Speak Your Mind 2 Cents at a Time
Layan Odeh and Paula Sambo of Bloomberg News report Omers’ Eric Haley retires in latest change within private equity:The head of buyouts at Ontario’s pension fund for local government workers, Eric Haley, will retire and leave the firm at the end of the year in the latest change to the plan’s private equity business.
Haley will continue to lead the North American buyout team until the end of 2025, Don Peat, spokesperson for the Ontario Municipal Employees Retirement System, said in an email. “We are deeply grateful to Eric for his commitment to delivering on the Omers pension promise and his significant contributions to our private equity business and team culture.”
Omers has been revamping its private equity unit under Ralph Berg, who became chief investment officer in 2023. Last year, the Toronto-based fund halted direct private equity investments in Europe and opted to shift its strategy by investing alongside partners and external managers. The pension also launched a global funds strategy within a new group called Private Capital.
The $27.5 billion (US$20 billion) private equity portfolio was split, with Michael Block leading the global funds strategy and Haley overseeing the North American buyout program, the firm said at the time. It’s unclear whether Omers will replace Haley.
Haley’s departure continues a period of employee change within Omers’ private equity business. In March, Alexander Fraser, a former partner of a Temasek-backed fund, joined as global head of its private equity arm. He succeeded Michael Graham, who retired in February. Jonathan Mussellwhite, who had led private equity in Europe since 2018, left a few months before that.
For decades, the so-called Maple Eight have built up their deal teams to take a leading role in some private equity transactions. Now, some of them want to lean more on partners, as higher borrowing costs choked deal activity and diminished the allure of controlling portfolio firms.
Last month, Ontario Teachers’ Pension Plan said it’s re-examining its buyout unit, aiming to work more with partners rather than owning large or controlling stakes in private businesses as it seeks to mitigate risk. And Caisse de Depot et Placement du Quebec said in February that it will scale back its direct investing and team up with third-party managers.
I'll keep my comments brief as it's Election Day in Canada and I want to see coverage as results start coming in.
I'm hoping for sweeping change coast-to-coast but the polls suggest another minority government is on its way (sigh!).
Speaking of sweeping change, OMERS is rejigging its private equity unit.
The change has accelerated since Ralph Berg took over as CIO in 2023.
Berg has recently refocused the investment programs and in Private Equity he decided fund investments was the best route for Europe and Asia and stuck to buyouts in North America with more co-investments:
Private equity is the final piece of the puzzle with investments dominated by the buyout program. In September last year, after analysing performance and deal flow, Berg decided to switch to fund investing in Asia and Europe and to focus on buyouts in North America.
“I came to the view based on data and performance we don’t have the scale to afford the quality origination and asset management required to efficiently do control deals in Asia or Europe,” he says. “We decided to focus on our buyout efforts in North America.” That group employs around 65 people across New York and Toronto.
The fund also recently formed a new external funds management group within private equity, called private capital headed by Michael Block. This is where the historical group of OMERS Ventures, which had some success in financing pharma in particular, and a legacy portfolio in green tech, will now be housed. Through this new group it will continue to invest in life sciences and venture capital and invest with external partners in funds and co-invest.
OMERS also recently hired Alexander Fraser, a former partner of a Temasek-backed 65 Equity Partners to run its private equity arm.
Well, to be blunt the writing was on the wall for Eric Haley who was promoted in 2022 to head the North American direct buyout group.
Clearly there is an important shift in strategy going on, less purely direct buyouts, more co-investments with large strategic partners.
It's going on all over, not just OMERS, and I wrote about it last week when I covered why Canadian pension funds are cutting back on pioneering PE investments.
In short, I don't care if you're OMERS, OTPP, CDPQ or whoever, you are not going to compete with the top private equity funds in the world so it makes more sense co-investing alongside them on larger transactions to reduce fee drag.
OMERS' CIO Ralph Berg hinted at this to the Financial Times when he said: “[we] evolved our investment strategy over the last couple of years to explore different models and use funds where it is complementary”.
I suspect they'll be using more and more funds where it makes sense and start curtailing their purely direct deals, especially in Europe and Asia.
Even in North America, it's a challenging environment.
One thing is clear, however, Ralph Berg is running the show at OMERS when it comes to investments and he's very performance driven and expects results.
CEO Blake Hutcheson doesn't get involved in these investment decisions but he too expects results and wants to make sure all departments are producing what is expected of them.
Alright, let me wrap it up there but before I forget a few items related to OMERS.
First, Anca Drexler, former Head of Total Portfolio Management there is now the new CIO of Building Ontario Fund:
And OMERS CFO & CSO Jonathan Simmons is back it again this year, walking to raise funds for MS research:
Jonathan raised more than $500,000 last year in cumulative funds for his 25th anniversary and if you'd like to support him, please do so by clicking here.
I was diagnosed with MS back in June 1997 right in the middle of writing my Masters' thesis in Economics at McGill.
Back then, I flew to New Jersey to meet Dr. Stuart Cook who wrote The Handbook of Multiple Sclerosis (my late aunt worked with him and arranged a meeting).
At the time, there were only three drugs available to treat MS (Betaseron, Avonex and Rebif) and Dr. Cook convinced me to go on Avonex which lasted for eight years till I stopped using it because I saw no meaningful benefits.
Amazingly, the progress in research and new drugs over the last 28 years has been spectacular (especially for relapsing remitting MS, less so for progressive MS although there too there's progress).
The good thing about MS is after many years, the disease stabilizes, there are a lot less or no inflammatory attacks but neurological deficits remain.
After almost 30 years, I can write my own handbook on MS but count myself lucky.
My biggest preoccupation these days is addressing my chronic SI joint pain which is debilitating and I am prepared to do radiofrequency nerve ablation which will cost me a pretty penny (there is no free healthcare in Canada, that's a myth).
Anyways, I wish Jonathan all the best again this year, please feel free to donate here to help him raise his target funds.
Below, Blake Hutcheson, President and CEO of OMERS, recently addressed the Canadian Club Toronto for a discussion on today’s turbulent economic and political landscape.
Blake is a terrific speaker and I highly recommend you take the time to watch this.
Let me also wish him a happy belated birthday and wish him many more healthy years ahead.
I celebrated mine with my wife and 19-month toddler over the weekend but unlike Blake and my friends, I was jumping in and out of a playpen but did get to watch the Habs with some buddies last night eating pizza (too bad they lost).
The post Looking at What People Do, Not What They Say appeared first on CEPR.
