Hedge heavy

James Simons of Renaissance Technologies, a money management firm begun by him in 1982, controls Medallion, Renaissance’s lead hedge fund with $5 billion under management. From 1990 to 2004, Medallion delivered annualized returns of 33.21%. From the end of 2002 until the end of this year, $6.4 billion is the total of disbursements to Medallion’s investors. And those returns are after the highest hedge fund fees in the business: 5% annually for management and a 44% share of the profits. Typically, a hedge fund sees 2% charged for management and 20% taken out of profits. Next up is the Renaissance Institutional Equities Fund, which allows a $20 million minimum investment and which is expected to top $100 billion under management.

Mutual funds in general

According to research firm Morningstar, over three years through September, stock funds in the US gained an annual average of 17.79% a year.

Working to stem the trade imbalance

Last week, Chinese aviation officials signed a letter of intent to buy 70 Boeing 737 jetliners, which comes to about $4 billion. They also pledged verbally to buy an additional 80 of the aircraft. Still, China’s trade surplus with the US is likely to top $200 billion this year, up from $162 billion in 2004. However, for September the monthly surplus was only $7.6 billion, down from $10 billion in August.

Does the UK lead in house prices?

In the UK. house prices jumped 15% in 2003 and are expected to rise by 4% at the end of 2005. For 2006, UK house prices are projected to fall by 6%. In the US house prices went up 6% in 2003 and are projected to be up 13% for 2005.

Rates up

The European Central Bank announced it intends to raise interest rates December 1 and again in early 2006. The benchmark rate should go to 2.25% next week and to 2.50% the next month. This action is expected to somewhat slow the strengthening of the dollar. Year to date, the dollar has risen 15.3% against the euro and 16.3% against the yen. The US benchmark interest rate is 4%, having been lifted 12 times for 12 quarters in a row.

Recession looming, maybe

A rule of thumb among economists in recession forecasting allows for the rising interest rates on short–term Treasury notes to catch up with the interest rates on long–term Treasury notes. When that happens, and it’s about to, historically it signals an economic slowdown. Last week, the gap in yield between two–year and ten–year Treasury notes was about 0.08 percentage point.

Should Congressman Clyburn

follow Alaska’s fine example?

Last week, US Senator Ted Stevens (R–Alaska) pulled the funding for his notorious $320 million “Bridge to Nowhere” in Alaska. The bridge was to connect Ketchikan with Gravina Island (pop. 50).

More competition for Columbia’s

convention center

Spartanburg convention officials recently announced plans for a 50,000 sq. ft. exhibition hall addition to their Memorial Auditorium. Also, they want to build a 600–space parking deck and another 60,000 sq. ft. of “flex space,” all across the street from the new Marriott.

Feeling upbeat?

Remember the recent bad news

On a single day in October 1987, the Dow Jones Industrial Average fell 22.6%. Japanese stocks have been rising lately, but they are still 65% lower than 1989. SC’s per capita income in 2004 was 44th in the US, and its current unemployment rate is the third highest. GM announced Monday it intended to drop 30,000 US jobs over the next three years.

SC’s proposed oil refinery

Officials at Hilton Head Island are putting together an attack on the proposed refinery in the Lowcountry, probably Jasper County. SC Representative Michael Thompson (R–Anderson) is expected to introduce legislation in support of a Lowcountry refinery in the upcoming legislative session. The Hilton Head Island officials are afraid the refinery could threaten tourism and its jobs.

National 2006 budget deficit

In 2004, the national fiscal year ending September 30 had a deficit of $412 billion; in 2005, $319; and in 2006 it appears to be coming in around $300 billion, even with Hurricanes Katrina and Rita.