/4
And:
A defendant in the case, who spoke on condition of anonymity, denies paying bribes—his firm paid Helsinge “consultancy fees”—but says that exchanging information on rival bids and tenders was “the way of doing business” in South America at the time.
Ah, yes, great, great.
But the other part of the Businessweek story is that this story of corruption and bribery — and Morillo’s instant messages allegedly proving it — fell into the hands of David Boies, the famous American lawyer, who saw that Morillo and his clients had stolen billions of dollars from Venezuela and decided to try to get that money for himself:
Excited by the evidence in their possession, various combinations of Boies, [Morillo’s rival Wilmer] Ruperti, Blondie (the private investigator) and [investor Bill] Duker (the moneyman) met over the summer of 2017 in various offices and on Duker’s 230‑foot sailboat, Sybaris, named for an ancient Greek city famous for its excess. …
First they needed to persuade the Maduro administration to let them bring a claim on PDVSA’s behalf. … Ruperti introduced Boies and Duker to Nelson Martinez, Venezuela’s newly installed oil minister, and Reinaldo Muñoz Pedroza, the country’s attorney general. On July 12, 2017, the parties came to an agreement: Blondie, Duker and the lawyers would get 66% of the proceeds, leaving 34% for PDVSA.
So they set up an entity — PDVSA US Litigation Trust — to sue Morillo and his clients in Florida federal court, and to pay any winnings two-thirds to the lawyers and one-third to PDVSA. They sued, and the defendants’ first line of defense was, basically, “look, you say that we stole billions of dollars from PDVSA, but why do you get to sue? You aren’t PDVSA; you’re some weird new trust. If we stole from PDVSA, let PDVSA sue us.”
Back in court in Miami, before the proceedings could turn to the matter of whether Helsinge and its customers had committed any crimes, Boies needed to demonstrate that the trust had standing—the legal right to bring a case. In most lawsuits, an injured party files a complaint and the two sides argue over its merits. Here you had an opaque New York vehicle claiming to represent Venezuela’s state oil company, which itself was controlled by a corrupt dictator subject to sanctions. Beyond that, it was unclear from the preliminary filings who controlled the trust and who stood to benefit. In July 2018 the defendants filed a motion to have the case dismissed on the grounds that the trust was illegitimate.
This defense was helped by the fact that nobody from PDVSA could really come to court to explain that the trust was legitimate, because (1) Venezuela was subject to increasingly strict US sanctions that made it hard for Boies to work with PDVSA and (2) the Venezuelan government didn’t make it particularly easy either:
What followed was a kind of courtroom farce, as Boies Schiller Flexner’s increasingly desperate efforts to demonstrate the trust’s bona fides fell apart under scrutiny. Defense lawyers sought to depose Venezuelan signatories to the litigation agreement among the various parties, but none could be pinned down. One had simply vanished. Another, Martinez, the oil minister, had recently been arrested in Venezuela and charged with corruption. “Jailed? Did I hear jailed?” the judge asked, trying to keep up. When PDVSA’s general counsel did finally commit to going to the US to be deposed, two dozen attorneys booked flights and hotels, only for the witness to pull out at the last minute, apparently under orders from Maduro himself.
The plaintiffs’ position was further undermined by how poorly news of the litigation was going down in South America. As part of the discovery process, Boies Schiller Flexner was ordered to hand over the agreement letter laying out the 66%-34% split. It was pilloried on Venezuelan state television. On April 24, 2018, the National Assembly, home to what remains of the country’s opposition, published a decree describing the trust as “a mechanism to divert the funds and resources” of Venezuela.
Ultimately this defense worked, and the judge dismissed Boies’s lawsuit. I love that a famous US lawyer learned of Swiss companies defrauding a Venezuelan company out of billions of dollars, and his natural first reaction was to go to a US federal court to get it to order those companies to give him the money instead. “If a US lawyer notices anyone stealing any money anywhere in the world, that money belongs to him, and a US court will enforce his rights to it” is not 100% wrong as a description of US law, which explains a lot about the extraterritorial application of US law, the hegemony of the dollar system, and the entrepreneurial American legal culture. But it is not 100% right either, and it did not work out for Boies.
Anyway, elsewhere in euphemisms for bribes, here is the Economist with a helpful collection:
One approach is to talk about something other than money. Some officials, for example, like to keep citizens well abreast of their food and drink preferences. “I really want to drink a Nescafe,” declares an airport security guard six times as he frisks your correspondent in Burkina Faso. In Uganda traffic police find ways to mention their favourite soda. In South Africa such requests are so common that bribes for driving offences are known as “cold drink money”.
I guess if you’re a cop at a traffic stop you can’t really ask for a consultancy fee.
Succession
I have occasionally tried to understand the capital structure, valuation, corporate governance and shareholder base of Waystar Royco, the Roy family’s publicly traded conglomerate on the TV show Succession, but I quickly find myself frustrated by some contradiction that doesn’t make much sense, and then I remind myself that it’s a TV show and nobody cares about the absolute verisimilitude of its corporate bits. (Who is on the Waystar Royco board? Why are there no independent directors? Who cares!) Anyway at FT Alphaville last week Louis Ashworth gave it a go; he got farther than I ever have but he gave up too, and my advice is that it isn’t worth it.
Things happen
SVB’s new owner fights to rebuild brand and stem outflows. Moody’s Downgrades 11 Regional Banks, Including Zions, U.S. Bank, Western Alliance. New Wall Street ‘fear gauge’ to track short-term market swings. The Crypto Detectives Are Cleaning Up. The Impending Fight for Private Equity Buyout Lending. CME plays down rival to LME nickel market. UK Aims to Avoid Repeat of Liz Truss’s Market Mayhem With LDI Reforms. Partner pay at top US law firms hit by dealmaking drought. J&J Consumer-Health IPO Process to Kick Off Key Test for Moribund New-Issue Market. A Schwab Divorce From Bank Could Unlock Value, JPMorgan Says. Gemini’s Plan for Derivatives Exchange Adds to Crypto’s Flight From the US. “The market considers the one-month bill a safe haven. … The three-month is more in the crosshairs.” How Vanuatu allegedly lost its mackerel rights — and fought back. “Afterward we had dinner at Bennigan's; on the menu chalkboard, under Quiche of the Day, Jello [Biafra] scrawled ‘YOU.’”
If you'd like to get Money Stuff in handy email form, right in your inbox, please subscribe at this link. Or you can subscribe to Money Stuff and other great Bloomberg newsletters here. Thanks!
[1] This number comes from the company’s first-day declaration (PDF), Document 10 in the bankruptcy docket.
[2] A footnote to this sentence in the declaration cites Money Stuff.
[3] There are also about $1 billion of unsecured bonds outstanding, and talk about nostalgia: They were issued in 2014 to fund a stock buyback, and include about $600 million of *30-year bonds*, due in 2044, with a 5.165% interest rate. They were rated A-/Baa1 when issued. Different times!
[4] Its closest competition is when Hertz Global Holdings Inc. sold stock to meme-stock investors *in bankruptcy*, which was incredible, but (1) the US Securities and Exchange Commission shut that deal down almost as soon as it launched, so it never raised much money and (2) Hertz was trying to reorganize in bankruptcy, not liquidate; it succeeded and the equity actually recovered, so buying (and, thus, selling) the stock was not *that* crazy. To be clear, that is still a possibility here — “Bed Bath & Beyond has pulled off long shot transactions several times in the last six months, so nobody should think Bed Bath & Beyond will not be able to do so again” — and I will feel dumb and amazed if the people who bought Bed Bath stock on Friday at $0.29 end up making a fortune on the trade.
[5] This is a little loose, and there are scenarios where some equity owner might put in more money in a bankruptcy-type situation in order to *keep control of the company*. “An equity owner throws in more money and comes out with zero stake in the company" is … less common.
[6] No, no, it’s still trading; it was at about $0.19 or so at noon today. Really this should say “… and (2) now is even more clearly going to be worthless,” but all hope is not technically lost.
[7] Bloomberg reports: “‘The idea that you can continually support your company even in the face of constant dilution of your investors just isn’t a long-term, viable corporate-finance strategy,’ said James Gellert, CEO of ratings firm Rapid Ratings. ‘Bed Bath & Beyond had a seeming disregard for common equity holders.’”
/4 of 4

