Tag: Bloomberg

Allstate to Sell Chicago-Area HQ in Embrace of Remote Work

Mary Pat Campbell

Link: https://www.bloomberg.com/news/articles/2021-10-08/allstate-to-sell-chicago-hq-as-insurer-embraces-remote-work

Excerpt:

Allstate Corp. plans to sell its headquarters building, marking the U.S. finance industry’s firmest endorsement yet of the desire to offer hybrid work after the pandemic. 

With many employees choosing to work remotely, the insurance giant will sell its offices in Northbrook, Illinois, according to an emailed statement Friday. The complex in a Chicago suburb has several buildings that total 1.9 million square feet on a 186-acre (75 hectares), Allstate has said in regulatory filings.

Author(s): May Reyes

Publication Date: 8 Oct 2021

Publication Site: Bloomberg

Wall Street’s Shift South Runs Into Texas, Florida Culture Wars

Mary Pat Campbell

Link: https://www.bloomberg.com/news/articles/2021-10-05/wall-street-s-shift-south-runs-into-texas-florida-culture-wars

Excerpt:

Wall Street’s three biggest municipal-bond underwriters have seen business grind to a halt in Texas after the state blocked governments from working with banks that have curtailed gun-industry ties. In June, as Goldman Sachs Group Inc. was on the hunt for a new campus in Dallas, Republican Governor Greg Abbott took a shot at ESG initiatives by banning state investments in businesses that cut ties with oil and gas companies.

That’s not to mention the brawls over Covid vaccines and mask mandates, deadly Texas blackouts along the country’s most isolated power grid and new state laws that restrict voting and all but ban abortion. It’s all happening just as Wall Street’s shareholders push the industry to fight climate change, racism and the gender gap.

….

So far, most big banks haven’t taken public positions on the new abortion restrictions. They’re being cautious about requiring Covid-19 vaccinations for employees in places where officials have assailed mandates. But the new Texas gun law is running into both the industry’s efforts to advance social causes and its ability to work with the second-largest state for muni-bond issuance. 

JPMorgan Chase & Co. — which has 25,500 Texas employees, its most in any state outside New York — has said it can’t bid on most business with public entities in Texas because of ambiguities around the law. The biggest U.S. bank is assessing its potential next steps, said a person with knowledge of the company’s thinking. 

Author(s): Max Abelson, Amanda Albright

Publication Date: 5 October 2021

Publication Site: Bloomberg

Wall Street Links to Pennsylvania Pension Fund Probed by SEC

Mary Pat Campbell

Link: https://www.bloomberg.com/news/articles/2021-09-29/wall-street-links-to-pennsylvania-pension-fund-probed-by-sec

Excerpt:

A $66 billion Pennsylvania state pension fund under scrutiny for errors in calculating investment returns has been asked by securities regulators to turn over records related to possible gifts exchanges with dozens of Wall Street firms, according to a subpoena reviewed by Bloomberg.

The U.S. Securities and Exchange Commission issued the subpoena Sept. 24 to the Pennsylvania Public School Employees’ Retirement System, demanding information about the fund’s dealings with firms including Blackstone Inc., The Carlyle Group Inc., Morgan Stanley, Apollo Global Management Inc. and consultant Hamilton Lane Advisors. 

SEC Enforcement Division Senior Counsel Heidi Mitza asked that the pension fund supply “all Documents and Communications Concerning any compensation, remuneration, money, gifts, gratuities, trips or anything of any value” exchanged between representatives of investment managers, advisers, and consultants and any representatives of PSERS or the state, according to the subpoena. 

Author(s): Neil Weinberg

Publication Date: 29 Sept 2021

Publication Site: Bloomberg

China Property Fear Spreads Beyond Evergrande, Roiling Markets

Mary Pat Campbell

Link: https://finance.yahoo.com/news/hong-kong-stocks-sink-evergrande-023055601.html

Graphic:

Excerpt:

Growing investor angst about China’s real estate crackdown rippled through markets on Monday, adding pressure on Xi Jinping’s government to prevent financial contagion from destabilizing the world’s second-largest economy.

Hong Kong real estate giants including Henderson Land Development Co. suffered the biggest selloff in more than a year as traders speculated China will extend its property clampdown to the financial hub. Intensifying concerns about China Evergrande Group’s debt crisis dragged down everything from bank stocks to Ping An Insurance Group Co. and high-yield dollar bonds. One little-known Chinese property developer plunged 87% before shares were halted.

Hong Kong’s benchmark Hang Seng Index slumped 3.3%, its biggest loss since late July. The selling also spilled over into the Hong Kong dollar, offshore yuan and S&P 500 Index futures. Holiday closures in much of Asia may have exacerbated the volatility, traders said.

…..

