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☆ JPMorgan bond chief Bob Michele sees worrying echoes of 2008 in market calm
▼ + stars: | 2023-06-09 | by ( Hugh Son | ) www.cnbc.com time to read: +6 min

"This does remind me an awful lot of that March-to-June period in 2008," said Michele, rattling off the parallels. Last month, JPMorgan bought failed regional player First Republic; in March 2008, JPMorgan took over the investment bank Bear Stearns. Michele oversees more than $700 billion in assets for JPMorgan and is also global head of fixed income for the bank's asset management arm. The cycle coincides with the central bank's steps to rein in market liquidity through a process known as quantitative tightening. Brown | AFP | Getty Images"There are a lot of things that resonate with 2008" including overvalued real estate, he said.

Persons: Bob Michele, JPMorgan Chase, Michele, Jamie Dimon, Rick Rieder, Goldman Sachs, Jan Hatzius, Frederic J, Brown, Ribbing Organizations: & Commodities, JPMorgan, CNBC, First, Bear Stearns, Wall Street, Fed, AFP, Getty Locations: York, BlackRock, Downtown, Los Angeles , California, refinance

It's focused on maximizing your after-tax yield with a diverse, low-cost blend of bond ETFs. Here's everything you need to know about the new Wealthfront automated bond portfolio. Read our review Read Our Review A looong arrow, pointing rightWhy you should consider an automated bond portfolioWealthfront's automated bond portfolio pays a 5.48% yield, which is higher than Wealthfront's own cash account that pays 4.55% to 5.05%. Also, the automated bond portfolio may be tax-advantaged, but there's no guarantee that it will work. It also invests in a blend of commission-free bond ETFs and iShares bond ETFs.

Persons: Wealthfront, —, Charles Schwab, you'll Organizations: Bond, Service, SEC, Reading Chevron, Treasury, Fidelity, Wealthfront

☆ From your 401(k) to bonds, here’s how to protect your financial well-being as debt default worries grow
▼ + stars: | 2023-05-27 | by ( Ramishah Maruf | ) edition.cnn.com time to read: +7 min

New York CNN —The White House and House GOP negotiators are rushing to finalize a deal to raise the country’s debt limit. With that X-date only about one week away, there’s still no deal to raise the debt ceiling – putting Americans’ finances in danger. If you invest in bonds, pay attention to when your Treasury bills are maturing. Stick with high-quality investmentsSteer clear of corporate junk bonds or emerging market bonds, CNN has previously reported. Federal government contractors could also see a lag in payments, which could affect their ability to compensate their workers, CNN previously reported.

☆ Enad Global 7 stock jumps after US activist investor pushes for sale
▼ + stars: | 2023-05-22 | by ( ) www.reuters.com time to read: +2 min

NEW YORK, May 22 (Reuters) - Enad Global 7 AB's (EG7.ST) stock price jumped 5% on Monday after U.S. activist investor Alta Fox urged the Swedish video game company to explore strategic options, including a possible sale. "EG7 is a high-quality business that remains dramatically undervalued due to no fault of current leadership," Alta Fox's managing partner Connor Haley wrote. Previous management's missteps and the fact that it is not well known outside of Sweden are hurting the company, the letter said. The hedge fund suggested the company, whose stock is listed in Sweden, should relist in the United States in order to buy back shares. ($1 = 10.56 Swedish crowns)Reporting by Svea Herbst-Bayliss; Editing by Conor HumphriesOur Standards: The Thomson Reuters Trust Principles.

☆ A new CEO won’t fix Twitter’s biggest problem
▼ + stars: | 2023-05-17 | by ( Clare Duffy | ) edition.cnn.com time to read: +7 min

New York CNN —During his six months as Twitter’s CEO and owner, Elon Musk decimated its ad business, alienated some news publications and VIP users, and plunged the platform into a constant state of chaos. But she may struggle to address Twitter’s biggest problem: Elon Musk. On Tuesday, Musk said he “didn’t care” if his controversial tweets drew the ire of Twitter advertisers or Tesla shareholders. She may struggle to undo the damage Elon Musk has done to the company's ad business. That could only add to the difficulty Yaccarino will face in shoring up Twitter’s business.

☆ Mortgage demand drops as interest rates hit a 2-month high
▼ + stars: | 2023-05-17 | by ( Diana Olick | In Dianaolick | ) www.cnbc.com time to read: +1 min

Higher mortgage rates and a severe shortage of homes for sale are taking their toll on mortgage demand. Mortgage applications to purchase a home dropped 4.8% last week, compared with the previous week, according to the Mortgage Bankers Association's seasonally adjusted index. Mortgage rates increased last week, even as Treasury yields were essentially flat, with the spread between the two rates widening to 310 basis points. "Mortgage rates have generally been struggling versus Treasuries since the Fed ended reinvesting its bond portfolio proceeds in late 2022," explained Matthew Graham, chief operating officer. "More recently, elevated supply of mortgage debt owing to the FDIC's various liquidation efforts have weighed on the sector."

