This post appeared originally on Forbes.com. You’ve heard it a million times: invest in real estate because “they’re not making any more of it.” Often, that’s less than true. Manhattan hasn’t gotten any bigger, but its residential and office capacity has soared. It is more than true, however, for farmland: the number of arable acres… Read More
Is the Fed Projecting or Pretending on Rates?
by • September 18, 2013
Let’s go back to some Fed “projection” analysis we did on August 19th Tomorrow we will get some new Fed projections. Suddenly people care. Below is the work we did back on August 19th. Fed Projections – Goal Seeked or Better Informed? It is worth taking a closer look at some of the Fed projections…. Read More
Could Verizon Bond Mark a Temporary Peak?
by • September 12, 2013
Can you hear me now? Yesterday Verizon priced $51 billion worth of bonds at $49 billion. Technically they sold $49 billion of bonds at $49 billion that then traded to be worth $51 billion. That is a lot of profit to those who got good allocations. That is positive for the market. Some “free money” goes… Read More
Is a 3% Yield the Turning Point for the Treasury Market?
by • September 5, 2013
How Much Has the Fed Lost? We spent much of yesterday looking at the potential for 3% on the 10-year Treasury and the Fed’s treasury position. For those of you who asked the Fed had lost $105 billion on the $1.6 trillion on the bonds they owned in early March. Since the 10 -ear was… Read More
Stocks Won’t Be Enough
by • August 19, 2013
This post appeared originally on Forbes.com. Heard this one from your broker? “Sure, there are problems out there, but the real question is whether you think the market will be higher or lower three years from now.” Most of us are optimists, so we buy. OK, but the critical issue is really: how much higher?… Read More
Holding Bonds To Balance Stocks? There Are Better Ways
by • July 8, 2013
This post originally appeared on Forbes.com. Before you dump bonds, remember why you have them.” So says the mainstream financial press, echoing countless advisors. Their big point is that investors shouldn’t get too spooked by the recent carnage because bonds have, for decades, acted a ballast against stock volatility, and that sort of insurance will… Read More
Liquidity Detox: Prepare For The Shakes
by • June 18, 2013
This article originally appeared on forbes.com. Volatility is back, and unpacking for a long stay. June will set a 2013 record for days with 100-point swings, and the Vix is headed north. But the real story is in bonds, where total returns for the year — interest income plus or minus price movement– actually went… Read More
And the Mighty Arms of Atlas Hold the Heavens from the Earth
by • June 10, 2013
Jeremy Hill of TF Market Advisors puts out the excellent weekly Macro Monitor newsletter. Check out this week’s edition below: Roughly 4.4 million Americans were described as long term unemployed in Friday’s jobs report. That number seems intuitively important in the context of current monetary policy. We believe the fear of structural long term unemployment has… Read More
The Hedge-Fund Investment Puzzle
by • June 5, 2013
The following originally appeared in the The Wall Street Journal: If hedge funds are as bad as the headlines would have us believe, why do sophisticated institutions keep investing in them? Anyone glimpsing headlines lately knows that hedge funds are accused of causing the Cooper Union college endowment to fail, are underperforming and overcharging, and… Read More
Safe Fixed Income Returns, Even As Bonds Tumble
by • June 3, 2013
This post originally appeared on Forbes.com. Bond investors are faced with a rude development: total returns – that is, the combination of income and price movement – are now negative for the year (junk bonds aside). Who even remembers the last time that was true? Perhaps we’re not really seeing the end of a 30-year… Read More