What we’re reading (3/18)
“Hedge Funds Ramp Up Leverage To Near Record Highs To Juice Returns” (Reuters). “Hedge funds' use of leverage in equities trading is near record levels after debt-fueled strategies ballooned in recent years and an upturn in financial markets prompted riskier bets, according to two banking sources and recent client notes from major banks. Fresh data compiled by Goldman Sachs, JPMorgan and Morgan Stanley, the three largest global prime brokerages, seen by Reuters in notes distributed to a restricted group of clients, show that leverage used to juice up returns is at or close to historical highs, depending on the bank.”
“Once America’s Hottest Housing Market, Austin Is Running In Reverse” (Wall Street Journal). “Austin was at the forefront of the U.S. housing boom, when rock-bottom borrowing costs near the start of the pandemic fueled robust sales and sent home prices to new highs. Austin prices soared more than 60% from 2020 to the spring of 2022. A surge in interest rates crushed the housing market nationwide, and existing-home sales fell to a nearly 30-year low in 2023. Despite that collapse, home prices remain near record levels thanks to tight supply. But in Austin, according to the Freddie Mac House Price Index, prices have fallen more than 11% since peaking in 2022, the biggest drop of any metro area in the country.”
“8 Incidents In 2 Weeks: What’s Going On With United’s Planes?” (New York Times). “An engine fire sparked by plastic packaging wrap, a tire lost shortly after takeoff and a plane veering off the runway: These are among the eight incidents that have occurred over the past two weeks on flights operated by United Airlines. While no injuries — or worse — have been reported, the mishaps have generated headlines and stoked rising anxiety about aviation safety among federal officials and passengers alike.”
“Musk Says His Ketamine Prescription Is In Investors’ Best Interests” (Bloomberg). “For Wall Street, ‘what matters is execution,’ Musk said in an interview with former CNN anchor Don Lemon streamed Monday on YouTube. ‘From an investor standpoint, if there is something I’m taking, I should keep taking it,’ he said referring to Tesla’s success.”
“Online Selling Platforms Amplify Consumer Preference For Local” (RealClear Markets). “The way Americans shop has radically changed over the last couple decades. The decline of traditional shopping malls and rise of online shopping followed by the COVID-19 pandemic ushered in an era of uncertainty for many retail small businesses. Yet, recent numbers suggest that American small businesses have finally found their footing when it comes to evolving with the way consumers shop. In fact, mom-and-pop shops across the country experienced a selling frenzy during the last holiday season. Much of that success is due to the full embrace of the digital era of retail.”
