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Thursday, October 21, 2010

UK’s Dreadful Debt, Saves Economy

Chancellor Addresses UK’s Dreadful Debt, Saves Economy

George Osborne MP, pictured speaking on the la...
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The Chancellor of the Exchequer, George Osborne announced yesterday in the Comprehensive Spending Review (CSR), that the UK had a structural budget deficit of at £109Bn. The largest in Europe. Debt interest payments this year would amount to £43Bn.Therefore radical action to tackle the gap in the public finances was unavoidable. On this point the Chancellor is absolutely correct.

The opposition and Trade Unions can undertake as much posturing as they choose. However, without the measures taken in June. Just one month after the election. The process of steering public finances toward a sustainable path long term interest rates (the yield on gilts) would have been delayed . Gilt yields would certainly have been higher than now.

Why is it that opposition and unions fail to make a connection between debt levels, sovereign ratings, sovereign debt yields and the level of Base Rates? From the rate the Bank of England has to set, so the nation’s medium term economic fortunes will evolve.

Without the June judgments debt interest payments would also have been higher, so further increasing the deficit. This would have delayed the date when the ratio of debt to GDP stabilised.

This dismal scenario would have had wreaked carnage on private sector activity and also the longer term supply performance of the overall economy. In passing the first test of his nerve; one has to respect that the Chancellor has gone further in terms of welfare reform – Mr Osborne has maintained the downward pressure on gilt yields.

This will act as a non fiscally expansive stimulus to private sector activity. There will be no crowding out!
Still acolytes of Keynes still want their hero to see his name in the spotlight. This is, however, no time for a simplistic Y= C + I + G … model to be trotted out again.

Theory has to yield to empirical evidence. Evidence borne in the environment of economic dynamics, not dogmatic comparative statics. The data shows that periods in which the structural budget deficits have increased are generally associated with economic weakness and vice versa.

This is because in the real world increased government spending “crowds out” private sector activity. One only has to consider the UK case in the 1983-87 period, when the public finances moved into surplus whilst the economy enjoyed an extended period of above trend economic growth. The reverse case in seen in Sweden in the mid 1970’d when fiscal spending was hampering the economy despite the export success of ABBA!

This is no frivolous statement for one just has to question what happened to the Japanese economic miracle? Were it just a question of spending tax payers money Japan would have experienced an extended boom over the last 10-15 years. That was not the case. We all know about the dreadful and ongoing “lost decade”.

What is crucial for the UK and indeed any modern western market economy lies with where is the money supply. The Bank of England Governor, Dr. Mervyn King recognises this. On the road in the West Midlands he told his that there is “too little money in the economy”. Take that as an unsubtle hint that more QE in the UK is on the way. This is likely to be marked at the MPC in November.

Implications for Financial Markets
UK financial markets were little moved by the Chancellor’s statement yesterday. Be not surprised as the plan was well signaled. The macro message was barely changed from the June Budget. Yield to maturity on 10 year Gilts was unchanged at 3.00%. The 25 point rise in the FTSE 100 index to 5728 had more to do with the strong Wall Street opening than any of the detailed cuts in departmental budgets unveiled by the Chancellor.

Of course there is delight that there was no back-tracking in the CSR on the need for large cuts in planned expenditure or a shift in the emphasis from spending restraint to tax increases.

With the economic recovery likely to derive considerable support from sustained low long term interest rates and further asset purchases by the Bank of England I continue to expect equities to make solid gains over the rest of 2010 and throughout 2011.

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Getting monthly dividend payments from REITs

What is REITS and how to get monthly dividend payments from it

Personal Investing - By Ooi Kok Hwa


A LOT of investors, especially senior citizens, are hoping to get consistent and regular dividend payments from stocks.

In this article, we will look into constructing an investment portfolio, which consists of real estate investment trusts (REITs), to get monthly dividend payments.

A REIT is a real estate company that pool investor funds to purchase a portfolio of properties. Normally, it has two unique characteristics: investment in income-producing properties, with almost all of its profits distributed to investors as dividends.

From the table, based on the latest stock price (as at Oct 18) and on assumption that the same dividend payments will be paid over the next 12-month period, almost all REITs will provide about 7%-8% dividend yields. Based on our observations, most of the REITs will try to pay higher dividends over the years. Hence, if the overall economy continues to recover, some REITs may pay even higher dividends for the coming few years.

Due to them only listing at the middle of this year, we have excluded CMMT and Sunreit.

