Pension Pulse

Alex Rosenberg of CNBC reports, Jeremy Siegel’s bullish call: This is a ‘goldilocks situation’ for stocks : It's no secret that Wharton School finance professor Jeremy Siegel tends to be a market bull. After all, he may be most famous for penning a classic of popular investment literature, "Stocks for the Long Run." But after a 12 percent rally in the past six months, and nearly a tripling of the S&P 500 over the past eight years, it is striking to see how just optimistic Siegel still is about the market . "I actually think we have a Goldilocks situation going on now," he said Thursday on CNBC's " Trading Nation ." "We have everything moving in tandem." For starters, earnings have looked good, Siegel pointed out, adding: "But much more important than that is the maintained or upward guidance for second, third and fourth quarter — something we've not had for years." In prior years, he said, "it's bee...

Janet McFarland and Niall McGee of the Globe and Mail report, Home Capital secures $2-billion lifeline as shares collapse : Shares of beleaguered mortgage lender Home Capital Group Inc. plunged 65 per cent on Wednesday as the company revealed it was negotiating an emergency $2-billion line of credit to shore up its finances after depositors rushed to pull money from their savings accounts. The news shook Bay Street as analysts raised concerns about the company’s viability if investors continue to withdraw more funds from their accounts at Home Capital’s wholly owned financial subsidiary, Home Trust. Home Capital is Canada’s largest alternative mortgage lender, providing subprime loans to people who don’t qualify for traditional bank mortgages . The company relies on deposits to provide the money to make loans . Its financial struggles, which stem in part from a regulatory investigation in Ontario, underscore the pressure that is building in parts of the housing market. ...

Martin Braun of Bloomberg reports, NYC Pensions' Push Into Private Equity Yields Index-Fund Returns : New york City's biggest pensions have invested about $13 billion with private-equity firms in pursuit of large returns. They would have done better with a low-cost stock index fund. The city’s $63 billion teachers’ and $58 billion civil employees’ funds have earned an annualized return of 9.15 percent and 9.1 percent after fees, respectively, on their buyout, venture capital and “special situations” funds since the late 1990s. That’s less than the 9.5 percent they would have earned by putting the money into the Russell 3000 -- the stock-market benchmark the plans expect their private-equity portfolios to beat by 3 percent a year. “We’re more-or-less break even and that’s a disappointing result,” said Scott Evans, chief investment officer of New York City’s pension funds. “What you have here is the mathematics of a very large tail of unproductive funds weighing down pe...

Benefits Canada reports, CPPIB to sell Irish aircraft leasing company : The Canada Pension Plan Investment Board and its co-investors have announced the sale of Dublin-based aircraft leasing company AWAS to Dubai Aerospace Enterprise Ltd. The CPPIB first invested in the company with European private equity firm Terra Firma in 2006. “We are pleased with the outcome of this transaction,” said Ryan Selwood, managing director and head of direct private equity at CPPIB. “We continue to believe that the aircraft leasing industry is a highly attractive market for CPPIB over the long term and look forward to exploring future opportunities to invest in the sector at scale, subject to market conditions.” AWAS leases airplanes to 87 airline customers in more than 45 countries and has assets totalling about $10 billion as of last November. The company owns 214 aircraft with an average age of 5.8 years, and has also ordered 23 new aircraft. In March 2015, AWAS sold 84 aircraft to Macqu...