The Long View
The Long View
Oct 28, 2020
Peter Hayes: Surveying the Municipal Bond Landscape
Play • 51 min

Our guest this week is Peter Hayes. Peter is a managing director at BlackRock where he heads the firm's municipal income group and sits on its global fixed-income Executive Committee. In his role, Peter oversees all aspects of municipal fund management, including portfolio management, research, strategy, and trading. Among his responsibilities, Peter is one of the managers of the BlackRock Strategic Opportunities Fund. In addition to these duties, Peter is also a member of BlackRock's Global Operating Committee. Before joining BlackRock in 2006, Peter was a portfolio manager at Merrill Lynch Investment Management, where he led the short-term tax-exempt trading desk and managed short-term municipal bond strategies. Peter earned a bachelor's in economics from the College of the Holy Cross.

Background

Peter Hayes Bio

The Big Picture

Local Finances Are Troubled, but Fund Investors May Still Profit,” by Carla Fried, nytimes.com, July 10, 2020.

Muni Investors Scale Back,” by Peter Hayes, blackrock.com, Oct. 7, 2020.

How Much Is COVID-19 Hurting State and Local Revenues?” by Louise Sheiner and Sophia Campbell, brookings.edu, Sept. 24, 2020.

Record Increases of new Covid-19 Cases in 3 U.S. States With the Most Population,” by Jay Croft, Christina Maxouris, and Douglas Wood, cnn.com, June 24, 2020.

Stimulus

Second Stimulus Checks (10/1/20): What Will the Next Stimulus Package Look Like?” by Claudia Dimuro, pennlive.com, Oct. 2, 2020.

CARES Act Includes Essential Measures to Respond to Public Health, Economic Crises, But More Will Be Needed,” by Sharon Parrott and others, cbpp.org, March 27, 2020.

Municipal Liquidity Facility definition

The Fed Says It Is Expanding its Municipal Bond Buying Program,” by Jeff Cox, cnbc.com, April 27, 2020.

U.S. Municipal Market Activity Witnessing Positive Momentum Post Fed’s Intervention,” by Nikhil Francis and Saswata Mohanty, acuitykp.com, Sept. 18, 2020.

Lawmakers Tangle Over Fed’s Muni-Market Rescue,” by Heather Gillers, morningstar.com, Sept. 17, 2020.

Riskier Fixed-Income Sectors Bounce Back in the Second Quarter,” by Gabriel Denis, Morningstar.com, July 6, 2020.

Credit

Municipal Bond Perspective: Where We Go From Here,” beyondbullsandbears.com, April 24, 2020.

How Is the Coronavirus Crisis Affecting the Municipal Bond Market?” by Daniel Bergstresser, econofact.org, April 8, 2020.

Bond Insurance Returns to the Muni Market in a Big Way,” by Heather Gillers, wsj.com, Oct. 22, 2020.

Muni Bond Insurers See Demand Grow Amid Pandemic Worries,” by Liz Kiesche, seekingalpha.com, Oct. 22, 2020.

Supply and Demand

Municipal Bond Market Update—September Edition,” by Corey Boller, dividend.com, Sept. 10, 2020.

Supply and demand shocks in the COVID-19 pandemic: an industry and occupation perspective,” by R Maria del Rio-Chanona and others, academic.oup.com, Aug. 29, 2020.

Will Supply-Chain Disruptions and Delayed Capital Spending Be Material,” by Brian Bernard, Morningstar.com, March 25, 2020.

Munis in Focus: 2020 Municipal Market Update,” by David Hammer, pimco.com, Sept. 11, 2020.

Global Supply Chains in a Post-Pandemic World,” by Willy C. Shih, hbr.org, Sept.-Oct. 2020.

Reviving States, Cities and the Munibond Market Amid COVID-19,” by Brian Wynne, morganstanley.com, April 27, 2020.

Revenue Streams Drying Up? Municipal Bonds in the Pandemic,” by Dennis DiCicco, jhinvestments.com, Aug. 20, 2020.

Taxes

Calculating Tax Equivalent Yield: Are Municipal Bonds Right for You?” by Thomas Kenny, thebalance.com, May 11, 2020.

7 Best Tax-Free Municipal Bond Funds,” by Barbara Friedberg, money.usnews.com, Oct. 7, 2020.

Taxable Munis? They’re Worth a Look,” by Jeffrey R. Kosnett, Kiplinger.com, Jan. 2, 2020.

Coronavirus Fears Affect the Municipal Bond Market,” by Cooper Howard, schwab.com, March 18, 2020.

What Is the Muni-Treasury Ratio or M/T Ratio?” by Thomas Kenny, thebalance.com, July 29, 2020.

Portfolio/Positioning

Strategic Municipals Opportunities Fund

Muni Market Tailwinds Turn to Headwinds,” by Peter Hayes and Sean Carney, blackrock.com, April 2, 2020.

