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- Topley’s Top Ten – July 15th, 2019
Topley’s Top Ten – July 15th, 2019
Matt Topley
July 15, 2019
1.PIMCO Chart Breaking Down Leadership into 3 Year Periods.
Large Cap Growth Leading for 6 ½ Years.
2. Why Gold is Rallying? Negative Yielding Debt Plus High Probability of More Rate Cuts from Developed World
State Street SPDR Bloghttps://global.spdrs.com/blog
3. 2 Year Treasury Yields Well Above 2018 Lows.
These charts show howyield curve is inverted..short-term yields above 2018 lows but 30 year yieldsbreak lower.
2 Year Treasury
30 Year Rates Break Below 2018
4.Not Sure if This is a First Ever….Junk Bonds with Negative Yields in Europe.
“Look at what’s happening in Europe — they’re talkingabout going more negative, more negative interest rates — and yet we have asystem of corporate finance where there’s many fragile companies that should begone. But they’re being kept going as zombie companies because of the interestrate situation that we’re in … . So yes, I was very concerned about the housingmarket in late 2006, but I’m much more worried today about the corporate bondmarket than I am about things like housing in the financial system.”
Jeff Gundlach on Europe and U.S. Corp Debt
Sub-Zero Yields Start Taking Hold in Europe’sJunk-Bond Market
By Laura Benitez and Tasos VossosJuly 9, 2019, 4:24 AM EDT
Number ofnegative-yielding euro junk bonds rises to 14 from 0
Expectations offurther monetary stimulus depress yields
Centralbankers hinting at more monetary stimulus have depressed yields so much thateven some European junk bonds trade at levels where investors have to pay forthe privilege of holding them.
The number ofeuro-denominated junk bonds trading with a negative yield — a status untilrecently associated with ultra-safe sovereign borrowers — now stands at 14,according to data compiled by Bloomberg. At the start of the year there werenone.
Cheap money policiessince the financial crisis have kept interest rates at, or near, all-time lowsfor the last decade. That’s prompted many investors to buy riskier assets thatyield enough for them to meet their liabilities, driving bond markets higherand yields lower. The European Central Bank said on Monday it’s ready to add more stimulus tothe euro zone, indicating that an end to the age of ultra-low borrowing costsis far from over.
The European trendfollows a global pattern that’s seen the volume of securities yielding lessthan zero hovering just above $12.8 trillion, according to Bank of AmericaMerrill Lynch.
High yield borrowerswith bonds denominated in euros trading with a negative yield include:
Ardagh Packaging Finance plc /Ardagh Holdings USA Inc.
Altice Luxembourg SA
Altice France SA
Axalta Coating Systems LLC
Constellium NV
Arena Luxembourg Finance Sarl
EC Finance Plc
Nexi Capital SpA
Nokia Corp.
LSF10 Wolverine Investments SCA
Smurfit Kappa Acquisitions ULC
OI European Group BV
Becton Dickinson Euro Finance Sarl
WMG Acquisition Corp.
5.One Country Not Participating in Bond Rally…China’s Investable Bond Market Up 5x in 10 Years
Global Bond Party Bypasses China–By Shen Hong
China’s growth back to 1992 levels
China Growth at Its Slowest Since 1992 as Beijing Struggles to Juice Economy-By Chao Deng
6.SPACS Are Back in 2017-2019
7.What Are SPACs, and Why Are They Back?
These once-shunned investment vehicles have made a big comeback.
Dan Caplinger(TMFGalagan)Apr 12, 2019 at 8:03AM
Initial public offerings are hot rightnow, with many high-profile companies choosing to go public by making theirshares available to ordinary investors. The IPO process, however, can be longand difficult to navigate, with potential traps for companies that aren’t assuccessful as others in handling things like road shows and drumming upinvestor interest.
But there’s an interestingalternative that some companies use to get their shares traded on publicexchanges. Rather than filing all the paperwork associated with the requiredregistration statement with the U.S. Securities and Exchange Commission, acompany can instead merge with another company that’s already public. To takeadvantage of that rule, some investors turn to special purpose acquisitioncompanies, also known as SPACs, whose sole purpose is to raise capital frominvestors and then look to acquire an operating business — often one that’s privatelyheld.
After a long hiatus, SPACs areonce again becoming more popular. Most recently, the announcement thatthe parent company of Chuck E. Cheese willmerge with SPAC Leo Holdings (NYSE: LHC) and return to thepublic markets has turned attention back to these investment vehicles. Beforeyou invest in one, it’s important to know what SPACs are and why you’re seeingmore of them.
