Weekly Research Briefing: Deflated in a Good Way

December 04, 2023 | 22 Min Read
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The financial markets continued their upward moves last week as several inflation measures in the U.S. and Europe surprised to the downside, sending bond yields to new recent lows and the S&P 500 to 2023 closing highs. More importantly, both credit spreads contracted further while the equities broadened out to smaller cap companies. What are the markets trying to tell us? They are saying that in 6-9 months, the economy will be fine, credit trends will be decent, and the Fed Funds rate will be lower. Bank stocks, REITs and high yield bonds would not be outperforming right now if a significant economic slowdown, banking crunch or credit crisis was on its way. The markets do not work that way.

The Fed speakers will continue to act tough on inflation because that is what they get paid to do. But look closely at the comments from Waller, Powell and Goolsbee. They closed and locked the gate on future rate hikes. The Fed's Barker and Daly are acting the role of the bad cops trying to keep it open, but this is done. Now we look forward to when the 2024 rate cuts will occur. This decision will be a function of how low inflation will go and how the job market performs. Currently, the market is estimating five cuts of 25 basis points beginning at the March FOMC meeting. Watch the holiday party moods of residential builders, realtors and auto dealers given the 100 basis point reversal in interest rates.

Stocks and bonds took last week's interest rate signals and ran hard up. For anyone positioned at the tails of hotter inflation or an economic hard landing, it was time to better align the portfolio into risk assets. There was even a surprising burst of corporate activity for a post-Thanksgiving week. Big private companies, Panera Bread and Shein both filed for IPOs. AbbVie bought ImmunoGen for $10 billion. Cigna and Humana huddled to create a $140 billion health care insurance giant. Alaska Air offered a 300% premium to Hawaiian Airlines to join forces. Trian very strongly asked for two Disney board seats. Elliott bought large positions to go after both Crown Castle and Phillips 66. And on the earnings side, big Dow component Salesforce beat earnings, raised guidance as free cash flow surged sending the Dow Industrials to challenge its all-time high. It was an unusually busy week as the corporate world moves to wrap up their 2023 books.

This week we have the monthly JOLTS and November Jobs data, ISM Services, UofM Consumer Sentiment data to sift through. The monthly jobs numbers get the full assistance of the returning auto workers. While there will be no Fed speak to influence the markets like last week, it will be a very busy conference week with over 300 companies presenting across industry conferences and year end analyst meetings. So anticipate some stock specific news to move prices around. Have a great week and take note that the western ski areas just caught 2-3 feet of snow in the last 72 hours in the event you need any help with your holiday travel plans.


The U.S. Financial Conditions eased 90 bps in November, the largest monthly easing on record dating back to 1982...

This massive swing in the FCI will make everything a bit easier for consumers and businesses. Consumers will see a whole percentage point chopped from mortgage, auto and credit card rates. Businesses should see improved borrowing rates and more open capital market windows. There probably won't be any meaningful December IPOs, but for January and the first quarter, you can bet that the conveyor belt of deals is going to be turned on. The list of companies looking to sell assets and investors looking to monetize private holdings is very long. It does not hurt seeing Arm Holdings and Birkenstock Holdings back near their IPO highs.

@biancoresearch


Bonds going from Trash to Treasure last month was the biggest win for the markets…

And far from a buyers’ strike, bonds have been enjoying a startling run. November was the best month for the asset class in the US in almost 40 years — a rally that has sent benchmark 10-year US government bond yields down from 5 per cent in mid-October to just 4.3 per cent or so now. In turn, this has fuelled the biggest monthly jump in global stocks since the same month in 2020.

The market has leapt directly from a certainty that interest rates will be higher for longer to a firm suspicion that, in fact, central banks will take sliding inflation levels as a cue to start cutting rates possibly even as soon as next spring. This smells somewhat excessive, but it is foolish for investment to stand in the way for now.

“We’re not going to see 5 per cent on the US 10-year again,” said Karen Ward, chief market strategist for Europe at JPMorgan Asset Management. “If you missed 5, don’t miss 4.5. Bonds are very high on the Christmas wishlist in my house.” Festive times in the Ward household.

Financial Times


The Fed's Barker and Daly say that they are not thinking about rate cuts. But Waller is the one the matters...

