Blog Posts by Jennifer Carinci

While most of us are packed up and pumped up about the three-day Memorial Day weekend, former U.S Comptroller General David Walker is fired up about the nation's debt.

Walker, who founded the Comeback America Initiative and served 10 years as comptroller general (1998-2008), has been sounding the alarm on our out-of-control government debt since long before it became cool to care about fiscal health.

He sat down with Matt and Aaron and blasted out of the gates, swinging at both parties in Congress and their failure to resolve the issue of raising the debt ceiling to avoid default. The current ceiling is $14.3 trillion, and at our spending rate we're scheduled to breach that limit on Aug. 2, sending the U.S into default.

There's no denying the resiliency of U.S. stocks, and Tuesday's rebound to break-even on the S&P 500 and the Nasdaq are only the most recent examples.

While doomsayers continue pointing to weak economic data and fundamentals, according to legendary analyst Louise Yamada of LYAdvisors.com, the technicals show a market uptrend that is still intact, and it's putting the U.S. back on top of the world. "The emerging markets have been underperforming the developed world, and within the developed world, the U.S. is outperforming the rest of the markets," says Yamada.

While investors may be cheering the 1% bounce for Japan's Nikkei 225 index overnight, Yamada points out that many global markets, including Japan and the U.S., are "struggling at the 2007-2008 peaks." But the real cause for concern is among the emerging markets, where we're starting to get some weekly sell signals. And the two most fragile, Brazil and India, are already rolling over, according to Yamada.

Last week's commodity price bloodbath signaled a potential shift in the market. A stronger dollar triggered a reversal in trends, rising 2% on the week. Meanwhile, crude oil tumbled nearly 15%, the price of gold shed 5% and silver prices led the losses, plunging 25%, all in one week. The Wall Street Journal's Greg Zuckerman, a veteran reporter covering hedge funds and top money managers, stopped by Breakout to help make sense of the unwinding commodities trade after breaking the news that Wall Street titans George Soros and John Burbank were selling their gold and silver positions. While these moves alone do not cause double-digit declines, they can be of the size and scale that exacerbate a sell-off and leave retail investors burned.

In the clip above, Zuckerman tells Breakout that the smart money is concerned the Fed's quantitative easing program really will end in June and additional stimulus, or QE3, won't happen. "There are all kinds of really smart guys that have been frustrated by this market," says Zuckerman. And this smart money has been shorting "momentum kind of stocks" such as Lululemon (LULU).

You may have thought he dispelled all of his investing secrets, but there's more to reveal from Joel Greenblatt's recent visit here at Breakout. The author of The Big Secret for the Small Investor has some valuable insight on which benchmark indexes you should pay attention to, which could lose you money, and why ETFs tracking the right indexes are a "good passive strategy."

Greenblatt lays out a food chain of investing, with active fund managers at the bottom of the pyramid. He is very critical of active managers and prefers investors go it alone by tracking certain indexes and buying ETFs that do the same. Most investors follow the traditional indexes, like the S&P 500. Despite beating most active managers (putting them up higher in the food chain), he says "they're still very flawed." That's because they are market-cap weighted, meaning they put more weight into the largest companies whose size adjusts automatically as stock price fluctuates.

The problem with market-cap weighted indexes is "if a stock is overpriced, you own too much of it. If a stock is underpriced, you own too little of it." And this alone can cost an investor 2% a year, according to Greenblatt. So, we move up the investing food chain to avoid that loss and seek out profit.

Breakout brought in Michael Yoshikami, the founder and CEO of YCMNET Advisors, to try to make some sense of last week's sentiment roller coaster.

Yoshikami, who was recognized by Barron's as one of the Top 100 Independent Financial Advisors for 2009 and 2010, says "those people that are betting on the U.S. not recovering are mistaken." That's not to say he believes it's going to be necessarily robust, but he does have a few ideas for taking advantage of what he believes will be a weak rebound for the world's biggest economy.

Happy Earth Day! Today marks the 41st anniversary of the birth of the environmental movement, so the Breakout crew figured what better day to focus on some "green" or socially responsible investing ideas.

Socially responsible investing is not a new concept, but it is an evolving strategy that has different meanings to different investors. And the growing number of mutual funds devoted to making a profit from socially responsible investing, sometimes shortened to SRI, use various approaches to do so.

There are few funds in the space that can boast double-digit returns like the five-star Morningstar-rated Gabelli SRI Green Fund (SRIGX). The mid-cap growth fund is up more than 17 percent in 2011, and it has risen over 30 percent from a year ago. In the accompanying video, fund manager John Segrich tells Breakout this success comes from investing in global resources, everything from "energy to agriculture to water, forestry, metals, minerals, infrastructure."

An unwelcomed reminder of devastation raised anxiety for investors who put money into Japan's post-tsunami rebuilding story. A 7.1 aftershock rattled the country and the markets late this week. Thankfully, it resulted in minimal damage, but major power outages occurred in northeastern Japan.

James Bianco, president of Bianco Research, joined "Breakout" to put the investment story into perspective. Bianco says it starts with the Bank of Japan printing a previously unimaginable amount of money to revive the economy and keep the financial hub stable. As for the Japanese currency, Bianco says it "ultimately leads to a weaker yen, not stronger."

So, how should a nimble investor react to the latest aftershock in Japan?

For Bianco, history will likely repeat itself, which takes us back to the 1995 Kobe, Japan, earthquake that killed over 5,000 people and caused widespread infrastructure damage along the southern coast of Japan. "What spawned out of all of that was the yen carry trade," says Bianco.

While the broader tech space is breaking down, infatuation with social media companies is running rampant, from Wall Street to Main Street. Most of the major networking companies -- Facebook, Twitter, LinkedIn among them -- remain privately held. But speculation over the social media phenomena has valuations soaring, and it's fueling investments before the companies even go public. See more on this in last month's interview with SecondMarket CEO Barry Silbert.

Top market economist, President of River Twice Research and Time Magazine columnist Zachary Karabell stopped by Breakout to discuss the social media phenomonenon. He's not questioning Facebook's $75 Billion valuation or Groupon's $25 Billion price tag. In the video clip, Karabell goes beyond the numbers and discusses the larger impact on our economy and overall prosperity, and whether it's necessary to follow the money into this trend.