TXPR closed at 567.37, down 0.51% on the day. Volume today was 1.50-million, third-highest of the past 21 trading days.
CPD closed at 11.27, down 0.35% on the day. Volume was 93,900, above the median of the past 21 trading days.
ZPR closed at 9.39, down 0.42% on the day. Volume was 247,320, second-highest of the past 21 trading days.
Five-year Canada yields were at 3.59% today.
Life wasn’t exactly rosy in other markets, which the pundits attribute to Powell’s testimony to Congress:
Of Wall Street’s three major indexes, the Dow Jones Industrial Average lost most ground with a 1.7% decline, while the S&P 500 fell 1.5% and the Nasdaq Composite lost almost 1.3%. The S&P/TSX Composite Index lost 1.2%.
Powell sent stock investors fleeing when he told U.S. lawmakers earlier in the day that the Fed is prepared to hike rates in larger steps if future economic data suggests tougher measures are needed to control rising prices.
The remarks followed recent data showing an unexpected inflation increase in January and an unusually large jobs gain for the month.
Traders dramatically raised their bets for a 50-basis-point rate hike in March after Powell’s comments, with money market futures last pricing in a more than 70% chance of such a move, up from around 31% on Monday, according to CME Group’s FedWatch tool.
…
The Dow Jones Industrial Average fell 574.98 points to 32,856.46; the S&P 500 lost 62.05 points to 3,986.37; and the Nasdaq Composite dropped 145.40 points to 11,530.33.All 11 major S&P sectors closed lower, led by economically sensitive financials which finished down 2.5%. Declining least was the consumer staples index, down 0.97%.
…
Meanwhile, the yield on two-year Treasury notes, which best reflects short-term rate expectations, hit 5% for the first time since July 2007.
…
The Toronto Stock Exchange’s S&P/TSX composite index ended down 239.26 points at 20,275.54, its lowest closing level since last Wednesday
Mr. Powell, in remarks before the Senate Banking Committee, also noted that the Fed’s fight against inflation was “very likely” to come at some cost to the labor market.
His comments were the clearest acknowledgment yet that recent reports showing inflation remains stubborn and the job market remains resilient are likely to shake up the policy trajectory for America’s central bank.
…
But a number of recent economic reports have suggested that inflation did not weaken as much as expected last year and remained faster than expected in January, while other data showed hiring remains strong and consumer spending picked up at the start of the year.While some of that momentum could have owed to mild January weather — conditions allowed for shopping trips and construction — Mr. Powell said the unexpected strength would probably require a stronger policy response from the Fed.
“The process of getting inflation back down to 2 percent has a long way to go and is likely to be bumpy,” he told the committee. “The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated.”
Fed officials projected in December that rates would rise to a peak of 5 to 5.25 percent, with a few penciling in a slightly higher 5.25 to 5.5 percent. Mr. Powell suggested that the peak rate would need to be adjusted by more than that, without specifying how much more.
The Boston Fed has released a “Current Policy Perspective” by John Sabelhaus and Jeffrey P. Thompson titled “The Limited Role of Intergenerational Transfers for Understanding Racial Wealth Disparities”:
Transfers of wealth between generations—whether through inheritances or inter vivos gifts—are less important in explaining racial disparities in wealth than might be expected. While this factor looms large in the media’s discussions of racial inequality, it explains relatively little of the disparities evident in the data. One reason is that most people, regardless of race, receive no inheritance or other transfer of substantial value. In addition, most recipients of inheritances ultimately consume those bequests and do not plan to leave substantial gifts to their offspring. Further, the assets that account for a large majority of most households’ wealth (employment-based retirement plans and home equity) are not inherited and accumulate slowly over families’ working lives.
Using nonparametric decomposition techniques, we show that intergenerational transfers explain only a modest portion of disparities between white and non-white families. This finding is consistent with prior research, but we improve upon the existing literature in a variety of ways, including augmenting the wealth measure in the Survey of Consumer Finances to account for the value of defined benefit pensions, adding controls for lifetime earnings and the availability and generosity of employer-provided pensions, and capturing some inheritances and inter vivos transfers that are not typically reflected in most studies. When no other controls are included, we find that differences in intergenerational transfers account for 13 to 16 percent of white/non-white private wealth gaps. When we control for lifetime earnings, workplace pensions, and a handful of additional human capital variables, the marginal contribution of intergenerational transfers shrinks considerably, but the combined portion of the racial wealth gap that is explained rises to 80 to 90 percent. Policymakers interested in helping households build wealth are advised to look to ways that would enable them to boost the earnings that they receive over their lifetime.