The basics of SPACs
A SPAC is essentially a shellcompany that doesn’t have any operations of its own. The stated purpose of thecompany is to identify and purchase a business that’s consistent with theinvestment objectives of the SPAC. Some special purpose acquisition companieslimit themselves to particular industries, while others have free rein to makeacquisitions in whatever type of company they wish.
SPACs begin by going throughthe IPO process, offering shares to investors. Typically, the proceeds from theIPO are held in trust while the SPAC seeks a takeover candidate. The terms ofthe SPAC specify a given time frame in which a merger must be completed. Ifthat time period expires without an acquisition, then SPACs will typicallyreturn their capital to their investors.
If the SPAC finds a suitablecompany, then the two will merge. The combined entity then typically takes thename of the operating business, often changing its ticker symbol to reflect thenew name.
The most important benefit of aSPAC is that the IPO process for a special purpose acquisition company isalmost always a lot simpler than it would be for an operating business. Becausethe business purpose is so straightforward, the SEC rarely has extensive issuesor questions up front. Moreover, once the SPAC is in place, the process fordoing the subsequent merger is simpler than it would be to file a full set ofregistration paperwork with the SEC.
Why SPACs are making a comeback
We’ve seen periods beforewhen SPACs were popular, especially before thefinancial crisis. But use of SPACs declined precipitously following the marketmeltdown. Greater regulatory attention played a role in that downturn, butthere were also fewer privately held businesses seeking to go public at thetime, and so the list of takeover candidates for SPACs was short. Many SPACs endedup failing to find companies to take over before their specified time limitsran out.
Recently, though, an excess ofcapital has led investors to seek out merger and acquisition opportunities moreaggressively, and that’s led to the return of SPACs. More SPACs went public in2018 than in any year since 2007, raising more than $10 billion in capital foruse in searching for investment opportunities. In particular, private equity funds have become keyusers of SPACs, as in the Chuck E. Cheese transaction.
Far from a sure thing
Individual investors shouldunderstand that investing in a SPAC isn’t a guarantee of success. When TheWall Street Journal looked at SPACs from three or four years ago,it found that more than half of them traded below their initial offering price.Given the huge bull market that investors have enjoyed, that track record isworrisome.
As long as the IPO marketproduces victories for companies going public, then you’ll see many businessesopting to go through that process to generate buzz. But SPACs will also remaina way for investors to bet on a leadership team’s ability to find a smartacquisition. And despite the potential pitfalls, SPACs will generate interestfrom those who hope to find the right acquisition at the right price.
8.Northern Triangle Countries…El Salvador, Guatemala, and Honduros…2/3 of citizens did not graduate High School and 2/3 of economy is un-taxed.
9.Streaming Consumption Stats
From Barry Ritholtz Blog
10.7 Simple Tactics to Increase Your Focus and Productivity 52% or More (By Tomorrow)
by Austin Gillis | Mar 13, 2019 | Self-Improvement
We live in a world that seems boundand determined to sabotage our goals.
Everyday, the average American isexposed to more than 5,000 advertisements, a barrage of click bait andirresistible social media platforms, never ending streams of high-qualitytelevision and innumerable other distractions.
We live in a world that is working against us. It doesn’t want you to stay focused.It doesn’t want you to do great work. It doesn’t want you to succeed.
But I do.
And today, I’ve compiled a list of7 simple but wildly effective tactics that will help you improve yourproductivity and focus by 50% (or more) as soon as tomorrow morning.
1. Know Your Body Clock (AndFind Your Magic Time)
Despite what you’ve been told bymainstream media and many popular “gurus,” there are, in fact, a number ofelite performers who wake up after the sun rises.
Although there is undeniable meritto the concept of “The 5 a.m. Club,” it should not be seen as a panacea to yourpersonal or professional challenges, nor should it be seen as a massprescription for success.
Because it’s not.
Different individuals function ondifferent chronotypes–or biological “clocks”–and as such, you must learn totailor your life and schedule to your natural biological processes. Some peopleeffortlessly rise at 5 o’clock every morning and immediately posses the mentalfaculties to dive into their most important work with vim and vigor.
Others (like me), are incapable offorming complete sentences before the hour of 7 a.m. (and at least 2 cups ofcoffee).
