Share to Twitter Share to Linkedin The relentless pace of the Federal Reserve’s rate hikes are coming against a backdrop of large numbers of older adults struggling economically and taking on debt to make ends meet. Even before the pandemic, debt was growing among older households . And the pandemic hit older adults especially hard . They experienced outsized health and employment impacts and weren’t eligible for some of the more generous forms of pandemic relief, which focused on families with children at home. And even as the economy has rebounded, for many older adults, economic pressures continue. Last year, poverty rates for those over age 65 went up , while falling for other age groups. And it’s not only those at the very bottom of the economic ladder who are struggling. The share of people reporting difficulty paying regular expenses (things like groceries, rent, and healthcare) has nearly doubled over the last 12 months and now stands at 35% … [Read more...] about Older Adults And Debt: A Storm On The Horizon?
Why equity is cheaper than debt
Representative image Foreign investors have been aggressively buying Indian equities in November, investing Rs 30,385 crore this month so far, on stabilisation in rupee and resilience of the domestic economy compared to global counterparts. However, going forward, buying by Foreign Portfolio Investors (FPIs) is unlikely to turn very aggressive as high valuations in India are a headwind, said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. Further, valuations in markets like China, South Korea and Taiwan are very attractive now and so more FPI money is likely to move to these markets, he added. According to data with the depositories, FPIs invested a net sum of Rs 30,385 crore in equities during November 1-18. This came following a net outflow of just Rs 8 crore last month and Rs 7,624 crore in September. Prior to these outflows, FPIs were net buyers in August to the tune of Rs 51,200 crore and nearly Rs 5,000 crore in July. Before that, … [Read more...] about FPIs invest Rs 30,385 crore in Indian equities in November so far
Gautam Adani, Chairman, Adani Group Gautam Adani’s plan to raise at least $5 billion in equity aims to shut down two of the most frequent criticisms leveled against the Indian tycoon’s swelling empire: high debt ratios and a limited investor base. After four years of eyebrow-raising gains -- some Adani Group shares surged more than 2,000% -- Asia’s richest person is embarking on a fundraising campaign that will likely include a local share sale as well as buy-in from large investment funds in the Middle East and Canada. An equity injection of this size is expected to help the conglomerate deleverage and Bloomberg Intelligence sees a successful equity raise across the group supporting the companies’ dollar bonds. The billionaire is seeking legitimacy in the face of questions about his group’s breakneck expansion from a traditional port operator to a sprawling empire with assets including media, cement and green energy, that critics say has boosted leverage and financial … [Read more...] about Asia’s richest man makes a $5 billion bet to silence debt-obsessed critics
Home equity loan rates are likely to increase in tandem with the increase in the Federal Reserve’s federal funds rate announced today. Key Takeaways The Federal Reserve raised its benchmark rate by 0.75% to a target range of 3.75% to 4% at its Nov. 2, meeting. Today's rate hike is the sixth of 2022 in an effort to reduce consumer demand, consumer prices and inflation. Interest rates for all types of loans, including home equity and home equity lines of credit, are expected to increase in tandem with the latest rate increase. The Fed raised its benchmark rate by 0.75% to a target range of 3.75% to 4% at its meeting Nov. 2, as it did in September . It's the sixth rate hike this year to combat high inflation in the U.S., which was 8.2% year-over-year in September. The Fed’s inflation target is 2%. Interest rates on many home equity products like home equity loans and home equity lines of credit (HELOCs) generally change in sync with changes in the Fed’s target … [Read more...] about Expect Home Equity Loan Rates to Rise After a Fed Rate Hike
Share to Twitter Share to Linkedin Should you tap a reverse mortgage to access your home equity? (Shutterstock) Many Boomers today are facing an unpleasant future. Their golden years were supposed to be fun, relaxing and carefree, but now reality has set in, and they find themselves financially unprepared. Many didn’t save enough during their working years because they planned to sell their homes and live off the equity by moving to more affordable locales. The problem is that two-thirds of the average retiree’s net worth is in the form of home equity at a time when more are wanting to retire at home rather than selling and moving to Florida, Arizona or other warm climates. Many may be tempted to explore the reverse mortgage option as a way to increase their retirement income. Doing so means the elimination of a mortgage payment, assuming payments are still being made, and the ability to receive a portion of your homes equity. Reverse … [Read more...] about Reverse Mortgage: Should You Use Your Home Equity To Get More Retirement Income?