The Canadian Securities Administrators are touting a software update for SEDAR. I have sent them an eMail with a question:
I understand that improvements to SEDAR “will produce better data for all stakeholders, so that analysts, investors, governments, academics and others can easily access and analyze robust data from the system to gain deeper insights into the state of the Canadian capital markets.” ( https://www.securities-administrators.ca/about-sedar/sedar-frequently-asked-questions/ )
Will the new system allow direct linking to any specific document at will by any of these analysts, investors, governments, academics and others without the necessity of obtaining written permission? Will access to an API make it possible for these users to devise their own search and download routines?
Please advise.
Sincerely,
Feel free to send them an eMail of your own!
The IMF has published an article by MARKUS BRUNNERMEIER titled RETHINKING MONETARY POLICY IN A CHANGING WORLD:
Although financial stability remains an important concern, there are important differences between the current environment and the one that followed the global financial crisis:
- Public debt is now high, so any interest rate increase to fend off inflation threats makes servicing the debt more expensive—with immediate and large adverse fiscal implications for the government. Since the beginning of the COVID-19 crisis in early 2020, it is also evident that fiscal policy can be a significant driver of inflation.
- Instead of deflationary pressures, most countries are experiencing excessive inflation. That means there is now a clear trade-off between a monetary policy that tries to reduce aggregate demand by raising interest rates and one that aims to ensure financial stability.
- The nature and frequency of shocks have changed. Historically shocks were mostly from increases or decreases in demand—with the prominent exception of the supply shocks during the so-called stagflation of the 1970s. Now there are many shocks: demand vs. supply, specific risks vs. systemic risks, transitory vs. permanent. It is difficult to identify the true nature of these shocks in time to respond. Central bankers need to be more humble.
The low interest rates and less extreme public debt levels that prevailed after the global crisis permitted central banks to ignore what were then relatively inconsequential interactions between monetary and fiscal policy. The period following the 2008 crisis was one of monetary dominance—that is, central banks could freely set interest rates and pursue their objectives independent of fiscal policy.
…
A key question for policy is what determines the winner of any contest between fiscal and monetary dominance. Legal guarantees of central bank independence are insufficient, by themselves, to guarantee monetary dominance: legislatures can threaten to change laws and international treaties can be ignored, which could cause a central bank to hold off its preferred policy. To promote monetary dominance, the central bank must remain well capitalized: if it requires frequent recapitalization from the government, the central bank looks weak and risks losing public support. Central banks with large balance sheets that contain many risky assets and pay interest on the reserves to private banks may have large losses as interest rates rise. Those losses could result in increased pressure from fiscal authorities to refrain from raising interest rates.
I haven’t written about drones for a long time. Let’s fix that:
The global commercial drone market hit US$8.15-billion in 2022, and it will rise to US$47.38-billion by 2030, according to Strategic Market Research – and North America is the leading market for commercial drone applications. The combination of automation with drone technology brings together two rapidly advancing fields in new and increasingly complex ways. The global autonomous drone market is expected to be worth US$56.5-billion US by 2030, up from US$15.5-billion today, according to a report by Markets N Research.
Those applications cut across industries, with both technological advances and growing adoption in the construction, agricultural and logistics industries driving the market.
…
Drones also offer significant potential advantages for delivery services, says Dan O’Toole, CEO and founder of Dronedek, which is developing smart technology-enabled mailboxes for autonomous drone deliveries.As they mature, drone delivery services can offer cost and time savings over traditional methods, with added benefits like cutting the number of vehicles on the road and reducing labour needs, Mr. O’Toole says. Data released by McKinsey earlier this year indicated the number of daily drone deliveries continues to grow and that as it matures, the tech has the potential to lower both costs and carbon emissions compared with other forms of delivery transport.
“Drones could become an important part of the delivery supply chain,” the report reads, noting that more than 2,000 commercial drone deliveries took place each day in early 2022.