As mentioned earlier, a lot of retirees would like to invest in investment assets that can provide a consistent and regular dividend income. Therefore, we think that REITs can provide a good alternative to the retirees. 
From the table, except for Arreit, Atrium, Axreit and Hektar, all other REITs will make dividend payments twice per year. Most of them will pay their dividends in the month of February and August. Hence, if an investor would like to receive his dividends other than the above two months, he may need to diversify their REITs into holding many types of REITs.

Based on the list of REITs in the table, we can see that, except for the month of January and April, dividend payments were being made at different months throughout the year, thus investors can receive a stream of dividend income by buying into different types of REITs.

Investors can build a REIT portfolio consisting of a few REITs which make dividend payments at different months of the year. The following is just one of selection options available for consideration.


Based on the current price dated on Oct 18, assuming that the same dividends will be paid in the next 12 months, a portfolio with AMfirst, Arreit, Atrium and Hektar can generate a dividend yield of more than 8% (see table). Besides, by buying with equal amount into these four REITs, investors can get dividend payments for almost every month, except for the month of January, April, July and October.

Nevertheless, investors need to understand that the above selections are solely based on the assumption that these REITs will reward investors with the same dividends and pay during the same month as shown in the table above.

We also understand that apart from the above four REITs, some other REITs may reward investors with even higher dividend payments.


  • OoiKokHwa is an investment adviser and managing partner of MRR Consulting




  • Prostate Cancer Symptoms, Treatment & PSA Tests; Couples counseling improves sexual intimacy after prostate treatment




    Prostate Cancer Symptoms and Treatment

    By LiveScience Staff

    Prostate cancer is diagnosed in about 20 percent of men. It may be more prevalent, however, because some men never know they have it and die of other causes before the slow-growing cancer becomes a problem. 
    Prostate cancer is the most common type of cancer found in American men, after skin cancer, according to the American Cancer Society. And prostate cancer is the second leading cause of cancer death in men, after lung cancer.

    Only men have a prostate gland, which is just below the bladder, in front of the rectum. It is about the size of a walnut.

    The prostate grows from birth to adulthood. But in some men, it keeps growing. This can lead to an enlarged prostate, a non-cancerous condition called benign prostatic hyperplasia (BPH).  This can cause problems passing urine.

    In some cases, certain cells in the prostate become cancerous and continue multiplying.

    Scientists don't know what causes prostate cancer, officially called prostate adenocarcinoma. Risk factors include smoking, age and family history.  A diet high in red meat also plays a role, studies suggest. Black men are more likely to get prostate cancer than others.

    Experts don't agree on whether all men should be routinely tested for prostate cancer. One test involves the doctor putting a gloved finger in the rectum to feel for bumps or hard spots on the prostate. A blood test, called PSA (prostate-specific antigen) looks for signs of the disease in the blood.

    "These tests are not perfect, though," states the American Cancer Society. "Uncertain or false test results could cause confusion and worry." And, the society notes, surgery is sometimes performed or radiation therapy conducted even when a doctor is not sure how fast the cancer might spread. Importantly, prostate cancer grows slowly, according to the American Cancer Society. In fact autopsies suggest that as many as 90 percent of men over age 80 have prostate cancer, most never knowing it and dying of something else.

    "If you are older than age 70, you may opt for expectant management (also called watchful waiting) if your prostate cancer is growing slowly," according to the Mayo Clinic.

    Early and accurate diagnosis of prostate can, however, improve odds of survival, studies show.

    The American Cancer Society suggests the decision about whether to test should reside with patient and doctor after a discussion about the cancer and its risks. The talk should take place at age 50 for men who are at average risk, at age 45 for men at high risk of getting prostate cancer (African American men and men who have a father, brother, or son found to have prostate cancer before age 65), and at age 40 for men with several family members who had prostate cancer at an early age.
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    Prostate Cancer: PSA Test (Part 2)


    -IMAGEALT-
    A breast cancer cell seen through an electron microscope.
    CREDIT: The National Cancer Institute.

    This is the second part of a three-part series on the PSA test for prostate cancer.
     
    Cancer of the prostate is one of the most common types of cancer among American men. More than 6 in 10 cases of prostate cancer cases occur in men 65 and older. Treatment for prostate cancer works best when the disease is found early.

    Prostate-specific antigen (PSA) is a protein produced by the cells of the prostate gland. The PSA test measures the level of this protein in the blood. It can be detected at a low level in the blood of all adult men.

    A fundamental problem with the PSA test is that, while elevated levels can indicate the presence of cancer, they can also be caused by other problems such as benign enlargement of the prostate that comes with age, infection, inflammation and seemingly trivial events such as ejaculation and a bowel movement.