And it’s important to note, thataccording to Dr. David Breuss, one of the foremost sleep scientists in theU.S., your chronotype is biological.Being a night owl or early riser doesn’t make you better or worse than anyoneelse. It’s simply a part of your unique biology.
Much like your height or the sizeof your ears, your chronotype may shift or change over time, but there is verylittle you can do to consciously influence it.
You are simply left with the choiceto fight with it or against it. And if you want to maximize your focus andincrease your productivity, I encourage you to fight with it.
When you work in accordance withyour biology, everything becomes easier. You work when your brain is mostcapable of producing great work and you rest when your brain needs rest.
As simple as this tactic may sound,if applied correctly, it can be an absolute game changer.
This week, I want you to take Dr.Breuss’s sleep chronotype quiz (you can get it for free here) and keep an hourly log ofyour subjective energy levels so you can find those 2-3 peak hours during whichyou should schedule your most important work. Go to sleep when you feel tiredand wake up when your body tells you to wake up to ensure your sleep cycle works for you.
And then let me know what youdiscovered down in the comments below! I’d love to hear if you found anythingsurprising or counterintuitive.
2. Create Location BasedAnchors
One of the most powerful yet leastutilized productivity and focus hacks is the intentional creation of locationbased anchors.
An anchor is simply an externalstimuli that triggers your brain to go into a particular state.
For example, if you’ve ever been toa Tony Robbins’ event, you’ll know that one of his favorite exercises is to getthe entire crowd AMPED up and then instruct them to make a specific physicalgesture to anchor the emotional state into their body. Then, when the powerwithin has fallen back asleep and destiny is flaking on its date, attendees canbring themselves back into that motivated and energetic “Seminar State” withthe clench of a fist or clap of the hands.
To increase your productivity andcontrol your focus, you’re going to take this tactic a step further. Instead ofone simple gesture or movement, you are going to create an entire series of anchors to help you get into your mostproductive state each week.
And you’re going to do it byfollowing a very specific routine, to the letter.
First, you need to pick aninspiring location in which you will work every day. Itcould be a co-working space, home office, coffee shop, whatever. It doesn’tmatter so long as you can commit to working there every day. In that location, pick a particulardesk or chair at which you will work. Again, it doesn’t matter where it is, solong as you can work there every day. Ifyou’re at a restaurant or coffee shop, order the same thing every day. Ifyou’re at an office, bring the same food or beverages with you.
When you sit down to work, play thesame song–mine is Bach’s Cello Suite in G–through a set of noise cancellingheadphones (these are a game changer) and plug in a binaural beat track like this one.
Then, and most importantly, do NOTallow yourself to do ANYTHING except work from this location. This isn’t whereyou read your favorite blog, take calls from your spouse, or watch cat videoson YouTube. It’s where you work. Period.
After a couple weeks of this, yourbrain will begin to catch on and you’ll notice a slight bump in yourproductivity. After a month, the improvements will be even more marked. Andafter 6-12? This simple habit will make you unstoppable.
3. Use these Supplements
Before I dive into the secrets of “Betterfocus through chemistry,” I must preface this section with a simplecaveat.
Smart drugs and nootropicswork.
But they work best when coupledwith a healthy lifestyle. When you are active throughout the day, engaged instrength training throughout the week, sleeping 8-9 hours a night, eating aclean diet, and spending time relaxing with friends and family.
They aren’t a cure all and, despitewhat you might have read in the dark recesses of the internet, there is no“Limitless Pill” (trust me, I’ve spent more than $3,000 testing thisstuff).
BUT. If you already live a healthylifestyle and are simply looking for an added edge to your performance…
… Here’s a list of 5 supplementsthat will improve your focus and productivity (and the respective studiesbehind them).
If you’re looking for an“all-in-one” nootropic to enhance focus, creativity, and motivation I’d alsoencourage you to check out Qualia from Neurohacker Collective (noaffiliation). It’s a bit on the expensive end but it is far and away myfavorite “smart drug” and it saves you the time and hassle of creatingcustomized supplement stacks to optimize your brain.
As with any advice you receive onthe internet that encourages you to tamper with your bio and neurochemistry, besure to do the research for yourself and talk to a knowledgeable health carepractitioner before embarking down the dangerous road of smart drugs andbiohacking.
4. Read More…Slowly
With of tablets, smart phones, andother e-readers, the consumption of written online content has gone up astaggering 40% in recent years. Amazing, right?
Except…it isn’t.
