After a tiny move lower yesterday in stocks the futures market is showing a strong rally this morning with the S&P500 up about 3/4%–tech shares are even stronger as NASDAQ futures are up 1.4% . When these trends are strong there is always a reason to drive prices higher (or lower)–today Micron Technology (MU) is leading the way higher and China has announced large stimulus packages for their economy. As I have mentioned before strong trends tend to move for longer periods of time than one might expect–seldom are the trends reversed instantly.
The 10 year treasury rose by 4 basis points yesterday–now at 3.78%–around 10 basis points higher than when the Fed funds rate was lowered by 50 basis points. This movement is most interesting to watch and as the U.S. Treasury continues to issue massive levels of debt one has to question whether we will see any movement lower on the longer dated government bonds. For certain we will most certainly continue to move the yield curve back into a more normalized pattern.
The strong moves higher in preferreds and baby bonds have taken a pause as prices are level with the close of last week–this particular trend (higher) may be coming to a conclusion, but one never knows. Investors with decent positions in these securities will just have to sit back and collect dividends and interest.
Tomorrow we have the personal consumption expenditures (PCE) numbers. being released. There numbers has the potential to move markets , but only if the report shows inflation movement way out of expectations–and only for a day or so–market trends are likely to continue.
My money market is paying a bit less than a month ago so I think I’ll park my cash in some penny stock REIT debt.
That’ll show them for lowering my Money Market rate. You messed with the wrong pensioner.
NEW TERM PREF
OFS Credit Company, Inc 7.875% Series F Term Preferred Stock Due 2029
Ticker Symbol: OFSCV
CUSIP: 67111Q503
Exchange: OTOTC
I park cash in SACC and TRINL for the last 6 months. With investments like that, I wont need MM for a few more months.
Mr. C I had a partial call of the TRINL but I am not buying more as a substitute for a MM
yesterday’s top pick: SACC at $24.90
(Sachem Capital Corp., 6.875% Notes due 12/30/2024)
YTM around 8.5%
SAFEST and MOST PROFITABLE way to park money for 3 months.
Look at the balance sheet, they have enough money to call and pay the whole BB.
Thanks to Mr. Conservative and Peppino. I picked up some SACC in several accounts.
Are you looking at this balance sheet? https://www.sec.gov/ix?doc=/Archives/edgar/data/1682220/000141057824001401/sach-20240630x10q.htm I’m just asking because I don’t see enough cash to pay 30 million in a redemption.
Jimmy – According to the June 30, 2024 financial report, the company has $10,577,000 in cash and the baby bond is a $30 million dollar issue. The quarterly report looked pretty poor as they had to write down some loans. After expenses and preferred stock dividends, they actually lost money in the quarter due to loan impairments. I have no position in the company, as I’m a little concerned about the quality of their loans. The stock market values the company at 53% of book value, so other investors appear to have concerns as well. Not sure when their loans mature, but it’s possible $30 million could actually mature from July 1 until the baby bond maturity date of November 7th.
kaptain, They have to come up with another 170.5 million in the next three years. They must be planning on a lot of rolling debt like our government. I also don’t have a position and will not have any in the future. Good luck to all that do, it is too risky for me.
if you just look at cash you won’t buy anything.
to repay this BB they can divest some investments or refinance.
ZERO chances to go bankrupt.
Anyway you’ll see it in 3 months.
is this a joke?
Evidently. Look before you leap. So you’re going to possibly earn 8% for three months… Like 42 cents.
You are risking 100 to get 0.43. Does that sound like a deal worth making? While the pfd has held up well, the common is in real danger. Besides a 200mm market cap is too low for many investors. Heck a bunch of 6+ coupons at the TBTF banks only over stripped par by less then 1%. I’d rather sweat a call then sweat principal