Author: Mary Pat Campbell

The Fatuous Uproar About Robinhood and GameStop

Mary Pat Campbell
The Fatuous Uproar About Robinhood and GameStop

Excerpt:

First, the spectacle of the Senate wasting its time, in the middle of a pandemic, on some trading junkies maybe having not made as much money as they felt entitled to, is pathetic. It shows how warped the priorities of our putative elites are. This is secondary market trading in one bloody stock. Secondary market trading is societally unproductive (more on that shortly) and should be discouraged by increasing transaction costs (this is one of the big reasons to push for a financial transactions tax, not for revenue purposes, although that’s a nice side bennie, but to shrink the financial casinos).

The company is unimportant. The parties on both sides are competitors in a beauty contest between Cinderella’s ugly sisters: clueless new gen day traders versus clumsy shorts, many of whom look inept at the basic survival requirement of managing trading risk. And as we’ll address in due course, the real bad guy, the SEC for promoting such a socially unproductive market, has yet to receive the criticism it deserves. It’s simply bizarre that cheap market liquidity is being treated as some sort of right.

The focus has been the traders on Robinhood, a free trading platform, although some of the bigger low-cost services also had some trading halts in GameStop. These punters are surprised that a free service might not give them the best, or any execution in a bad market? Did they not work out that they were the product and having their order flow to Citadel might not be a great position to put themselves in?1 Or as Financial Times reader AM put it:

Author(s): Yves Smith

Publication Date: 29 January 2021

Publication Site: naked capitalism

How the Federal Reserve’s Actions and Low Interest Rates Impact Public and Private Retirement Savings

Mary Pat Campbell
How the Federal Reserve’s Actions and Low Interest Rates Impact Public and Private Retirement Savings

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Excerpt:

The extended period of low interest rates we’re in is not only creating challenges for public pension systems across the nation, but it is also negatively impacting people who are relying on their own savings to fund their retirements.

A common strategy for generating retirement income is to invest savings from an individual retirement account (IRA) or 401(k) into income-producing assets such as corporate bonds. But interest rates on corporate bonds have been falling in recent decades, reaching multi-decade lows in 2020.

Author(s): Marc Joffe

Publication Date: 20 January 2021

Publication Site: Reason

Is the GameStop Saga Really an Army of Investing “Davids” vs Hedge Fund “Goliaths”?

Mary Pat Campbell

Link: https://legalinsurrection.com/2021/02/is-the-gamestop-saga-really-an-army-of-investing-davids-vs-hedge-fund-goliaths/

Excerpt:

Understandably, many Americans would like to push back against Wall Street and enjoy fiscal karma. I know I am and tempted to purchase one share.

However, there are likely to be real market consequences for participating in this “short squeeze.”

Author: Leslie Eastman

Publication Date: 1 February 2021

Publication Site: Legal Insurrection

Your Regulator Overseers

Mary Pat Campbell

Link: http://pointsandfigures.com/2021/01/31/your-regulator-overseers/

Excerpt:

As you know, Congress oversees the bureaucracy.  It’s agencies, the unelected bureaucrats that make a lot of the regulations that affect our lives.  Colloquially, you might know this as a part of The Deep State.  The Senate Banking Committee and the House Financial Services Committee oversee the Securities and Exchange Commission (SEC).

The GameStop saga has laid a lot of things bare.  But one thing that needs pointing out is that most of the people on those committees have no clue how the entire financial system as it pertains to exchanges and markets works.  I am not impugning the personal characters of the Senators and House members on the committees.  In 99.9% of the cases they are decent and intelligent people. What I am saying is most of them have no clue when it comes to understanding the industry they are charged with overseeing.   It is rare when you find an elected official that really and truly understands.  Not rare like a four leaf clover rare. Rare like seeing a tiger in the wild rare.

I am not talking about trading markets either as plenty of elected congresspeople seem to know how a brokerage account works. I am talking about understanding the mechanics and plumbing, and truly understanding.

Author(s): Jeffrey Carter

Publication Date: 31 January 2021

Publication Site: Points and Figures

Ohio has underreported coronavirus deaths by 4,000, state discloses

Mary Pat Campbell

Link: https://www.toledoblade.com/local/Coronavirus/2021/02/10/ohio-new-coronavirus-cases-still-below-average/stories/20210210105

Excerpt:

Ohio reported 3,281 new coronavirus cases Wednesday, which is below the 21-day average of 4,105, while also disclosing that statistics from late last year appeared to have underreported coronavirus deaths by as many as 4,000 people.

The state has reached a total of 928,631 cases and 11,856 deaths, according to the Ohio Department of Health. Sixty-three of those deaths were reported Wednesday, which is below the 21-day average of 69.

But that death toll does not yet include deaths from October, November, and December that were omitted and “will be added to the state’s death count during the coming week,” the health department said in a statement.

Publication Date: 10 February 2021

Publication Site: Toledo Blade

NY Hedge Fund Founder Admits To Fraud In Connection With Neiman Marcus Bankruptcy

Mary Pat Campbell

Link: https://dailyvoice.com/new-york/northsalem/news/ny-hedge-fund-founder-admits-to-fraud-in-connection-with-neiman-marcus-bankruptcy/802716/

Excerpt:

A hedge fund founder admitted to bankruptcy fraud for abusing his position on a Neiman Marcus Group Inc. bankruptcy committee to purchase securities at a deflated price.

