What we’re reading (2/27)
“Warren Buffett Defends Berkshire Hathaway’s $25 Billion In Buybacks” (Wall Street Journal). “In Mr. Buffett’s annual letter to shareholders, he defended the larger-than-usual buybacks, saying they enhance the intrinsic value for shareholders but still leave Berkshire ample funds for any opportunities. He was less than complimentary of other chief executives buying back stock. ‘American CEOs have an embarrassing record of devoting more company funds to repurchases when prices have risen than when they have tanked,’ he wrote.”
“Where Have All the Houses Gone?” (New York Times). “Much of the housing market has gone missing. On suburban streets and in many urban neighborhoods, across large and midsize metro areas, many homes that would have typically come up for sale over the past year never did. Even in cities with a pandemic glut of empty apartments and falling rents, it has become incredibly hard to buy a home.”
“Why This QE Is Different In One Chart” (Global Macro Monitor). “The Fed deserves some kudos for not letting the financial system collapse during the early days of COVID but the risk of much higher inflation is now at hand. There is just too much money created by the Fed and the credit markets chasing too few assets, goods, services, and, yes, semiconductors.”
“As Rising Treasury Yields Spook Stock Investors, March Looms Like A Lion” (MarketWatch). “Ultimately, seasonal trends suggest that March will be wobbly and could be used as an excuse for further selling, but on that downturn may be cathartic and give way to further gains in the spring.”
“ARK Funds: The Tail That Wags The Dog?” (Morningstar). “Although ARK's investment strategy is familiar, the company's sales success is not. Its inflows raise the question: Is the mutual fund tail wagging the stock-market dog? That is, have ARK funds performed so well--ARKK is up 11% this year after gaining a breathtaking 152% in 2020--because when its funds put their new monies to work, they boost the prices of the stocks that they already hold?”
