What Has Stayed The Same?

Based on my Twitter give food to, stock buybacks appear broadly misinterpreted in terms of what they are meant to accomplish (to redistribute excess capital back again to shareholders) and the impact they have in accordance with dividends. 1. Buybacks are done when stocks are rich: if the stock of a company executing buybacks is “full”, then why are you owning it to start with?

Excluding the signaling or taxes effects of buybacks vs dividends, buybacks and dividends are identical in conditions of overall financial impact. What has stayed the same? 1.5 billion can be used to buy back stocks with the excess cash. As highlighted above under ‘what has transformed’, home outflows are actually impacted on the margin by the form of capital distribution (i.e. whether it’s received via buyback or dividend). Regarding a buyback, households are creating their own dividend through the sale of stocks simply. 4000), we can easily see why flows really don’t matter. 12.7 trillion over that same timeframe (as of 9/30/15 – the latest z.1 report), a normalized increase of 37% of GDP to 70% of GDP.

In an interval of such serious uncertainties, there’s a very important factor that is sure right now: central bank or investment company accommodation exerts powerful inflationary effects upon securities and asset prices. As well as for the first time in a while, unstable asset market Bubbles pressure central bankers to remove accommodation. Sure, they don’t desire to be in the Bubble popping business, though when it comes to market Bubbles the earlier they pop the better.

Surreptitiously, tremendous amounts of structural damage take place during late-cycle excess. Markets are indicating an initial reputation of structural issues. The week at 99 bps Three-month Treasury costs rates ended. Two-year government yields slipped two bps to 1 1.32% (up 13bps y-t-d). Greek 10-season yields sank 32 bps to 5.63% (down 141bps y-t-d). Japan’s Nikkei 225 equities index slipped 0.3% (up 4.3% y-t-d).

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198 million (from Lipper). Freddie Mac 30-year fixed mortgage rates increased two bps to 3.91% (up 37bps y-o-y). 1.617 TN, or 58%, over the past 240 weeks. 747bn, or 5.5%, over the past year. The U.S. money index slipped 0.1% to 97.164 (down 5.1% y-t-d). The Goldman Sachs Commodities Index dropped 1.5% (down 8.6% y-t-d). June 13 – Reuters (Pete Schroeder and Lisa Lambert): “The U.S.

Treasury Department unveiled a sweeping plan… to upend the country’s financial regulatory construction, which, if successful, would offer many items on Wall Street’s wishlist. June 14 – Bloomberg: “China’s broadest way of measuring new credit slowed in-may as policy manufacturers moved to contain excessive borrowing, while M2 money supply increased at the slowest pace on record.

156bn)…, pitched against a median estimate of just one 1.19 trillion yuan… and 1.39 trillion yuan in April. New yuan loans rose to at least one 1.11 trillion yuan, compared to the estimated 1 trillion yuan. June 14 – Wall Street Journal (Anjani Trivedi): “China’s bank regulator ought to know better by now: loosen the reins and debt soon piles up.

While Beijing is carrying out a high-profile campaign to reduce leverage in its financial marketplaces with one hands, with the other it is motivating more reckless borrowing possibly. June 14 – Bloomberg: “Only this past year he was hailed among the boldest dealmakers in China. June 14 – Bloomberg (Keith Zhai and Ting Shi): “China’s billionaires are learning just as before that wealth and power are no longer enough to keep them out of trouble.

Anbang Insurance Group Co. said… that Wu Xiaohui — its chairman, and one of China’s most intense abroad dealmakers — was struggling to perform his responsibilities for personal reasons. Caijing Magazine, a reputable financing and business publication, said he was taken away for questioning. Wu is the latest example of the new reality in Xi Jinping’s China: Almost anyone could be hauled away at any time, regardless of cash or connections.

June 13 – Bloomberg (Kana Nishizawa): “The Hong Kong money may be sliding into the weak end of its trading music group, yet money managers see no good reason for stock investors to turn bearish just yet. Unlike previous bouts of weakness in the pegged currency… these times there’s plenty of liquidity in the system, and no shortage of buyers. 2.6 trillion) relationship buying scheme set to perform until year’s end, the ECB will have to decide this autumn whether to keep on buying to prop up a still weakened inflation rate or start winding down the program.