What we’re reading (9/30)
“‘Most Americans Today Believe The Stock Market Is Rigged, And They’re Right’” (Bloomberg). “New research shows insider trading is everywhere. So far, no one seems to care…[i]n theory, the law governing insider trading is clear-cut: Under the Securities Exchange Act of 1934, executives who abuse their access to nonpublic information, either by trading on it themselves or passing it along to someone else, can be charged with fraud and sent to jail. But regulators and lawyers say identifying and prosecuting the offense is deceptively difficult, and lawmakers…have been calling for reform.”
“We Asked 3 Major Investors What Happens Next In The Market — None Of Them See Big Returns” (CNBC). “In response to bonds that offer negative real returns, big investors are seeking alternative investments that provide a yield and that aren’t correlated to stocks, according to Ashbel Williams, executive director and CIO of the Florida State Board of Administration. He manages more than $195 billion in assets for one of the largest U.S. pension funds. He invests in assets including planes, trains, timber, and music and TV rights, he said. Bonds now make up a smaller percentage of his holdings, down to 18% or 19% from about 25% a decade ago, Williams said.”
“Jerome Powell's Week From Hell” (CNN Business). “Everything is going wrong for one of the world's most powerful figures. Jerome Powell's chances of getting another four-year term as head of the Federal Reserve took a hit Tuesday after Senator Elizabeth Warren called him a ‘dangerous man’ for being too soft on Wall Street banks. That blow came on the heels of two Fed officials stepping down amid a trading scandal that even Powell acknowledged is ‘obviously unacceptable.’ Meanwhile, the Treasury Department moved up the timeline for when it will run out of cash, raising the specter of a calamitous US default come October 18.”
“Real-Estate Investors Are Less Optimistic About The U.S. Housing Market — Here’s Why” (MarketWatch). “Small scale real-estate investors are less enthusiastic about the state of the U.S. housing market — and their reasons for worry largely mirror those of the average home buyer today, according to a new survey. Real-estate data company RealtyTrac reported that 48% of individual real-estate investors view the investment market as being worse or much worse than it was a year ago, based on the results of a survey the company conducted. That’s up from 45% of investors in last year’s edition of the same survey. RealtyTrac polled mom-and-pop investors who purchase between one to 10 properties a year — including both investors who flip the homes and those who hold onto them as rental units. These investors own most of the single-family rental properties in the country.”
“Massive Pension Investors Are Betting Big Bucks That The Office Isn't Dead In NYC And San Francisco. Here's Why They're Ignoring The Narrative And Going Bargain Hunting Instead.” (Insider). “Just under $17 billion of commercial real-estate sales took place in New York in the first half of 2021, according to data from CBRE, putting the year on track for even less dollar volume than the $36 billion sold in 2020, when the pandemic inflicted its worst damage on the economy. In 2019, almost $61 billion of commercial real estate was sold in NYC, according to CBRE.”
