event of the transfer window. But achieving such feat rest squarely on their ability to offer and render more and better services to their customers. Customers are now more sophisticated and their expectations are becoming more and more increasing. They can network and definitely affect the workings of PFAs if not giving their expectations.

reginaldodunze.blogspot.com

Hobbies and its impact on the life of Retirees- Odunze Reginald C

According to Donna Rosato in an article captioned “5 secrets to a happy retirement-“noted that “Busy retirees tend to be happier. But just how active do you have to be? Moss has put a number on it. He found that the happiest retirees engage in three to four activities regularly; the least happy, only one or two. “The happy retiree group had extraordinarily busy schedules,” he says. “I call it hobbies on steroids.”
Rosato (op cited) noted that “For the biggest boost to your happiness, pick a hobby that’s social. The top pursuits of the happiest retirees include volunteering, travel, and golf; for the unhappiest, they’re reading, hunting, fishing, and writing. “The happiest people don’t do things in isolation,” says Moss.
That’s no surprise when you consider that people 65 and older get far more enjoyment out of socializing than younger people do.”

This is agreement with Merrill Lynch survey  who “found that nearly three out of four people over 50 said their ideal retirement would include working. Which is fine. Staying connected to the work world in some way can not only offer financial benefits, it can also keep retirees more active and socially engaged”

But according to an article captioned Politicians and politics safe heaven for retirement which appeared in Reginald odunze.com, Odunze opined that “But does it give them happiness, happiness varies, what gives Retiree A happiness, may not necessarily give Retiree B happiness.  But the majority of them tend to be happy”.

But be as it may, they tend to be happy and according to Dave Bernard in an article captioned “Finding Retirement state of mind” which appeared in US News .he stated that “they appear to be genuinely happy with their state of affairs and making the most of each day. When you ask about their retirement experience they shine a genuine smile and are happy to regale you – often at length – about how wonderful it is to be in their shoes. Their happiness is infectious and you may find yourself caught up in their joy. Although it is safe to assume not everything is perfect in their world, their overall outlook is positive “.

But does it relate to Africa, and Nigeria in particular, from my little experience any forum organized for retirees normally had a large turnout, indicating that there is that urgent need for socialization. Even though psychologist has noted human beings are gregarious, but on overall outlook they tend to treasure human relationship in the form of socialization.

But can retirees afford the huge cost of socialization? One of the major means of alleviating such expenditure is to join volunteer group, but is it effective in Africa and Nigeria in particular.

 reginaldodunze.blogspot.com