hope that anyone interested saw this earlier and similar stomach-turning MLevine writeup, "Money Stuff: Bed Bath Moves Into the Beyond" ...
somehow like an inverse of naked shorting
or something
\\\ Beyond bloodbath
On Jan. 20, Bed Bath & Beyond Inc. had about 117.3 million shares of common stock outstanding; the stock closed that day at $3.35 per share. On March 27, it had about 428.1 million shares outstanding, at $0.7881 each. On April 10, it had 558.7 million shares outstanding, at $0.2961 each. Yesterday, April 23, when it filed for bankruptcy, it had 739,056,836 shares outstanding.[1] The stock closed at $0.2935 on Friday.
So in the last two weeks, Bed Bath & Beyond has sold about 180 million shares to retail investors, more shares than it had outstanding in January. The stock averaged about $0.31 per share over those two weeks, meaning that the company raised maybe $55 million, in those two weeks, as it has been sliding into bankruptcy. Since January, Bed Bath & Beyond has sold about 622 million shares, or almost 50 million shares a week, raising a few hundred million dollars.
Here is Bed Bath’s first-day declaration in the bankruptcy case, which describes what the company has been up to over the last few months. The points that I would highlight are:
In December 2022, “Bed Bath & Beyond triggered multiple events of defaults under its financing facilities” and began its slow move into bankruptcy.
Also in December 2022, its financial advisers at Lazard “commenced a process to solicit interest in a going-concern sale transaction that could be effectuated in chapter 11,” that is, to find someone who was interested in buying the company out of bankruptcy and continuing to operate its business.
They failed: By mid-January, “Lazard had engaged with approximately 60 potential investors to solicit interest in serving as a plan sponsor, acquiring some or all of the Debtors’ assets or businesses, or providing postpetition financing,” but “to date, the Company has been yet to identify an executable transaction.”
So, as of mid-January, it seems that the company’s plan was to file for bankruptcy, close all its stores, liquidate its inventory and hand whatever cash was left to its creditors.
But Bed Bath did have one thing going for it. It was “part of the ‘meme-stock’ movement started and fueled on Reddit boards and social media websites,” because it “checked the two boxes needed to become a meme-stock: (i) a troubled financial situation and (ii) nostalgia value.”[2]
So someone had the bright idea of delaying things for a bit by selling tons and tons of stock to Bed Bath’s retail shareholders at whatever prices they’d pay. “Certain third-party investors expressed interest in providing the Debtors with substantial equity financing in light of the Company’s depressed share price and continued trading volatility. More specifically, the Debtors were approached by Hudson Bay Capital Management, LP” about a weird stock deal that we discussed in January; this ended up raising about $360 million. After the Hudson Bay deal ran its course — basically, after Hudson Bay and Bed Bath drove the stock price from above $3 to below $1 by pounding out about 311 million shares to retail investors — Bed Bath and its brokers at B. Riley Securities Inc. sold another 311 million shares to retail investors, but at ever-declining prices, so they raised a lot less money. Still something, though.
It was not enough, though, and ultimately this weekend Bed Bath & Beyond filed for exactly the sort of bankruptcy it was contemplating in January: Close all the stores, liquidate the inventory, hand whatever cash is left to the creditors. “The Debtors are committed to achieving the highest or otherwise best bid for some or all of the Debtors’ assets by marketing their assets pursuant to the Bidding Procedures, and, if necessary, conducting an auction for any of their assets,” the company says, but it has had like four months to find someone interested in buying the business, and if no one has shown up yet no one is going to. And: “The Debtors estimate that the aggregate net sales proceeds from all Sales will be approximately $718 million,” against about $1.8 billion of debt to pay off. Nonetheless:
While the commencement of a full chain wind-down is necessitated by economic realities, Bed Bath & Beyond has and will continue to market their businesses as a going-concern, including the buybuy Baby business. Bed Bath & Beyond has pulled off long shot transactions several times in the last six months, so nobody should think Bed Bath & Beyond will not be able to do so again. To the contrary, Bed Bath & Beyond and its professionals will make every effort to salvage all or a portion of operations for the benefit of all stakeholders.
/1

