Economic growth has slowed down in China, with the country record only a 6% increase in GDP last quarter. That would be magnificent growth in a developed nation, but for China, that's the slowest growth in 30 years. The FT reports: China’s economy grew at 6 per cent in the third quarter of 2019 compared with a year earlier, its slowest pace in about 30 years, delivering another blow to global growth and underlining many of the challenges facing President Xi Jinping. The country’s trade war with the US, slowing income growth and cooling manufacturing investment took a toll on the world’s … [Read more...]
About Jeremy Jones, CFA
Can Boris’ Brexit Deal Pass?
With the announcement of a Brexit deal agreed to between Boris Johnson and the EU, the only question left is, can the deal make it through the House of Commons? Johnson's coalition partner, the Democratic Unionist Party, has said it will not back the deal, which means it will have a very hard time passing the House. James Blitz reports in the FT: James Forsyth in The Spectator has a good assessment of where the problem lies. He says Mark Spencer, the Conservative chief whip, calculated last night that if the DUP backs Mr Johnson, the government will win on Saturday with a majority of just … [Read more...]
Are Low Interest Rates Amplifying Market Shocks?
New research from the IMF suggests that forcing investors to search for yield in riskier assets by targeting extremely low-interest rates is amplifying shocks in markets. Chris Giles reports for the Financial Times: Persistently low interest rates are encouraging investors to take dangerous risks in a quest to maintain their financial returns, the IMF said on Wednesday, raising concerns that even the current lacklustre performance of the global economy may not be sustainable. Policymakers should urgently seek to extend banking regulations introduced after the financial crisis to other … [Read more...]
Are Investors Ready to Demand Higher Yields?
Worries about the future returns in bonds have heightened the possibility investors will begin demanding higher yields. Daniel Kruger reports at The Wall Street Journal: Recession worries and interest-rate cuts from the Fed have boosted bonds of all kinds this year. But worries that the gains can’t go on forever have led some investors to unusual corners of the market. Mr. Doty said he has added taxable bonds sold by states and local governments, which offer more attractive yields and stronger credit quality than most company debt or the tax-exempt bonds typically sold by … [Read more...]
Junk Bond Yields
What do junk bonds yield today? The table below lists the yield of the Merrill Lynch junk bond index (High-Yield index), as well as the latest SEC yield on some of the top junk bond (high-yield) dedicated funds. A note of caution when you are looking at yields on junk bond funds; Like all SEC yields, these yields are based on the last 30-days of income generated by the fund. They are not directly comparable to the yields on the Merrill Lynch junk bond indices. Junk Bond Fund Description Symbol Yield as of 8/31/2019 Yield as of 9/30/2019 Merrill Lynch U.S. High-Yield … [Read more...]
Ginnie Mae (GNMA) Bond Yields
What do Ginnie Mae (GNMA) bonds yield? The table below lists the yields on two of the major Ginnie Mae (GNMA) indices as well as the latest SEC yield on some of the top Ginnie Mae (GNMA) dedicated funds. A note of caution when you are looking at yields on Ginnie Mae funds. Like all SEC yields, these yields are based on the last 30-days of income generated by the fund. They are not directly comparable to the yields on the Merrill Lynch and Barclay’s Ginnie Mae (GNMA) indices. Description Symbol Yield as of 8/31/2019 Yield as of 9/30/2019 Merrill Lynch Ginnie Mae … [Read more...]
Do Wealthy Americans Pay Their Fair Share in Taxes?
The 1% of Americans with the highest incomes pay an average federal tax rate of 33%. Meanwhile, the bottom 20% of households pay an average of 2%. In fact, once transfer payments are factored in, the bottom 20% of households pay -70% in taxes, earning $49 for ever $1 they pay in federal taxation. Bloomberg's Michael R. Strain reports: Contrary to the narrative that seems to be forming on the political left, the U.S. federal tax code is very progressive. According to the nonpartisan Congressional Budget Office, the lowest-income 20% of households have an average federal tax rate of about 2%. … [Read more...]
Are Central Banks about to Burn the Dollar?
For decades the gold standard reserve currency of the world has been the American dollar, but now as Eva Szalay and Colby Smith report for the Financial Times, that preeminent role may be at risk. They write: The US dollar has long towered over global markets and finance. But cracks are starting to appear in the edifice. The greenback’s pre-eminent role in official funds and international trade is formidable and unlikely to fade quickly. But the latest data from the IMF on central banks’ reserves show a subtle shift away from the dollar that analysts say could signal a rethink on the … [Read more...]
Can China Avoid Isolation, Decline and Revolt?
Bret Stephens, writing at The New York Times, isn't sure that China can avoid "full-blown nightmare of international isolation, economic decline, and domestic revolt." With the Chinese economy's growth slowing down to levels not seen in nearly 30 years, and capital fleeing the country, Stephens wonders if China has hit a "middle-income trap." He writes: It turns out to be a trap few countries escape: Of 101 countries defined as “middle income” in 1960, only 13 rose to high-income by 2008, according to a World Bank report. And some of these countries, like Greece, are prone to slip … [Read more...]
The Highest Yielding S&P 500 Stocks
If you are on the hunt for yield, the top 10 highest yielding S&P 500 stocks is a tempting place to look for new ideas. Compared to the less than 2% yield offered by investing in an S&P 500 index fund, the average yield of the highest 10 dividend-paying S&P 500 stocks is over 8%. The list below includes the 10 highest yielding S&P 500 stocks along with their indicated dividend yield. Click the company name for more information on each stock. Highest Yielding S&P 500 Stocks Company Name Yield Macy’s (M) 10.3% Macerich … [Read more...]
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