    Another major problem with the PSA test is defining what is “abnormal.” Older men usually have higher PSA measurements than younger men. African-Americans normally have slightly higher values than whites.

    PSA test results are usually reported as nanograms of PSA per milliliter (ng/mL) of blood. In the past, most doctors considered PSA values below 4.0 ng/mL as normal. However, recent research found prostate cancer in men with PSA levels below 4.0 ng/mL

    Some researchers have suggested lowering the PSA cutoff levels. For example, a number of studies have used cutoff levels of 2.5 or 3.0 ng/mL instead of  4.0 ng/mL.

    Many doctors are now using the following ranges with some variation: 0 to 2.5 ng/mL is low, 2.6 to 10 ng/mL is slightly to moderately elevated, 10 to 19.9 ng/mL is moderately elevated, and 20 ng/mL or more is significantly elevated.

    Because age is an important factor in increasing PSA levels, some doctors use age-adjusted PSA levels to determine when diagnostic tests are needed. When age-adjusted PSA levels are used, a different PSA level is defined as normal for each 10-year age group.

    Doctors who use age-adjusted levels usually suggest that men younger than age 50 should have a PSA level below 2.4 ng/mL, while a PSA level up to 6.5 ng/mL would be considered normal for men in their 70s. Doctors do not agree about the accuracy and usefulness of age-adjusted PSA levels.

    But there’s even more to make you nuts when you’re evaluating your PSA.

    PSA is either free or attached to a protein molecule. If you have a benign prostate condition, there is more free PSA. Cancer produces more of the attached form. A free PSA test that indicates prostate cancer can lead to more testing, such as a biopsy.

    PSA velocity is the change in PSA levels over time. A sharp rise in the PSA level may indicate a fast-growing cancer.

    The relationship of the PSA level to prostate size is PSA density. An elevated PSA in a man with a very large prostate is not as alarming as a high PSA reading in someone with a small prostate.

    Another problem with PSA are false test results.

    If you have an elevated PSA but no cancer, you get what is called a false positive. This type of result can lead to medical procedures, anxiety, health risks and expense. Most men with an elevated PSA don’t have cancer.

    When you have prostate cancer and your PSA test comes back in the normal range, you get a false negative. It’s important to understand that most prostate cancers are slow-growing; they can be around for many years before they cause symptoms.

    Prostate Cancer: PSA Test (Part 3)

    [This is the final part of a three-part series on the PSA test for prostate cancer.]

    Cancer of the prostate is one of the most common types of cancer among American men. More than 6 in 10 cases of prostate cancer cases occur in men 65 and older. Treatment for prostate cancer works best when the disease is found early.

    Prostate-specific antigen (PSA) is a protein produced by the cells of the prostate gland. The PSA test measures the level of this protein in the blood. It can be detected at a low level in the blood of all adult men.

    A fundamental problem with the PSA test is that, while elevated levels can indicate the presence of cancer, they can also be caused by other problems such as benign enlargement of the prostate that comes with age, infection, inflammation and seemingly trivial events such as ejaculation and a bowel movement.

    PSA test results are horribly confusing and often terrifying. In the first parts of this series, we discussed the sources of much of the confusion. In this column, we’ll address the primary question about PSA: Does it save lives?

    The answer is: We don’t know. What’s worse is that we don’t know if PSA screening outweighs the risks of follow-up diagnostic tests and cancer treatments.

    For example, prostate surgery can cause incontinence and erectile dysfunction. Even a  prostate biopsy has risks because it can cause bleeding and infection.

    The PSA test can detect small tumors. However, finding a small tumor does not necessarily reduce a man’s chance of dying from prostate cancer. PSA testing may identify very slow-growing tumors that are unlikely to threaten a man’s life. Also, PSA testing may not help a man with a fast-growing or aggressive cancer that has already spread to other parts of his body before being detected.

    So, what should a man do to protect himself from prostate cancer?

    Some doctors encourage annual screenings for men older than age 50; others recommend against routine screening. However, most doctors and medical organizations agree that men should learn all they can about prostate cancer, so they can reach informed decisions.

    My personal history with PSA tests is illustrative of many of the problems men face with this type of screening. I hope that sharing it will help.

    I’m 69 years old. I’ve been having physical exams almost every year since I hit my 50s. These physicals included a PSA blood test and a digital rectal exam (DRE).  Until recently, all tests produced normal results.

    My PSA was always around 1.5. Most doctors want your PSA to be under 4. (The numbers stand for nanograms of PSA per milliliter of blood.) And, my DREs found no irregularities, just some benign enlargement.