https://www.globenewswire.com/news-release/2023/04/28/2657083/0/en/Norsk-Hydro-Robust-results-executing-on-strategy.html
Lots of buying and selling of assets!!!!
This just sounds like musical chairs to me. WTF?
"Glencore will acquire an additional 40 percent stake in MRN which is currently owned by Vale. This 40 percent interest will be acquired by Hydro from Vale and immediately sold to Glencore on a back-to-back basis. After the transactions Hydro will no longer have an ownership position in MRN. The transactions will have a total enterprise value of USD 1.15 billion which shall be adjusted for debt like items and working capital. Closing is expected in the second half of 2023."

First Republic, Part 2:

The other option is “do nothing.” First Republic reported earnings on Monday, and they were legendarily awful:
Across the industry, First Republic’s quarterly earnings report on Monday has come to be regarded as a disaster. The firm announced a larger-than-expected drop in deposits, then declined to take questions as executives presented a 12-minute briefing on results.
But First Republic reported a profit. The problem, for First Republic, is that lots of its low-interest deposits have fled, and it has had to replace their funding by borrowing from the Fed, the FHLB and the big banks at much higher rates. Meanwhile it still has lots of long-term loans made at low interest rates. If you borrow short at 0% to lend long at 3%, and then your short-term borrowing costs go up to 5% while your loans stay the same, you will be losing 2% a year on your loans, and that is roughly the state that First Republic finds itself in. But it is not exactly the state that First Republic finds itself in: It still has some cheap insured deposits, some short-term assets, some floating-rate assets, some fee income, and in fact it has managed to scrape out a profit even as rates have moved against it. Can that last? I mean, maybe not:
The deposit run has forced First Republic to rely on other, more expensive funding. That makes it hard to generate interest income, and at some point it might not be able to.
“They’ve never been super profitable,” said Tim Coffey, managing director and analyst at Janney Montgomery Scott. “Now you’re not growing and you’re layering on really high borrowing and funding costs.”
But a bank can stay in business even with some quarterly losses, as long as it remains well capitalized, and as a technical matter First Republic has enough capital to withstand some unprofitable quarters. And if you muddle along for long enough, the situation can right itself: The long-term low-interest loans will roll off and be replaced with higher-interest new loans, and First Republic’s interest margins will start to expand again. It might work! If you are a First Republic shareholder, “do nothing and hope the business recovers” is clearly the best option.
Of course deposits might keep flowing out, but so what? First Republic is now funded in large part with loans from the Fed and the FHLB, and I suppose they could just lend it some more money. When Silicon Valley Bank failed, the Fed put in place a new Bank Term Funding Program that was designed for more or less this purpose: The BTFP lets banks borrow against their assets without taking into account interest-rate losses, so that they can replace fleeing deposits with loans from the Fed. US regional banks spent years in a low interest rate environment, they were caught out by a rapid rate hiking cycle, and the Fed responded to that problem by lending them money to smooth out the transition.
The advantage of doing nothing is that nobody has to take any losses now. But the regulators seem to want to move. Bloomberg again:
The clock for striking such a deal began ticking louder late last week. US regulators reached out to some industry leaders, encouraging them to make a renewed push to find a private solution to shore up First Republic’s balance sheet, according to people with knowledge of the discussions.
The calls also came with a warning that banks should be prepared in case something happens soon.
And one way for something to happen soon is if the Fed stops lending to First Republic:
As weeks keep passing without a transaction, senior [FDIC] officials are increasingly weighing whether to downgrade their scoring of the firm’s condition, including its so-called Camels rating, according to people with direct knowledge of the talks. That would likely limit the bank’s use of the Fed’s discount window and an emergency facility launched last month, the people said.
Why? Why close a bank and take billions of dollars of losses if you don’t have to? The consequences of doing something are obvious and bad; the consequences of doing nothing are a bit more diffuse.
But let’s talk about some of them. One is that there are legal limits on the Fed’s ability to keep propping up First Republic. I mentioned the BTFP, the Fed’s post-Silicon Valley Bank program that lends to banks at 100% of the face value of their collateral, even if that collateral has lost money due to rising interest rates. But only US Treasury and agency securities are eligible to be BTFP collateral, and First Republic’s assets are mostly loans. Those loans tend to be pretty safe — they are mostly mortgages to rich people — but they are very exposed to interest-rate risk, so they have lost a lot of value. And it can’t use them to borrow from the BTFP.
