Defined Benefits

A dark cloud will be hanging over Boeing Co. when it releases its third-quarter earnings report Wednesday morning and Chief Executive Officer Kelly Ortberg, who has only been in the job since August, presides over his first quarterly conference call with analysts for the storied planemaker.

It is hard to be “the most pro-union president in American history,” as Joe Biden likes to claim, while also leading an effort to “reimagine and rebuild a new economy,” as he has also promised. That’s because these goals are fundamentally incompatible: America’s unions no longer fit the modern economy.

While a strike by East Coast port workers is strangling the flow of goods from Maine to Texas and grabbing headlines, news of machinists at Boeing Co. about to enter their fourth week of picketing near Seattle has receded a bit into the background.

The current approach to investment management has no sound basis and doesn’t work. There is a better way.

Just as the industrial revolution changed the way goods are manufactured and consumed, so the technological revolution will do for services. Once something can be made at scale, the market for it can expand and be segmented. The same goes for financial planning.

At a finance conference in London this summer, four senior investment bankers set about persuading the room that the $1.7-trillion private credit market isn’t a threat to Wall Street. Barely three months later, two of them have jumped ship to seek their fortunes in the upstart asset class.

Buyout heavyweights are increasingly resorting to the old-fashioned way of making money — actually running the companies they’ve bought.

MassMutual Head of Annuity Distribution Matt DiGangi recently sat down with VettaFi to discuss the increasing demand he is seeing for annuities, and how MassMutual has sought to meet client investor needs.

A popular rebuttal of the idea that the US ought to worry about its surging public debt is, “What about Japan?” America’s taxpayers are currently on the hook for 123% of gross domestic product, exceeding the previous record of 118% in the aftermath of the second world war, and the number is going up.

The ERISA Advisory Council is conducting hearings on Qualified Default Investment Alternatives (QDIAs), seeking recommendations for improvements. The big challenge is making better decisions for people who do not want to engage.

Institutional investors, which have traditionally made up private debt’s largest pool of money, are no longer a source of growth for the $1.7 trillion industry.

Here’s a quote attributed to P. J. O’Rourke, an American author, journalist and political satirist: “There is a simple rule here, a rule of legislation, a rule of business, a rule of life: beyond a certain point, complexity is fraud.”

The safest way to ensure retirement security is to match, on a year-by-year basis, future spending needs with a reliable stream of inflation-adjusted income and maturing fixed-income assets. As we’ve already seen, a conventional stock/bond portfolio may not cut that mustard.

Most people see “blockchain” and “funds” in the same sentence and immediately think of pools of money betting on cryptocurrencies like Bitcoin and Ether. That isn’t how Singapore sees the utility of distributed ledgers.

Decisions made by the Treasury get much less attention than those made by the Federal Reserve, but they can be even more consequential for interest rates — and the entire US economy.

Is private equity a problem? To what extent could this class of investment funds, which manages almost $9 trillion worldwide on behalf of everyone from wealthy individuals to California teachers, cause or propagate the next financial crisis?

When two popular trades, such as buying US big tech stocks and selling the Japanese yen, are unraveling at the same time, investors naturally think they are somehow related.

On days like Monday’s dramatic selloff, which capped a three-week loss of $6.4 trillion in global wealth, personal finance experts usually have the same advice for wary retail investors:

Private equity has been in the news frequently in the last few weeks, and not in a good way.

Which financial assets a central bank should buy and sell is hardly a novel question. Historically, the US Federal Reserve has focused on shorter-term Treasury securities, but quantitative easing had the Fed buying mortgage securities and quality commercial paper in significant quantities. More generally, central banks often hold gold and foreign currencies.

A recent Financial Times opinion piece laid out how illiquidity makes private equity hazardous for investors. The Bank of England’s Nathanaël Benjamin warns private equity illiquidity is a systemic risk to the financial system.

With the S&P 500 index up almost 18 percent since the beginning of this year, now may be a good time to check how well your retired or near retired clients’ household assets match up with their expected spending liabilities.

Goldman Sachs Group Inc.’s trading unit powered a surge in earnings in the second quarter.

The clubby world of private credit seems to be running out of space for the little guy.

As Pete Stavros addressed the private equity industry’s yearly shindig in Berlin last month, the KKR & Co. executive’s words were slightly less headline grabbing than those of Apollo Global Management’s co-president Scott Kleinman. But they were just as troubling.

Markets today pose a new existential question: Can there be a bubble in something if it has no price?

Those wishing to explore the gap between the nation’s apparent macroeconomic success and its microeconomic malaise would do well to consult Ruchir Sharma’s What Went Wrong with Capitalism.

A long era of easy profits in private equity is gone, and Goldman Sachs Group Inc. is digging in deeper for the harder work ahead.

Nadeem Meghji was on honeymoon in late 2022 when the biggest storm to have rocked Blackstone Inc.’s property business hit its peak.

When JPMorgan Chase & Co. arranged a series of trades to shift the risk of losses from $20 billion of its loans, some of those dangers wound up at a familiar place: rival banks.

As private equity investment in health care has surged to almost $1 trillion over the past decade — funding new technologies, clinical trials and more — a lack of transparency has made it hard to assess whether the industry is also putting patients at risk.

Institutional investors have grown tired of paying fees to hedge funds for what they see as “skill-less returns.”

Goldman Sachs Group Inc. has put together $21 billion for private credit wagers, its biggest war chest yet for Wall Street’s buzziest asset class.

JPMorgan Chase & Co. is on the hunt to buy a private credit firm to augment its $3.6 trillion asset management arm, as the biggest US bank makes more inroads into Wall Street’s buzziest sector.

The goal that was so theoretical in my 20’s had become a reality in my 60’s. I had become financially independent by investing in real estate.

Idanna Appio spent 15 years at the Federal Reserve Bank of New York analysing the history of sovereign debt crises. Now, as a fund manager at the $138 billion First Eagle Investments, she’s reached a conclusion: US Treasury bonds are too risky to hold.

Shadow banking is back. A constellation of less-regulated intermediaries — from insurers to private investment funds — is increasingly taking on the traditional business of banks, making trillions of dollars in risky loans and occupying a central role in the economy.

High fees are the main reason the Bridgewater fund and the other hedge funds using a risk-parity strategy performed so badly. Their underperformance relative to the 60/40 index portfolio amounted to about three percent annually. Of that three percent about two percent went to fees and other compensation.

When it comes to Bitcoin ETFs, it’s not just the retail trading crowd that’s taking the plunge. It’s now clear that hedge funds, pension funds and banks have also sprinkled capital into the exchange-traded funds after their blockbuster debut that was more than a decade in the making.

The rise of electronic trading and growing popularity of portfolio trading has had an unintended consequence for the US corporate bond market: making private credit even more attractive.

As the market for initial public offerings bounces back after two lifeless years, investors who’ve been impatiently waiting for their payoff are finally getting some returns.

Investors’ hopes for rate cuts this year have faded. The past quarter’s economic data showed that the inflation battle is not over; whether the Fed eases now depends on the data, a point Jerome Powell and the Federal Reserve have repeated ad nauseam.