Displaying items by tag: Goldman Sachs

Monday, 07 February 2022 20:22

Goldman Says This is Causing the Market Turmoil

Quantitative easing was the process of flooding the market with money in exchange for buying up long-term government debt and MBS; quantitative tightening was coined by Citigroup in order to describe the unwinding of this process. Goldman Sachs says this is causing increased volatility and sapping liquidity out of the treasury market. This QT could come with an abundance of arbitrage opportunities particularly in U.S. interest rate markets. Additionally, Goldman says QT will widen the gaps in new and old securities and narrow treasury yields and swap rates. F


INSUM: The treasury market is ripe for turmoil with the upcoming rate hike in March.

Published in Eq: Large Cap
Thursday, 03 February 2022 19:14

Goldman’s Approach to Direct Indexing

Fidelity made a splash with its announcement of a $5,000 minimum direct indexing product a couple of weeks ago, and there has been a rush by Vanguard, JPMorgan, and BlackRock to acquire direct indexing firms. Goldman has been a long-time investor provider of direct indexing services, in fact over 20 years ago. Goldman specialized in wealthier clients with a minimum investment of $250,000. Goldman offers software tools for clients to use to add and drop stocks from indices. Most of the time they do this for tax purposes but sometimes clients customize by dropping equity sinners like fossil fuels or prisons. Goldman's direct indexing is a form of active management with higher fees than passive funds, but certainly more futures.


FINSUM: The advent of direct indexing for all will be an interesting follow as lower minimums become the new norm.

Published in Wealth Management
Wednesday, 02 February 2022 19:13

Goldman and Morgan Get Very Bearish

David Kostin, a strategist at Goldman Sachs Group Inc., took a bearish tilt on U.S. stocks worrying about risks that may be on the road ahead. Goldman is far from the only bear on Wallstreet, Michael Wilson of Morgan Stanley says that the fair value of the S&P 500 is closer to 4,000. This would be a 10% downturn in the S&P if fully realized. Goldman isn’t that pessimistic but if real U.S. treasury yields rise 60 basis points then that will be their baseline. The median forecast is still quite positive for the S&P 500 by the end of the year with a target price close to around 5,100. However, Wallstreet says the antidote is to focus on quality and energy stocks.


FINSUM: Wall street is forgetting how bad sustained realized inflation will be for the market; it's without a doubt the biggest risk, because companies are used to operating with systematic sub 2% inflation.

Published in Eq: Total Market
Tuesday, 11 January 2022 21:31

Goldman Makes a Very Bearish Call on 2022

Goldman Sachs updated its path for Fed tightening in 2022 calling for four rate hikes instead of three in 2022. This is a fairly aggressive path for tightening as the current Fed target interest rate is between 0%-.25% which means it will hit around 1-1.25 by Goldman’s forecast. The biggest reason for the rate rises is the tightening labor market. Previously the Fed leaned on slack in the labor market as an excuse to brush off inflation concerns but now they are no longer doing that. Goldman has the hikes penciled in for each quarter March, June, September, and now December. Goldman saw regional San Francisco President Mary Daly’s comments of shedding some balance sheet weight of indicating the Fed’s future path.


Finsum: The Fed hasn’t tightened this quickly in the post-financial crisis era, but broadly the markets and yields are in lock step with Goldman’s predictions.

Published in Eq: Total Market
Thursday, 06 January 2022 21:21

Goldman Goes Huge on Crypto

Bitcoin has stumbled as of late, all the way down to $46,000, but Goldman Sachs isn’t backing off their bullishness and they say the price may double to over $100,000 by the end of 2023. The first of the primary reasons is just the groundswell into digital assets generally. The second big factor is how investors will fundamentally see bitcoin moving forward, as a store of value substitute. They see bitcoin eating away at a stalling gold bouillon. To date, bitcoin only makes up a fifth of the ‘store of value’ market, but that could swing all the way up to a market majority. Other cryptos could also jump in to take some of the markets as well.


FINSUM: As Fed uncertainty lingers, investors are going to push themselves more into alternatives to hedge inflation and interest uncertainty and maintain a store of value.

Published in Wealth Management
Page 4 of 25

Contact Us

Newsletter

Subscribe

Subscribe to our daily newsletter

Top
We use cookies to improve our website. By continuing to use this website, you are giving consent to cookies being used. More details…