Meanwhile these loans are eligible collateral at the Fed’s discount window, its more standard lending program, but the discount window lends against the market value of collateral, and these loans have lost a lot of value. If deposits keep fleeing from First Republic, its ability to replace those deposits with Fed loans depends on the market value of its assets, which means it might run out of capacity. If the FDIC is worried about that happening sometime soon, then there is some urgency to do something first.
More generally, the theory of central banking is that central banks should lend to solvent banks, but not prop up insolvent banks. The Fed’s statutes limit its ability to lend to undercapitalized banks. In some obvious economic sense, First Republic is undercapitalized — its assets are worth less than its liabilities, which is why we are talking about this — but legally it is fine and has plenty of regulatory capital.
But at some point, if the regulators conclude that First Republic is not viable, it is at least, like, embarrassing for them to keep lending it money. In the limit case, if all of First Republic’s deposits fled, you could imagine the Fed lending it $210 billion (up from its current $105 billion of Fed/FHLB money) so it could continue to limp along. But that’s bad! You don’t want a bank out there doing business, making loans, paying executive salaries, that is entirely funded by the Fed. You need some private-sector endorsement of the bank for the Fed to keep supporting it.
Also: The losses have already happened. First Republic made loans at low interest rates, now interest rates are higher, and so its loans are not worth what they used to be. As an accounting matter, those losses don’t have to be recognized yet; First Republic’s balance sheet is still technically solvent, and it can muddle along for a while. But economically the difference between “the banking system reports billions of dollars of losses today and then normal profits afterwards” and “the banking system bleeds these losses into lower accounting profits for the next few years” is not that great, and the former is more clarifying.

Annual pace decelerates to just 1.1% as fears of recession this year grow despite strong consumer spending
Following is a current report from The Guardian:

US economic growth slowed sharply in the first quarter of the year, despite strong consumer spending resilient to interest-rate rises designed to tame historic inflation.
The latest GDP figures released by the US commerce department show that the world’s largest economy slowed sharply from January through March, to just a 1.1% annual pace as businesses reduced inventories amid a decline in housing investment. The abrupt deceleration from 2.6% growth in the final three months of 2022 and 3.2% from July to September came in significantly under economists’ expectations of a 2% increase.
The figures indicate that aggressive interest rises designed to tame inflation are beginning to produce what US central bankers desired – a slowing economy coupled with reduced wage increases and a tighter job market without tipping it into outright recession.
“The data confirm the message from other indicators that while economic growth is slowing, it isn’t yet collapsing,” said Andrew Hunter, chief US economist at Capital Economics. “Nevertheless, with most leading indicators of recession still flashing red and the drag from tighter credit conditions still to feed through, we expect a more marked weakening soon.”
Resiliency in consumer spending, which rose 3.7%, reflected gains in goods and services and came as business investment in equipment recorded the biggest drop since the start of the pandemic in 2020 and inventories dropped the most in two years.
The Federal Reserve has indicated that while it has slowed the rate of interest rises, it expects commercial lenders, buffeted by the collapse of two regional banks this year, to tighten lending standards.
Many economists say the cumulative impact of Fed rate hikes and tighter lending requirements have yet to work their way through the system, presenting central bankers with a dilemma over whether to continue raising rates.
“The last thing the Federal Reserve wants to be doing is raising rates as the economy begins to grind to a halt and potentially exacerbating the situation,” said Marcus Brookes, chief investment officer at Quilter Investors. “The coveted soft landing is looking increasingly difficult to achieve and we are now getting towards a position where the market may become concerned that stagflation could be a likely possibility.”
There is widespread skepticism that the Fed will succeed in averting a recession. An economic model used by the Conference Board, a business research group, puts the probability of a US recession over the next year at 99%. That expectation is compounded by political risk, given congressional Republicans could let the US default on its debts by refusing to raise the statutory limit on what it can borrow. Wider global economic conditions are also in play.
Earlier this month, the International Monetary Fund downgraded its forecast for worldwide economic growth, citing rising interest rates around the world, financial uncertainty and chronic inflation.
The IMF chief, Kristalina Georgieva, said global growth would remain about 3% over the next five years: its lowest such forecast since 1990.