As the Trump administration pursues a deeply chaotic policy agenda, key labor market data haven’t yet revealed strong signs of economic weakness, but other sources indicate growing recessionary pressures. Consumer expectations are more pessimistic about inflation and unemployment, manufacturing and construction activity are declining, the stock market has fallen and remains volatile, and GDP forecasts look grim. These “softer” measures could take time to reflect in the official jobs data, particularly at the national level. This week’s data releases—including the Job Openings and Labor Turnover Survey (JOLTS) tomorrow, unemployment insurance claims on Thursday, and the jobs report on Friday—should provide more clarity.
Soft indicators reveal economic weaknessBy “soft” indicators, we primarily mean data sources that rely on consumer or business sentiment rather than outcomes. For example, a “soft” measure of consumer strength would be consumer sentiment surveys asking them about their confidence levels, but a “hard” measure of consumer strength would be their actual spending. Other “soft” measures include forecasts that make projections based on past historical relationships. So far, it is these soft indicators that have deteriorated noticeably while most hard indicators have not yet strongly signaled a recession.
The latest New York Federal Reserve survey shows that consumers have more pessimistic expectations about inflation, their households’ financial situation, and particularly unemployment: The probability that unemployment will be higher one year from now hit its highest expected level since the pandemic recession in 2020. The University of Michigan’s consumer confidence surveys also show a worsening of expectations over the next year regarding unemployment and inflation.
In their Manufacturing Business Outlook, the Federal Reserve Bank of Philadelphia reported a deterioration in general activity, new orders, and current shipments in April. This weakness showing up first in the manufacturing sector is ironic given that the Trump administration’s tariff policies are often defended on the grounds that they will help U.S. manufacturing. The Census Bureau’s data on monthly new residential construction also show some softening in the housing market, particularly for single-family housing starts.
Further, the stock market losses have wiped out any gains from the last year, and measures of stock market volatility remain high—reflecting a lack of confidence in the current economic and policy landscape. The Atlanta Federal Reserve’s GDPNow model estimates a 2.5% decline in real GDP for the first quarter of 2025.
Key labor market indicators could begin to show trouble brewingThis economic turmoil has not yet been reflected in top-line labor market data—though they have shown some weakness in federal employment. This week’s releases of JOLTS, UI claims, and the jobs report could begin to indicate widespread economic distress.
The delay in data reporting could be one of the reasons we haven’t seen a pronounced deterioration in this labor market data. The latest JOLTS data are from February, which showed very little change, but the fingerprints of recent policy decisions are visible for the federal workforce. Figure A shows a significant spike in federal layoffs, hitting 22,000 in February. Tomorrow’s JOLTS release will likely show continued weakness among federal workers in March that may begin to be visible in the overall data.
Figure A
The latest jobs report provided data for mid-March and has shown a net loss of 15,000 federal jobs since January. However, this number may have been kept low because many federal workers were put on administrative leave, and those workers remain officially on federal payrolls. I’ll be surprised if more of the widely reported cuts to the federal workforce and federal contractors aren’t visible in the next jobs report on Friday.
The most updated read on the labor market comes from the unemployment insurance (UI) programs. The Department of Labor aggregates state reports of how many workers filed for initial UI claims each week, and how many people received UI benefits for regular state programs and separately for federal employment. The latest data show higher initial and continued UI claims for federal workers than this time last year, consistent with the spike in layoffs from JOLTS and the drop in employment in the payroll data.
The UI claims data also show a spike in regular continued UI claims (not including federal) in D.C. Figure B shows that national UI claims grew 4.7% over the year but grew a whopping 98.3% over the year for D.C. residents, likely reflecting job losses among federal contractors and related sectors.
Figure B
While the fingerprints of recent policy decisions are clearly showing up in the soft data, it may take time for it to hit the overall labor market measures, at least at the national level. Unless there is a dramatic shift in the current policy agenda, we will likely start to see measured weakness in upcoming labor market data in the coming months.
Authored by Peter Hitchens via The Daily Mail,
In my trade I have long grown used to the way governments lie and get others to lie for them.
It is what they do.
But I have seldom seen such a cloud of lies as we face now. Hardly anyone in this country knows the truth about Ukraine.
There has been nothing like it since we were all lied to about the Iraq invasion, with bilge about fictional ‘Weapons of Mass Destruction’. The liars were caught out.
And they learned from it. They learned to lie more skillfully.
Meanwhile, many of those in our society who knew how to challenge such lies died off or retired and were not replaced.
We have never had a debate about the Ukraine crisis which started from the beginning. Did anyone in power ever tell you truthfully how, when or why this war began? No. Did anyone in power explain why Britain, crime blighted, decrepit, rubbish-strewn, rat-infested, broke Britain, had to get involved in it? Never.
You have just been fed propaganda rubbish about ‘democracy’, freedom and an invented Russian menace. Here are some of the lies you have repeatedly been told.
The war, they say, was not provoked. Seldom in history has a war been more provoked.
Russians, nice ones like the liberal, democratic politician Yegor Gaidar, and nasty ones like the bloody despot Vladimir Putin, begged the West to stop trundling its military alliance, Nato, eastwards towards Russia.
ALL Russians, including the great anti-Communist author Alexander Solzhenitsyn, had been shocked and angered when Nato in 1999 abruptly gave up its defensive posture and launched attacks on Yugoslavia – which had not attacked a Nato member.
These protests reached their peak in February 2007, when Putin made a dramatic speech in Munich. He said Nato expansion was ‘a serious provocation that reduces the level of mutual trust. We have the right to ask: against whom is this expansion intended?’
Look, if someone as gaunt as Putin spoke to you like that in a pub late in the evening, you’d take it as a warning that he was seriously riled. And unless you wanted a fight, you’d back off. But we didn’t back off.
US President George W.Bush, the genius who invaded Iraq, deliberately raised the temperature the following year. Can it be that Bush likes wars?
In April 2008, Bush said that Ukraine should be placed on the path towards joining Nato. Even the Guardian, the Liberal Warmonger’s Gazette, conceded that this was ‘likely to infuriate the Kremlin’. And so it did. I suspect we were on the path to war from that moment.
I am always accused, when I say that, of making excuses for Putin. I am not.
I think he was stupid as well as wrong to be provoked. Wise men ignore provocations. But to claim he was not provoked is just to lie.
Another lie we are repeatedly told is that Russia attacked Georgia later in 2008. But anyone can find, on the web, a 2009 Reuters news agency story headlined ‘Georgia started war with Russia: EU-backed report’.
