What the Irish bailout means for investors

What the Irish bailout means for investors

Concerns about a sovereign debt crisis in Europe have re-emerged in recent weeks, highlighted by the government of Ireland’s November 21 application for tens of billions of euros in aid from the European Union (EU) and the International Monetary Fund (IMF). This action was taken to address weakness in Ireland’s banking system, which has been

Why leveraged companies are choosing to pay more for financing

Why leveraged companies are choosing to pay more for financing

As credit markets have opened up, we’ve seen a number of companies refinance their bank debt for more speculative, high-yield debt. At first glance this may not make sense, because the cost of capital in this kind of transaction can rise sharply — from 3% to 7%, for example. But high-yield debt gives companies two

Germany shines amid dark clouds

Germany shines amid dark clouds

While Germany emerged from Europe’s recent turmoil with accelerating economic growth and strengthening exports, the Eurozone still faces imbalances. Growth accelerated despite debt turmoil For the second quarter, Germany reported a stronger-than-expected expansion of 2.2% — its best quarterly result since 1990, the year of the country’s reunification. It achieved this despite the market turmoil

Derivatives and financial reform

Derivatives and financial reform

The recent Dodd-Frank Act introduced sweeping changes to the derivatives market. Daniel Farrell, Putnam’s Head of Equity Trading, discusses how Putnam uses derivative contracts and the impact of the bill on Putnam equity funds. Broadly speaking, what are derivatives and how are they used? Derivatives are investments whose value is based on — or “derived”

Consumers benefit, but not all consumer-sector stocks

Consumers benefit, but not all consumer-sector stocks

What are the potential implications for consumer-sector stocks? At the margin, we think the impact of increased regulation and taxation on financial services companies could be negative — particularly for businesses that touch the consumer directly, such as credit card companies. Anything that slows economic growth, increases uncertainty, or decreases confidence is negative. What are

Sovereign debt troubles weaken euro

Sovereign debt troubles weaken euro

The importance of investment diversification took on more prominence in recent weeks, as sovereign debt concerns in Greece and other European Union (EU) countries played a role in increasing volatility in the equity and currency markets. Putnam Europe Equity Fund is focused on achieving diversification by investing in the securities of established large and midsize