Yes! We want drone delivery! It’s 4am! Where’s my pizza?
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -2.1805 % | 2,500.6 |
| FixedFloater | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -2.1805 % | 4,796.2 |
| Floater | 9.01 % | 9.27 % | 51,475 | 10.02 | 2 | -2.1805 % | 2,764.1 |
| OpRet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0613 % | 3,344.7 |
| SplitShare | 5.03 % | 7.14 % | 52,506 | 2.74 | 7 | 0.0613 % | 3,994.3 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0613 % | 3,116.5 |
| Perpetual-Premium | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.4816 % | 2,737.5 |
| Perpetual-Discount | 6.23 % | 6.38 % | 62,191 | 13.33 | 35 | -0.4816 % | 2,985.1 |
| FixedReset Disc | 5.46 % | 7.77 % | 88,953 | 11.72 | 61 | -0.4267 % | 2,251.9 |
| Insurance Straight | 6.19 % | 6.25 % | 87,241 | 13.59 | 20 | -0.7897 % | 2,901.8 |
| FloatingReset | 9.80 % | 10.07 % | 32,397 | 9.56 | 2 | -0.0941 % | 2,585.1 |
| FixedReset Prem | 6.57 % | 6.53 % | 217,962 | 3.97 | 2 | -0.4711 % | 2,353.4 |
| FixedReset Bank Non | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.4267 % | 2,301.9 |
| FixedReset Ins Non | 5.33 % | 7.36 % | 67,047 | 12.10 | 13 | -0.2720 % | 2,437.4 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| CM.PR.P | FixedReset Disc | -4.73 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 16.71 Evaluated at bid price : 16.71 Bid-YTW : 8.41 % |
| CU.PR.H | Perpetual-Discount | -3.38 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 20.57 Evaluated at bid price : 20.57 Bid-YTW : 6.44 % |
| BN.PR.N | Perpetual-Discount | -3.07 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 18.00 Evaluated at bid price : 18.00 Bid-YTW : 6.75 % |
| CCS.PR.C | Insurance Straight | -2.94 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 19.51 Evaluated at bid price : 19.51 Bid-YTW : 6.43 % |
| BN.PR.K | Floater | -2.55 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 13.01 Evaluated at bid price : 13.01 Bid-YTW : 9.27 % |
| IAF.PR.B | Insurance Straight | -2.38 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 19.25 Evaluated at bid price : 19.25 Bid-YTW : 5.99 % |
| FTS.PR.K | FixedReset Disc | -2.10 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 16.35 Evaluated at bid price : 16.35 Bid-YTW : 8.55 % |
| TRP.PR.A | FixedReset Disc | -2.08 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 14.15 Evaluated at bid price : 14.15 Bid-YTW : 9.29 % |
| TRP.PR.B | FixedReset Disc | -2.00 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 11.25 Evaluated at bid price : 11.25 Bid-YTW : 9.58 % |
| IFC.PR.A | FixedReset Ins Non | -1.99 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 17.72 Evaluated at bid price : 17.72 Bid-YTW : 7.45 % |
| BN.PR.B | Floater | -1.81 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 13.01 Evaluated at bid price : 13.01 Bid-YTW : 9.27 % |
| MFC.PR.J | FixedReset Ins Non | -1.72 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 21.79 Evaluated at bid price : 22.22 Bid-YTW : 6.99 % |
| GWO.PR.M | Insurance Straight | -1.72 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 22.66 Evaluated at bid price : 22.90 Bid-YTW : 6.34 % |
| TRP.PR.D | FixedReset Disc | -1.71 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 16.10 Evaluated at bid price : 16.10 Bid-YTW : 9.16 % |
| BMO.PR.W | FixedReset Disc | -1.69 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 17.44 Evaluated at bid price : 17.44 Bid-YTW : 8.08 % |
| TRP.PR.C | FixedReset Disc | -1.69 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 11.66 Evaluated at bid price : 11.66 Bid-YTW : 9.56 % |
| TD.PF.D | FixedReset Disc | -1.47 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 18.75 Evaluated at bid price : 18.75 Bid-YTW : 7.89 % |
| IFC.PR.K | Perpetual-Discount | -1.44 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 21.25 Evaluated at bid price : 21.25 Bid-YTW : 6.31 % |
