The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
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Cembalest: US municipal restructurings will rise continuously without federal intervention
“But absent intervention from the Fed or the Treasury, which I have a 95% confidence won't happen, we're gonna have Can you continuously rising stream of restructurings at the municipal level over the next few years?”
Bondholders lose more than pensioners in every US municipal restructuring to date
“And in the seven or eight restructurings that have happened so far at the municipal level, that's exactly what's happened. Every time there's been a pensioner and retiree healthcare write down, the bondholders lost more as a percentage of par.”
U.S. entitlement to discretionary spending ratio will hit 5:1 within a decade
“Because in 1970, the country spent the same amount on entitlement spending As it did on all of the rest of the non-entitlement discretionary spending. And so that one to one ratio became one and a half to one, then two to one. And now it's three to one, and it…”
Cembalest: Trump administration will post severe midterm losses despite strong economy
“I think this is the first administration that's going to post a double bogey At a time of strong stock markets and strong employment with respect to the losses they sustain in the midterm election.”
Except for 1973, market impacts of military conflicts dissipate within four months
“With the exception of the 1970 to 73 Arab-Israeli conflict which led to an oil embargo and a stagflation, almost every single military conflict was gone from the markets within three to four months. Where the business cycle was at that point the primary driver…”
Cembalest: 2017 tax bill spent twice as much on individual cuts than corporate reform
“So what's amazing is that a tax bill that started out as something to rationalize the competitiveness of the U.S. Corporate sector, they spent twice as much money on individual tax cuts, and so that, that's disappointing as well.”
Electricity accounts for just 17% to 18% of global energy consumption
“Electricity is only 17 or 18% of all global energy consumption.”
Cembalest: Elon Musk's Tesla Pay Is an Outlier Compared to Major Indices
“Last week, I did a post on Tesla, a story in pictures, which was kind of a brutal and cruel assessment of everything you're going on at Tesla, including, by the way, a chart on CEO compensation that shows how much Elon Musk gets paid for a loss-making enterpri…”
The U.S. has experienced negative real interest rates in only four eras
“Since, when the United States starts as a republic, there have been four periods when the cost of money is below the rate of inflation for an extended period. The Civil War, World War I, World War II, and the last 10 years.”
More than half of Italian high-yield bonds yield less than U.S. Treasuries
“More than half of all the high yield bonds issued in Italy have yields that are tighter than U.S. Treasuries.”
Cembalest: Mexican Assets Became Top Performers in Decade Post-1994 Devaluation
“And in 1994, after the Mexican peso devaluation, you couldn't sell a peso denominated asset or a dollar denominated asset with exposure to Mexico to anybody, and over the subsequent decade, all sorts of Mexican denominated assets were among the best performing…”
Cembalest: Municipalities can legally alter retiree healthcare, but pensions are inviolable
“Municipalities can unilaterally make changes to retiree healthcare obligations that are unpopular, but a judge will allow, whereas unfunded pensions are inviolable.”
Cembalest: Electricity is only 10% to 15% of industrial energy use
“I think electricity is maybe 10 or 15% of overall energy consumption by industry.”
Cembalest: Mexican government bond underwriting fees fell from 200 bps to zero
“If you were underwriting a Mexican government bond, you could still get paid a point and a half to two points in underwriting fees. Now you don't do it for anything except leave cable credit, and there's no fees”