Company News


Municipal

New Issues

11/20/17
$69,165,000
Rhode Island Conv Ctr
Co-Manager Serials 2019-2027 Federally Taxable
11/20/17
$2,000,000,000
Metro Transp Auth Transp Rev
Senior Co-Manager Serials CIB 2018-2047 Serials CABs 2027-2047

Capital Markets

New Issues

Debt

11/9/2017
$250m - Interstate P&L Co. - CoMgr
$550m - Brandywine Operating - CoMgr

10/26/2017
$570m - Discover Financial - CoMgr
$2.5b - Capital One Financial - CoMgr

10/25/2017
$1.15b - AT&T - CoMgr

10/24/2017
$7b - Goldman Sachs - CoMgr

Equity

Insights

CREDIT AND MARKET STRATEGY
MUNICIPAL MARKET WEEKLY

November 13, 2017

Taxing Week

The tax reform debate shifted into high gear Thursday following release of the Senate Finance Committee’s tax reform proposal – “Description of the Chairman’s Mark of the “Tax Cuts and Jobs Act” -- which among other provisions, lowers the corporate tax rate to 20% (beginning in 2019), repeals the AMT, eliminates deductibility of state and local taxes (SALT), lowers the top marginal individual rate, eliminates tax-exempt advance refunding bonds, and implicitly preserves tax-exempt private-activity bonds (PABs). Senate Finance has...

The prospects for a dramatic cut in tax-exempt Muni supply as a result of the House bill sent the market into a tailspin Monday through Wed as MMD in 30yrs rallied a total of -17 bps through Wed. Following release of the Senate proposal on Thurs, however, the 10-30yr MMD spots gave back some gains and...

Muni mutual fund inflows reversed course from the prior week’s -$655 mil. outflow to record net inflows of +$463 mil. helping to absorb some of the $9 bil. of new issue supply. This week’s calendar is above-average at $9.3 bil., split between $5.9 bil. negotiated and $3.4 bil. competitive. The negotiated space is led by three yield offerings, including...

Trade Ideas

Nothing is cheap, but we still think there is opportunity for long-end out-performance as we have been advocating all year. We like buying longer maturity ‘A’ rated bonds (20-30yr) with 5-9yr calls, as bonds with these longer calls may become less prevalent in the event...

Full Weekly Report

Quarterly Review

SAMUEL A. RAMIREZ & COMPANY, INC.
QUARTERLY MACROECONOMIC OUTLOOK
FINANCIAL STRATEGIES GROUP – 3rd QUARTER 2017

Dear Clients,

Please find attached Ramirez & Co.’s Quarterly Macroeconomic Outlook. In our report, we continue to monitor the US economy, global events and the Fed’s outlook on the economy and rates:

  • 2Q17 GDP growth settles at 3.1%.  The Atlanta Fed’s GPDNow forecasts 2.5% GDP growth for 3Q17, while the NY Fed’s GDP nowcast stands at 1.5%, dragged down by manufacturing numbers likely affected by the hurricanes.  The NY Fed foresees GDP recovering to 2.9% for 4Q17.  Bloomberg consensus expects 2.3% GDP growth in 3Q17 and 2.7% in 4Q17.  In spite of a series of natural disasters, economic surprise indicators in the US rise to the positive.
  • The markets, primary dealers and Fed economists all foresee one more hike in the Fed Funds rate for 2017.  After 2017YE, opinions diverge: the Fed and primary dealers see a faster pace of rate increases than the markets.  Major banks continue to see a flattening of the yield curve as they predict short-term rates rising faster than long-term rates.
  • Inflation beguiles the Fed.  Following a series of rate hikes, inflation in both services and goods tick downward.  CPI for services (less energy services) declines to 2.6% YoY in September from a 2016 average of 3.1%.  CPI for commodities (less food and energy) lowers to -1.0% YoY from a 2016 average of -0.5%.

    Members of our Financial Strategies Group, Niso Abuaf, Konstantin Semyonov and Duncan Sinclair, would be happy to discuss further any of the material with you.

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