The dispatch summarises an inquiry by the respected Swiss diplomat Heidi Tagliavini. She had been asked by Brussels to look into that war. That is what she said. But, somehow or other, a lot of Western media outlets failed to find space for it. I still meet supposedly informed people who have never heard of Ms Tagliavini or her report.
And then there is the claim that this is about democracy and freedom. It isn’t. The more the West claims to care for these things, the less it does to help them.
Some examples:
Ukraine’s elected president was lawlessly overthrown by a mob in 2014. Britain and the USA condoned this shameful event because they preferred the illegal rebels to the elected government. You just can’t do that and pretend to be the guardian of democracy. But then, we aren’t anyway.
You will search in vain for protests against the treatment of Romania’s presidential candidate, in a country that is in the EU and Nato.
CALIN Georgescu’s election was annulled by judges in December when he looked like winning the first round. And he has been banned from standing in the second round – all because he has the wrong kind of politics. And if that’s not enough, look at the West’s deep, shaming silence over the frightening, thuggish behaviour of Turkey’s President Recep Erdogan.
A few weeks ago, this Turkish Putin arrested and jailed Ekrem Imamoglu, an opposition politician who looked likely to beat him at the polls.
Mr Imamoglu joined the many journalists and democrats who already rot in Turkish prisons.
Erdogan has crushed free media, free speech and the freedom to protest. But his country is still allowed to stay in Nato, and Western states have made less noise than an angry vole guarding its nest. They’re scared of Erdogan.
I won’t even try to explain how Germany recently recalled its old, dead parliament to push through laws the newly elected parliament would not pass. This was done to allow the spending of extra billions on the Ukraine war. But I hope you get my drift.
Demand proper debate. Demand the truth. Don’t be dragged into more stupidity, or we will end up with bomb craters as well as potholes.
* * *
Views expressed in this article are opinions of the author and do not necessarily reflect the views of ZeroHedge.
By Philip Marey, senior US strategist at Rabobank
For now, Trump’s advisors seem to have talked him out of firing Powell, easing market stress last week. The VIX fell from almost 36 on Monday to 25 by the end of the week. However, as we warned a year ago and last month, the Fed and Trump are on a collision course and we are likely to see further confrontations as the Fed’s cutting cycle is slowed down by the inflationary impact of the tariffs. At a closed door IMF meeting on Friday, Powell is reported to have stressed that central banks must be shielded from politics to ensure they can focus on keeping inflation stable and employment high. While he drew applause for these remarks, his audience can do very little to keep him safe from Trump.
On Saturday, the FOMC’s external communications blackout started. However, Powell has already made clear that May 7-8 is not a live meeting. This also means that we are not going to get Fed reactions to some interesting data points that are scheduled for this week, including Q1 GDP, March PCE inflation and April payrolls and unemployment.
Week aheadToday, the Canadians go to the polls. The two largest parties are the Liberals (Mark Carney) and the Conservatives (Pierre Poilievre). Justin Trudeau resigned as Prime Minister of Canada on January 6, following declining poll numbers and the resignation of Finance Minister Chrystia Freeland. Caretaker Prime Minister Mark Carney has called a snap election for today.
After Trudeau's resignation, Liberal Party support surged from 20% to 43% under Mark Carney, and the Liberals are leading polls for the first time since 2022. Carney's agenda focuses on economic growth, affordability, and global trade, including eliminating the carbon tax, ambitious housing plans, and infrastructure investment.
You will find more infographics at Statista
Poilievre and the Conservatives, with the slogan "Canada first, for a change," aim to lower the lowest income bracket and introduce a tax cut to defer capital gains taxes when reinvesting within Canada, as their campaign gains momentum.
For more details on the Canadian election, please read the preview of the Canadian elections by Christian Lawrence and Molly Schwartz.
Meanwhile, the American interest in Canada has not waned. In an interview with Time magazine, published on Friday, US President Trump repeated his claim on Canada. He said: "I'm really not trolling. Canada is an interesting case.… I say the only way this thing really works is for Canada to become a state."
Tomorrow, we get the US goods trade balance for March, which turned more negative since December due to rising imports that are likely caused by front-loading because of the tariffs. In February, the trade deficit declined a little due to a rise in exports. Trump’s intended reciprocal tariffs are proportional to the trade deficits with the various trading partners, but many are now trying to negotiate their way out of them. Trump expects some results in a few weeks. Keep in mind that the specific part of the reciprocal tariffs (i.e. above the 10% universal tariff) were delayed until early July for most countries.
We also get the Conference Board report on US consumer confidence, which has declined, also because of the tariffs. While the assessment of the present situation has fallen back to levels shortly before the November elections, the expectations index has plummeted to the lowest level since 2013. So American consumers are very pessimistic about the impact of Trump’s policies.
On Wednesday, we get the Australian CPI for March and the Chinese PMIs for April. Eurozone CPI data for April and GDP growth for Q1 are also scheduled, with separate data for individual Eurozone countries.
In the US, the advance estimate of Q1 GDP growth will be published. The consensus expectation is only 0.2% growth (this is at an annualized rate!), a substantial slowdown from 2.4% in the final quarter of last year. Strong imports, likely caused by front-loading the tariffs, have been a major drag on GDP growth in Q1.
US personal income and outlays for March will also be published. This report includes the PCE deflator, the Fed’s preferred measure of consumer price inflation. The consensus expectation is a decline in headline PCE inflation to 2.2% in March from 2.5% in February. The core PCE deflator is expected to fall to 2.6% from 2.8%, which would suggest continued stickiness. Another data point that the FOMC usually pays attention to is the Employment Cost Index for Q1, which is expected to remain at 0.9%. However, both the ECI and the PCE may now be seen as rearview mirror data points in light of the anticipated inflationary effects from the tariffs.
Finally, the ADP statisticians will publish their estimate of US employment growth in the private sector, which they think is informative regarding Friday’s payrolls. The ADP measure is expected to slow down to 128K in April from 155K in March.
On Thursday, the Bank of Japan is expected to keep the target rate unchanged at 0.50%. However, the BoJ will publish its quarterly outlook, which will extend projections through March 2028.
We also get the US initial jobless claims for the week ending on April 26. They have been moving sideways recently, hovering around the post-2021 average, so they have not been a cause for alarm yet.
The ISM manufacturing report for April will also be published. Last month, the headline index fell below the neutral level again, but remains in the range it has been moving in since 2023. The employment sub-index has been sliding downward, albeit slowly, since 2021 as the Fed has tried to rebalance the labor market. In contrast, the prices paid sub-index has been on the rise since the elections.
