CLO Metrics continue to improve
Based on these metrics, the picture seems rosy, and credit performance looks set to continue through the second half of the year should the main drivers of the recovery remain intact.
Insights Topic
TwentyFour
ESG is Inflationary
As companies and individuals adopt sustainable practices, we believe the potential exists for inflationary consequences.
Investors should remember – Powell is not a bond manager
It feels like we are currently spending at least 40% of our time talking about inflation, or more accurately, why the US Federal Reserve seems to have a different view of inflation to almost everybody else.
Is the Fed behind the curve on inflation?
In this video, TwentyFour CEO Mark Holman joins Tom Porter to decipher the Fed’s latest messaging, and to remind bond managers that Jerome Powell is not one of them.
Supply points to Selectivity?
Doing the necessary work to understand the difference between companies merely exposed to COVID restrictions and those structurally damaged by them continues to be extremely important.
Labour Support Tapering Need Not Be Feared
Douglas Charleston examines the health of labour markets across key developed economies and why ABS investors shouldn’t fear the gradual removal of COVID related job support schemes
The new mortgage prisoners – the unintended consequences of improving the world
In both instances, the good intentions of the regulator and the authorities are clear… But at the same time both changes have the potential to cause an increasingly undesired side effect.
Should We Fear the Repo Men?
Given the magnitude of the amounts involved we do think there is potential for some temporary volatility in the US Treasury market as the volumes change. We will be keeping a keen eye on both in the months ahead.
US Banks Pass Their Health Check
Yesterday the US Federal Reserve released the results of its annual bank stress test, subjecting the 23 largest US lenders to a punitive set of scenarios. Some observers might think the events since March 2020 had been sufficient to test the resilience of the banks, but the Fed went beyond this recent real-life challenge and tested bank balance sheets against a range of hypothetical crises.
A Lighter Shade of Green
We have a high opinion of Kensington as a mortgage lender and when we score it for ESG as part of our investment analysis it performs very well even without this latest Green initiative, but we do feel it can stretch further.
Punch Pubs Sees Off WBS and Shows Route to Bonds
All told, while we think relative value in WBS can be attractive, we believe the trend of refinancing in the bond market is only going to continue in the coming years, though it will be gradual.
FOMC: Taper Talk and Treasury Tumble
With all of the recent data pointing to higher inflation expectations and the Fed expected to maintain a transitory interpretation, we will be focusing our attention on comments from the various regional Fed presidents on conditions that could prompt a tapering move at some point in the future.