Operating at the Intersection of Technology and the Capital Markets
It feels as though a crisis of confidence is brewing. What will happen when the Bank of England stops buying long bonds? Can the U.K. run its version of QE while inflation is climbing? How high will the Dollar climb? How low will earnings and economies fall?Will Credit Suisse fail? Will the Fed pivot? (I … Continue reading Crisis Of Confidence & The Fed Put
Expect global yields to march higher for the foreseeable future. The Fed would need to pause its rate hikes to stop yields from climbing. The Fed will continue to raise the Fed Funds rate, thereby pushing yields higher along the yield curve. We are in the midst of a global recession that is likely to … Continue reading Global Yields Will March Higher
Meta Platforms (META) would provide the UFC an on-ramp to the metaverse. The UFC would provide META with valuable global content that could both serve as grist for META's virtual reality mill and provide META with a competitive edge in the content wars versus TikTok, Apple (AAPL), Amazon/Prime Video/Twitch (AMZN), Apple (AAPL), Google/YouTube (GOOG), Microsoft/Xbox … Continue reading META & The UFC?
One element to consider when contemplating the forward yield curve and equity premiums is that the yield curve may settle at a level that is higher than what investors anticipate in the out years - say 2025 forward. P/E Multiples are behaving as if a zero percent Fed Funds Rate is the long-term norm, which … Continue reading Positive Real Yields
During the week ended September 28th, the Fed reduced its Treasury security holdings by approximately $2.1 billion and reduced its Government Agency security holdings by approximately $16.7 billion. Recall the Fed stated that it would reduce its Treasury holdings by up to $60 billion and reduce its Government Agency holdings by up to $35 billion … Continue reading QT Lite
P/E multiples will be in flux for the next few months. Phase I will begin in October. Phase II will begin in January. The sequence will look something like the following: Analysts: Many sell-side analysts will revise their December quarter Revenue and Earnings estimates downward coming off of the September quarter earnings calls beginning in … Continue reading P/E Multiples In Flux
Credit Markets (Yes): A liquidity crisis would cause the Fed to pivot. If the credit markets seized up the Fed would intervene. Market intervention is after all the Fed's operating model (as is the case for all central banks). Consumers and investors would have to lose confidence in the U.S. Economy to the point where … Continue reading What Would Cause The Fed To Pivot?
A rate hike is what's next for the U.K. The hike will come before the bank's November meeting. The U.K. has an abundance of economic problems yet deflation is not one of them. The Bank of England put forth a weak rate increase last week. The Bank of England would tell you the reason for … Continue reading What’s Next For The U.K.?
The Bank of England stepped into the bond market, agreeing to purchase Government long bonds until October 14th. The BoE plans to restart its Government bond sale program on October 31st (the central bank plans to sell GBP 80 billion of bonds each year as part of its tightening process). How did the U.K. find … Continue reading The U.K., The U.S., Inflation & Real Yields
Our view of the Equity market over the next few years calls for a choppy market that will reward Active Managers and penalize the Buy & Hold crowd. This forthcoming "choppy" market will not be a market where most Technology stocks move up or down, or where certain sectors move in unison. Rather, we are … Continue reading The Return of Active Management
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