Because, according to a study conducted by Slate andwebsite analytics company Chartbeat, fewer than 5% of readers finish thearticles and blog posts on which they click.
We’re no longer reading online. We’re skimming. Right before wehop over to yet another piece of content that we will leave half-read andunfinished.
To improve your focus and increaseyour productivity, you must first increase your attention span. You must havethe capacity to focus all of your attention on one thingwithout interruption or distraction for a prolonged period of time.
Yet modern TL;DR culture makes itdifficult for you to accomplish this aim. Each and every day you’re bombardedwith advertisements, click bait, and a sea of content in which you can loseyourself. But you struggle to fully consume or internalize any of it.
To remedy this situation I have asimple challenge for you. Read more…slowly. Don’t just skim through content,read it through until the very end. Instead of speed reading 100 business booksevery morning, take half an hour to read a classic work of fiction or aninspiring biography.
Train yourself to regain control ofyour attention and channel your focus where you–not someadvertiser or marketer–want it to go.
And start by picking up a copyof War and Peace and reading that sucker throughuntil the very end (hate me now, thank me later).
5. Take More Breaks
Counterintuitive though it mightbe, recent studies have shown one of the fastest ways to improve your focus andproductivity is to actually work less and take more breaks. And, when you thinkabout things, this actually makes a lot of sense.
Your brain, like the muscles inyour body, becomes fatigued after prolonged periods of use. In fact, because ofthe energy required to sustain long periods of intense focus (your brain doesconsume 20% of your body’s calories), long hours behind your desk can physically exhaust you too. Yet most of us try topush through them, erroneously believing that taking an hour long lunch ordipping away for a quick cat nap makes us “weak” or “lazy.”
The truth is, frequent breaks andat least one 60-90 minute break can increase your productivity upwards of 20%. This means if you adhere to thestandard 8-hour work day, you will actually earn back 1.6 hours of productivetime while only “losing” 1-1.5.
Furthermore, breaks give youseparation from your work and the ability to re-examine big projects with amore objective eye. That one sentenceyou can’t seem to write? That one salesproposal you just can’t finish? That one salescampaign where you can’t seem to optimize the sales video? Take 90-minutes toeat lunch, take a nap, and talk with someone you love and I promise you’llsolve your problem during your next block of work.
Frequent breaks, although counterto everything you’ve ever been taught about success and work ethic, allow youto work better, focus deeper, and create like a true Empire Builder.
6. Monotask
Although you might have written “Agreat multitasker” as a ‘strength’ on your resume 20-years ago, you wouldn’twant to do it now. The reason is simple, according to every cognitive sciencestudy conducted over the last 50+ years (at least all the good ones), yourbrain is incapable of multitasking.
Not inefficient. Incapable.
According to the Harvard Business Review:
“It takes time (an average of15 minutes) to re-orient to a primary task after a distraction such as anemail. Efficiency can drop by as much as 40%. Long-term memory suffersand creativity […] is reduced.”
Forty percent!
You cannot multitask, so stoptrying now. Quit answering emails while writing blogposts or checking social media while talking to a client or trying to play agame on your phone while working on your sales funnel.
Play when you play. Work when youwork. And when you work, only work on ONE thing at a time. Period.
7. Destroy Distractions (OrThey Will Destroy You)
Finally, to boost your focus andbecome more productive so you can achieve those big goals and dreams you’ve setfor yourself, you must destroy the distractionsin your life or they will destroyyou.
When you’re distracted by shinyobjects, well-intentioned co-workers, family members, and a constant stream ofnotifications and updates you are incapable of tapping into flow and engagingin true deep work. Instead your work will be shallow, dull, and incomplete. Amere skeleton of what you could achievein a state of unadulterated focus.
Distraction is a death sentence foryour dreams.
It neuters your ability to do greatwork, holds you back from enjoying the balance you desire, and stunts yourgrowth personally and professionally.
So eradicate it
Guard your attention with yourlife. Cut out all distractions and ruthlessly eliminate anything or anyone (inthe metaphorical sense…and do it politely please) standing in between you andyour goals.
Turn off your notifications. Tellyour family not to call you unless there is a true emergency. Inform yourco-workers that you will be unavailable for any of theirrequests until a set time (and ask them to email you first). Create anenvironment and professional ecosystem conducive to intense focus and yourproductivity will skyrocket overnight.
In a world that seems hell-bent ondistracting and derailing you, this will not be an easy task.
But I can promise you, it will be worth it.
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