Aug 14, 2022
Welcome to Bespoke Brunch Reads — a linkfest of the favorite things we read over the past week. The links are mostly market related, but there are some other interesting subjects covered as well. We hope you enjoy the food for thought as a supplement to the research we provide you during the week.
While you’re here, join Bespoke Premium with a 30-day free trial!
Lawmaking
Congress Just Passed a Big Climate Bill. No, Not That One. by Robinson Meyer (The Atlantic)
In addition to the passage of the Inflation Reduction Act this week, Congress passed the CHIPS Act earlier this summer, with as much as one quarter of its $280bn in outlays aimed at accelerating zero-carbon and climate-relevant industries. [Link; soft paywall]
The Sinema-Manchin split that shaped Dems’ deal by Burgess Everett and Marianne Levine (Politico)
A tick-tock recap of the furious dealmaking which allowed Democrats to move their climate and taxation bill through the Senate and in to law with no margin for error. [Link]
Energy
Oil is back on the menu as energy majors return to exploration by Robin Millls (The National News)
While the oil industry capex response to higher prices has been at best tepid so far, there are signs of rising interest in new large-scale projects, including deep offshore exploration. [Link]
The Place With the Most Lithium Is Blowing the Electric-Car Revolution by Ryan Dube (WSJ)
Left wing politics, a history of environmental exploitation, vocal indigenous communities, and booming demand for lithium make the process of extracting it in South America fraught at best as electric vehicle production explodes. [Link; paywall]
China
China Graft Probes Stem From Anger Over Failed Chip Plans (Bloomberg)
An effort to build domestic capacity in semiconductors manufacturing and development has been relatively unsuccessful in China, which has so far failed to keep up with American intellectual property that underpins global chip use. [Link; soft paywall, auto-playing video]
China’s Current Account: A Very Nerdy Investigative Thread by Adam Wolfe (Thread Reader/Twitter)
A detailed dive into why the huge increase in the Chinese goods trade surplus hasn’t led to a similar increase in the country’s current account surplus. [Link]
Investing
RIP Big Bull Market (1982-2022) by Andy Kessler (WSJ)
A history of the massive trend towards capital appreciation dating from the early 1980s which may finally be coming to a close with the end of ever-lower interest rates. [Link; paywall]
Hedge Funds Face SEC Demand To Share More About Their Strategies by Lydia Beyoud (FA Mag)
A new SEC proposal would see a requirement that hedge funds provide regulators with more details about their strategies, which would allow the SEC to better understand risks in the financial system. [Link]
Inflation
The Snowballing US Rental Crisis Is Sparing Nowhere and No One by Maria Paula Mijares Torres and Jonnelle Marte (Bloomberg)
Across the country, rents are soaring far above incomes thanks to low vacancy rates and a dearth of new buildings as well as pandemic-era high demand for housing that hasn’t faded much yet. [Link; soft paywall]
Richer people are eating more at Applebee’s and IHOP by Danielle Winer-Bronner (CNN)
Down-market but still full-service restaurants are seeing improving foot traffic and consumer spend as higher-income consumers trade the steakhouse for a more humble meal. [Link]
Labor Markets
Business Is Booming for Layoff Specialists: ‘Never Seen Anything Like This’ by Maxwell Strachan (Vice)
Tech companies used to ramping up hiring rather than reducing headcount are scrambling for expertise as they look to fire staff that were added as part of over-optimistic expansion plans pre-dating the recent collapse in valuations. [Link]
Iranian charged in alleged plot to kill ex-Trump adviser John Bolton by Ellen Nakashima and Perry Stein (WaPo)
A Justice Department investigation uncovered an Iranian IRGC member attempted to book a $300k hit on Bolton; the suspect is presumed to have fled back to Iran. [Link; soft paywall]
Social Media
Teens, Social Media and Technology 2022 by Emily A. Vogels, Risa Gelles-Watnick, and Navid Massarat (Pew)
Use of Facebook among teens has plunged, with Twitter also down. Instagram and Snapchat are more popular while TikTok is second-place to YouTube; 95% of teens say they’ve used Google’s video site. [Link]
Vaccination
A vaccine for Lyme disease is in its final clinical trial by Bill Chappell (NPR)
As Lyme disease spreads across a greater territory of the US, a vaccine designed to prevent it has entered Phase 3 trials and could be available as soon as 2025. [Link]
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Have a great weekend!