Short Term Treasuries Are ‘Overvalued’: BlackRock Muni Bonds Head,” Peter Hayes on “On the Move” video panel, finance.yahoo.com, Sept. 18, 2020.

Stay the Course Amid Market Volatility,” blackrock.com.

Volatility, the Vote and Taking the Long View,” by Tony DeSpirito, blackrock.com, Oct. 12, 2020.

Issue Selection

How Munis Can Boost Your Investment Health,” gsam.com, Oct. 5, 2020.

How to Invest in Municipal Bonds,” by Miranda Marquit, forbes.com, July 9, 2020.

Small Investors Ruled the Municipal-Bond World for a few Days in March,” by Heather Gillers, wsj.com, May 7, 2020.

How and Why to Build a Bond Ladder,” fidelity.com, Sept. 17, 2020.

Rising Rates Series: The Ups and Downs of Bond Ladders,” by Karen Schenone, fundsociety.com, June 4, 2018.

2011: The Year 60 Minutes Misled Americans About Municipal Bonds,” by Janet Tavakoli, businessinsider.com, Dec. 30, 2011.

Bogleheads On Investing Podcast
Bogleheads On Investing Podcast
bogleheads
Episode 031: Jamie Catherwood, host Rick Ferri
Jamie Catherwood is a financial historian and the publisher of the website Investor Amnesia. He received a history degree from King’s College London in 2017 before joining O’Shaughnessy Asset Management, a quantitative investment firm based out of Stamford, Connecticut. Jamie quickly built his reputation as an expert on the history of money and finance after starting a popular weekly blog that links current market activity and investor behavior to similar events and investor behaviors throughout the centuries. Jamie shared numerous interesting anecdotes in this podcast and draws clear parallels to the current environment This podcast is hosted by Rick Ferri, CFA, a long-time Boglehead and investment adviser. The Bogleheads are a group of like-minded individual investors who follow the general investment and business beliefs of John C. Bogle, founder and former CEO of the Vanguard Group. It is a conflict-free community where individual investors reach out and provide education, assistance, and relevant information to other investors of all experience levels at no cost. The organization supports a free website at Bogleheads.org, and the wiki site is Bogleheads® wiki. Since 2000, the Bogleheads' have held national conferences in major cities around the country. There are also many Local Chapters in the US and even a few Foreign Chapters that meet regularly. New Chapters are being added on a regular basis. All Bogleheads activities are coordinated by volunteers who contribute their time and talent. This podcast is supported by the John C. Bogle Center for Financial Literacy, a non-profit organization approved by the IRS as a 501(c)(3) public charity on February 6, 2012. Your tax-deductible donation to the Bogle Center is appreciated.
57 min
Money For the Rest of Us
Money For the Rest of Us
J. David Stein
What Is Tail Risk and Are You Taking Too Much Of It?
When should you protect against rare, but extreme events? When should you self-insure? Under what circumstance should you sell tail risk protection to others? Topics covered include: * How tail events differ from tail risk * Why volatility is not the best measure of risk for individuals * What does it cost to protect against large stock market losses * Why younger investors can take more risk due to their human capital * How does the profit wheel options strategy work * How the catastrophic power outage in Texas exemplifies tail risk * Why individuals need to build more reserves because the economic system is too efficient and vulnerable to breakdowns Thanks to SmartAsset and Babbel for sponsoring the episode. Use code DAVID for Babbel to get three months free. For more information on this episode click here. Show Notes Average Weather in San Antonio Texas, United States—Weather Spark Update on the CBOE BuyWrite and PutWrite Option Indexes, October 2018—Asset Consulting Group The Texas Freeze: Why the Power Grid Failed Katherine Blunt and Russell Gold—The Wall Street Journal His Lights Stayed on During Texas’ Storm. Now He Owes $16,752 by Giulia McDonnell Nieto del Rio, Nicholas Bogel-Burroughs, and Ivan Penn—The New York Times When More Is Not Better: Overcoming America’s Obsession with Economic Efficiency by Roger L. Martin Related Episodes 250: Investing Rule One—Avoid Ruin 283: Why You Should Care About Carry Trades 321: How to Analyze Complex Investments 323: The Economy Is Not A Machine
27 min
Sound Investing
Sound Investing
Paul Merriman
The Ultimate Buy and Hold Strategy: 2021 Update
Paul Merriman discusses the 2021 updated Ultimate Buy and Hold Strategy, designed to show why the 10 equity asset classes should be part of a diversified portfolio. This new study uses an expanded base of returns so that all 10 equity asset classes are reflected in the 1970 to 2020 period. While the expansion of returns makes the returns more dependable, the results are virtually the same as with the previously limited data base. Every year since 2012, The Merriman Financial Education Foundation updates this UB&H Strategy as among its most important work. The 2021 study makes reference to two tables that listeners will want to review. They are the Worldwide Equity Portfolio Tables 50% US/50% Int’l and the Worldwide Equity Portfolio Tables 70% US/30% Int’l. This podcast is part of the educational offerings from The Merriman Financial Education Foundation, a registered 501(c)3.  If you found value in this podcast, here are five ways to support the podcast and our foundation: 1)     Leave a podcast review on your player of choice. 2)    Sign up for our biweekly newsletter at PaulMerriman.com 3)    Use our M1 Finance affiliate link to set up a brokerage account and use our portfolio suggestions. If you fund your account with a minimum of $1,000, our foundation will receive a one-time fee at no cost to you, which helps support our financial education projects.. 4)    Buy our latest book, We’re Talking Millions! 12 Simple Ways To Supercharge Your Retirement available at Amazon and other online outlets. 5)  Consider making a tax-deductible donation to the Foundation to support our mission to provide financial education to investors.  Thank you!
