Gee, this sounds strangely - and disturbingly- familiar.....as the coda to 'The Big Short' notes, even as the dust was settling from the GFC, banks already were exploring the sale of CDOs under different names like "bespoke debt tranche instruments." History may not repeat, but it sure does rhyme, which also suggests the WSJ is being somewhat disingenuous in calling this a 'new' thing.
Big Banks Cook Up New Way to Unload Risk
Banks are selling risk to hedge funds, private-equity firms through so-called synthetic risk transfers
U.S. banks have found a new way to unload risk as they scramble to adapt to tighter regulations and rising interest rates.
U.S. Bank and others are selling complex debt instruments to private-fund managers as a way to reduce regulatory capital charges on the loans they make, people familiar with the transactions said.
These so-called synthetic risk transfers are expensive for banks but less costly than taking the full capital charges on the underlying assets. They are lucrative for the investors, who can typically get returns of around 15% or more, according to the people familiar with the transactions.
< - >
The deals function somewhat like an insurance policy, with the banks paying interest instead of premiums. By lowering potential loss exposure, the transfers reduce the amount of capital banks are required to hold against their loans
< - >
Banks started using synthetic risk transfers about 20 years ago, but they were rarely used in the U.S. after the 2008-09 financial crisis. Complex credit transactions became harder to get past U.S. bank regulators, in part because similar instruments called credit-default swaps amplified contagion when Lehman Brothers failed.
Regulators in Europe and Canada set clear guidelines for the use of synthetic risk transfers after the crisis. They also set higher capital charges in rules known as Basel III, prompting European and Canadian banks to start using synthetic risk transfers regularly.
U.S. regulations have been more conservative. Around 2020, the Federal Reserve declined requests for capital relief from U.S. banks that wanted to use a type of synthetic risk transfer commonly used in Europe. The Fed determined they didn’t meet the letter of its rules.
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https://www.wsj.com/finance/banking/bank-synthetic-risk-transfers-basel-endgame-62410f6c

https://www.medicare.gov/plan-compare/?utm_campaign=20231101_oep_mpf_pfa_mamc&utm_content=english&utm_medium=email&utm_source=govdelivery#/compare-plans?plans=2024-H5521-323-0&plans=2024-H9615-019-0&plans=2024-H2775-106-0&fips=36117&year=2024&lang=en
Try this from the medicare site. I'm in NY state and have had Aetna for 3 years going on 4 in 2024. Each year I compare options and they are as good or better than others. I have the zero pay plan because I have no health concerns or prescriptions other than a statin to control cholesterol.
edit: I do self-medicate with beer, but Aetna won't pay for that on any of their plans :)

Monday Bloomberg posted, lowest export of wheat in 20 years due to low water in the rivers. My thought , use the railroad.

Just finished reading Prof. Snowball's piece on junk bonds in which much is made of the virtue of investing in junk, as opposed to "equities."
Just for fun ("Gonna turn this mother out.") I decided to back-test FAGIX versus an equal-weight widows-and-orphans portfolio of FSUTX and FDFAX not subject to rebalancing. I had no idea how this would turn out.
The Vanguard 500 is included as the benchmark. Results since 1986 in this link. Junk has the lower standard deviation. But how many people pay attention to SD versus "Worst year I spent with this portoflio?" Junk had the worst year versus W&O at 31.9% to 27.36%. I also notice that W&O lead on Sharpe and Sortino numbers. They also made twice as much money for you, and beat the 500 index just for fun.
How about other time periods? Prof. Snowball looks at 15 years. FAGIX pulls slightly ahead of W&O, but still has the worst year.
And 20 years. W&O are back in the money lead, but FAGIX pulls ahead on Sharpe and Sortino numbers.
Prof. Snowball also runs through numbers from all the periods of The Great Distortion, which I am too lazy to run. But I will run two of my favorites from MFO premium: Since COVID, and TGN. Portfolio Visualizer does not account for monthly starts, so the first test dates from 202001, and the second from 202201.
Since COVID, W&O eke out a win in money, Sharpe, and Sortino numbers. And they do much better in the worst-year category.
Since TGN, W&O have lost less of your money. And there is something to be said for that in a period of rising rates.
A person can have more fun with this PV by adding 100% VWELX or PRWCX as the third portfolio entry.

@hank Just for the heck of it....although not look-a-like investments, the chart covers 2 years for LCORX v FBALX v SPY, beginning in June, 2007; through 2008 and into mid 2009. This, of course; includes the full bottom of this time frame in March of 2009.

I've subscribed to Credit Karma for a few years. You get a lot of current info on your credit score, hard inquires, any new accounts opened and info on accounts active and closed. It will send you an email if anything about your credit score changes. Again, quite a bit of monitoring and info for free.

@Mona, I used annualcreditreport.com for years. It required accessing the credit bureaus from annualcreditreport.com portal only. It provided credit reports but not the credit scores - I could pay some to get those. Then, 1/yr restriction. As my wife & my reports are almost identical, I had a system going where I could check my credit report somewhere every 3 mo.
But I got tired of this tracking.
Things may also be a bit different now.
On the other hand, I can log into Credit Karma anytime for FREE full reports & Vantage Scores (similar to FICO Scores). It also has a monitoring system to send alerts for changes. I use it only few times a year. Of course, I get ads for Intuit products - TurboTax, Mint (in the past), etc.