☆ How to protect your investments in the debt ceiling standoff
▼ + stars: | 2023-05-17 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +5 min

But even if that’s the case, between now and then bond investors should expect volatility. Bond investors are all about pricing in the risk that they may not be paid back on debt they buy — either on time or at all. But the lack of a deal to raise lawmakers’ self-imposed debt ceiling so close to the X-date is introducing unwanted risk into each investor’s calculus. “We’ve already seen some pricing stress around short-term bills, Treasury bills, and a little bit of change in the… sovereign credit default swap spreads,” said Gary Gensler, chair of the Securities and Exchange Commission, at an event on Monday. Right now, yields on one-month T bills are well above the yields for 10-year and 30-year Treasury bonds.

"We are not pausing - that is very clear," ECB President Christine Lagarde told a press conference. NOT FED DEPENDENTShe also dismissed the notion that the ECB would have to pause if its U.S. counterpart did so, saying the ECB was "not Fed-dependent". The German 10-year yield , the euro zone benchmark, fell as much as 7 basis points to a one-month low of 2.18%. "In a nod to the hawks, the ECB hinted at 'future decisions' in the plural," Holger Schmieding at Berenberg said. Firms in the services sector especially have complained of labour shortages, suggesting that more wage pressures could come this summer.

But it made clear that further action was likely given mounting wage and price pressures. "We are not pausing - that is very clear," ECB President Christine Lagarde told a press conference. The ECB move, a slowdown after three consecutive 50 basis point increases, comes only days after euro zone banking data showed the biggest drop in loan demand in over a decade. That suggests previous rate rises are working their way through the economy and that ECB policies are now restricting growth. Reuters GraphicsPolicymakers had been split in the run up to Thursday's meeting between a 25 basis point and a 50 basis point rise, but markets and economists had overwhelmingly bet on the smaller increase after soft data in recent weeks and similar moderation by other big central banks, most recently the Fed on Wednesday.

☆ ECB to stop reinvesting cash in largest bond scheme
▼ + stars: | 2023-05-04 | by ( ) www.reuters.com time to read: +2 min

"The Governing Council will keep reducing the Eurosystem’s asset purchase programme portfolio at a measured and predictable pace," it said. "In line with these principles, the Governing Council expects to discontinue the reinvestments under the APP as of July 2023." Redemptions fluctuate, but about 148 billion euros' worth of debt held under the APP expires in the second half of the year. That means a halt to reinvestment would see an extra 58 billion euros' worth of maturities on top of the currently scheduled 15 billion euros per month. At 7.7 trillion euros, the ECB's balance sheet is already more than a trillion euros below its peak size but remains well above its historical average.

☆ Investing Club mailbag: Should I reinvest my dividends or take the cash?
▼ + stars: | 2023-05-04 | by ( Zev Fima | ) www.cnbc.com time to read: +4 min

Does your charitable trust reinvest dividends it receives from Club holdings back into the stock that issued the dividend? Investors who took dividends as cash with a 0% return had a the total return of 24.52%. Over five years, an investor who reinvested dividends had a return of 56.77%, versus 56.64% took dividends as cash. Over 10 years, reinvesting dividends generated a total return of 226.12%, compared to 204.71% for an investor who keep dividends in cash. As a charitable trust, all dividends and realized capital gains are distributed to charity at the end of the year.

☆ What Home Depot's billion-dollar pay raise may help prove about workers
▼ + stars: | 2023-04-30 | by ( Bob Woods | ) www.cnbc.com time to read: +7 min

"We are confident we can make the investments needed to remain competitive in a tight labor market while also growing our profitability." "The [home improvement] environment seems to be weakening, not accelerating, and therefore incremental wage investments at this time would open the door to more questions and surprise. "They're behaving as they should given the tight labor market, showing leadership and not just thinking about a 12-month timeframe. And in a tight labor market, it's getting increasingly difficult to keep talent [if] you pay unlivable wages and [offer] few opportunities for growth and success." It's hard to say when, and if, Home Depot will see a demonstrable return on the monumental expenditure for its frontline workers.

☆ Fed’s SVB review finds there’s no “I” in “blame”
▼ + stars: | 2023-04-28 | by ( John Foley | ) www.reuters.com time to read: +4 min

So many, in fact, that the report makes it hard to point the blame anywhere in particular. The 114-page post-mortem of SVB, compiled in just over six weeks at the behest of supervisory chief Michael Barr, points out some obvious but undeniable truths. But this ailing dog of a bank also had a too-long leash, thanks to timid, consensus-seeking supervisors. Using pre-rollback rules, SVB would have fallen visibly short of its required liquidity levels by the end of 2022. But the report skirts over the extent to which the Fed’s top staff were aware of risks at SVB.

