Yesterday a major sell program came in during the afternoon and knocked the market back. So far today that is forgotten. We have seen a lot of good news: Powell was optimistic about the economy but didn’t talk about raising rates anytime soon. Wall Street banks are having blowout earnings. There was some good news […]
“‘Make or Break’ Call on Inflation Is Stumping Global Investors”
The headline above comes from Bloomberg this morning. The article goes on to say: “Inflation and rates, especially as a bond investor right now, is the call that you have to make,” said Elaine Stokes, fixed income portfolio manager at Loomis Sayles. “It’s the make-or-break call of your year.” After 30 years of lowering interest […]
New Rules on SPAC Warrants
The SEC is proposing new rules on accounting for SPAC warrants. I have seen a few people comment that this is the death knell for SPACs, but it looks like more of a speedbump than anything else at this point. It may delay filings for new SPACs, which probably wouldn’t be such a bad thing […]
SEC addressing “frenzy” over SPACs
“SEC Seeks to Curb Lofty SPAC Projections Statement by regulator’s acting director addresses the frenzy over blank-check company deals” This is from the Wall Street Journal yesterday (April 8), and it could be a big deal. One of the major advantages of a company going public via a SPAC (Special Purpose Acquisition Company) is that […]
“Norway’s Stock Investing Behemoth Signals Shift to Active Management”
This is a headline from the Wall Street Journal yesterday (April 7). For years we have seen a shift the other way, from active to passive. This shift has caused major changes to the way markets work, including: 1. Active managers will typically hold more cash than index managers. Therefore, a shift to passive also […]
“The SPAC Boom Is Over. That’s Creating Bargains for Investors.”
This was a headline in Barron’s yesterday. The article points out what a lot of others, including us, have been noticing, that there are a lot of Special Purpose Acquisition Companies (“SPACs”) now trading for below the cash they have in trust. SPACs give investors the right to redeem their shares for a proportionate share […]
“White-Hot Stock Rally Masks Mammoth Value Swings”
This was a headline in the Wall Street Journal on April 5, 2021. Of all the things going on in markets this year, one of the most important is the battle between growth stocks and value stocks. Growth stocks have outperformed for years, but as the vaccine rolls out and the economy starts to reopen, […]
Rethinking Bonds
The markets are starting to price in higher interest rates than the Fed is predicting. That’s significant as bond prices move inversely with interest rates. Investors buy bonds for two primary reasons, either for income or to reduce portfolio risk. For income investors, higher rates aren’t such a bad thing; you could possibly take less […]