    About three years ago, my family physician gave me a DRE and found nothing, but my PSA test came in at 2.97. My doctor told me to see a urologist for a follow-up exam because my PSA, while under 4, had increased.

    The urologist did another DRE and ordered another PSA test. The test came in at 2.96. The urologist said that he thought 2.96 was my new PSA and that I should not worry about it.

    Two years later, my PSA was still 2.96. Then, this year, it came in at 4.1.  My family physician sent me to a urologist.

    Before I went to the urologist, I did some research and learned that something as seemingly insignificant as a bowel movement could affect a PSA test. I told the urologist that I recalled going to the bathroom just before having blood drawn. He thought that this BM could have affected the test.

    Another DRE. Okay. Another blood test. The PSA was 3.3. The urologist said no biopsy was required. The increase from 2.96 to 3.3 was not a cause for concern.

    What now? I’m tempted to forget about PSA tests, but I’ll probably have another in a year.
    The Healthy Geezer column publishes each Monday on LiveScience. If you would like to ask a question, please write fred@healthygeezer.com. © 2010 by Fred Cicetti.

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    Couples counseling improves sexual intimacy after prostate treatment

    September 25, 2011
    Couples counseling improves sexual intimacy after prostate treatmentEnlarge

    This is Leslie Schover, Ph.D, a professor in MD Anderson's Department of Behavioral Science. Credit: Image courtesy of MD Anderson 

    VIDEO: Hope for Restored Sexual Function for Prostate Cancer Patients and their Partners
    VIDEO: Sexual Counseling for Couples after Prostate Cancer Treatment
    PODCAST: Listen to expert Leslie Schover discuss results of face-to-face and internet-based counseling.

    Prostate cancer survivors and their partners experience improved sexual satisfaction and function after couples counseling, according to research at The University of Texas MD Anderson Cancer Center. The article, published in the September issue of Cancer, a journal of the American Cancer Society, revealed both Internet-based sexual counseling and traditional sex therapy are equally effective in improving sexual outcomes. Couples on a waiting list for counseling did not improve.

    Men experienced a marked improvement in their sexual function for up to one year, and women who started out with a improved significantly with counseling.

    "We know that one of the crucial factors in a man's having a good sexual outcome after treatment is a partner who also wants their sex life to get better," said Leslie Schover, Ph.D, a professor in MD Anderson's Department of , lead investigator on the study and author of the paper, "A Randomized Trial of Internet-Based Versus Traditional Sexual Counseling for Couples After Localized ." "Women's issues such as ill health, post-menopausal and lack of desire for sex can be a major barrier in achieving satisfactory sexual outcomes."

    Leslie Schover explains the significance of results in randomized trial incorporating couples counseling for prostate cancer patients and their partners. Credit: Video courtesy of MD Anderson

    CAREss (Counseling About Regaining Erections and Sexual Satisfaction) randomized 115 heterosexual prostate cancer survivors who were experiencing erectile dysfunction and their partners into three groups: a wait list group that received delayed counseling, a face-to-face counseling group, and a group that received an Internet-based sexual counseling program.

    After three months, the wait-list couples were randomized into either the face-to face or the Internet-based counseling group. A second Internet-based group of 71 couples was added to boost the numbers and allow researchers to analyze the relationship between extent of website use and outcomes.

    Couples were assessed before and after the three-month wait-list period, again after counseling, and also at six and 12-month follow-ups. In addition to web-based education and exercises, participants in the Internet-based group received feedback from their counselor through email.

    Treating the Body and the Mind

    Many prostate cancer survivors are as concerned about loss of desire and lack of satisfying orgasms as they are about erectile dysfunction. Men in this study improved on most dimensions of sexual function. From baseline to one year, men improved significantly in erectile function, but also in orgasmic function, intercourse satisfaction and overall . Sexual desire remained stable.

    Leslie Schover discusses results of face-to-face and internet-based counseling. Credit: MD Anderson

    Some patients and/or partners are too anxious about sexual issues to seek help from a therapist face-to-face. An internet-based program that offers online tools and surveys, as well as interaction with the therapist by email, gives them a less threatening option. "Not only do men often use the internet to search for information on sex, but prostate cancer patients consider the web a valuable resource for information on the impact of treatment on sex," said Schover.

    Another advantage of web-based counseling for couples is the potentially lower cost. While many insurance companies cover medical treatment of erection problems after , the cost of sex therapy is often not reimbursed. Already burdened with co-payments for their cancer treatment, many couples cannot afford additional costs associated with mental health care.