Nassau County resident Daniel Kamensky, of Roslyn, the founder of the New York-based hedge fund Marble Ridge Capital pleaded guilty to pressuring a rival bidder to abandon its higher bid for assets in connection with Neiman Marcus’s bankruptcy proceedings.

U.S. Attorney Audrey Strauss said that Kamensky was the principal of Marble Ridgewhich had assets under management of more than $1 billion that invested in securities in distressed situations, including bankruptcies. Prior to opening Marble Ridge, Kamensky worked for many years as a bankruptcy attorney at a well-known international law firm, and as a distressed debt investor at prominent financial institutions.

Author(s): Zak Failla

Publication Date: 7 February 2021

Publication Site: Daily Voice

COVID-19: Weather Has Big Impact On Virus Spread, Study Finds

Mary Pat Campbell

Link: https://dailyvoice.com/new-york/northsalem/news/covid-19-weather-has-big-impact-on-virus-spread-study-finds/802724/

Excerpt:

A new study published in the Physics of Fluids found that the spread of airborne viruses, such as COVID-19, is very much affected by the weather.

As temperatures rise and humidity falls, the study’s authors, from the University of Nicosia in Cyprus, said they expect another improvement in COVID-19 infection rates.

….

Applying this theory, they found that COVID-19 transmission rates varied in the northern and southern hemispheres depending on the time of year, thus pointing to a weather dependence.

Typical disease transmission studies only consider transmission and recovery rates, the study noted. Researchers argued that weather and climate – temperature, relative humidity, and wind speed – should also be factored into predicting how the virus will spread.

Author(s): Kristin Palpini

Publication Date: 7 February 2021

Publication Site: Daily Voice

The Crazy World of Stonks Explained

Mary Pat Campbell
The Crazy World of Stonks Explained

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Excerpt:

Gamestop’s stock has been on a wild roller coaster ride, rising by roughly 640% from the start of last week to its peak. After Robinhood and other brokers initializing trading restrictions due to the heightened market activity, the stock has since fallen more than 80% to $90 per share.

But the stock’s volatile price action doesn’t come close to telling the story of how this market frenzy began on the Reddit community r/wallstreetbets, the hedge funds that suffered when GameStop share price rose dramatically, and why Robinhood halted trading last week.

Author(s): Niccolo Conte

Publication Date: 2 February 2021

Publication Site: Visual Capitalist

Bipartisan Agreement AKA Multiemployer Pension Bailout

Mary Pat Campbell
Bipartisan Agreement AKA Multiemployer Pension Bailout

Excerpt:

Two years ago retired coal miners traveled to Washington, D.C. to lobby lawmakers to put in place a federal safety net in case the United Mine Workers of America (UMWA) pension fund fails. Coal plant closures and company bankruptcies have sent the pension fund to the edge of collapse. In October, 2019 Murray Energy, the last major company propping up the dwindling fund, also went bankrupt and the prediction was insolvency in FY23.

From their 5500 form for the year ended 6/30/19 confirming the timeline.

Author(s): John Bury

Publication Date: 2 February 2021

Publication Site: Burypensions

Rhode Island Pension Fund Beats Benchmark with 11.9% Return in 2020

Mary Pat Campbell

Link: https://www.ai-cio.com/news/rhode-island-pension-fund-beats-benchmark-11-9-return-2020/

Excerpt:

Rhode Island’s state pension fund rallied at the end of last year, gaining close to $900 million during November and December alone, to end the year up 11.9% net of fees with a record high asset value of just under $9.5 billion.

The record was set just a month after the Rhode Island Pension Fund surpassed the $9 billion threshold for the first time. The fund gained $303 million in December and nearly $573 million in November. The fund outperformed its benchmark, which returned 11.5% for the year, but underperformed a portfolio comprised of 60% stocks and 40% bonds, which returned 13.5%. The program’s annual assumed rate of return is 7%.  

Author(s): Michael Katz

Publication Date: 4 February 2021

Publication Site: ai-CIO

MassMutual Under Investigation Over ‘Roaring Kitty’

Mary Pat Campbell

Link: https://www.thinkadvisor.com/2021/02/04/state-regulator-probing-roaring-kitty-massmutual/

Excerpt:

Massachusetts’ top securities regulator, William Galvin, is looking into the actions of Keith Patrick Gill, the former MassMutual broker who played a key role in the trading frenzy surrounding video game retailer GameStop and other stock last week.

Gill is the person behind the Roaring Kitty YouTube streams that, combined with a string of posts by Reddit user DeepF***ingValue, drove a sudden increase in GameStop stock trading, slamming hedge funds that had bet against the struggling retailer.

“I can confirm our Securities Division sent an inquiry to MassMutual last Friday asking about Mr. Gill’s status,” a spokesperson for Galvin told ThinkAdvisor on Thursday.

Author(s): Jeff Berman

Publication Date: 4 February 2021

Publication Site: Think Advisor

COVID-19 Numbers Continue to Look Better

Mary Pat Campbell

Link: https://www.thinkadvisor.com/2021/02/04/covid-19-numbers-continue-to-look-better/

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Excerpt:

The top federal COVID-19 tracking team says key pandemic intensity indicators improved last week.

The U.S. death rate increased slightly, but the number of new cases fell, and the percentage of people tested who actually had the virus that causes COVID-19 also fell, according to the White House COVID-19 Team Data Strategy and Execution Workgroup.

Author(s): Allison Bell

Publication Date: 4 February 2021

Publication Site: Think Advisor