You know that Blackstone founder Stephen A Schwarzman focuses a lot on #1, that is, himself. Schwarzman has pushed Blackstone into many industries, and now he's adding another, insurance. The Wall Street Journal reports: Blackstone BX +2.48% Group Inc. struck a sweeping deal with American International Group Inc. to manage a portion of the assets backing AIG’s life-insurance policies and annuities, a big step by the private-equity firm toward becoming a major player in the insurance industry. Blackstone will enter into a long-term agreement to manage an initial $50 billion in assets, with … [Read more...]

Your Survival Guy received a chart package yesterday that leaves a lot to be desired. I’m talking about the desperate state of the yield on Treasuries thanks to three nasty cracks in the stock market so far this century. Note: When stocks fall, Treasury prices usually rise as investors flee to the full faith and credit pledge of U.S. government bonds, for whatever that’s worth. Take a minute to see how low yields are (which move in the opposite direction of bond prices). The series of charts below runs from the beginning of this century and displays maturities from as short as 12-months to as … [Read more...]

The Fed wants inflation, for you, of course. The Fed can print as much money as it wants in order to get what it wants, so inflation doesn't really matter to Chairman Jerome Powell or the other Fed governors. But how about your family? Unless you have a printing press in the basement, you are feeling the inflation that has slammed American consumers hard this year. Yesterday's CPI report was an alarm bell ringing on the toll inflation is taking on Americans. Will anyone at the Fed listen? How about the Biden administration? Unlikely. They want inflation to help fund all their spending. … [Read more...]

You can file this under the heading that index investing is now a commodity as you’ve read here, here, here, here, and here. All Vanguard is exposed to man-made indexes, and with this move looks to vacuum up some more fees for its own survival against BlackRock. Whether it's good or bad, Dawn Lim discusses the acquisition here: Vanguard Group is buying JustInvest LLC, a smaller investing upstart that helps financial advisers build personalized portfolios. The deal marks the first ever corporate acquisition by the world’s second-largest asset manager since Vanguard’s start in the … [Read more...]

Your Survival Guy feels like Jason Bourne writing to you about a secret, underground black-ops finance story—like I’m uncovering some hidden truth. A secret. But in reality, the truth isn’t hidden at all—it’s right in front of our eyes. More like in front of our “I.” That’s the beauty with stories full of EGO and hubris—they just can’t keep their success to themselves. So here we go. You know about my concerns with “You Invest, They Win” and how EGO plays an unfortunate role in “high” finance. We get a front-row seat to all of this in Blackstone founder Stephen A Schwarzman’s book, What It … [Read more...]

You have here yet another reason why certain exchange-traded funds and mutual funds are dangerous because MODELS break. That's when things get ugly. Dawn Lim reports in The Wall Street Journal what happened when some BlackRock models were altered. She writes: When BlackRock told brokerages that it had tweaked rules around its flagship model portfolios in late May, that set in motion synchronized buying and selling across its own funds. A BlackRock fund that tracks financial stocks took in a record influx of money for a day too. As part of changes on the week of May 26, BlackRock also cut the … [Read more...]

Rates on government bonds are falling as the market is hit by what ZeroHedge.com calls a "liquidity supernova." The Wall Street Journal reports: Government bonds continued to rally, pushing the yield on 10-year Treasury notes down to 1.261% from 1.321% Wednesday. The benchmark yield, which helps to set borrowing costs throughout the economy, was last below 1.3% in February. Yields drop when bond prices climb. Driving yields lower is a combination of waning confidence in the strength of the economy post-pandemic and technical factors including the flushing out of wagers that they would keep … [Read more...]