On Friday, all eyes will be on the US Employment Report for April, featuring the nonfarm payrolls and the unemployment rate. The consensus expectation is a slowdown to 130K in April from 228K in March. This would still be better than the slow first two months of the year. Unemployment is expected to remain unchanged at 4.2%. Average hourly earnings are also expected to remain stable at 0.3% month-on-month, which should lead to a modest increase to 3.9% from 3.8% in year-on-year terms. A report like this would certainly not make the Fed’s May meeting a live one. However, the Fed will stay alert for signs of deterioration in the labor market that would warrant a rate cut in June.
Apart from these data points, the daily tariff news will likely move markets.
Tyler Durden Mon, 04/28/2025 - 11:20Russia on Monday made clear that it is sticking by initial demands raised by Moscow at the start of the war in February 2022, after President Putin last week issues statements which appeared open to compromise for the sake of peace talks.
Foreign Minister Sergey Lavrov has declared that Russia will never give up its hold over Crimea, as well as the annexed regions of Donetsk, Luhansk, Zaporizhzhia, and Kherson oblasts. He named as a condition for peace negotiations that Russia's control and sovereignty over these territories is vital and essentially non-negotiable.
"The international recognition of Crimea, Sevastopol, the DPR, the LPR, the Kherson and Zaporozhye regions as part of Russia is another imperative," he said. "All the commitments Kiev assumes must be legally binding, contain enforcement mechanisms and be permanent," Lavrov added.
Image: Russian Ministry of Foreign Affairs
"Russia proceeds from the premise that Kiev’s non-accession to NATO, as well as reaffirming its neutral and non-aligned status as per the 1990 Declaration on Ukraine’s State Sovereignty - these factors form one of the two pillars for a final settlement to the Ukraine crisis that would meet Russia’s security interests," he continue.
The top Russian diplomat also demanded that Ukraine enact legislation that restores and protects Russian language, culture, and churches and monasteries in Ukraine. Some one-third of the country has long spoken Russian as their first language, and many more know it as a second language.
Zelensky has been waging a state persecution campaign against the largest Orthodox Church in Ukraine, because it has not broken spiritual communion with the Moscow Patriarchate, at times outright seizing monasteries and churches, and arresting bishops and priests. Russian media broadcasts and media have also long been banned.
Lavrov detailed of Moscow's demands, "The second pillar consists of overcoming the legacy of the neo-Nazi regime which took power in Kiev after the February 2014 putsch, including the initiative by its perpetrators to eradicate and cancel, in both physical and legislative terms, everything Russian, be it the Russian language, media, culture, traditions, or the canonical Orthodox faith," as conveyed in TASS.
"Demilitarizing and de-Nazifying Ukraine is also on the agenda, along with lifting sanctions, withdrawing lawsuits and cancelling arrest warrants, as well as returning Russian assets subjected to the so-called freeze in the West," he emphasized.
Of course, there's also the ban on Ukraine ever becoming a member of NATO, which is a key compromise already being offered by the Trump administration.
Again, all of this is essentially identical to the demands articulated by Putin at the very beginning of the full-scale war. President Trump, coming off the brief Rome meeting with Zelensky, thinks he's ready to give up Crimea:
US President Donald Trump has said he thinks Volodymyr Zelensky is ready to give up Crimea, despite his Ukrainian counterpart’s previous assertions on the Black Sea peninsula that was annexed by Russia in 2014.
Speaking to reporters at an airport in New Jersey on Sunday a day after meeting with Zelensky at the Vatican, Trump said “Oh, I think so,” in response to a question on whether he thought Zelensky was ready to “give up” the territory.
But is the Ukrainian leader really ready to do this and face attacks - possibly even assassination attempts - from within his own far-right paramilitaries and even army commanders?
A Ukrainian Army brigade commander openly threatens Zelensky on a Ukrainain TV show.
— Chay Bowes (@BowesChay) April 28, 2025
He warns him not to negotiate with Russia, not to concede territory, or he will "Regret it"
Open threats to the commander in chief from his own troops, Ukraine is a lawless basket case. pic.twitter.com/McN1GjlkIM
While the common Ukrainian populace is likely more willing to find compromise for the sake of peace, there are still Azov militants and their associates running the show in many places - and their position remains that no compromise whatsoever should be made and the fight must continue, even as Ukrainian forces are being beaten back.
Meanwhile, US Secretary of State Marco Rubio has warned in a media interview that if Washington imposes more sanctions on Russia, this basically assures more war for years to come. "The minute you start doing that kind of stuff, you're walking away from it, you've now doomed yourself to another two years of war and we don't want to see it happen," he said.
He added: "There is no other country, there is no other institution or organization on the Earth that can bring these two sides together, no one else is talking to both sides but us and no one else in the world can make something like this happen but the president."
* * *
More headlines via Newsquawk... Geopolitics: Ukraine
Authored by Ciaran Lyons via CoinTelegraph.com,
SEC Commissioner and head of the crypto task force, Hester Peirce, says US financial firms are navigating crypto in a way that’s similar to playing the children’s game “the floor is lava,” but in the dark.
“It is time that we find a way to end this game. We need to turn on the lights and build some walkways over the lava pit,” Peirce said at the SEC “Know Your Custodian” roundtable event on April 25.
Peirce explained that SEC registrants are forced to approach crypto-related activities like “the floor is lava,” where the aim is to jump from one piece of furniture to the next without touching the ground, except here, touching crypto directly is the lava.
“A D.C. version of this game is our regulatory approach to crypto assets, and crypto asset custody in particular,” she said.
Peirce said that, much like in the game, firms wanting to engage with crypto must avoid directly holding it due to unclear regulatory rules.
“To engage in crypto-related activities, SEC-registrants have had to hop from one poorly illuminated regulatory space to the next, all while ensuring that they never touch any crypto asset,” Peirce said.
Source: US Securities and Exchange Commission
Peirce said that investment advisers are often unsure which crypto assets qualify as securities, what entities count as qualified custodians, and whether “exercising staking or voting rights” could trigger custody violations.
“The twist in the regulatory version is that it is largely played in the dark: burning legal lava and no lamps to illuminate the way.”
Peirce also said that a broker or ATS that cannot custody or manage crypto assets will struggle to facilitate trading, making it unlikely for a “robust market” to develop.
Echoing a similar sentiment, SEC Commissioner Mark Uyeda said at the event that as more SEC registrants work with crypto assets, it’s essential that they have access to custodial options that meet legal and regulatory requirements.