| SLF.PR.D | Insurance Straight | -1.39 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 18.45 Evaluated at bid price : 18.45 Bid-YTW : 6.05 % |
| GWO.PR.R | Insurance Straight | -1.33 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 19.25 Evaluated at bid price : 19.25 Bid-YTW : 6.25 % |
| BMO.PR.Y | FixedReset Disc | -1.32 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 18.68 Evaluated at bid price : 18.68 Bid-YTW : 7.76 % |
| MFC.PR.C | Insurance Straight | -1.28 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 18.51 Evaluated at bid price : 18.51 Bid-YTW : 6.11 % |
| BIP.PR.F | FixedReset Disc | -1.20 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 20.60 Evaluated at bid price : 20.60 Bid-YTW : 7.86 % |
| SLF.PR.E | Insurance Straight | -1.17 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 18.63 Evaluated at bid price : 18.63 Bid-YTW : 6.05 % |
| MFC.PR.B | Insurance Straight | -1.14 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 19.08 Evaluated at bid price : 19.08 Bid-YTW : 6.12 % |
| FTS.PR.M | FixedReset Disc | -1.08 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 17.42 Evaluated at bid price : 17.42 Bid-YTW : 8.42 % |
| SLF.PR.G | FixedReset Ins Non | -1.06 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 13.11 Evaluated at bid price : 13.11 Bid-YTW : 8.55 % |
| MFC.PR.K | FixedReset Ins Non | 1.07 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 19.75 Evaluated at bid price : 19.75 Bid-YTW : 7.36 % |
| TRP.PR.G | FixedReset Disc | 1.11 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 17.30 Evaluated at bid price : 17.30 Bid-YTW : 8.54 % |
| PVS.PR.K | SplitShare | 1.14 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2029-05-31 Maturity Price : 25.00 Evaluated at bid price : 22.25 Bid-YTW : 6.67 % |
| IFC.PR.C | FixedReset Disc | 2.53 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 18.66 Evaluated at bid price : 18.66 Bid-YTW : 7.59 % |
| GWO.PR.N | FixedReset Ins Non | 3.56 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 12.80 Evaluated at bid price : 12.80 Bid-YTW : 8.34 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| RY.PR.M | FixedReset Disc | 64,464 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 17.95 Evaluated at bid price : 17.95 Bid-YTW : 7.88 % |
| MIC.PR.A | Perpetual-Discount | 51,300 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 20.54 Evaluated at bid price : 20.54 Bid-YTW : 6.72 % |
| BN.PF.H | FixedReset Disc | 36,423 | YTW SCENARIO Maturity Type : Call Maturity Date : 2025-12-31 Maturity Price : 25.00 Evaluated at bid price : 23.80 Bid-YTW : 7.32 % |
| BN.PR.R | FixedReset Disc | 31,000 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 14.70 Evaluated at bid price : 14.70 Bid-YTW : 9.05 % |
| GWO.PR.N | FixedReset Ins Non | 29,323 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 12.80 Evaluated at bid price : 12.80 Bid-YTW : 8.34 % |
| SLF.PR.G | FixedReset Ins Non | 25,121 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-03-07 Maturity Price : 13.11 Evaluated at bid price : 13.11 Bid-YTW : 8.55 % |
| There were 16 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| CCS.PR.C | Insurance Straight | Quote: 19.51 – 21.43 Spot Rate : 1.9200 Average : 1.0965 YTW SCENARIO |
| BIP.PR.F | FixedReset Disc | Quote: 20.60 – 21.94 Spot Rate : 1.3400 Average : 0.9391 YTW SCENARIO |
| CM.PR.P | FixedReset Disc | Quote: 16.71 – 17.59 Spot Rate : 0.8800 Average : 0.5653 YTW SCENARIO |
| IFC.PR.K | Perpetual-Discount | Quote: 21.25 – 22.25 Spot Rate : 1.0000 Average : 0.7216 YTW SCENARIO |
| CM.PR.Q | FixedReset Disc | Quote: 19.10 – 20.50 Spot Rate : 1.4000 Average : 1.1537 YTW SCENARIO |
| BN.PR.N | Perpetual-Discount | Quote: 18.00 – 18.79 Spot Rate : 0.7900 Average : 0.5568 YTW SCENARIO |