“The repercussions from Evergrande’s prospective collapse will likely contribute to China’s ongoing economic deceleration, which in turn anchors global growth and inflation, and casts a pall over commodity prices,” wrote analysts led by Phoenix Kalen, head of emerging-market strategy in London.

Author(s): Catherine Ngai and Ishika Mookerjee

Publication Date: 20 September 2021

Publication Site: Yahoo Finance

Virginia Public Pensions Make a Direct Bet on Cryptocurrencies

Mary Pat Campbell

Link: https://finance.yahoo.com/news/virginia-public-pensions-direct-bet-163646280.html

Excerpt:

The Fairfax County Police Officers Retirement System and Fairfax County Employees’ Retirement System are planning to invest, pending board approvals, a total of $50 million in Parataxis Capital Management LLC’s main fund, which buys various digital tokens and cryptocurrency derivatives.

The outlays come on the heels of the Fairfax funds — which together manage about $7.15 billion — investing several times in Morgan Creek Asset Management funds, and, earlier this year, in crypto venture firm Blockchain Capital. While some of these investments ended up going into coins like Bitcoin, the majority was invested into technology startups, so Fairfax considered them venture-capital investments. Parataxis, with its focus on actual coins, is different.

….

But that same volatility can lead to outsized returns, which have been one reason for Fairfax’s expanded investment. Molnar’s $1.95 billion police retirement fund was planning for 2% exposure to crypto via Morgan Creek and Blockchain Capital, but at the end of June crypto accounted for 7% of assets, due to appreciation, she said. Although Molnar couldn’t discuss exact appreciation, crypto “was not an insignificant contributor to performance” in the second quarter, she said.

Author(s): Olga Kharif

Publication Date: 10 September 2021

Publication Site: Yahoo Finance

SALT Cap Confounds House Democrats Crafting Taxes for Biden Plan

Mary Pat Campbell

Link: https://www.bloomberg.com/news/articles/2021-09-09/salt-cap-confounds-house-democrats-crafting-taxes-for-biden-plan?sref=H58UC22s

Excerpt:

House Democrats continue to search for a way to satisfy lawmakers who want to scrap the deduction limit on state and local taxes without losing progressives wary of a tax cut that would overwhelmingly benefit the wealthy.

The budget blueprint Democrats passed this summer instructs lawmakers to include some form of SALT cap relief in a tax-and-spend plan of up to $3.5 trillion.

A full repeal would be costly and politically difficult to pass with razor-thin margins in both chambers. But a coalition of lawmakers from New York, New Jersey, and other states with high tax rates continue to insist that is what it will take for them to back the legislation.

…..

Suozzi is one of the leaders of the “SALT Caucus”, an alliance of more than 30 lawmakers who want to roll back the $10,000 deduction limit established in the Republican-led 2017 tax law. While they argue that the cap unfairly targets Democrat-dominated states and encourages people to move to Florida and other low-tax states, progressives counter that expanding the deduction shouldn’t be a priority in a social spending bill because the lion’s share of the benefit would go to the wealthy.

…..

That [2019] bill passed the House, but 16 Democrats voted against it, including New York Representative Alexandria Ocasio-Cortez, who has described a full repeal as a “gift to billionaires.” Democratic leadership is dealing with a much narrower majority this Congress and can’t afford to lose that many votes with no Republicans expected to support the reconciliation package.

Author(s): Kaustuv Basu

Publication Date: 9 September 2021

Publication Site: Bloomberg

Behavioral Economics Doesn’t Have to Be a Total Loss

Mary Pat Campbell

Link: https://www.bloomberg.com/opinion/articles/2021-08-27/behavioral-economics-doesn-t-have-to-be-a-total-loss

Excerpt:

Economists are often reminded by well-meaning friends and strangers that economics is flawed for assuming people are rational when they’re not. It’s not always clear what these skeptics mean by rational — often it’s a propensity for making bad decisions. And there’s truth in that.  People struggle to make sense of probabilities, especially in the midst of uncertainty. Just look at the difficulty most people have had understanding the effectiveness of Covid-19 vaccines.

We humans also tend to exaggerate remote risks and ignore more likely events. Even when we accurately assess risk, sometimes we procrastinate doing what’s in our best interest or make snap decisions we regret later.

….

But generally, the idea we could nudge people to make better choices by exploiting their behavioral biases was always oversold. It’s hard to persuade people to do something they don’t want to do, especially when you don’t fully understand their unique motives. And if data isn’t presented clearly and honestly, attempts to nudge people can be self-defeating when they don’t trust you.