(US) Fed's Waller (voter, hawk): Good argument that if inflation keeps falling for several months that we could lower policy rate

  • Will closely monitor goods, services prices in upcoming weeks to see if inflation remains on downward path
  • Supply-side problems mostly behind US; Monetary policy will need to do the work from here
  • Inflation remains too high and is too early to say if the slowing in inflation will be sustained; Cannot say definitively if Fed has done enough and data over next couple months will 'hopefully tell'
  • Need some improvement in services inflation ex-housing for overall inflation to reach 2%
  • Labor market is cooling off but still fairly tight and will be watching closely
  • Consumer spending is cooling, manufacturing and non-manufacturing activity has slowed
  • Premature to rely on productivity growth gains to guide stance of Fed policy
  • Encouraged by signs of moderating economic growth
  • Recent loosening of financial conditions a reminder to be careful about relying on market tightening to do Fed's job
  • Increasingly confident policy is well positioned to slow economy and return inflation back to 2%
  • Policy helped rapid inflation improvement in prior year
  • Output growth is moderating which supports inflation progress
  • Financial conditions are tighter overall despite drop in yield

Q&A:

  • Good argument that if inflation keeps falling for several months that we could lower policy rate; No reason to insist rates remain high if inflation falls
  • Could still be a shock that throws a soft landing off course, but that cannot be forecasted; Absent a shock there is no reason why the Fed cannot pull off a soft landing
  • There will be a repricing of CRE, but it will be well anticipated and not a shock; Will take place over a couple of years; Not concerned that it will cause a recession
  • Seeing strong rebound in labor force participation
  • Slowing of economy will have an impact on credit delinquencies, and earnings; those are signs of moderating demand as the Fed intends
  • Sees Q4 GDP at ~1-2%; Last couple weeks of data make Q3 appear as a 'one off' jump; I was stunned by Q3 GDP data

TradetheNews


"Only five weeks after the market was discounting two 25-basis point cuts by January 2025, it’s now expecting five." (John Authers)

A torrid bond-market rally shows traders are convinced the Federal Reserve’s rate-rising cycle is over. The debate now turns to when central bankers start cutting, and by how much.

At issue is whether the economy settles in for a soft landing or spirals into something worse. Both scenarios suggest rate cuts are coming, possibly as soon as March. Current market expectations call for at least 1.25 percentage points of easing next year, a trend that would seem to clear a path for lower yields and an extended rally.

Bloomberg


For once, let's lead off with Europe where Eurozone inflation fell much more than expected to 2.4% last week...

This should be a reminder to all financial market participants that falling inflation is not just a U.S. happening. The pressures are happening in most every country in the world.

Inflation in the eurozone has fallen far more than expected to 2.4 per cent in November, the slowest annual pace since July 2021, providing some relief to consumers and raising hopes that interest rates could soon be cut.

The sharp drop from 2.9 per cent a month earlier adds to tensions between investors who hope rates will be cut soon and central bankers seeking to keep borrowing costs high until the biggest surge in inflation for a generation has been definitively tamed.

Falling energy prices and lower growth in food and services prices were the main factors behind the slowdown in the harmonised index of consumer prices, according to data published on Thursday by Eurostat, the EU’s statistics arm.

Economists polled by Reuters had expected a more modest slowdown to 2.7 per cent. The drop in inflation has prompted investors to bring forward their bets of when the European Central Bank could start cutting its deposit rate to as early as next April.

Financial Times


The European bond markets loved the better-than-expected inflation data...

@Schuldensuehner: Good Morning from #Germany where yields have dropped significantly. 10yr yields have gone down by 28bps, marking the most rapid decline since March. This decline is a result of decreasing inflation rates and disappointing econ data from France. As a response, markets are predicting 5 ECB cuts in the upcoming year, w/initial one set for Mar.


Over in the U.S., signs of negative inflation are being seen. I bet that you didn't see that coming...

After a historic run-up in inflation, Americans are now starting to see something they haven’t in three years: deflation.

To be sure, deflation—that is, falling prices—is largely confined to appliances, furniture, used cars and other goods. Economywide deflation, when prices of most goods and services continuously fall, isn’t in the cards.

But economists say goods prices likely have further to fall, which will ease inflation’s return to the Federal Reserve’s 2% target, perhaps as early as the second half of next year.

Prices for long-lasting items, known as durable goods, have fallen on a year-over-year basis for five straight months. In October, they were down 2.6% from their peak in September 2022, according to data released Thursday by the Commerce Department.

