Showing posts from October, 2020

Another Stock Market Crash Looming?

Fred Imbert and Yun Li of CNBC report the Dow closes more than 150 points lower as Wall Street posts its worst one-week sell-off since March: Stocks fell on Friday, led by major tech shares, as Wall Street wrapped up a difficult week in which coronavirus cases rose, U.S. fiscal stimulus talks broke down and traders braced for next week’s presidential election. The Dow Jones Industrial Average closed 157.51 points lower, or 0.6%, at 26,501.60. At one point, the Dow was down more than 500 points. The S&P 500 dropped 1.2% to 3,269.96 and the Nasdaq Composite pulled back 2.5% to 10,911.59. The Dow and S&P 500 fell 6.5% and 5.6%, respectively, and posted their biggest weekly losses since March. The Nasdaq lost more than 5% over that time period and also had its worst one-week performance since March. Those weekly losses came as the seven-day average of new coronavirus cases in the U.S. hit an all-time high this week , according to data from Johns Hopkins University. In Europ

Total Fund Management Part 3: When All Roads Lead to Rome

This is Part 3 of a seven part series on integrated Total Fund Management brought to you by Mihail Garchev, the former head of Total Fund Management at BCI and I. Please take the time to read Mihail's synopsis below followed by my comments and a clip where delves deeply into today's comment (added emphasis is mine, also slightly edited this version): Before we continue with Episode 3 today, let us take a minute and quickly look at the summary takeaways from Episode 2 last week or "what nobody told you about long term investing." We started Episode 2, challenging the notion that long-term investing is about the horizon. And what we concluded was that long-term investing is not only about the horizon but about wealth maximization. Then the natural question was, "how one maximizes wealth." And we looked at how prices, cash flows and reinvestment drive wealth maximization. Although it is commonly accepted that a long horizon's final wealth is driven mo

The Future of Institutional Investing in Canada

Today, the Ontario Chamber of Commerce (OCC) brought together the heads of three major Canadian pensions to discuss the future of institutional investing in Canada. The panelists included Blake Hutcheson, President and Chief Executive Officer, OMERS, Jo Taylor, President and Chief Executive Officer, Ontario Teachers’ Pension Plan and Jeff Wendling, President and Chief Executive Officer, Healthcare of Ontario Pension Plan. The moderator was Amber Kanwar, a well-known BNN Bloomberg anchor and reporter appearing on The Open and The Disruptors who took time off her maternity leave to moderate this panel. She did a great job, asking many good questions.  Was this panel discussion worth the $75 plus tax I paid to watch? Yes, any time you get Blake Hutcheson, Jo Taylor and Jeff Wendling in a discussion, you'd be an idiot not to pay to watch what they have to say. Having said this, my own feeling is there should be a standard price for these web events, say never more than $50 flat (inc

A Secular Shift in Real Estate?

Weizhen Tan of CNBC reports banks may have to brace for heavy losses as commercial property prices plunge: Commercial real estate prices have plunged this year as people stopped going into offices, and retail businesses were disrupted. That could lead to a significant amount of losses for banks, according to a recent report. In previous downturns, commercial property loan losses were “heavy” and there are worrying signs that such a trend could be repeated this time during the coronavirus-induced slowdown, Oxford Economics’ Adam Slater said in a report. In a worst-case scenario, Slater said these loan losses would “materially erode” bank capital. “Large (commercial real estate) price declines generally translate into big losses for banks. Write-offs of (commercial real estate) loans made a big contribution to overall bank losses in the last two major downturns,” wrote Slater, an economist at the firm. During the 2008 great financial crisis, for example, such loan losses accoun