Aug 10, 2022
Searching for ways to better understand the fixed income space or looking for actionable ideas in this asset class? Bespoke’s Fixed Income Weekly provides an update on rates and credit every Wednesday. We start off with a fresh piece of analysis driven by what’s in the headlines or driving the market in a given week. We then provide charts of how US Treasury futures and rates are trading, before moving on to a summary of recent fixed income ETF performance, short-term interest rates including money market funds, and a trade idea. We summarize changes and recent developments for a variety of yield curves (UST, bund, Eurodollar, US breakeven inflation and Bespoke’s Global Yield Curve) before finishing with a review of recent UST yield curve changes, spread changes for major credit products and international bonds, and 1 year return profiles for a cross section of the fixed income world.
In this week’s report we look at the explosive market reaction to CPI this morning.
Our Fixed Income Weekly helps investors stay on top of fixed income markets and gain new perspective on the developments in interest rates. You can sign up for a Bespoke research trial below to see this week’s report and everything else Bespoke publishes free for the next two weeks!
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Aug 7, 2022
Welcome to Bespoke Brunch Reads — a linkfest of the favorite things we read over the past week. The links are mostly market related, but there are some other interesting subjects covered as well. We hope you enjoy the food for thought as a supplement to the research we provide you during the week.
While you’re here, join Bespoke Premium with a 30-day free trial!
Institutional Investors
Virginia pension fund invests in crypto lending in bid to boost returns
A county pension fund is trying its hand at crypto yield farming despite high profile catastrophes in the space over the past six months, operating under an impressively self-assured “blood in the streets” thesis. [Link; paywall]
SoftBank Emerges as a Big Loser of the Tech Downturn. Again. by Eliot Brown (WSJ)
It won’t surprise anyone that the investor who was mad position sizes were far too small as market surged ended up one of the biggest bagholders in the subsequent market crash and bear market. [Link; paywall]
‘Real” Estate
The Metaverse Real Estate Boom Turns Into a Bust by Aidan Ryan (The Information)
The surge in prices for property positioned in the metaverse that came as the strange concept rolled out has led to a massive bust amidst collapsing prices for everything from crypto to tech to semiconductors. [Link; payroll]
What Remote Work Debate? They’ve Been Back at the Office for a While. by Emma Goldberg (NYT)
After more uniform work-from-home policies during the pandemic, smaller cities have retreated to the office at full speed while larger metros debate the pros and cons of remote work. [Link; soft paywall]
Energy Prices
Oh, poor thing: Yacht owners moan they’re getting hit by stubbornly high diesel prices by Lydia Moynihan (NYP)
Yachts are famous gas guzzlers, swallowing vast quantities of diesel every time they leave the dock. Large yachts around 70 feet can burn over 100 gallons per hour just idling their engines. [Link]
Europe’s energy crisis: Controversy as Spain bans air conditioning from dropping below 27°C by Laura Llach (Euronews)
Even air conditioned buildings in the stifling heat of Spain offer less relief than normal thanks to EU-wide efforts to reduce natural gas consumption amidst a crunch in Russian supplies. [Link]
Natural Gas Surges With US LNG Export Terminal Set for Fast Restart by Gerson Freitas Jr, Sergio Chapa, and Diana Li (Bloomberg)
The US LNG terminal that suddenly shut down this summer and took billions of cubic feet of export capacity with it will reopen substantially sooner than estimated, ramping up output as soon as this October. [Link; soft paywall]
Power Companies Enter Peak Hurricane Season Lacking Enough Transformers by Jennifer Hiller and Katherine Blunt (WSJ)
Hurricane season regularly knocks out hundreds or thousands of electricity transformers across the country. But supply chain problems and booming demand for electrical equipment mean an under-inventoried utility network as the storms approach. [Link; paywall]
Education
Kids Are Back in Classrooms and Laptops Are Still Spying on Them by Pia Ceres (Wired)
Student monitoring software is a widespread feature of remote learning, with some terrifying side effects that spyware reading student texts on devices that have nothing to do with school work. [Link; soft paywall]
Jurisprudence
The most pro-business Supreme Court ever by Felix Salmon (Axios)
More than 80% of the decisions that the US Supreme Court made during 2020 came down on the side of business, the most of any year since at least 1921 per a new paper. [Link]
When Pigs Either Die or Fly
Scientists Revive Cells in Pigs’ Organs After Death by Amy Dockser Marcus (WSJ)
A paper published this week established cell function an hour after death in some pig organs, a possible lesson for safely harvesting human organs from donors in the future. [Link; paywall]
Air traffic controllers say co-pilot ‘jumped’ from plane (AP/MSN)
In North Carolina, a cargo plane with damaged landing gear made an emergency landing but not before the co-pilot jumped from the aircraft; he did not survive the fall into a suburban backyard. [Link]
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Have a great weekend!