My concern is that the top 8-10 stocks in the S&P500 (FAANG's) seem to be the only things producing the gains in the S&P 500 while the other 490 are bobbing for air or worse. Not a good look.

Or they could hire CPA analysts who would know that a strong demographic customer base and conservative underwriting standards do not necessarily make a strong bank's balance sheet. Being too fixated on growth and not enough on balance sheet risk caused the problem both at these banks and for the fund managers/analysts invested in them. These banks took customer deposits and invested them badly, playing a leveraged bond duration game in a rising rate environment, probably not super hard to detect for anyone focused on the balance sheet instead of the income statement. This shareholder letter marks a significant strategic shift. A key excerpt:

In Financials, our banking tranche showed negative returns through the quarter and detracted significantly from performance in our global and US funds. Only one of the twelve banks we held at various points through the quarter contributed positively to performance, and First Republic Bank (FRC US)2 was the largest detractor.
Our very selective approach to investing in Banks led us to own First Republic at portfolio
weights that expressed a high degree of conviction in the company’s risk-adjusted return profile. As you are likely aware, over the past month, First Republic experienced a significant crisis, as collateral damage from the Silicon Valley Bank (SIVB US) collapse, which resulted in a severe de-rating of the FRC share price. A fair question for anyone to ask is how to reconcile our very selective approach to investing in banks with a large position in a bank that has experienced a significant crisis. At a very high level, our investment thesis on First Republic was based in its application of a world-class client service model to arguably the world’s most attractive banking client markets (specifically, the high net worth and high-end professional services markets in urban coastal population centers across the United States). That strategy for First Republic had enabled the company to structurally grow earnings while preserving exceptionally conservative underwriting standards. In other words, while First Republic is a bank, we observed that its unique model and exposure profile largely neutralized most of the quality attributes that generally make banks less attractive and more risky. Put another way, an attribute-by-attribute analysis of First Republic, reinforced over its long successful track record, made us comfortable treating First Republic as we would treat best-in-class growth companies we discover in other industries.
However, after SVB Financial shared its post-close announcement on Wednesday, March 8th, highlighting elevated deposit attrition, the sale of available-for-sale securities at a material loss, and an equity capital raise, we spoke with First Republic’s CFO in order to confirm our knowledge of the company’s exposure to deposits from early-stage companies, net unrealized losses in available-for-sale securities, and other aspects of its capacity to avoid the negative feedback loop that SVB was beginning to experience. We left that balance sheet review confident enough to continue holding our positions. What destabilized our confidence was Friday’s announcement that SVB Financial would enter receivership and the recoverability of uninsured deposit balances at SVB was in question. As these revelations became clear, we concluded that the probability of contagion extending to First Republic depositors had become too high to justify continuing to hold our positions. In other words, we concluded that First Republic had ceased to be an investment opportunity and had instead transitioned to more of a pure gamble on which wagering our clients’ funds was unacceptable. We proceeded to exit our entire investment position in First Republic at the next opportunity (the Monday morning pre-market) as efficiently as we could without further pressuring the share price.
In the aftermath (at least the first stage) of this banking crisis, we have carefully reviewed our financial sector investment strategy. We have reinforced our commitment to finding and owning best-in-class growth companies in the capital markets ecosystem. Perhaps more importantly, we have further tightened our already strict standards for bank and real estate company investments. This specifically means that we will invest in fewer banks going forward. They are far too fragile to take large portfolio positions in. Those bank investments that we do own will be more tactical or opportunistic, and they will be held at even more limited portfolio weights. We are also currently focused on the negative implications from this banking crisis related to funding, credit, and regulatory costs for American banks generally. We are focused on the extent to which those issues could apply material stress to more cycle-sensitive borrowers. We are now even further underweight American banks than we were prior to the banking crisis, beyond simply exiting our First Republic position. Our real estate company investments remain focused on structural growth opportunities that exclude exposure to general commercial real estate classes. And we have increased our exposure to multiple best-in-class growth companies within the capital markets ecosystem whose upside scenarios we believe have become significantly more likely due to this banking crisis.
2 As of 01/31/2023, the Grandeur Peak Funds owned 221,572 shares of First Republic Bank and 47,006 shares of SVB Financial Group

