Monday Morning Kickoff

It has been a true rarity in the last year that the S&P500 falls by more than 1% in a week. With a fall of about 1.9% last week I am waiting for the buying to come back in – I suspect shortly we will see a bounce back in stock prices-there is too much cash with no place to go.

Interest rates (as measured by the 10 year treasury) rose to as high as 1.59% last week before closing at the week’s low of 1.45% In spite of some straight shooting from various Fed officials rates continue lower. I suspect this will change in the next couple of months as potential treasury buyers are likely to demand a higher coupon if the Federal Reserve is going to taper asset purchases (reduce demand).

The Federal Reserve balance sheet grew by $17 billion last week. A new record high balance sheet—forever higher.

Last week the average $25 preferred and baby bond barely moved at all–down 1 cent. Investment grade issues rose 1 cent, banks rose 6 cents and mREIT preferreds fell a penny.

Last week we had 3 new income issues price.

Tiny REIT Presidio Property Trust (SQFT) sold a new issue of 9.375% cumulative preferred stock. The issue is trading on the NASDAQ now and last traded at $24.44.

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Serial term preferred stock issuer Priority Income Fund (not publicly traded) priced a new term preferred with a coupon of 6.125%. The issue is trading on the OTC grey market right now under ticker PRIIP and closed on Friday at $24.98

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Lastly Great Elm Capital Corporation (GECC) finally priced a new issue of notes with a coupon of 5.875%. Being debt there is no OTC grey market trading and to my knowledge this issue has not yet traded.

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One thought on “Monday Morning Kickoff”

  1. Did the Plunge Protection Team just spring into action? Futures 500 points up from the low. Biden called an emergency meeting with powell Yellen and Gensler.

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