46 min
WashingtonWise Investor
WashingtonWise Investor
Charles Schwab
Global Issues May Loom Large for Investors
While it feels like domestic priorities have been in the spotlight for months, global concerns can’t be dismissed. Jeff Kleintop, Schwab’s chief global investment strategist, joins host Mike Townsend to discuss international activity with implications for U.S. markets. From U.S.-China relations to the outlook for President Biden’s relationship with allies across Europe to prospects for emerging markets in 2021, Jeff helps shine a light on where the potential opportunities are for investors. Mike also shares his thoughts on the progress and timing of the latest economic stimulus bill, Washington’s new focus on the recent retail trading frenzy led by GameStop, Janet Yellen’s comments on tax increases in the administration’s next big bill, and the growing chatter about a possible delay in the April 15 tax deadline. _WashingtonWise Investor_ is an original podcast from Charles Schwab. For more on the series, visit Schwab.com/WashingtonWise. If you enjoy the show, please leave a ★★★★★ rating or review on Apple Podcasts. Important Disclosures Investors should consider carefully information contained in the prospectus or, if available, the summary prospectus, including investment objectives, risks, charges, and expenses. Please read it carefully before investing. The policy analysis provided by the Charles Schwab & Co., Inc., does not constitute and should not be interpreted as an endorsement of any political party. The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third-party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Past performance is no guarantee of future results and the opinions presented cannot be viewed as an indicator of future performance. Investing involves risk including loss of principal. Indexes are unmanaged, do not incur management fees, costs and expenses and cannot be invested in directly. For more information on indexes please see www.schwab.com/indexdefinitions. All corporate names are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. International investments involve additional risks, which include differences in financial accounting standards, currency fluctuations, geopolitical risk, foreign taxes and regulations, and the potential for illiquid markets. Investing in emerging markets may accentuate these risks. (0221-186S)
27 min
Marketplace Roundtable
Marketplace Roundtable
Seeking Alpha
Value Investor's Edge Live #32: Surging Containership Rates - MPC Containers Update
Constantin Baack, CEO of MPC Containers (OTCPK:MPZZF), a leading small-sized containership lessor, joined J Mintzmyer's Value Investor's Edge Live on 9 February 2021 to discuss this segment of the surging containership markets. MPCC is one of our current top picks at Value Investor's Edge, and is significantly benefiting from surging rates. Although it's not currently listed in the US markets, there's sufficient trading liquidity on the Oslo Exchange ("MPCC") and they are considering a potential US-listing if market conditions remain favorable throughout the year. For more particular information on MPC Containers, I highly recommend reviewing their latest earnings presentation, which was published on 25 February. Their full Q4-20 financial report is also linked. For readers and listeners primarily interested in US-listed names, the primary comps include: Atlas Corp. (ATCO), Capital Product Partners (CPLP), Costamare (CMRE), Euroseas (ESEA), Global Ship Lease (GSL), Navios Maritime Containers (NMCI), Navios Maritime Partners (NMM), and SFL Corp. (SFL). The content from this interview should be relevant for investors in all of these names. Topics Covered (<1:00): Intro/Disclosures (1:00): What is driving the recent strength in smaller containerships? (4:30): Strategy for the charterbook? Durations vs. rate levels? (7:20): Discount level of one-year vs. two-year charters? (8:30): Structure of the MPCC pool with 15 ships? Plans for charter cover? (9:45): Any plans for a US-listing? Is the IPO market available? (11:45): Dividend plans and potential policy structure? (14:30): Capital allocation priorities into mid-2021? Asset purchases? (16:45): Are accretive asset purchase opportunities still available? (19:45): Any differentiation of interest within smaller-sized ships? (22:15): Merger and consolidation opportunities in this sector? (25:00): What is the typical ROE for recent acquisitions? Unlevered? (27:50): Some of the latest fixture examples? (28:45): How long can the current charter strength last? Learn more about your ad choices. Visit megaphone.fm/adchoices
34 min
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