Howdy folks,
You get what you vote for. Problem is that only the most fervent vote in the primaries and so many voting districts are gerrymandered into predetermined party outcomes. My township hasn't had a democrat run for local office in at least 3 elections and we're on four year terms. They voted 55/44 Trump in 2020. What this means is that everything is decided at the primary. We have a county on Lake Michigan - Ottawa that had a religious group get pissed over mask mandates and primaried the existing conservative republican county commissioners with some serious crazies. Now it will probably reverse at the next election, but, again, these are four year terms. They'll piss off Nessel and she'll have their ass.
rono the 3rd term elected republican township trustee.
peace,
rono

@hank He came from a different world of 'investments' managed by the pro's, as in what do the little people know? In the 80's Schwab and Fido were changing the way things functioned in the investment world in favor of the 'little people'. I would suggest Mr. Templeton, Merrill and other large investment houses were not pleased by changes taking place with mutual fund loads starting to be reduced and 'discount brokerage' available to the 'little people' via Schwab and Fido. In the early to mid 80's, I was placing buys and sells via Touch Tone Phone Trading with Fido. Yes, I still had to do my research via printed investment data; but I didn't need a retail broker or paid advisor to do buys and sells we made.
I suggest Mr. Templeton and other similar investment houses weren't happy about the 'loss' cash flows from advisors and high loads on funds.
I imagine with what is in place today, that the percentage of 'advisors' who fared much better than the self directed retail investor in the recent melts of 2008, 2020 or 2022 is very large. 2022 surely had a lot of phone calls from investors using advisors as to 'why didn't you do better with my money'. What am I paying you for ???

https://www.sec.gov/Archives/edgar/data/1683471/000089418923002845/pfaalphaintelligentliquida.htm
Alpha Intelligent - Large Cap Value ETF (AILV)
Alpha Intelligent - Large Cap Growth ETF (AILG)
(each a “Fund”, and together, the “Funds”)
Each, a series of Listed Funds Trust (the “Trust”)
Supplement dated April 25, 2023
to the Summary Prospectus, Prospectus and Statement of Additional Information
dated February 28, 2022
After careful consideration, and at the recommendation of Princeton Fund Advisors, LLC, the investment adviser to the Funds, the Board of Trustees of Listed Funds Trust approved the closing and subsequent liquidation of the Funds pursuant to the terms of a Plan of Liquidation. Accordingly, the Funds are expected to cease operations, liquidate their assets, and distribute the liquidation proceeds to shareholders of record on or about May 24, 2023 (the “Liquidation Date”). Shares of the Funds are listed on the NYSE Arca, Inc.
Beginning on or about April 26, 2023 and continuing through the Liquidation Date, each Fund will liquidate its portfolio assets. As a result, during this period, each Fund will increase its cash holdings and deviate from its investment objective, investment strategies, and investment policies as stated in the Funds’ Prospectus and SAI.
The Funds will no longer accept orders for new creation units after the close of business on the business day prior to the Liquidation Date, and trading in shares of the Funds will be halted prior to market open on the Liquidation Date. Prior to the Liquidation Date, shareholders may only be able to sell their shares to certain broker-dealers, and there is no assurance that there will be a market for the Funds’ shares during that time period. Customary brokerage charges may apply to such transactions.
If no action is taken by a Fund’s shareholder prior to the Liquidation Date, the Fund will distribute to such shareholder, on or promptly after the Liquidation Date, a liquidating cash distribution equal to the net asset value of the shareholder’s Fund shares as of the close of business on the Liquidation Date. This amount will include any accrued capital gains and dividends. Shareholders remaining in a Fund on the Liquidation Date will not be charged any transaction fees by the Fund. The liquidating cash distribution to shareholders will be treated as payment in exchange for their shares. The liquidation of your shares may be treated as a taxable event. Shareholders should contact their tax adviser to discuss the income tax consequences of the liquidation.
Shareholders can call 1-800-617-0004 for additional information.
Please retain this Supplement with your Summary Prospectus,
Prospectus and Statement of Additional Information for reference.

If anybody has money making suggestions (other than cash) pass them along

@hank, I've been watching utilities, RYU and ECLN. They both started trending up 3 or 4 weeks ago. Bought a little of each, but not enough to make a difference.
from Investopedia:
With a strong capital pipeline, increasing regulatory support, and corrected valuations that remain historically rich, utilities are poised to return to steady growth without volatility. “After a volatile stretch for utilities stocks, we expect a return to steady, fundamental growth.” Mar 28, 2023
For 2023, the outlook for the utilities sector is strong. The sector's defensive characteristics could continue to look attractive to investors seeking shelter during market and economic choppiness.
Are utility stocks a good investment during a recession?
Defensive stocks, like shares of healthcare or utilities companies, are often cited as recession-proof investments. This is because consumers still need to purchase medical care and electricity, regardless of the economic situation.