That has helped bring down core inflation, which excludes the volatile food and energy categories, to 3.5% in October, from 5.5% in September 2022, as measured by the personal-consumption expenditures price index, the Fed’s preferred inflation gauge.

WSJ


And while last week's Q3 GDP estimate came in higher than expected, the Core PCE Price Index came in lower than expected...

@LizAnnSonders: Core PCE Price Index within 3Q23 GDP revised lower from +2.4% to +2.3% … still on the higher side if comparing to post-GFC/pre-pandemic, but nowhere near surges in earlier decades (like 1970s)


Need another deflation signal?

The price of corn has tumbled to a three-year low as supplies from the US and Brazil surge while demand stagnates, helping to cool food price inflation but heaping pressure on farmers who had been expecting high prices to last.

Corn, which is used predominantly for animal feed and to produce ethanol, has been trading below $4.50 a bushel in Chicago in recent days, its lowest level since December 2020. It had been trading above $8 a bushel in May last year…

The price fall comes as other key agricultural commodities such as wheat drop from last year’s highs, in a reversal of price trends that had sharply pushed up food costs for consumers. Cheaper animal feed tends to lead to lower costs for meat and dairy producers and cheaper products for consumers.

Financial Times


Your new investment marching orders?


Business activity surveys remain scattered. Here is a strong beat in the Chicago data...

The Daily Shot


While the national ISM Manufacturing PMI surprised to the downside…

The Daily Shot


Lackluster economic data and plunging inflation figures are sending interest rates in one direction...

StockCharts.com


And residential mortgage rates are benefitting from the pullback in Treasury yields...

@NewsLambert: Reprice: The average 30-year fixed mortgage rate slips to 7.09%. That's the lowest reading since September 1st. It's down 94 bps since the multi-decade high hit last month (8.03%). Spread: 287 bps


Neil Dutta at RenMac outperformed others this year in forecasting the economy. So give him the mic...

While public forecasters stumbled throughout the year, the Fed appeared to pull off the balancing act. Current economic data is consistent with a soft landing for the economy — a situation in which inflation cools without causing a recession or sudden spike in unemployment. And Fed Chair Jerome Powell is in a more forgiving mood: Based on recent comments, it's highly unlikely that interest-rate hikes will be back on the menu anytime soon, even if the economy suddenly shows signs of heating back up.

All this is good news for American households, as the cost to borrow money — from credit cards to mortgages — will gradually decline alongside everyday expenses. It's also a favorable setup for financial markets. Stock prices have contracted for nearly two years as bond yields have surged. But with rates stabilizing, if not falling somewhat, stock returns are poised to boom. If 2023 was about the hard work of stabilizing the economy, then 2024 is about enjoying the fruits of that labor...

Thinking through the scenarios for the year ahead, I will say what's changed for me is that the odds of surgical interest rate cuts by the Fed have increased (in my estimate, this possibility has moved from a 30% chance of happening to 50%), while the odds of additional hikes next year have decreased (50% to 30%). And the likelihood of a more aggressive easing cycle to combat a broader slowdown has remained unchanged (20%). Obviously, these are very subjective probabilities. But I'm not inclined to see an aggressive easing cycle because I think the risk of recession remains low: Real incomes are rising, household balance sheets are strong, other central banks around the globe have already started easing (likely supporting growth), and the government is running an expansive fiscal policy.

If I'm right, and the Fed is cutting rates even as the economy continues to grow at a modest pace, it will be a nirvana like situation for equities. While stock prices are up already, many stocks have underperformed the broader market. If the Fed indeed cuts rates next year, it could provide a lift to some of these laggards.

Business Insider


A look at the spectacular November returns that the collapse in Treasury yields created...

Semis, Banks, and REITS led. These are not signs of future economic weakness. And for once, all the market cap indices performed together showing that the market is less concerned about the weaker balance sheets of the smaller cap companies.

StockCharts.com


Credit spreads also collapsed as a sign of strength for anyone invested in the credit markets...

@SpreadThread1


This is an incredible picture showing equity like returns put up by investment grade bonds in November...

@SpreadThread1: I can't remember too many single MONTHS with so many double-digit returns for individual investment grade corporate bonds.


I see the fuel for the stock, bond and private markets in 2024...

