• High yield: When you come to a fork in the road, take it

    US high yield corporate bond total returns have exceeded all other major fixed income sectors year-to-date at 10.2% as of writing. With a more dovish Fed and a rate cut on the horizon, the reasons to buy high yield are there. At the same time, the reasons for rate cuts remind us that credit risk is an important factor in high yield corporate debt, and the catalysts for credit quality improvements may not exist.

  • Should I consider investing in municipal bonds that are subject to AMT?

    Although the US tax system has included various versions of a minimum tax since 1969, the Alternative Minimum Tax regime resembling the current system was enacted with the Revenue Act of 1978. The AMT is a parallel tax system designed to reduce the number of taxpayers who pay little or no tax due to deductions and exemptions.

  • Not so stressed out but testing the waters

    The Fed released its stress test results at the end of last month, with all the banks passing its quantitative and qualitative checks. While each individual bank’s credit quality has improved post-recession, questions about the strength of the broader financial system remain. What the Fed has bookmarked as potential problem areas is helpful in positioning against major market risks.

  • Stocks make new highs on dovish Federal Reserve comments

    Stocks hit record highs last week, driven by the promise of lower interest rates while the incoming economic data remains consistent with slower, but still positive, economic growth.

  • Bank & Thrift Newsletter

    1. Daily Fix, 2. US Interest Rate Forecasts, 3. Bank, Thrift & MHC Summary Valuation, 4. Recent Bank M&A Transactions, 5. Relevant Janney Capital Markets Professionals

  • Spiking the punch bowl, the next economic downturn, and second-half surge

  • Economic readings remain consistent with slower but still positive growth

    As the market cheered the U.S.-China trade truce last week, the incoming economic data continued to show slower, but still positive, U.S. economic growth (we expected this after tax cuts and increased government spending boosted 2018 growth).

  • Outlook 2019: Mid-Year Update

    The Mid-Year Update presents a follow-up to our annual view published last December and affords a chance to make adjustments, if necessary, for what we expect to come during the remainder of the year.

  • What happened to asset class returns in 2018?

    We begin 2019 with a benchmark allocation to risk assets. Despite expecting slower economic growth in 2019, the fourth quarter 2018 financial market pessimism seems excessive – we do not see a recession in the foreseeable future.

  • Brexit investment implications update

    Learn about the investment implications around Brexit uncertainty.

  • Any excuse will do

    In December/January, that excuse came in the form of tightening financial conditions, which allowed for the patient pause in place today.

  • Stocks post stellar first half and react favorably to reduced trade tension

    Stocks are now reaching new all-time highs as a result of the U.S.-China trade war truce announced this weekend.

  • Stocks react favorably to the dovish Federal Reserve meeting outcome

    Stocks reached all-time highs last week, as investors reacted favorably to the Federal Reserve’s (Fed’s) dovish stance and increasing likelihood of near-term interest rate cuts.

  • Municipal Market Monthly — June

    The first half of 2019 was good for municipal bond investors.

  • Bank & Thrift Newsletter

    1. Daily Fix, 2. Bank, Thrift & MHC Summary Valuation, 3. Recent Bank M&A Transactions, 4. Relevant Janney Capital Markets Professionals

  • Update on investment implications of US-China trade talks

    After becoming concerned that China was backing away from promised reforms, President Trump stated that he would increase the current 10% tariff rate on $200 billion worth of Chinese imports to 25%, a move that was originally due March 1, but was delayed to extend the talks and seek a better agreement.

  • Update on market volatility and trade tensions

    Last night President Trump opened up a second front on trade by promising a 5% tariff on all Mexican goods by June 10 (rising to 25% by October) if Mexico doesn’t stop the flow of Central American immigrants to the U.S. President Trump invoked the International Emergency Economic Powers Act (IEEPA), which gives the president broad leeway if he certifies a national emergency.

  • Selling often has no discretion

    I last authored a report under this banner the morning of December 26, 2018. At that time, stocks had plummeted to an S&P level of 2,351 and some pundits thought the market had much further to go. We wrote, “It is time to buy.”

  • Where has all the Capex gone

    How companies spend their cash is an important consideration from a credit quality standpoint. In the current environment, companies have been doing more with less—a corporate strategy trend that developed in the post-recession era.

  • Municipal Market Monthly — May

    This outperformance has been particularly notable since the 10-year ratio has been above 80% since before the 2008 financial crisis and subsequent Great Recession.

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