Uyeda said the agency should consider letting advisers use “state-chartered limited-purpose trust companies” with the authority to hold crypto assets as qualified custodians.
Meanwhile, the recently sworn-in chair of the SEC, Paul Atkins, said that he expected “huge benefits” from blockchain technology through efficiency, risk mitigation, transparency, and cutting costs.
He reiterated that among his goals at the SEC would be to facilitate “clear regulatory rules of the road” for digital assets, hinting that the agency under former chair Gary Gensler had contributed to market and regulatory uncertainty.
“I look forward to engaging with market participants and working with colleagues in President Trump’s administration and Congress to establish a rational fit-for-purpose framework for crypto assets,” said Atkins.
Tyler Durden Mon, 04/28/2025 - 10:45By Pam Martens and Russ Martens: April 28, 2025 ~ Common sense voters in the U.S. didn’t need an economics degree or a crystal ball to predict that putting Donald Trump in the Oval Office for a second term – a man unanimously convicted of 34 felony counts by 12 members of a U.S. jury prior to his election – was not going to produce a shining moment in history for the United States. Trump’s first 100 days in office in his second term arrives this week, and it comes on the wings of this headline: “Trump has lowest 100-day approval rating in 80 years.” That data comes from a new ABC News/Washington Post/Ipsos poll showing that only 39 percent of poll respondents approve of how Trump is performing as President. A solid majority, 55 percent, said they disapprove. Even more alarming for the U.S. economy – where two-thirds of GDP … Continue reading →
After three consecutive days of reports of mutual gunfire at army outposts along the Line of Control (LOC) disputed border area, Pakistan's defense minister declared Monday that a military incursion by India is imminent.
"We have reinforced our forces because it is something which is imminent now. So in that situation some strategic decisions have to be taken, so those decisions have been taken," Defense Minister Khawaja Muhammad Asif told Reuters from Islamabad. This confirms Pakistani Army build-up along the border.
Protest against the suspension of Indus Waters Treaty by India, in Karachi, Pakistan, via Reuters.
A severe war of words has been on since last Tuesday's deadly militant attack on tourists in Kashmir, which saw 26 Indian tourists get executed after the gunmen sought to identify Hindus among the group. The Indian government promptly accused Pakistan of harboring the Islamist terrorists which committed the atrocity, which Islamabad angrily rejected.
The nuclear-armed neighbors have already fought two historic wars over the Kashmir region, and fears are rising that another one may soon be on the horizon - also after both sides have sent military reinforcements to the respective regions they administer. Amid a massive manhunt, India identified two detained suspected militants as Pakistani.
"Asif said India's rhetoric was ramping up and that Pakistan's military had briefed the government on the possibility of an Indian attack," Reuters continues of the defense chief's statements. "He did not go into further details on his reasons for thinking an incursion was imminent."
And very alarmingly, the question of use of nuclear weapons was broached in the interview:
Asif said Pakistan was on high alert and that it would only use its arsenal of nuclear weapons if "there is a direct threat to our existence".
Khawaja Muhammad Asif, Pakistan’s defense minister
The Indian army over the weekend announced there has been "unprovoked" firing "initiated by Pakistan" along the Line of Control (LOC) which divides Kashmir into two. Pakistan in the aftermath of the accusation neither confirmed nor denied.
The New York Times described Saturday that "Pakistani solders fired at an Indian position first and India responded in kind, according to local news reports, which said that "the exchange was brief and that there were no casualties." Precise locations of these live fire incidents have not been disclosed.
Soon after the crisis land borders were been shut, visas and military exchange programs mutually canceled, and a landmark water treaty was suspended. Pakistan blasted India's cancelation of the Indus Water Treaty as an "act of war" and warned it would respond accordingly if water flows are violated among the two rivals' shared rivers.
Unverified videos like the below have been widely circulating online:
Non stop Pakistan military movement to India’s border. pic.twitter.com/tUDsmhhHnI
— Open Source Intel (@Osint613) April 28, 2025
But if gunfire continues to be exchanged between the two militaries, also amid reports that Pakistani visa holders are being promptly booted from the country amid the diplomatic crisis - clashes could accelerate toward open war.
India's Chief Minister of Jammu and Kashmir Omar Abdullah has meanwhile said there must be a "decisive fight against terrorism and its origin." Indian officials have continued to heap accusations that ultimately Islamabad either supports these groups or at least turns a blind eye.
Air Force and army activity along the border ramping up?
Tyler Durden Mon, 04/28/2025 - 10:25Pakistan has activated its Swat & Skardu airbases amid tensions with India. The Airforce were seen conducting sorties today. pic.twitter.com/U5GK17xLAd
— Clash Report (@clashreport) April 27, 2025
Those words of Senior U.S. District Judge William H. Orrick may be the only uncontested line in his opinion this week, enjoining the Trump Administration from withholding federal funds to “sanctuary jurisdictions.”
In President Trump’s first term, efforts to implement sweeping changes on immigration and other issues were met by a slew of injunctions.
In 2017, one of those orders was from Judge Orrick, an Obama appointee in San Francisco.
Trump has already faced a record number of national injunctions by district courts.
His administration has objected to forum- and judge-shopping by political opponents by bringing the majority of such challenges in overwhelmingly Democratic states like California.
Such injunctions did not exist at the founding, and only relatively recently became the rage among district court judges. Under President George W. Bush, there were only six such injunctions, which increased to 12 under Obama.
Both Democratic and Republican presidents have complained about district judges tying down presidents like so many judicial Lilliputians. However, when Trump came to office, the taste for national injunctions became a full-fledged addiction. Trump faced 64 such orders in his first term.
When Biden and the Democrats returned to office, it fell back to 14. That was not due to more modest measures. Biden did precisely what Trump did in seeking to negate virtually all of his predecessors’ orders and then seek sweeping new legal reforms. He was repeatedly found to have violated the Constitution, but there was no torrent of preliminary injunctions at the start of his term.
Now, however, with less than 100 days in office, Trump 2.0 has already surpassed that number for the entirety of Biden’s term.
The Supreme Court bears some of the blame for this. Although a majority of justices, including liberal Justice Elena Kagan, have complained about district courts’ issuance of national injunctions, the high court has done little to rein in district court judges. On May 15, the justices are poised to consider the issue in a case involving birthright citizenship. Many hope that the justices will bring what they have consistently failed to supply to lower courts: clarity and finality.
Some judges have already seen their stays lifted by appellate courts.
However, in just one day this week, three more major injunctions were issued on sanctuary cities, voter registration, and deportations.
