On Wednesday I bought a small amount of the Lincoln Financial Group 9% non cumulative preferred stock (LNC-D) which was an add to my modest holdings in this issue. This purchase was executed off a good-til-cancelled buy order which was entered a few weeks back–then it moves a little lower–might have to buy a little more. Within the last month the issue has traded as high as $29–now at $24.58. It is kind of early to be jumping into most banking and insurance issues in a major way. Honestly I see so many ‘potential’ buys in the various issues it is difficult to hold back on buying–but I’m going to try to restrain myself for a few more days–but if one doesn’t ‘hold their nose’ and do a little buying it is highly likely a giant opportunity will be missed. With my CD and Treasury buckets full I need to step in a little bit.
Equities are tumbling a bit this morning – down almost 1%, while treasury yields are plunging—the 10 year now at 3.29%—incredible ‘rush to safety’ amid global banking concerns–now with Deutsche Bank potentially having problems. This bank, along with Credit Suisse, have been problems since was back in 2007-2010 so I guess we shouldn’t be surprised. Regardless this issue has a long, long way to run.
I see the Fed balance sheet rose around $100 billion in the last week–add this to the $300 billion rise from the previous week we see the balance sheet back up to round $8.8 trillion which is now just below the record high of about $9 trillion. Any thought on this ever reaching 0 in our lifetime should be forgotten about – it will never happen. Honestly the $400 billion increase in the last 2 weeks is lower than I would have guessed it would be as banks rushed to borrow on their depreciated assets–so maybe that is the bright side. We don’t know which banks have borrowed from the Fed – this data will not be announced until 2 years after the start of the program, although one can figure it out in the future by going through banking financial statements.
Well let’s get the day rolling and see where we go heading into the weekend.