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Bond losses are because they bought them when interest rates were low, not expecting interest rates to rise.
That's always a risk. Investors thought high prices for bonds would go on forever. But they were stupid as I predicted long ago in my Fed bond bubble doomsday machine topic.
However, they aren't entire stupid:
Why regional banks are now willing to take billions in losses
Some cash from these sales is being used to buy new bonds that lenders hope will perform well as rates come down in the coming months or years. The Fed is expected to start cutting rates as early as September.
“If they’ve got extra cash, bank treasurers who think we’re at the top of the cycle may decide to go ahead and lock in long-duration bonds so that once we’re in a lower-rate environment they still have a decent yield,” Feddie Strickland, an equity research analyst with Hovde Group, said.
The difference this time around is that regional banks aren’t selling lower-yielding securities to pay depositors. Instead they are preparing for interest rate cuts from the Federal Reserve.
Locking in 'the swoosh'
Regional banks that announced bond sales in recent weeks include Pittsburgh-based PNC Financial Services Group and Charlotte-based Truist (TFC), two of the top 10 biggest lenders in the US, along with Regions (RF) and Webster (WBS). More are expected to do the same.
PNC took a half-billion dollars in losses on its bond sales and reinvented the proceeds into securities with yields "approximately 400 basis points higher than the securities sold," according to the bank.
As for commercial real estate, malls are dying thanks to Amazon and other online retailers. Office space is vacant thanks to the pandemic showing that worker productivity from home was just as high as in the office, and cheaper.
There's going to be pain.
Trump has the same problem. He had to refinance his commercial property this year. And because no banks would touch him, he had to go with an online bank which doesn't even have any physical branches. God only knows what interest rate he got jammed with.
The unemployment rate is nothing to complain about. It is still lower than it was for most of Trump's regime.
Commodities.
The rapid growth of commodities markets has drawn a wave of new entrants—such as tech-focused trading players, hedge funds, and banks, as well as players involved in mining and processing—creating a need for additional liquid and risk management offerings. In our view, this is a positive development. Such vibrant markets can both increase value pools and help facilitate the energy transition through investments in new and emerging technologies and products. Doing so could have broader benefits in terms of meeting global climate goals and building and scaling a greener, cleaner future.
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The critical role of commodity trading in times of uncertainty
Geopolitical fragmentation and the energy transition are increasing the interconnectivity of commodity markets, putting commodity trading at center stage.www.mckinsey.com
Please explain how illegals are driving up the cost of housing.Where are Biden's 12 million illegals living?
My friends are to smart to max their credit cards. Hell, I haven't paid interest on a credit card in over 30 years.
At least I provide actual data instead of wishful thinking and nothing more to back up your desire to see America fail.Meh your copy and paste doesn't solve the problem that very well could bring your lovely economy crashing down
Please explain how illegals are driving up the cost of housing.
I can't wait to hear how a poor immigrant is driving houses over $400,000.
This should be fun.
I should probably remind you there are 131 million households in the US.
At least I provide actual data instead of wishful thinking and nothing more to back up your desire to see America fail.
Many are living in free housing built by Republican farmers.Please explain where Biden's 12 million illegals are living?
I see what you did there. There were 11 million illegals when Trump was president.Please explain where Biden's 12 million illegals are living?
You aren't explaining, fool.
Show me proof it's all the Mexicans' fault.
I see what you did there. There were 11 million illegals when Trump was president.
Did you call them Trump's 11 million illegals?
Nope. Because you are a raging hypocrite.
So tell me, dipshit. Are there a lot of illegals living in nice houses in your town?
You remind me of those racists who tried to blame the 2008 crash on blacks, without ever noticing how a great number of your WHITE neighbors were defaultin.
"I had no idea Biff was a negro!"
In my area, the illegals live in a rundown apartment complex where the floors are bare concrete and not carpeted.Many are living in free housing built by Republican farmers.
Just turn right at the Trump 2024 sign and follow the road around the crop circle. Nice rows of migrant housing. They even have BBQs out front.
I don't think any are living in 400,000 houses they just bought though.
Who told you that?
Link for the 12 million let in to live in the USA??I didn't say it's all the Mexican's fault, moron.
Biden lets in 12 million illegal aliens.
Where are they all living?
Link for the 12 million let in to live in the USA??
Biden did not let in 12 million illegals, dipshit.I didn't say it's all the Mexicans' fault, moron.
Biden lets in 12 million illegal aliens.
Where are they all living?
Biden did not let in 12 million illegals, dipshit.
Did Trump let in 11 million illegals?
I am trying to jumpstart some cognition in your idiot brain. Tell me, are there a lot of illegals living in $400,000 houses in your town?
You made that up. You pulled it out of your idiot bigoted fat ass.
What and who is a border czar?How many did Biden and the border czar let in?