Some of these orders appear premature and overbroad.
Take Judge Orrick’s order. Again, Trump is targeting cities offering sanctuary to unlawful immigrants as imposing high costs on the country, including increasing burdens for federal programs and grants to these cities.
Orrick previously stopped that effort in the first Trump term, and he was affirmed by the United States Court of Appeals for the Ninth Circuit. However, the orders are not identical, and so far no action has been taken against these cities.
Under one of the orders, titled “Protecting the American People against Invasion,” Trump has ordered the attorney general and the secretary of Homeland Security to “evaluate and undertake any lawful actions to ensure that so-called “sanctuary” jurisdictions, which seek to interfere with the lawful exercise of Federal law enforcement operations, do not receive access to Federal funds.”
Orrick noted that the term “sanctuary jurisdiction” was not defined and dismissed the express reservation that such actions can only proceed to the extent that they are allowed under law.
The irony is that the opinion itself is overly broad and imprecise. There are indeed cases limiting the ability of the federal government to “commandeer” states and cities into carrying out federal functions. However, there are also cases upholding the right to withhold federal funds that contravene federal laws and policies.
The operative language in the order is the focus on sanctuary policies that “interfere” or prevent federal enforcement. There must be some accommodation for the federal government in refusing to pay for the rope that it will hang by.
Justice Robert Jackson famously wrote in Terminiello v. City of Chicago that the Constitution cannot be construed as a “suicide pact.” I have never been fond of that quote, which has often been used to justify the curtailment of individual rights. But these cases could bring a new meaning to the quote in immigration cases.
If one accepts the Trump administration’s data, then continued funding of these jurisdictions might be more akin to being forced to pay for your own hit man and then calling it suicide.
There is a reason courts generally wait for these conflicts to become “ripe.” The administration could easily engage in impermissible “commandeering,” but it could also “evaluate and undertake” more focused and defensible withholdings of federal funds. Judge Orrick decided not to wait to find out.
These are difficult questions, but the Supreme Court can reduce these cases by actually ruling with clarity. The court has often left these issues mired in ambiguity, kicking cases like cans down the road for any final resolution.
Consider the order out of the District of Columbia blocking an effort to change federal voting forms to require proof of citizenship. Trump campaigned on the issue, and, according to a Gallup poll, 84 percent of U.S. adults are in favor of requiring voters to show such identification.
Judge Colleen Kollar-Kotelly barred the federal government from changing the standardized national voter registration form and to have federal voter registration agencies “assess” the citizenship of individuals who receive public assistance before providing them a voter registration form.
Kollar-Kotelly raises good-faith limits on presidents’ ability to regulate elections, a power mainly left to the states. However, this is a policy that does not necessarily impose a new condition on states.
After all, non-citizens are barred from voting in federal elections in all states. Again, there must be some ability of the administration to act to address a national priority in the funding of election reforms and practices.
The question is whether the court will recognize such a federal interest.
The problem with some of these orders is not that they are without foundation, but that courts appear on a hair-trigger to enjoin the Trump administration on any subject whatsoever. There is a need to deescalate in both branches as we expedite these appeals. We are indeed “here again,” but this is not a good place for anyone.
* * *
Jonathan Turley is the J.B. and Maurice C. Shapiro Professor of Public Interest Law at the George Washington University Law School. He is the author of best-selling book “The Indispensable Right: Free Speech in an Age of Rage.”
Tyler Durden Mon, 04/28/2025 - 10:05This week will be the first for a while where data and earnings will compete with tariff headlines as it’s a bumper week on this front. According to DB"s Jim Reid, in terms of data the main highlights in the US are payrolls (Friday), core PCE inflation and US GDP (Wednesday), ISM manufacturing (Thursday) and the latest JOLTS and consumer confidence tomorrow.
In Europe flash CPI numbers get released from Spain tomorrow, Germany, France and Italy on Wednesday, with the Eurozone aggregate on Friday (our economists’ preview is here). On Wednesday, Q1 GDP reports are due for Germany, France, Italy and the Eurozone. In Asia, the focus will be on the BoJ meeting (Thursday - our preview here) and April PMIs in China (Wednesday).
Besides the macro, we get an avalanche of micro as we face the busiest week of Q1 earnings season with corporate reporting centering around results from Microsoft and Meta on Wednesday and Apple and Amazon on Thursday. This will contribute to a whopping 40% of S&P 500 market cap reporting this week.
It's fair to say that Mag-7 earnings will go a long way to dictating the tone of the week, and perhaps quarter, now that the worst of tariffs appears to be behind us. As Jim Reid mentioned last week, remember that before Liberation Day the main theme bubbling in the background was the Mag-7 underperforming due to DeepSeek, worries about extreme levels of Capex needed to power AI forward, valuations and a disappointing Q4 reporting season around the end of January. Three months on we'll see what earnings look like.
Elsewhere we see the federal election in Canada today. Remember the ruling Liberal Party were frequently 25% behind in the polls in early-mid January even after Trudeau had announced his resignation as leader. However after the "51st state" rhetoric and aggressive tariffs, the rally round the flag movement has propelled the Liberals into a 3-4pp lead in current poll of polls which if replicated today would likely give them a small majority. So a remarkable turnaround.
Elsewhere in politics, Wednesday will mark President Trump’s first 100 days in office. So expect lots of reflections on this landmark. The UK holds local elections on Thursday with the main point of interest being how well the populist Reform Party does given they have recently edged ahead of the ruling Labour Party in national polls.
So its fair to say it will be a busy week.
Let's go into more detail on some of the main data points. Firstly, in terms of payrolls, DB economists forecast that headline (+125k forecast vs. +228k previously) and private (+125k vs. +209k) payrolls will mean revert after a strong March, particularly within the leisure/hospitality and retail sectors. The bank's econ team point out that March and April can get whipped around due to the timing of Easter and school spring breaks. Unemployment should remain steady at 4.2% though.
Wednesday's advance Q1 GDP will be interesting as the consensus suggests only +0.4% annualized growth in the quarter (+1.1% expected at DB vs. +2.4% in Q4) so that will raise some concerns if it materializes. At the same time DB sees March personal income (+0.5% DB vs. +0.4% last month) and spending (+0.6% DB vs. +0.4%) data. This will also contain the latest reading on the core PCE deflator (+0.1% vs. +0.4%) which is expected to be on the softer side this month. This will be welcome but remember this is all largely pre-tariffs.