@GunjanJS: The one chart that sums up how people have been positioning this year. Huge inflows to money-markets funds, bringing assets to a record $1.3 trillion. Interest in bonds > stocks.


Talk about a legendary quote...

“When everybody is bearish, they’re probably going to be wrong; when everybody is bullish, they may be right for a while.” (Burton Crane, NYTimes)
@WalterDeemer


As Ryan notes, strength leads to strength...

@RyanDetrick: Last month was the 18th best monthly return for the S&P 500 since '50. Looking at previous top 20 monthly returns showed above avg returns going forward. A yr later up 13.3% on avg and higher 80% of the time. Bottom line, big mos like we just saw are usually bullish events.


The biggest question of 2024 for the equity markets?

Will smaller caps catch up? This likely comes down to a question of economic strength and stability in the credit markets. If weaknesses accelerate, then equity investors should continue to hug the legs of their 'Magnificent Seven'. But as last week showed, if investors feel better about a soft or no-landing, then the market should broaden out.

StockCharts.com


If the banking customers are so strong, what does that say about the state of the banking system?

@Markzandi: The economy’s resilience to the Fed’s aggressive tightening is due in part to businesses’ successful effort to lock-in interest rates when they were low. The % of nonfinancial corporate cashflow going to cover interest expense is as low as it has been since in the wake of WWII.


One of the biggest moves last week was in the REITS of Gotham CRE: Vornado and SL Green...

A year ago, most investors thought these companies were going belly up. Six months ago, the companies looked stressed. But just look at what some asset sales and new financing can do for a couple of broken real estate empires. Congrats to several readers who invest in and know this space well.

StockCharts.com


And not just east coast mega-city real estate, as now west coast leasing activity is also picking up...

Goldman Sachs upgraded Hudson Pacific Properties to Neutral from Sell with a price target of $6.25, up from $5.50. The analyst says a number of key negative catalysts have played out and the stock's risk/reward now appears more favorably skewed. Goldman's live-time leasing trackers show that Bay Area office leasing activity has inflected meaningfully in Q4, which could be beneficial to sentiment for Hudson Pacific, the analyst tells investors in a research note. In addition, the recent conclusion of the Hollywood studio strike provides strong visibility on a recovery in the company's studio operating income in 2024, says the firm.

Hammerstone Markets


Real estate is a very big asset class for investors. This is why the big institutions are focused on it...

Income growth for real estate tends to outpace inflation, and most leases in commercial properties contain inflation step-ups. What’s more, as commodities (steel, say, or wood) and labor become more costly, existing buildings tend to appreciate because it becomes more expensive to replace them. Problems in the office sector and pockets of retail and hospitality are well known, but we believe sectors such as industrial and data centers offer robust growth prospects.

J.P. Morgan


Speaking of owning a lot of hard assets...

Anyone who leases commercial business assets should be very excited that United Rentals broke out to all-time highs last week. URI is a $34 billion market cap renter of construction and industrial equipment. All-time new highs in equity valuation tell me that overall business activity is good, and that there is solid intrinsic value to the equipment that you see driving by their yards on the highways. I will believe URI's stock price much more than I believe any single ISM Manufacturing respondent who says that their business has never been more dismal.

@TMLTrader


As mentioned earlier, here are the two most recent high profile IPOs that investment bankers will be pointing to for 2024...

StockCharts.com


I see one heck of a luau at the Hawaiian Airlines headquarters this month...

Another Russell 2000 company exiting stage left (if the regulators allow the merger).

Alaska Air agreed to pay roughly $1 billion for Hawaiian Airlines, quadruple the $250 million that the Honolulu-based carrier was worth on the stock market on Friday.

Why pay so much? Partly it is opportunistic. Hawaiian has had a terrible stretch of late, posting losses every quarter but one since the pandemic. Weak demand from Japanese travelers, the fires in Maui and a problem with maintenance on jet engines added to the recent woes.

The combined company would have more than half the market into and out of Hawaii, around the level where executives think airlines make really good money in a given market. Alaska says the equity value of Hawaiian’s planes is alone worth $560 million.

