Our site runs on donations to keep it running for free. Please consider donating if you enjoy your experience here!

PPI Comes In Soft

We have a bit of a party going on in common and preferred shares as the producer price index (PPI) comes in soft at up .2% half the .4% expected. Obviously this is very good news, but with the CPI we now have 2 data points—-2. I think we may be heading to just a 1/2% rate hike in December–or even 1/4% if the November data being released just before the December FOMC meeting comes in reasonable.

The S&P500 is up just shy of 2%, while the 10 year treasury is around 3.78%—down 8 basis points.

I will do nothing unusual today – may nibble a bit on an issue or two, but ready cash is minimal so won’t do too much. To do much I would need to rearrange my t-bills etc and I am less than certain that now is the time to go crazy.

5 thoughts on “PPI Comes In Soft”

  1. i wonder if we are close to peak interest rates (a big if) maybe it’s time to do more nibbling on preferred’s that are down a ton
    not that they will rise much but maybe the downside is getting a little more limited?
    just pondering

  2. BAC is offering to buy pfds. P and M at $17 and $22. Why would I do that.
    Callable at $25. Are they in trouble? I don’t get it.

      1. Thanks Tim. On the cheap is right. I would never sell them that low,
        BAC seem like good pfds. Thanks for your reply. Very helpful.

        1. BAC is giving their view of the market & where rates are. I think their tender for each issue gives a current yield of 6.15%.
          The issues are callable at $25, as you say, but that will be years away..if ever.
          it’s a fair tender in my opinion – reflects current market conditions & provides a nice gain for anyone who scooped them up a month+ ago.

Leave a Reply

Your email address will not be published. Required fields are marked *