1 min readI understand that not all recipients of our monthly newsletter would have been affected by the meltdown of the auction rate securities market; however, the structure of the recent broker-dealer/SEC settlements may pique the interest of many corporate treasurers. Of specific interest to us is the manner in which institutional investors have been largely left…
3 min readExecutive Summary Institutional cash investors continue to face uncertainties and difficult choices in ultimately obtaining liquidity despite the latest liquidity announcements. Interests of institutional investors have taken a back seat in these settlements. The distinction between retail and institutional investors seems arbitrary and illogical. To avoid their own reputational risk, we think that the secondary…
1 min readIn real estate investing, we all know the old adage is location, location, location. And, as an extension, the three most important factors we’re looking to for signs of stabilization in the credit market are housing, housing, housing. Over the past 12 months we have seen national home prices plummet 15.5%, existing home sales decline…
3 min readIntroduction In a move to restore confidence in the U.S. mortgage market, President George W. Bush signed into law on July 30th, a housing rescue bill that includes a provision for the U.S. Treasury Secretary to inject capital into Government Sponsored Enterprises (GSEs) through direct stock or debt purchases.. The birth of the so called…
1 min readIn light of the difficult credit market of late and the recent emergence of a small yet hopeful glow at the end of the tunnel, this month we wanted to cover a topic that can help with a question that may be on the mind of many corporate treasurers: How do we get back on…
1 min readNow for some good news…. Indicators of a recovering credit and liquidity environment have emerged significantly over the last month. The TED spread (3-Moth LIBOR vs. Treasuries) continued to narrow to 79 basis points, while a continued sell-off in treasuries contributed to a stronger upward bias in the Fed Funds futures contract. These indications, along…
1 min readNow well into our 18th year of working with treasury managers across the country, it’s as clear as ever that managing risk remains one of the least understood and most challenging areas of corporate cash management. The treasury landscape is littered with painful examples of write-downs from highly rated securities whose risk was miscalculated, misunderstood,…
2 min readNow into our 18th year of working with treasury managers across the country, it’s as clear as ever that managing risk remains one of the least understood and most challenging areas of corporate cash management. The treasury landscape is littered with painful examples of write-downs from highly rated securities whose risk was miscalculated, misunderstood, or…
3 min readExecutive Summary Prior to the recent credit crisis, strong criticism of money market funds taking on too much risk could easily have been dismissed as fear mongering. With strong (but now dubious) triple-A credit ratings, constant $1 per share prices, daily liquidity, strong brand recognition, and deep-pocketed parents, what was not to like about money…
2 min readI tend to liken the liquidity crisis to a hurricane that has hit the financial industry. Bear Stearns was swept away during the worst of the storm and now, as the weather subsides a bit, some treasurers are beginning to emerge from their shelters to assess the damage; what held fast and what may never…