WSJ

StockCharts.com


One of the more frustrating things about being an investor in only the public markets is the inability to buy into some of the best industries and companies when they become available…

Back in my days of mutual fund public investing, I remember when our analysts became very excited about the outlook for general aviation growth. After doing meetings with many global industry players from the manufacturing side to the services side, it became obvious that there were few ways for our large cap equity funds to invest. The pure play jet manufacturers like Gulfstream, Learjet, Falcon and Cessna were small pieces inside of big aerospace conglomerates. The parts manufacturers supplied to both general and commercial aviation. Even the flight based service operations were mostly small and privately owned. So bottom line there was no way for my large cap equity fund to find exposure to the faster growing and solidly profitable industry known as general aviation.

Now that I am on the other side of the investing fence in the world of private equity, not a quarter goes by that I don't see a private credit or private equity opportunity available for our investors. Most of the companies would be sized as small cap companies if they were publicly owned which would have precluded me from buying them in my large cap mutual fund. But now, they are available and you might come across them as buyout equity, private credit or infrastructure assets inside of many private market portfolios. Meanwhile, the industry continues to have growth characteristics similar to what my analysts projected twenty years ago.

Anyway, here is a recent chart of accelerating trends for general aviation. The outperformance is not just due to the strong economy, but also due to the high commercial aviation occupancy as well as the need for a better first class solution. Just look at how fast the new JSX airline is growing with their Embraer private jet service to smaller airports with ticket prices that rival the major airlines. Onward and upward.

The FAA’s monthly Business Jet Report provides a snapshot of trends in business jet activity, and the report from November 2023 shows continued strong demand for private jets, see chart below.

Apollo Academy


Now let's remind ourselves why we invest into the private markets…

Private equity and private credit have historically outperformed over intermediate and long-term time periods on both an absolute and risk adjusted basis.

Past performance is not an indicator of future results. Source: Hamilton Lane Data via Cobalt, Bloomberg. Indices used: Hamilton Lane All Private Equity with volatility de-smoothed; S&P 500 Index, Russell 3000 Index; MSCI World Index; HFRI Composite Index; Hamilton Lane Private Credit with volatility de-smoothed; Credit Suisse High Yield Index; Barclays Aggregate Bond Index; Hamilton Lane Private Real Estate with volatility de-smoothed; Hamilton Lane Private Infrastructure with volatility de-smoothed; Hamilton Lane Private Natural Resources with volatility de-smoothed; FTSE/NAREIT Equity REIT Index; DJ Brookfield Global Infrastructure Index; MSCI World Energy Sector Index. Geometric mean returns in USD. Assumes risk free rate of 2.2%, representing the average yield of the ten-year treasury over the last five years. (November 2023)

Hamilton Lane


Little further explanation is needed as Norway’s $1.5 trillion wealth fund recommends adding Private Equity...

Norway’s $1.5 trillion wealth fund recommended that private equity be added to its investment portfolio, reflecting a broader shift among large pension and sovereign funds to diversify beyond public assets.

“An increasingly larger share of global value creation takes place in the unlisted market,” Norges Bank Governor Ida Wolden Bache said Tuesday. “We believe that such an opening could give higher returns for the fund over time. We think it will be possible to invest in unlisted equities in a way that meet our expectations on transparency and responsibility.”

The wealth fund, which owns about 1.5% of listed stocks globally, has asked the finance ministry numerous times — most recently in 2018 — to consider adding unlisted companies to its existing portfolio of stocks, bonds, real estate and renewable energy infrastructure…

An unlisted equity portfolio of 3% to 5% of the fund, or about $40 billion to $70 billion at the fund’s current value, will allow it “to take advantage of the benefits of the fund’s size and facilitate adequate diversification,” it said. That’s less than the $80 billion average of the ten largest private equity investors, it said.

Bloomberg


One more Russell 2000 company decides to return to private market ownership...

Blackstone agreed to buy online pet-care marketplace Rover Group in a roughly $2.3 billion deal that bets on growing demand for pet services, an area considered insulated from economic ups and downs. “Rover has a significant runway for growth as pet owners increasingly place a premium on high-quality care, flexibility and convenience,” Tushar Gupta, a principal at Blackstone, said in a statement…

Blackstone offered $11 a share, a 29% premium to Tuesday’s closing price of $8.50. The transaction is slated to close in the first quarter of 2024. Rover was founded in 2011 and went public through a special-purpose acquisition company merger in 2021, but it has largely traded below its $10 initial share price.