Billionaire Ramon Ang-led San Miguel Corp. (SMC) and Aboitiz Equity Ventures Inc. are lining up bond offers worth as much as P80 billion in a bid to tap demand for debt instruments during a period of rising interest rates. The Securities and Exchange Commission said on Friday it approved the planned bond offerings of the two conglomerates during a meeting on Nov. 17. SMC, a food, drinks, power and infrastructure group, is raising as much as P60 billion, composed of a P40-billion base offer and an overallotment option of P20 billion. Aboitiz Equity, which is into power, banking, food, property and infrastructure, is raising up to P20 billion. April Lynn Tan, chief equity strategist at stockbrokerage house COL Financial Group Inc., expected strong demand from investors. “Yields of these bonds are high so that should make them attractive, especially since most are expecting [interest] rates to peak soon,” Tan said in a text message to the Inquirer. Large banks were also … [Read more...] about San Miguel Corp, Aboitiz Equity get approval to sell bonds
- A + A (Nov 23): Indian billionaire Gautam Adani is courting sovereign wealth funds to raise roughly US$5 billion in equity across his sprawling business empire and reduce leverage, people familiar with the matter said. The network of companies owned by Asia’s richest person has reached out to top officials at firms including Mubadala Investment Co and Abu Dhabi Investment Authority about investments, the people said, asking not to be identified as the information is private. Adani’s group is looking to other large investment funds in the Middle East as well as in Canada to invest, they said. The group has even discussed raising as much as US$10 billion, one of the people said. Flagship firm Adani Enterprises Ltd is considering issuing about US$1.8 billion to US$2.4 billion in new shares as soon as next year, Bloomberg News reported Tuesday. The US$5 billion to US$10 billion target would include the funds raised in the potential Adani Enterprises share issue, one of … [Read more...] about Billionaire Gautam Adani weighs raising US$5 billion in equity as banks urge deleveraging
Share to Twitter Share to Linkedin Hui Ka Yan attends Evergrande's earnings announcement at the JW Marriott in Admiralty on March 29, ... [+] 2016. Nora Tam/South China Morning Post via Getty Images Hui Ka Yan became Asia’s wealthiest person as his fortune was soaring to a peak of $45.3 billion in October 2017, but a large portion of those gains proved to be short lived. His fortune, which is based mostly on his stake in Hong Kong-listed Evergrande, has seesawed back down to its current level of $32.8 billion as the property developer was pushed in opposing directions by a series of share buybacks and dividends against pressure from short-sellers. Investors’ divergent views on Evergrande are attributed to the massive debt pile Hui built while accumulating the company’s land holdings and making investments in a variety of businesses that range from theme parks and a soccer club to hospitals and mineral water, although his latest plan to turn … [Read more...] about Asia’s Former Richest Man Pursues Debt-Fueled Quest To Take On Tesla
- A + A (Nov 24): The world’s biggest money manager is loading up on emerging-market debt again. BlackRock Inc’s head of emerging-market debt Amer Bisat has dropped his 2022 defensive view on the asset class because he sees a peak in US interest-rate hikes nearing and thinks distress in some countries won’t trigger a systemic crisis. He favours bonds from the likes of Mexico, Indonesia and potentially Poland. “A window for bullishness has opened up,” said Bisat in an interview in London. “It is not the time to be extremely defensive any more and it is not too early to deploy capital.” The change of call comes as risky assets have started to rally, and chimes with views from others on Wall Street such as Morgan Stanley. Both hard and local currency emerging-market bonds have climbed this month, paring double-digit losses this year. BlackRock was wary of emerging-market debt earlier this year due to countries’ large funding needs, especially after Russia’s war in … [Read more...] about BlackRock’s Bisat says now is time to buy emerging-market debt
Foreign investors have pulled out close to Rs 6,000 crore from the Indian equity markets so far this month in the wake of strength in the US dollar against the rupee. With this, the total outflow by Foreign Portfolio Investors (FPIs) has reached Rs 1.75 lakh crore so far in 2022, data with the depositories showed. Going forward, FPIs' flow is expected to remain volatile in the coming months due to ongoing geopolitical risk, elevated inflation, expectation of rising treasury yields, etc, Shrikant Chouhan, Head-Equity Research (Retail) at Kotak Securities, said. "FPIs are unlikely to sell heavily in the near term. But they will turn sustained buyers only when the dollar starts declining. This, in turn, will depend on the trajectory of US inflation and the Fed's monetary stance," V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said. According to the data, FPIs withdrew Rs 5,992 crore from equities in October (till 21). However, during the last few days … [Read more...] about FPIs sell Indian equities worth Rs 6,000 crore in October on strengthening dollar