The day by day week ahead is at the end as usual, including the highlights from a busy week for earnings on both sides of the Atlantic. One final thing to note is the US Treasury’s updated borrowing estimates (today) and the subsequent refunding announcement (Wednesday). This normally gets released without too much fuss but remember that in Summer 2023 (end July/early August) this quarterly announcement helped cause brief but great stress in markets due to higher than expected borrowing and more long-dated issuance. Since then the Treasury has managed the process with a view to minimising market fears but in an era of large borrowings these events are always worth keeping an eye out for.
Courtesy of DB, here is a day-by-day calendar of events
Monday April 28
Tuesday April 29
Wednesday April 30
Thursday May 1
Friday May 2
* * *
FInally, looking at just the US, Goldman writes that the key economic data releases this week are the Q1 advance GDP report and core PCE inflation on Wednesday and the employment report on Friday. Fed officials are not expected to comment on monetary policy this week, reflecting the blackout period ahead of the May FOMC meeting.
Monday, April 28
Tuesday, April 29
Wednesday, April 30
Thursday, May 1
Friday, May 2
Source: DB, Goldman
Tyler Durden Mon, 04/28/2025 - 09:55
In 2025, the federal minimum wage is officially a “poverty wage.” The annual earnings of a single adult working full-time, year-round at $7.25 an hour now fall below the poverty threshold of $15,650 (established by the Department of Health and Human Services guidelines). The limitations of how the federal government calculates poverty understate how far the minimum wage is from economic security for workers and their families.
Set at an adequate level, the minimum wage is one of the strongest policy tools for improving the economic security of low-wage workers, and an effective tool at lowering poverty. Yet instead of addressing this massive hole in our economy’s social safety net by working to raise the minimum wage, congressional Republicans are pushing policies like imposing work requirements on safety net programs and cutting Medicaid. Supporters of these proposals characterize them as tools to incentivize work and protect the dignity of work, but these policies fail to account for the nature of low-wage work in our economy. Instead, they stand to deepen hardship for low-income workers with no economic upside for working people or the larger economy.
The minimum wage and the federal poverty lineWhen the minimum wage was created as part of the Fair Labor Standards Act in 1938, the policy was intended to protect the nation from “the evils and dangers resulting from wages too low to buy the bare necessities of life.”1 The federal wage floor is clearly not fulfilling this objective anymore because of a historically long period of inaction by Congress. The last time Congress increased the federal minimum wage was in July 2009, meaning that as prices have risen over the last 15 years, the value of the minimum wage has fallen by 30%. Figure A shows how annual earnings for a full-time minimum wage worker fall short of the poverty line for a household of any size.
Figure A
This comparison severely understates the economic vulnerability of these workers and their families. This is because the federal poverty guidelines—which are used at the federal, state, and local level to determine eligibility for public programs like Medicaid and SNAP—are informed by the Census Bureau’s official poverty measure (OPM), a reductionist measure of poverty. The OPM relies solely on a multiple of the current cost of the minimum food diet from 1963 to calculate the poverty line and identify the poor. The Census also publishes a more expansive measure of poverty known as the supplemental poverty measure (SPM), which accounts for the cost of a broader basket of items including food, clothing, shelter, utilities, internet and telephone, but this latter measure does not inform the poverty line used to determine eligibility for public programs.
As Figure B demonstrates, the share of workers in poverty is significantly higher when we rely on the SPM instead. By this measure, more than 10 million workers (7.0%) between the ages of 18 and 64 failed to earn enough to avoid economic deprivation in 2023, the latest year for which these statistics are available, whereas the OPM captured only 4.5% of all workers.
Figure B
The discrepancy between the federal minimum wage and the real experience of workers throughout the country has led 30 states and Washington, D.C., to increase their minimum wage above the federal level. In the 20 states still using the federal minimum, 11.8 million workers earn less than $17 per hour, more than 1 in 5 workers in those states. Those states are disproportionately located in the South. The stagnation of the federal minimum wage allows Southern policymakers to maintain low wages in their economies. Southern workers have lower earnings even when adjusting for cost-of-living differences between regions. In part due to wage-suppressing policies like a low-minimum wage, Southern workers experience greater poverty than those in other regions.
Increasing the minimum wage boosts earnings and reduces povertyThe federal minimum wage is a powerful tool in fighting poverty in the U.S. The best economic research has consistently shown that increasing the minimum wage lifts earnings for low-wage workers, with little to no impact on employment. Research shows that increasing the minimum wage decreases poverty by increasing the incomes of low-income families, even accounting for decreases in public benefits as families earn more from higher wages. In analysis of legislation introduced in 2021 to gradually increase the federal minimum wage to $15 an hour, EPI concluded that the policy would lift between 1.8 to 3.7 million individuals out of poverty, including up to 1.3 million children.
Despite persistent opposition from the business lobby and obstruction from conservative policymakers, raising the minimum wage remains popular among the public, and some legislators keep raising the call for federal action on this issue. Recently, members of Congress led by Sen. Bernie Sanders (I-Vt.) and Rep. Bobby Scott (D-Va.) once again reintroduced the Raise the Wage Act, which would gradually increase the federal minimum wage to $17 an hour. This would raise wages for more than 22.2 million workers, 4.2 million of whom live in households below the poverty line.
By contrast, Republican policies will make it harder for workers to escape povertyWhile the minimum wage has been left to wither, Republican budget proposals in 2025 will either erode other elements of the social safety net or make them much harder to access. Republicans seek to cut Medicaid and ratchet up work requirements on both Medicaid and SNAP.2 This will harm low-income workers and their families, as these social programs help improve the living standards of millions of workers who don’t earn enough to avoid economic hardship. In 2023 alone, social programs that rely on the poverty guidelines kept more than 7 million individuals out of poverty.3
Republicans have framed cutting benefits and expanding work requirements as a way to encourage people to work. The justification for these proposals is that generous Medicaid and SNAP benefits should be pared back because they encourage recipients to depend on government assistance instead of working. This seems to overlook the fact that two-thirds of non-elderly Medicaid enrollees and more than 85% of working-age adults who receive SNAP do work.
This conservative philosophy is an old idea that is deeply wedded to racist stereotypes about Black families being users of welfare programs. However, evaluating these proposals on their economic merits shows that they will increase hardship for low-wage Americans without creating economic benefit. Medicaid cuts at the levels proposed by Republicans would reduce incomes of low-wage families significantly, including a 7.4% reduction in income for families in the bottom 20% of the income distribution. Medicaid is also a vital investment in low-income children, who grow up healthier and with better education and income outcomes because of the Medicaid support they receive. Research suggests that Medicaid pays for itself through this investment in poor children. Cutting Medicaid will likely reduce these children’s educational achievement and wages earned over their lifetimes.