Author(s): Allison Schrager

Publication Date: 27 August 2021

Publication Site: Bloomberg

Americans Should Quit Their Jobs More Often

Mary Pat Campbell

Link: https://www.bloomberg.com/opinion/articles/2021-07-07/americans-should-quit-their-jobs-more-often

Excerpt:

The pandemic and the work-from-home environment it spawned also led many economists to speculate that workers would become better adapted to technology, more efficient and strike a healthier balance between work and life. This, in turn, would leave them more mobile. A Microsoft Corp. workplace trends survey found that 40% of Americans are considering leaving their jobs this year. And many are doing just that, with 2.5% of the employed quitting their jobs in May, according to the Bureau of Labor Statistics’  Job Opening and Labor Turnover Survey. Although that’s down from the record 2.8% in April, it’s still higher than any other point since at least before 2001. Plus, consider that the quit rate was only 2.3% in 2019 when unemployment was just 3.6%, compared with 5.8% this May.

Author(s): Allison Schrager

Publication Date: 7 July 2021

Publication Site: Bloomberg

Asian Americans Are Most Vaccinated Group in Majority of States: Covid-19 Tracker

Mary Pat Campbell

Link: https://www.bloomberg.com/graphics/covid-vaccine-tracker-global-distribution/us-vaccine-demographics.html

Graphic:

Excerpt:

At least 65% of Asian people have been vaccinated, on average, in states that Bloomberg is tracking. That compares with 45% of White people with at least one dose, 40% of Hispanics and 34% of Black people. In New Mexico, New York and Washington, more than three-quarters of the Asian population has been covered.

Even as rates slowed, Asians remained the most likely to get newly vaccinated, with an average of more than 5% getting their first dose over the past month compared to 3.5% or less for the other groups.

Author(s): Rachael Dottle, Andre Tartar

Publication Date: 14 July 2021 (last updated)

Publication Site: Bloomberg

Young American Adults Are Dying — and Not Just From Covid

Mary Pat Campbell

Link: https://www.bloomberg.com/opinion/articles/2021-06-18/young-american-adults-are-dying-and-not-just-from-covid

Graphic:

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Excerpt:

The observation that downward mortality trends have reversed in recent years for some groups of Americans is not new. Economists Ann Case and Angus Deaton helped start the discussion with their 2015 paper on rising mortality among middle-aged, non-Hispanic White Americans, and subsequently gave the phenomenon a resonant name: “deaths of despair.” Research has also identified those without college degrees and rural Americans as especially troubled.

In March, a National Academies of Sciences, Engineering, and Medicine committee summed up the current state of knowledge in a 475-page report on “High and Rising Mortality Rates Among Working-Age Adults.” Advances in overall life expectancy stalled in the U.S. after 2010 even while continuing in other wealthy countries, the committee summed up, attributing this mainly to (1) rising mortality due to external causes such as drugs, alcohol and suicide among those aged 25 through 64 and (2) a slowing in declines in deaths from internal causes, chiefly cardiovascular diseases.

Author(s): Justin Fox

Publication Date: 18 June 2021

Publication Site: Bloomberg

Death rates for young American adults rise due to overdoses, traffic accidents

Mary Pat Campbell

Link: https://thepostmillennial.com/death-rates-for-young-american-adults-rise-due-to-overdoses-traffic-accidents

Excerpt:

Those aged 15-to-44 have seen fluctuating mortality rates since the 1950s, deviating from all other age groups that have seen steady decreases over the years. The age group’s mortality rate for the COVID-19 pandemic “pales in comparison” to the 1918 pandemic, according to Bloomberg.

“In March, a National Academies of Sciences, Engineering, and Medicine committee summed up their findings in a report titled ‘High and Rising Mortality Rates Among Working-Age Adults.’ Advances in overall life expectancy stalled in the US after 2010 even while continuing in other wealthy countries, the committee summed up, attributing this mainly to (1) rising mortality due to external causes such as drugs, alcohol and suicide among those aged 25 through 64 and (2) a slowing in declines in deaths from internal causes, chiefly cardiovascular diseases,” wrote Bloomberg.

Author(s): Hannah Nightingale

Publication Date: 18 June 2021

Publication Site: The Post Millennial

Not Even Bond Traders Can Predict the Future

Mary Pat Campbell

Link: https://www.bloomberg.com/opinion/articles/2021-06-18/bond-traders-can-t-predict-inflation-any-better-than-anyone-else

Graphic:

Excerpt:

Historically, bond yields have not been very good at predicting inflation.

In the last 70 years, bond yields rarely rose ahead of inflation, going up only after inflation takes hold.  One study indicated that past inflation trends were a better predictor of bond rates than what future inflation turned out to be.

Does this mean bond traders are wrong? Not necessarily. It may just reflect that inflation is unpredictable and bond traders don’t know any more about the future than the rest of us. All they have is the past data and current prices to make their predictions, too. So when inflation suddenly spikes — as it has in the past — bond traders are as surprised as everyone else.

Author(s): Allison Schrager

Publication Date: 18 June 2021

Publication Site: Bloomberg