After a buying spree, investors are wondering if Japanese investors will continue to buy U.S. Treasury bonds. Kate Guguid reports for the Financial Times: Japanese investors have piled into foreign debt this year — but analysts have warned that the revival in demand from one of the cornerstones of the US Treasury market is unlikely to last. Data from Japan’s ministry of finance reported this week showed that investors bought ¥4.1tn ($30bn) of foreign debt in February, the largest total since September 2021. That follows net buying of ¥1.1tn in January, and marks a pause in the dramatic … [Read more...]
Archives for March 2023
Prepping for the Storm, Hiding in My Cozy Cave
You know I’m not interested in predictions. Yes, I hope the Bruins make it to the Stanley Cup and win it all. But I’m not betting my life’s savings on it. And most sports fans aren’t that reckless with their money. But when it comes to money and investing, the stories are crazy. If this was forwarded to you. Join the club. Sign Up here for my weekly email. It’s not unusual to hear horror-thons about betting the ranch on what turned out to be the next best thing. You know the stories as well as I do. And as Your Survival Guy, you should know by now I’m more interested in the return of … [Read more...]
GM’s Electric Vehicle Push Stalls
Efforts by General Motors to ramp up electric vehicle production have not been working out. Mike Colias reports for The Wall Street Journal: General Motors Co. Chief Executive Mary Barra has called 2023 a breakout year for the company’s electric-vehicle push. It is off to a slow start. The Detroit auto maker is dealing with the slower-than-expected rollout of two high-profile electric vehicles, the GMC Hummer EV and the Cadillac Lyriq, increasing pressure on Ms. Barra after GM lost EV market share to rivals last year. More than 15 months after GM began building theelectric GMC Hummer … [Read more...]
Hey, Where’s Everyone Going? Follow the Money Kid
If you want to know what’s going on in the world, just follow the money. That’s what I do. Take a look at the money exodus from states that treat residents like piggy banks. Remember, money travels to where it’s well treated. Just follow the money. If this was forwarded to you. Join the club. Sign Up here for my weekly email. Art Laffer and Stephen Moore, co-founders of the Committee to Unleash Prosperity, share the numbers in this WSJ piece (abridged): Lawmakers in California, Illinois, New York and Washington state have proposed new taxes on wealth, and higher income taxes for the … [Read more...]
Are Rising Rates Endangering Small Town Budgets?
Many small towns use short-term borrowing to pay bills between revenue collections. Higher rates could be threatening that finance model. Heather Gillers reports for The Wall Street Journal: Rising interest rates are squeezing cash-strapped towns and school systems that use short-term borrowing to keep cash flowing while they wait for property tax dollars to come in. A-rated cities and school districts are paying 3.16% for a one-year loan issued March 3, compared with 0.21% at the beginning of 2022, according to data from Refinitiv MMD. In places where local budgets are already burdened by … [Read more...]
Take Action: Don’t Wait for the Best to Save You
Wouldn’t it be a shame if, five years from now, you’re earning peanuts on your savings? That’s a real risk. Because if the Fed backs itself into a corner, the economy gets into a pickle (and who knows what else), it may be forced to cut rates. At least, that’s what the talking heads are saying. You know I don’t like predicting interest rates. Predictions are cheap. Everyone has one. And they’re not a worthwhile endeavor. I’m Your Survival Guy, not “Mr. What If This Happens.” I like to take action based on what’s in front of me. And what I’m seeing now are attractive enough rates that … [Read more...]
Tesla Is Dropping Its Prices
Tesla has announced price cuts for two of its vehicles, the Model S and the Model X. Alyssa Lukpat reports The Wall Street Journal: Tesla Inc. decrease; red down pointing triangle lowered the prices of two of its most expensive models in the U.S., the Model S and Model X, in its latest round of price cuts as the company tries to boost demand in a competitive market. Tesla dropped the base price of its Model S luxury sedan from $94,990 to $89,990, which is about a 5% cut, according to the company’s website. Tesla lowered the base price of its Model X sport-utility vehicle from $109,990 to … [Read more...]
When Is the Best Time for You to Do This?
“Life’s short,” my grandfather would say. “You’re only here for a visit.” He didn’t say it to me. I was too young when he passed away. He said it to my dad, who just turned 79. My grandfather would also ask my dad when he was starting out in business, “Do you know when the best time is to plant a tree?” And that got passed down to me. I never liked that one. “Yesterday,” I’d respond, feeling the pressure of not doing whatever it was I was supposed to do yesterday. “That’s right. Do you know when the next best day is to plant a tree?” “Today,” I’d say, feeling like, what’s … [Read more...]
Global Liquidity Is Increasing Despite the Fed
Despite efforts by the Federal Reserve, European Central Bank, and the Bank of England to decrease global liquidity, it is increasing instead and driving investors into riskier assets. Joseph Adinolfi reports for MarketWatch: Gains for global equities have left many on Wall Street perplexed as stocks — especially high-risk growth names with little or no profits — have rebounded from last year’s punishing selloff, resisting both the pull of more attractive bond yields, and the threat of higher interest rates. But some Wall Street analysts say they’ve found an explanation that has little to … [Read more...]
You’ve Answered Life’s Questions. But What about Investing in Bonds?
Do you remember purchasing your first home? Meeting with the bank? Going over interest rates and how much goes to just paying it? Reviewing the payment schedule and realizing how old you’ll be when it’s paid off? Talk about a bond between you and the bank. But when it comes to bonds and investing, I hear this: “I don’t invest in bonds. I don’t understand them.” But you’ve been in a bond your whole life. Just turn the table around. You’re the bank. Yes, there’re ins and outs to bonds that make experience dealing with them worthwhile, but the same is true for getting a mortgage. … [Read more...]