Market Commentaries
Muni Market Update: Fairly Valued with a Hefty Supply Backdrop
October 2024Municipal tax-exempt yields maintain fair overall valuations amidst a significant pick-up in supply throughout the year. The 10-year muni/treasury ratio is 69% vs. a 5-year average of 71%.[1] As of early September, total muni supply is up 38% year-over …
Cash vs. Bonds
July 2024With money market fund rates of 5% taxable and over 3.25% tax-exempt (5.15% TEY1), maintaining high cash balances is enticing. However, this is not an attractive long term investment strategy and will be a temporary mirage once rate cuts commence. In t …
Forty Years of Municipal Bonds – A Letter to Our Clients, Colleagues, and Friends
July 2024INDEPENDENCE I hope Summer 2024 is off to a good start. I wish you and your family a Happy 4th of July – the day the Continental Congress approved the Declaration of Independence. Our founders were skeptical of concentrated power. They knew concentrat …
Municipal Market Update| Pick Your Spots
March 2024Persistently low supply met with sturdy demand is keeping municipal yields at bay, even as Fed rate cut projections get kicked further and further out the calendar. The nature of the demand has created a tale of two municipalities along the yield curve …
Two Strategies for Today’s Municipal Market
December 2023Here are two portfolio strategies we find attractive in today’s municipal market: Tax loss swaps Discount bonds[1] trading at relatively attractive yields Tax Loss Swaps Selling bonds is an infrequent exercise for most income-oriented investors. Howeve …
Are the Bond Vigilantes Back?
October 2023Yields moved up precipitously during the month of September as the AAA rated 10-year municipal has moved from 2.85% on August 31st to 3.52%[1] today. 3.52% is equivalent to a taxable rate of 5.58% calculated at the 37% bracket. This bond selloff (highe …
Market Anxiety From One D-Word to Another
May 2023Moody’s “Corporate Default Rate to Breach Historical Levels” Three of four of the largest U.S. bank failures have occurred in the past two months Capital One: “Credit Card Delinquencies Test Multi-Year Highs as Job Market Faces ‘Material’ Worsening. Po …
On Recent Market Turmoil and the Safety of Your Assets
March 2023On Recent Market Turmoil and the Safety of Your Assets The market volatility over the last two weeks has occurred across a broad section of financial markets with varying levels of severity. And this dynamic is likely to remain present for some time as …
Municipal Market Update: The Best Defense is a Good Defense
December 2022The Fed on Wednesday raised its target range for the Fed Funds Rate by 50 basis points (0.50%) to 4.25%-4.50%. The Fed Funds Rate (FFR) most directly impacts short term treasury rates, while bonds 5-years and beyond are primarily priced based on market …
Perspective for Advisors | Tax Loss Swap into a SMA
September 2022The market rout of 2022 has left few asset classes unscathed. The S&P 500 is down 22.51% through 9/23. While bonds have not been immune given the Fed’s 180 degree policy turn from late 2021 and persistent inflationary pressures. The 2-year treasury …
Market Update: Municipal Yield and Valuation Overview
August 2022The first half of 2022 is one of the few market environments in recent history where all major asset classes suffered. The Novel Investor blog’s Asset Class Returns captures this nicely noting “cash” outperformed with a +0.2% return. “HG Bonds” (high-g …
Perspective for Advisors: Bonds are Back!
April 2022Jerome Powell and his Federal Reserve colleagues have begun taking steps to put the income back in fixed income assets, leading to one of the worst bond market drawdowns in the past forty years. Rates have spiked as the Fed has made a rapid about-face …
Municipal Market Update – Bonds are Back!
April 2022Jerome Powell and his Federal Reserve colleagues have begun taking steps to put the income back in fixed income assets, leading to one of the worst bond market drawdowns in the past forty years. Rates have spiked as the Fed has made a rapid about-face …
Yield Curve Historical Perspective & Municipal Market Update
February 20222022 is off to a volatile start in global financial markets as the Fed begins the process of tightening monetary policy. Yields have risen – especially at the front end of the yield curve, thereby flattening the curve. Today the average AA rated 2-year …
37 YEARS
December 2021of serving Investors, Issuers, and the Municipal Bond Market THANK YOU. We wish you and your family a healthy and prosperous 2022 and offer our profound “thank you” for your continued confidence in the Bernardi team. We greatly appreciate the o …