Comment from Mr. Lucas (Vanguard):

Lucas: Customer service complaints have always been sort of a feature of Vanguard’s history. If you go back to the days when Bogle led the firm—this is a point that I made at that conference—there were lots of complaints over the years about Vanguard’s customer service. I like to compare Vanguard to, say, those of you who shop at Aldi. If you go to Aldi, you have your quarter, you get your grocery cart, you bring your own bags or you put it in boxes. I would say Vanguard has got more customer service ethos than that, but it is something where it’s not necessarily been known for high-touch customer service. And it is trying to become a leader in customer service and to really improve its technological offer.
So, what Vanguard is trying to do is, because it has experienced over the course of its history and continues even in this first quarter, experienced such asset growth, it’s trying to enable investors to do as much as they can as simply as they can online, so without talking to a human advisor. And they’ve really made investments in technology. They’ve modernized their technology platform, and they’ve seen increased resiliency and increased customer service scores.
The big snafu they made in 2020 was—this is Vanguard, they’re always thinking about investor assets and costs and trying to save money on behalf of investors—so, in 2020, when the market turned down, they stepped back and they looked and they saw that historically when the market falls, client communications sort of fall off a cliff. So, they actually slowed their hiring of customer service representatives right at a time when—in fact, what happened with the lowering of interest rates is that investor demand shot up and that caused, I think, significant wait times and lots of frustration. They have normalized that, and I think are committed to sort of being a little bit more, call it, I don’t know if cautious is the right word, but they’re going to be more prone to overspend and I think on what they expect they will need to try and improve customer service. In talking with Vanguard leadership, they feel like they’ve heard that and they’re trying to become known for best-in-class customer service. That is a goal of theirs, and they say they’ve made progress in that. It remains to be seen. We hear a lot of comments from that here at Morningstar. But the big thing always to keep in mind is that Vanguard serves a lot of customers. So, you’d expect that some of them would be frustrated. And I’ve heard both success stories and stories of frustration, and we’ll see if the stories of frustration are minimized over the coming years.

Seriously, Vanguard has to catch up to where they were in terms of customer service. There is no replacement to having human touch in communication of their needs. Having a robust interface on the website is one thing, but not everyone can fully take advantage of that feature. So Vanguard still have a way to go in order to catch up with Fidelity and Schwab.

Difference between short and long-term thinking. Banks CEOs like most CEOs of publicly traded companies often only think from quarter to quarter. To accept zero yields in 2020 and 2021 as Buffett did would be unacceptable to such CEOs trying to hit quarterly earnings estimates in 2020 and 2021 and collect their sizable bonuses for hitting those quarterly numbers. Ultimately, such short-term thinking is bad for everyone but the CEOs and the analysts setting the earnings targets. Investors suffer as Buffett rightly pointed out. But society suffers as well. Banks go bust, we bail them out, people lose their jobs, etc.
Vanguard’s John Bogle called this the “agency society” in which the agents of investors, i.e., executives are the only ones who benefit. This problem could be alleviated if CEO bonuses and other compensation were shifted from short- term ones to long-term ones based on, say, a company’s three-year or five-year profitability and if analysts and Wall Street in general stopped being so short-term oriented. Raising the taxes on short-term capital gains from 20% to 30% or even 40% and lowering the taxes on long-term gains for stocks held 5 years to 15% or even 10% might “inspire” or incentivize Wall Street analysts, traders and money managers to think differently.
Importantly, most of Buffett’s wealth comes from his long-term ownership of Berkshire stock. His salary is minimal and I don’t think he receives a quarterly bonus.

”In a recent CNBC interview, Berkshire Hathaway (BRK.A) CEO Warren Buffett criticized banks for investing in mortgage securities at historically low yields, calling them a ‘very dumb holding for banks.’The problem for mortgage securities holders is that effective maturities lengthen when interest rates rise, the opposite of what the banks want. It leaves banks with relatively low yielding portfolios for potentially long periods. BofA's bond holdings yield about 2.6%, which could weigh on its returns, particularly if it has to pay more for deposits. The portfolio has an estimated average life of eight years. Unlike the banks, Berkshire chose to invest its cash of over $100 billion largely in short-term U.S. Treasury bills. It accepted rates near zero in 2020 and 2021 but is now getting 5% on its holdings. If Bank of America had taken more of a Berkshire-type approach, it now could be earning twice the current rate. Berkshire is Bank of America's largest investor, with a roughly 13% stake—some one billion shares. It's notable that Buffett has decided against putting new money into Bank of America this year even after the stock's weakness.”
Excerpted from Barron’s April 24, 2023 (Print)
Article: “Bank of America’s $99 Billion Bond Problem” - Andrew Bary

Brown Capital Management describes their investment approach to finding what they call «Exceptional Growth Companies (EGCs) over a three- to five-year horizon and beyond. EGCs offer products and services that save time, lives, money and headaches, or provide exceptional value. » This small company fund used to be rated *****, but it has not maintained that level of performance. I used to be a shareholder.

