UPDATE: The numbers are in. BlackRock is pushing around boardrooms to focus on everything BUT profits and shareholder return. Politico reports: At companies across the globe, BlackRock supported 64 percent of environmental proposals and about a third of social and governance resolutions put forth by shareholders in a year when workforce diversity and climate risk rose to the top of investor concerns. With $9 trillion in assets under management and ownership of more than 7 percent of shares on the S&P 500, BlackRock voted against corporate management at 42 percent of shareholder … [Read more...]
You Invest, They Win
The founder of the largest hedge fund in the universe, Ray Dalio, tweeted this from Burning Man:
Just back from Burning Man. Reminds me of Woodstock with better art (installations) and less good music. What a great vibe and what amazing creativity!
Photo is with my pal and coworker Jeff Taylor at his great music camp Root Society. If you go next year, 1-5am is best.
Are these the guys you want running your money? You invest, they win. But hey, it’s not about the money. It’s about saving the planet man.
Because if it’s about the money (Dalio has a personal net worth of $19 billion) then this hedge fund lost to a boring Vanguard fund that uses a conventional mix of 60% stocks and 40% bonds.
The article doesn’t come out and name the fund, but perhaps you, as a long-time reader of our websites, know the name: Vanguard Wellington.
You might also know what Vanguard founder, the late, great, Jack Bogle, meant when he said: “The grim irony of investing is that we investors as a group not only don’t get what we pay for, we get precisely what we don’t pay for.”
The captains of the investing universe are living their “best life” at whose expense?
Yours, of course. You invest, they win. Read more below.
VIDEO: Vicious NYC Thugs Beat and Rob Disabled Woman
Under the leadership of socialist Mayor Bill de Blasio, New York City has devolved into a violent, terrifying place. Previous administrations kept crime down through tough policies, but de Blasio's soft-on-crime stance, including eliminating cash bail for criminals, has led to a spike in crime that is ruining the city. The latest evidence of the city's descent into chaos is the vicious attack of a disabled woman by four assailants using a saucepan to beat her. The Daily Mail reports: Police are currently on the hunt for four attackers who bludgeoned a 61-year-old disabled woman with a … [Read more...]
Blackstone Squeezes Itself into Another Industry
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 Is Uneasy about This Market
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...]
You’re Getting Exactly What the Fed Asked For
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...]
Good or Bad? Vanguard Makes First Ever Corporate Acquisition
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 Inside “I-Rock”
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...]
FUNDS: These Models Are the Ugly Kind
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 Continue to Fall as “Liquidity Supernova” Floods Market
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...]
Major Shock to Repo Market and Bank Cash
ZeroHedge.com has been warning about a "liquidity supernova" for some time, and is now warning that the repo market is on the verge of a major shock, writing: A more troubling side-effect of this "liquidity supernova" is the ongoing collapse in short-term rates, which - as a reminder - we also warned about saying "the plunge in short-term debt (Bill) issuance (since there will no longer be an urgent need to keep cash balances in the $1+ trillion range) will compress short-term spreads (effective FF through 3M) to zero - or even negative - as there is suddenly a flood of liquidity which could … [Read more...]
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