Investment Management

Rates and Banks The 20 and 30-year treasury rates are now a hair under 5%, the highest level in 15+ years. TLT is the ETF that tracks the performance of the long-duration treasury bond market. It’s a decent proxy to see the impact of these rate hikes on current outstanding treasury assets. Treasury assets and long-duration bonds have a market…

Not Quite Austerity The Fed meeting yesterday left interest rates unchanged at 5.25-5.5%. Two more meetings in 2023 are scheduled for November 1st and December 13th. The most likely outcome is that we won’t have any more rate hikes, and the difference between another pause and another hike is marginal. More remarkable is that long-duration treasuries are now at or…

Google getting competitive I’ve wondered for years why Google didn’t continue to add basic features to their most popular products like Google Docs, Calendar or Chat systems. It could be to avoid feature bloat or to focus only on the highest-priority opportunities. It’s not like they didn’t have the capital or the talent to add features. Still, they ignored particular…

Osbon Capital launched in 2006 as an index boutique focused on ETFs and the emerging index strategy. At that time, Vanguard had just passed $1 trillion in assets under management and indexing and ETFs were still a relatively young concept. ETFs held just $300B in total assets at the time, and John had the foresight to predict that index ETFs…

Urban Housing and Inflation This week, I wanted to address the housing component of the inflation calculation. Shelter represents roughly 35% of CPI inflation metrics and 20% of the core PCE inflation. Shelter is the slowest metric to change as landlords can often afford to be patient, and 12-month leases take time to roll over. Owner occupancy (people who own…

Interest Expense I’m not sure this story is going to get the coverage it deserves, especially as the election news begins to dominate news cycles over the next 18+ months. The US government’s interest expense has reached a $1 trillion annual run rate. This is the interest paid on Treasury securities. You can keep track of the reported figure here….

Rents Softening + Global Inflation Issues The SF Fed recently produced a study on the potential for rent inflation to slow and even possibly turn negative by next year. Real estate owners are patient by nature and rents/shelter have been some of the slowest moving inflation metrics. Shelter represents around 40% of the official inflation statistics (CPI), so any movement…

LK99 is the new buzzword I hesitate to write about this because it’s an unproven technology and, therefore, will not impact markets if it does not live up to its promise. However, I’ve found in conversations over the last week that while it’s an extremely popular topic in some circles, it’s still not quite made it out in the mainstream,…