The Seattle company, which bills itself as an alternative to relying on friends and family for pet care, offers such services as boarding and in-home pet sitting, dog walking, drop-in visits, and dog training. Through Sept. 30, more than four million pet owners have booked services on Rover and more than one million pet care providers in North America and Europe have been paid, according to company data.

WSJ


Over in Japan, being public is no longer fun...

If you don't need the public equity vehicle for financing, then why put up with all those pesky, irritating shareholders? Many U.S. and European companies would agree.

Some of Japan’s most notable companies are feeling somewhat listless about being listed.

That might be the reason for the $5 billion take-private offer for Taisho Pharmaceutical Co., the largest management buyout in Japanese history, announced last week. With the founding Uehara family in control of a majority of shares, most expect the proposal to succeed even in the face of grumblings from minority shareholders, bringing to an end six decades as a public firm.

Taisho might be the biggest, but is far from alone in choosing this path. Buyouts by management and controlling parties have surged this year in Japan, with the total value now set to pass 1 trillion yen ($6.8 billion). Cram-school operator Benesse Holdings Inc. and karaoke provider Shidax Corp. are among firms also choosing to abandon public markets.

Expect this trend to continue: For many businesses, being public is no longer worth the hassle. For decades, a listing in Japan was easy street. Extensive cross-holdings ensured a compliant shareholder base; even if the domestic market was stagnant, the rise of China provided growth opportunities next door; and most of all, no one really expected stocks to deliver much of a return.

All that is changing. Now, everywhere management looks, there’s a new annoyance. Activist investors are emboldened by recent successes and launching campaigns to bend boards to their will. The Tokyo Stock Exchange is increasingly breathing down executives’ necks, looking to nag them into compliance with the goal of boosting valuations. Who needs the hassle?...

The Tokyo Stock Exchange’s pressure campaign to enhance corporate returns and reduce the vast number of firms that trade below book value has been a key catalyst in the rally of Japanese stocks to new three-decade highs. A widely publicized revamp of markets last year was dismissed as a cosmetic exercise, but the bourse is now tightening the screws; in 2024, it plans to launch a “name and shame” list of firms that are not meeting its value goals.

Bloomberg


The Nasdaq is going to clean house of 500+ stocks, in 2024, which should trim an entire column from the daily stock listings in the WSJ newspaper...

Hundreds of stocks have broken the buck this year, following a slump in the once-hot market for buzzy startups seeking rapid growth.

As of Friday, 557 stocks listed on U.S. exchanges were trading below $1 a share, up from fewer than a dozen in early 2021, according to Dow Jones Market Data. The majority of these stocks—464 of them—are listed on the Nasdaq Stock Market, whose rules require companies to maintain a minimum share price of $1 or risk being delisted...

Companies with a share price below $1 can stay listed more than a year before Nasdaq kicks them off. Largely owing to the pileup of stocks below $1, around one in six Nasdaq-listed companies is running afoul of the exchange’s rules, Nasdaq data show.

“Exchanges are supposed to be gatekeepers and list only bona fide companies that have investor interest,” said Rick Fleming, a former SEC investor advocate. “If a bunch of companies aren’t really meeting those standards, it undermines the seal of approval that the exchanges are supposed to be imparting.”

WSJ


How to turn $10,000 into $3.5 billion as illustrated by Mark Cuban...

Mark Cuban invested $10,000 into Broadcast.com during the mid 1990's so that he could use the sports over internet service to listen to Indiana University basketball games. This early investment eventually led to him striking a deal to take control of the company. Broadcast.com went public in 1998 and ripped 250% on its first day of trading. Nine months later, Yahoo bought the company for $5.7 billion. Mark Cuban cashed out of all his shares worth $1 billion. And in January 2000, he used $285 million of the proceeds to buy the majority stake in the Dallas Mavericks from H. Ross Perot Jr. Last week, he announced a deal to sell a majority stake in the team while still retaining control. If you ever needed proof that good things happen to good people, start by pointing here.

@JoePompliano


Thanks for the decades of pearls Charlie...

“Wisdom acquisition is a moral duty. And there's a corollary to that proposition which is very important, it means that you're hooked for lifetime learning, and without lifetime learning you people are not going to do very well. You are not going to get very far in life based on what you already know. You're going to advance in life by what you're going to learn after you leave here.” - Charlie Munger 2007 USC Law School Commencement Address

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