In May 2019, the trio bought the abandoned school, Bowtie High, for $100,000 and converted it into a 31-unit apartment building. Wig, Colucci, and Spanovich found a different bank and secured a $2 million mortgage, which they pay down at $12,129/month. In total, renovating the old school cost $3.3 million, an amount that the partners are still shocked by. Leasing started in October 2021 before renovations were even completedLeasing at Bowtie High started in October 2021, and within six months, the former high school had reached 100% occupancy. Bedrooms have a lot of natural light thanks to the old high school's large windows.

☆ Bank reserves could fall by $2.5 trillion as the Fed reduces its balance sheet, Fitch Ratings says
▼ + stars: | 2023-04-21 | by ( Filip De Mott | ) www.businessinsider.com time to read: +2 min

Bank reserves could fall between $900 billion to $2.5 trillion by year's end, Fitch Ratings said. That's as the Fed's quantitative tightening dries up liquidity in the banking system. "System-wide banking liquidity indicators are still robust, but our baseline projection is for reserves to fall significantly by USD900 billion to USD2.5 trillion by year-end," the ratings agency said. When it began trimming its balance sheet in June, the Fed held almost $9 trillion in such assets. "QT will also put downward pressure on bank deposits, boosting the system-wide loans-to-deposits ratio," Fitch said.

☆ Investing Club mailbag: What is an ex-dividend date and should you buy a stock before of after?
▼ + stars: | 2023-04-20 | by ( Zev Fima | ) www.cnbc.com time to read: +6 min

I always wanted the dividend and then waited a few days to sell because the stock price always seemed to go down after the ex-date. — Richard F. We don't concern ourselves too much with trading around an ex-dividend date because it, technically, doesn't matter. The ex-dividend date is when the value of the next dividend payment is extracted from the stock price. Based purely on the stock price move that is correct. Ultimately, the value of your position, when excluding the daily fluctuation of a stock price, is the same.

☆ Exclusive: Calls grow for quick end to ECB bond-scheme reinvestment
▼ + stars: | 2023-04-14 | by ( Balazs Koranyi | ) www.reuters.com time to read: +3 min

It is already letting 15 billion euros worth of these bonds expire each month. The sources said the ECB should not implement a hard stop, however, and could stay flexible to react to episodes like last month's banking sector volatility. But when markets are calm, like now, the ECB should let all maturing debt expire, they said. Redemptions fluctuate but about 148 billion euros' worth of debt expires in the second half of the year, so a full reinvestment stop would see an extra 58 billion euros' worth of maturities on top of the currently scheduled 15 billion euros per month. The sources said that once these reinvestments end, the next discussion would be about reinvestments in the 1.68 trillion euro Pandemic Emergency Purchase Programme, which are set to continue until the end of 2024.

☆ ECB needs more rate hikes and faster balance sheet cuts, Wunsch says
▼ + stars: | 2023-04-14 | by ( Balazs Koranyi | ) www.reuters.com time to read: +3 min

WASHINGTON, April 14 (Reuters) - The European Central Bank should speed up the reduction of its balance sheet and could stop reinvesting cash from debt maturing in its largest bond buying scheme to complement further interest rate hikes, Belgian policymaker Pierre Wunsch said. Fighting stubborn inflation, the ECB has raised rates at its fastest pace on record and has been shrinking its bloated balance sheet, all in the hope that more expensive borrowing will thwart demand and curb inflation. "The market has reacted very well, and our balance sheet is still too big," he said. "If there's another upside surprise in core inflation and the (ECB's quarterly) lending survey doesn't look too bad, we might have to do 50," he said. "What is really concerning is that in December we projected core inflation stabilising at 5% before its decline," Wunsch said.

☆ Starbuck's ex-CEO started his Congressional testimony with an emotional story about his father. It was used against him.
▼ + stars: | 2023-03-29 | by ( Alex Bitter | ) www.businessinsider.com time to read: +3 min

Former Starbucks CEO Howard Schultz told Congress about his father's work injury Wednesday. But Sen. Ed Markey used the anecdote to argue that Starbucks should respect unionizing workers. When Schultz was a child, his father slipped on ice and broke his foot while working as a driver, he said. Markey told the story of his own father, whom he said lost a finger in an accident at work. Starbucks told the Times that the remedies are "inappropriate."