"...Don’t be surprised if our portfolios reallocate some capital to CRE with our credit pencils well-sharpened."
Makes me smile. I'm still holding onto my own small stake in a dedicated niche REIT: PSTL. My confirmation-bias bone feels better, now. David, it was an engrossing read. Thank you very much.

@lewisBraham
I don't have to write my reps, cause I live in Massachusetts. I agree in theory that democratic actions ( letters, calls, marches campaigning) would work if everyone did it, but only 50% max of the public even votes.
Most of the reps leading the charge for this crap have been gerrymandered into districts they can't loose.
My sister in Texas is gerrymandered into a very red district. Her Rep Chip Roy is one of the more extreme GOPers. He refuses to respond to her emails, and will not let anyone but registered Republicans into his town meetings. There are guards at the door checking names off the voter lists.
Her local school board just voted to require the history teachers to only teach to their students that Trump won the 2020 election and it was stolen.
Unfortunately I think until the real awful consequences of the debt ceiling refusal really hit the fan nothing will change.

Yogi: "Many banks also offer unusual 11-mo, or 13-mo CDs as those one-time deals may not show up on industry wide 12-mo, 18-mo, 24-mo offering data."
Yep, I do my banking at Capital One, and that bank offers those types of CDs. I hold enough money at Capital One for liquidity objectives, and for very small CDs, whereas I choose to hold much larger amounts of CDs at Schwab. At Schwab, I hold a large amount of money for a CD laddering systen. I also have the option of using Schwab money market funds, that pay as much or more than most CDs at private banks, as holding accounts for CD monies that mature. At Schwab I have the option of immediately reinvesting in CDs, or holding for investing in other options. I traditionally have invested in Bond OEFs, but for now I don't choose to ride the roller coaster of bond oef investing, so I use CDs in a laddering system, along with high paying Money Market options.

https://www.sec.gov/Archives/edgar/data/869351/000183988223010046/small-497_042023.htm
497 1 small-497_042023.htm SUPPLEMENT DATED APRIL 20, 2023
BROWN CAPITAL MANAGEMENT MUTUAL FUNDS
The Brown Capital Management Small Company Fund
BCSIX - Investor Shares
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This Supplement is to give notice that effective May 1, 2023, The Brown Capital Management Small Company Fund will be re-opened to new investors. Accordingly, the section of the Prospectuses and Summary Prospectuses titled “Special Note Regarding The Brown Capital Management Small Company Fund” is hereby removed from the Prospectuses and the Summary Prospectuses of the Fund. Shares of The Brown Capital Management Small Company Fund may be purchased as described in the Fund’s current Prospectuses, Summary Prospectuses and Statement of Additional Information.
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update:
https://www.sec.gov/Archives/edgar/data/313850/000168386323003487/f25414d1.htm
497 1 f25414d1.htm VANGUARD ALTERNATIVE STRATEGIES FUND LIQUIDATION
 
Vanguard Alternative Strategies Fund
Supplement Dated April 19, 2023, to the Prospectus and Summary Prospectus Dated February 27, 2023
Important Changes to Vanguard Alternative Strategies Fund (the Fund)
 
On February 14, 2023, the board of trustees of the Fund approved a proposal to liquidate and dissolve the Fund. Effective as of the close of business on April 19, 2023, the liquidation is complete.
In connection with the liquidation, shareholders may receive proceeds that are taxable. Any liquidation proceeds paid to shareholders should generally be treated as received in exchange for their shares and will therefore generally give rise to a capital gain or loss, depending on their basis in the shares. Shareholders should consult their own tax advisors about any tax liability resulting from the receipt of liquidation proceeds.
 
© 2023 The Vanguard Group, Inc. All rights reserved.
Vanguard Marketing Corporation, Distributor.PS 1298B 042023
Vanguard Trustees' Equity Fund
Supplement Dated April 19, 2023, to the Statement of Additional Information Dated February 27, 2023
Important Changes to Vanguard Alternative Strategies Fund (the Fund)
On February 14, 2023, the board of trustees of the Fund approved a proposal to liquidate and dissolve the Fund. Effective as of the close of business on April 19, 2023, the liquidation is complete.
In connection with the liquidation, shareholders may receive proceeds that are taxable. Any liquidation proceeds paid to shareholders should generally be treated as received in exchange for their shares and will therefore generally give rise to a capital gain or loss, depending on their basis in the shares. Shareholders should consult their own tax advisors about any tax liability resulting from the receipt of liquidation proceeds.
Any references to the Fund in this Statement of Additional Information are hereby deleted.
© 2023 The Vanguard Group, Inc. All rights reserved.
SAI 046C 042023
Vanguard Marketing Corporation, Distributor.