Similarly, research shows that adding work requirements to benefit programs is a punitive choice with no upside. Studies of work requirements on Medicaid and SNAP find little to no increase in employment outcomes in places where the policies have been implemented. What these policies do achieve is to make it harder for individuals to access the benefits they are eligible for.
A reason why work requirements are ineffective is that they do not account for the precarious nature of low-wage work. Unpredictable scheduling practices are pervasive in low-wage jobs, including cancelled shifts and short notice changes to shift schedules. Low-wage workers also frequently change jobs in an effort to find better-paying work. The scheduling unpredictability and level of turnover in many low-wage jobs can make it difficult for workers to fulfill the consistent work-hour requirements needed to satisfy work requirement policies. Work requirements effectively act as cuts to existing beneficiaries and limit new participants who have little control over the labor market conditions associated with low-wage work.
ConclusionThe minimum wage is a powerful tool for increasing the economic security of low-wage workers. Yet Republican lawmakers have repeatedly denied increases in the federal minimum wage and are now pursuing a tax and budget plan that would cut Medicaid and limit access to safety net programs to finance tax cuts for the richest Americans. If it goes into effect, the combination of tax cuts and Medicaid cuts would effectively lower incomes for workers in the bottom 40% of the income distribution while boosting incomes for the top 1%. These cuts are also likely to harm people and children of color, who are disproportionately more likely to rely on Medicaid.
If lawmakers were serious about lifting families out of poverty and enabling them to fully participate in the labor force, they would be enacting policies to raise wages and expand access to good-paying jobs. By keeping wages low and making it more challenging to access benefits, lawmakers are seeking to deprive low-income households of the resources they need to thrive.
1. S.Rep. No. 884 (75th Cong., 1st Sess.), p. 4
2. Supplemental Nutrition Assistance Program (SNAP, formerly known as the food stamp program) is a crucial safety net program providing benefits so that low-income people in the United States can purchase food. SNAP has work requirements for most beneficiaries ages 16–59 who are able to work. In addition, there are more stringent work requirements for able-bodied adults without dependents (ABAWDs).
3. These individuals lived in households that qualified for SNAP benefits, housing subsidies, free or reduced-priced school meals, or cash assistance from the Temporary Assistance for Needy Families (TANF) program.
We have no idea how good we had it.
Let’s consider the returns data from the period post-Great Financial Crisis (GFC), and then unpack what it might mean.
Starting January 1, 2010, the S&P 500 generated a total return (with dividends reinvested) of 566.8%, or 13.3% per year from the start of 2010 through the end of Q1 2025. The Nasdaq 100 has nearly doubled that. (Chart above is from March 2009, but that’s cheating)
Compare this to the average 15-year return periods over the past century, which generated ~8.7%. Average annual returns over the past century have been about 10.4%.
Using rolling 15-year period returns, we see how atypical this era has been. The only two better eras were the immediate aftermath of World War II through May 1957 (about 18% annualized) and the tech boom in the 1980s and 90s, 15 years peaking in April 1999 (around 17% annualized). This current 15-year peak was through February 2024 at ~16%.
Over the entirety of the post-GFC era, we have been averaging a third more than the typical annual returns since 1925, and nearly double the average 15-year stretch.
And that spectacular run of post-financial crisis returns have come with only a few minor setbacks:
-Flash Crash in 2010.
-2015 gain of “only” 1.4%
-2018 drop of 4.4%, including a Q4 drop of nearly 20%.
-Q1 2020 down 34% in the pandemic.
-2022 down 18% for the year.4
The full table of gains since the GFC looks like this:
Table via Slickcharts
~~~
Main Street has now become a regular “BTFD” player. This is a direct result of muscle memory – a Recency Effect impact driven by 15 years of market gains. What has developed over the entirety of the post-financial crisis era of rising equity markets and until 2022, falling or zero interest rates. The good news is that this is how you build wealth over the long haul. Nick Maggiulli’s book “Just Keep Buying” makes this case very persuasively.
When we talk about muscle memory, what we are really discussing are habits for which we have been continuously rewarded. What breaks that prior habit depends upon how we change our behaviors in response to that punishment and reward.
Recall what happened during prior changes in market regimes.5 In the 1980s and 90s, dip buyers had been rewarded, despite the 1987 crash (the ultimate 22% dip!), the 1990 near-recession, a presidential impeachment, the Thai Baht crisis, the Russian Ruble default, Long-Term Capital Management collapse, and more.
For two decades, every dip purchase was soon rewarded.
It takes a while to change behavior. Look at the dotcom implosion (and the September 11 terrorist attacks). From March 2000 to the double lows October 2002 and March 2003, the Nasdaq 100 fell 82.9% (peak to trough). That was not a straight line down…
~~~
We may have had it too good for too long – even though it didn’t feel that way. In October 2009, I called the move off the lows “The Most Hated Rally in Wall Street History.” In seven months, the S&P 500 had moved 57.5% from the bottom, and the Nasdaq 100 had gained 64.6%.
History informs us that when US markets get slashed by 56%, it creates a very advantageous entry point into equities for fresh capital. The recency effect challenges us to overcome the psychological stresses caused by a fresh, memorable crash. People fought the rally the entire way up, and continued so for years. “Financial Repression” was the rallying cry for underperforming managers.
Over the ensuing 16 years, the crowd may have forgotten that pain. Any single day where markets rally 12.5% is not what risk managers call a rational trading day.
What has developed over the past decade and a half is simply that BTFD has worked like a charm. Perhaps, it has worked too well. The risk is that if and when the trend changes, people may be slow to adapt.
People hated the rising stock market in the early 2010s. The present concern is that, thanks to the Recency Effect, they no longer hate it enough…
Previously:
The Most Hated Rally in Wall Street History (October 8, 2009)
___________
1. Data from Nick Magiulli’s return calculator.
2. If we wanted to cherry pick the data, we could start with the March 2009 end of the GFC, and the returns would be much higher, or date it from the pre-GFC peak in October 2007, and make the returns lower.
3. See also Lazy Portfolios rolling returns.
4. Plus bonds down 15% – the first double-digit drop for both asset classes in 4 decades.
5. I am not necessarily claiming a regime change is upon us; rather, it is a reminder of what happens when secular trends in markets reverse.
The post A Spectacularly Underappreciated 15 Years appeared first on The Big Picture.
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