☆ I bought a crumbling Victorian townhouse for $18,000 and transformed it into my dream home — see inside
▼ + stars: | 2023-03-16 | by ( Kiera Fields | ) www.businessinsider.com time to read: +10 min

Betsy Sweeny bought a 3,025-square-foot crumbling Victorian house when she was 27 for only $18,000. Sweeny's living room during renovations. Betsy SweenySweeny's renovated living room with replica curved glass windows. It wanted staged after photos, so within 12 weeks, I finished one bathroom, the living room, the dining room, the foyer, and the exterior. The primary bedroom, living room, dining room, and baths were completely finished — the kitchen was ugly.

☆ Novartis initiates new trading line for share buybacks
▼ + stars: | 2023-03-13 | by ( Ludwig Burger | ) www.reuters.com time to read: +1 min

March 13 (Reuters) - Novartis said on Monday it received regulatory clearance to open a separate trading line for potentially up to 16.5 billion Swiss francs ($18.1 billion) in stock repurchases even as its ongoing $15 billion buyback programme is close to completion. At last week's annual shareholder meeting, the company won investor authorization for up to 10 billion francs in buybacks, which comes on top of 6.5 billion francs in prior authorizations. A company spokesperson told Reuters on Monday that the "majority" of its ongoing $15 billion buyback programme was already completed, adding that any repurchases would be decided by the board of directors. Novartis laid out plans for the $15 billion programme in late 2021, after receiving $20.7 billion for the sale of its nearly one-third voting stake in Roche (ROG.S) back to its cross-town rival. ($1 = 0.9118 Swiss francs)Reporting by Ludwig Burger in Frankfurt and John Revill in Zurich Editing by Paul Carrel and Christina FincherOur Standards: The Thomson Reuters Trust Principles.

☆ Banks are sweetening the interest rates on their CDs. Here’s what you should know before you jump in
▼ + stars: | 2023-03-12 | by ( Darla Mercado | Cfp | ) www.cnbc.com time to read: +4 min

Bank CDs are among the fixed-income investments that are enjoying a surge in popularity as the Federal Reserve raises interest rates. Lately, CDs from online banks are seeing higher rates on 1-year instruments. Another key benefit of bank CDs: At a time when Silicon Valley Bank's failure highlighted the safety of bank deposits, it's worth noting that bank CDs are protected by the Federal Deposit Insurance Corp. See below for the latest rates on 1-year CDs from online banks as of March 10, according to the firm. When rates fall, you can rely on longer-dated CDs that have already locked in the higher yield.

☆ Shares of SVB Financial fall more than 50% as tech-focused bank looks to raise more cash
▼ + stars: | 2023-03-09 | by ( Jesse Pound | ) www.cnbc.com time to read: +2 min

In this photo illustration of the TradingView stock market chart of SVB Financial Group seen displayed on a smartphone with the SVB Financial Group logo in the background. Shares of tech-focused bank SVB Financial plunged by more than 50% on Thursday after the company announced a plan to raise more than $2 billion in capital to help offset losses on bond sales. SVB Financial fell sharply after the bank announced a plan to raise more cash. The company reported $28.8 billion in available-for-sale securities on its balance sheet at the end of December, as well as $95.3 billion held-to-maturity securities. The bank cited higher interest rates and "elevated cash burn from our clients" as reasons to raise the new capital.

☆ Warren Buffett lashed out against critics of stock buybacks. The White House says it isn't anti-repurchases, it just wants to encourage smart spending.
▼ + stars: | 2023-03-02 | by ( Zinya Salfiti | ) www.businessinsider.com time to read: +3 min

Warren Buffett slammed critics of stock buybacks as economically "illiterate" in his annual letter. But a White House official said Biden isn't anti-repurchases, he just wants to encourage smart spending. The 92-year-old billionaire investor — who has touted the value of stock buybacks for decades — slammed opponents of stock buybacks in his annual letter to Berkshire Hathaway shareholders. But Biden isn't an opponent of share repurchases — he just wants to encourage smart spending, a National Economic Council official told MarketWatch. Berkshire has been one of the US's leaders in stock buybacks, spending nearly $8 billion on its own shares in 2022.

☆ Why investors don't expect a dividend check from Alphabet anytime soon
▼ + stars: | 2023-03-02 | by ( Samantha Subin | ) www.cnbc.com time to read: +4 min

Coming out of the Internet bubble in 2003, Microsoft implemented a dividend for the first time in its then nearly three-decade history. Over the next decade, the software giant slowly hiked that dividend annually, while its shares languished mostly in the 20s. But despite the recent struggle in Alphabet shares, and fears over what lies ahead for the dominant search engine, big investors say a dividend isn't the best use of cash to convince investors to stay the course. Like some of its tech peers, Alphabet could pay a small dividend to "check the box for institutional investors," Meeks said. "Last thing you want to do is commit yourself to a dividend and then all of a sudden retrench it."

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