With unprecedented volatility in the financial markets that’s been brought on by the international spread of coronavirus, and the economic backlash associated with it, is potential systemic risk to the global financial system lurking ‘out there’ in an obscure and often little understood investing vehicle (even for its buyers)… DERIVATIVES! Back in 2015, then reposted […]
Summary: Whether we work in real estate, on Wall Street or maybe in the manufacture of widgets… What is the potential impact on global financial stability from a yes vote next week for Brexit? On June 23, 2016 Britain will be holding a referendum that will decide whether or not the country will remain in […]
In an investment some debt or leverage can be good but, at some point, it can become all-consuming and impossible to repay! Think about what happened to homeowners who had a variable-rate mortgage, also known as debt or leverage, when mortgage rates began to rise and the value of the asset fell. If their income stayed […]
What’s better for a lender than underwriting a commercial mortgage loan, packaging it with other loans and then selling it to investors? Any inherent risk of loan default, after the time it may take to sell the security off course, would be passed off to the investor that buys it. What we saw during the financial […]
In my first job as a municipal bond analyst and strategist a key datapoint to consider was the steepness of the yield curve! When the curve was at its steepest, investors would be ‘getting paid’ in the form of higher yields to assume the price and reinvestment risk of moving out to longer maturities. When flat, meaning […]
In mid-December 2015, and for the first-time in about eight years, the Janet Yellen-led Federal Reserve raised short-term rates .25%! In a normal financial, political and economic environment one would therefore assume that the economy is in strong enough to warrant a rate hike and that inflation is at or very close to the Fed’s target rate. […]
Summary: At levels not seen since the financial crisis, is the distressed debt ratio sending a clear signal about the health of the US economy? Will the Fed or won’t the Fed and, in fact, at the end of the day does it even matter when considering the health of lower rated companies? High Yield Bonds: ‘A […]
After an 8.5% drop in the Shanghai Composite Index stock markets around the world recoiled in sympathy! But why, you may be asking, is the world so afraid of the goings on in China? Because while the communist nation has a quasi-capitalist economy, there’s a great deal of difference between here and there when you […]
Back on April 17, 2015 I wrote an article here titled ‘What a stock market top might look like!‘ And while hindsight is 20-20 and the stock market is currently suffering through some difficult days, at the time of the above mentioned article the chart of the S&P appeared (at least to me) to be […]
(Update 11:32 AM: As if investor angst wasn’t running at a high enough level already, trading on the floor of the NYSE for ALL stocks has been suspended for an as of yet undetermined reason although off-floor third market trading is still taking place!) (Update 1:45 PM: Is yesterday’s Tweet from the cyber-hacking organization Anonymous […]
