What we’re reading (4/7)
“Investors Big And Small Are Driving Stock Gains With Borrowed Money” (Wall Street Journal). “As of late February, investors had borrowed a record $814 billion against their portfolios, according to data from the Financial Industry Regulatory Authority, Wall Street’s self-regulatory arm. That was up 49% from one year earlier, the fastest annual increase since 2007, during the frothy period before the 2008 financial crisis. Before that, the last time investor borrowings had grown so rapidly was during the dot-com bubble in 1999.”
“Janet Yellen Calls For A Global Minimum Tax On Companies. Could It Happen?” (The Economist). “Such a levy, Ms Yellen said, would help ‘make sure the global economy thrives based on a more level playing field’, and would help end a ‘30-year race to the bottom’. Though the idea of a minimum tax raises hackles in tax havens in the Caribbean, parts of Europe and farther afield, many other big economies will welcome America’s renewed commitment to multilateralism on tax after the prickly unilateralism of the Trump years.”
“JPMorgan’s Chief Sees A Boom Coming” (DealBook). “A combination of excess savings, deficit spending, a potential infrastructure bill, vaccinations and ‘euphoria around the end of the pandemic,’ Mr. Dimon wrote, may create a boom that ‘could easily run into 2023.’ That could justify high equity valuations, but not the price of U.S. debt, given the ‘huge supply’ soon to hit the market.”
“Morgan Stanley Dumped $5 billion In Archegos’ Stocks The Night Before Massive Fire Sale Hit Rivals” (CNBC). “The night before the Archegos Capital story burst into public view late last month, the fund’s biggest prime broker quietly unloaded some of its risky positions to hedge funds, people with knowledge of the trades told CNBC.”
“International Passenger Traffic Down 89% In February, No Sign Of Recovery: IATA” (Reuters). “Global airline industry body IATA said international passenger traffic plunged 89% in February compared to the same month last year as COVID-19 infections climbed once more, and there was no sign of an aviation recovery yet.”
