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Posts Tagged ‘asset prices’

The Mood of Municipal Bonds

June 2nd, 2014 by Kurt L. Smith

When one thinks of municipal bonds, generally the next thought is…boring.  Bonds are usually boring; adding municipal to the mix should make them more so.  Bonds have a job to do and for most of the past several decades they have performed.  Primarily we have the trend to thank. (more…)

More Debt More Better

May 1st, 2014 by Kurt L. Smith

I was wrong. The great Credit Expansion Finished didn’t end with the financial crisis; the great Credit Expansion merely took a reprieve. While the effects of the reprieve were mighty indeed, with stock and bond prices plunging, I was wrong to believe Credit Expansion Finished. Total credit (debt) has now soared to new highs largely taking stock and bond prices right back up with it.
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High Prices Be Damned

December 20th, 2013 by Kurt L. Smith

For some things in life, the price is the price.  You must pay it because you have to or you need to pay it.  With one son in college and another on his way next year, I know all about prices one must pay.  Some people look at investing the same way: the cost is the price one must pay. (more…)

Exceptional Exceptions

August 30th, 2013 by Kurt L. Smith

In a world that includes dozens of US Treasury bond issues (but just one credit) or hundreds of Corporate bond issuers, Municipal bonds offer tens of thousands of different credits, terms and conditions.  It is these differences, rather than their similarities, between issuers and issuances that account for the robustness of the municipal bond market. (more…)

Joining The Fray

June 28th, 2013 by Kurt L. Smith

Bond market performance has gone from bad to worse.  The month of May was bad; June even worse.  Prices of longer-term bond funds have plunged, primarily in the past eight weeks, leaving municipal bond dealers and longer-term municipal bond portfolios down about ten percent for the period. (more…)

On The Right Track

June 10th, 2013 by Kurt L. Smith

In an era of seemingly low to no interest rates, we see an increase in opportunities in municipal bonds.  Despite continuing Quantitative Easing by the Federal Reserve, asset prices are weakening, yields are rising and long-term assumptions should be questioned. (more…)

Watch The Markets, Not The Fed

May 8th, 2013 by Kurt L. Smith

The Federal Reserve, along with most Central Banks around the world, are creating Cash and Credit at an unprecedented pace in the most ambitious economic experiment of all time.  Yet despite Central Bankers attempts to create Cash and Credit (and hence inflation), the price of Gold fell from over $1900 to almost $1300. (more…)

Wash, Rinse, Repeat

March 8th, 2013 by Kurt L. Smith

Stocks are cheap!  Compared to Bonds, Stocks are cheap, but then again, everything is cheap compared to Bonds.  This is the narrative driving Stock prices to multi-year and even all-time highs. Enjoy while you can but this narrative has no legs, despite the desires of all the central banks on the planet. (more…)

No, It Won’t Be Like This Forever

February 11th, 2013 by Kurt L. Smith

Sure short-term interest rates are near zero; nothing new here.  But the good news, albeit great news, is we continue to find worthwhile, short-term municipal bonds.  In a world of generic, too-big-to-fail, debt by the billions, you can thank a very diverse, too-many-issuers-to-count municipal bond market for these opportunities.

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It’s The Fed, Unfortunately

January 6th, 2013 by Kurt L. Smith

Looking back over the past year the defining point for the markets was Federal Reserve Chairman Ben Bernanke’s missive in September.  Asset prices peaked with Ben’s pronouncement.  Animal spirits are now dissipating.  The reversal eventually sent Municipal Bond prices to their high November 30th, along with my proclamation that Municipal Bonds were in bubble territory, heading for a big fall.

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NEWS FEED

The $247 trillion global debt bomb washingtonpost.com/opinions/the-2…