The Fidelity site now has no CDs available for terms 2 years or longer. This is probably just a temporary repricing in the market, but I expect available yields will drop. Fortunately, I purchased my latest 5-year ladder just before the changes. Unfortunately, I have a lot of CDs and Treasuries maturing in the next few months, so I may need to reinvest at lower rates (or return to bond funds).

@FD1000, way to go digging those. @Baseball_Fan: Great term "confidently wrong"! I love it!

Mr. G isn't the only "expert" that has been wrong but still keep predicting. I collected over the years many of these for other experts.
Why would anyone predict the future?

Great question!
I dunno.
But many former M* participants will likely remember a couple of years ago when you presented YOUR projections of TR and SD for THE NEXT FIVE YEARS (sic) for a long list of bond OEFs.
Do you still have those projections? Would love to see them again!
Given your "bond OEFs are better than sliced bread" mentality at that time, and the last coupla years of bondland disasters, gotta think (read, "know") YOUR projections were off by miles!
But I trust (in your world) not as far off as your former bond god, now monthly punching bag, Gundlach!

@FD1000, way to go digging those. @Baseball_Fan: Great term "confidently wrong"! I love it!

Mr. G isn't the only "expert" that has been wrong but still keep predicting. I collected over the years many of these for other experts.
Why would anyone predict the future?

Sincere props and congrats to you @FD1000, glad to see someone doing well in the markets, they are challenging and tricky for sure....
What makes me go hmm, when I read your posts is why does a guy who is comfortably retired make huge moves in and out into various markets when you obviously "have enough"...kinda like an old Harley, if its running good, don't F*#K with it, leave the wrenches in your tool box.
Your models/strategy has obviously worked well but say what the heck would happen if y Iran launches a barrage of missles that overwhelm the missle defenses...what happens if Biden takes seriously ill or worse and we get Kamala in as president (I am intentionally NOT trying to bait anyone into a political kerfuffle) just saying that would jerk the markets limit down, no? You'd likely lose several years of profit in your investments, so why expose yourself to that possiblity?
Good Luck to you and ALL,
Baseball Fan

I said the following on another forum starting on Nov 1.
==============
In other threads I said to start looking to get into the market in October and wait for the entrance.
SPY had a ST+mid term signal buy
VIX is down
Other stuff looks better too.
Momo looks good in the last several days. All = a buy before closing.
==============
You can just play it simple: no diversification, no predictions, no narrow range funds, looks like tilting LC growth is here to stay which = SPY/VOO or you can gamble and use some QQQ.
Earlier in the year I posted that value looks better, based on 2022, but within several weeks, growth started to lead again.
===============
I stick with a simpler approach. Under/Over value don't exist ST(weeks-months) and sometimes for years. I have no idea about a short covering because I don't look for it and I don't know when it started and how long.
I always listen to the Fed. The Fed blinked on Wed. The charts sensed it even sooner, the chart confirmed it. Most stock+bond funds lost in the last several weeks, usually, they recover some or all.
I changed 80% of my portfolio last week which I held for several months. My previous funds are still good but why not make more for several days-weeks. Small changes do not make sense to me, never did.
I also said before that usually it's that time of the year.
I would stick to what worked lately (weeks-months) and wide range funds. I don't know why investors look for bottoms for a narrow sector or what MAY do better (gold, health care, energy, value) when something has been working for months (SPY,QQQ)
When will I sell? no idea, the chart and uptrend will tell me what to do.
I actually mad at myself as to why I didn't change 100%, I got lazy. These periods are the ones where one week can equal several months of performance.

Mr. G is the king without clothes
FEB 2022([www.cnbc.com/2022/02/11/jeffrey-gundlach-says-the-fed-is-obviously-behind-the-curve-will-raise-rates-more-than-expected.html)
"Gundlach sees the 10-year Treasury yield...to exceed 2.5% this year. He also said, “It’s possible the 10-year takes a peek at 3%.”
Reality: the 10 year peeked at 4.2%
====================
MAR 16 2022 (www.cnbc.com/video/2022/03/16/the-fed-is-way-behind-says-doubleline-ceo.html)
G: stocks will go higher from here
Reality: The SP500 fell about 17% by 07/2022.
==================
August 26, 2021(www.nasdaq.com/articles/bond-king-sees-gold-pushing-higher-from-its-current-price-2021-08-26) "The dollar going down"
Reality: the Dollar went up from 08/2021 to 09/2022 by about 25%, which is a huge move.
==================
Gundlach predictions for 2019 (www.fa-mag.com/news/how-jeffrey-gundlach-s-predictions-for-2019-turned-out-53478.html)
EM should outperform. Reality: they underperformed
Stocks are value trap. Reality: 2019 was a great year for stocks, the SP500 made over 28%.
The dollar would probably weaken. It was flat
==================
Gundlach predicted in 2016 that the 10 year treasury to be 6% by 2021, see (www.barrons.com/articles/gundlach-bond-yields-could-hit-6-in-five-years-1478929496) and again in 2018(www.cnbc.com/2018/09/20/doublelines-gundlach-warns-us-treasury-yields-are-headed-higher.html).
Reality: On 12-31-2021 it was at about 1.5%.

Nov 4 Episode:

In this exclusive interview, he talks about his deep value, contrarian approach, his current strategy, and the lessons he’s learned over the years.
Berkowitz’s Fairholme Fund was once a top performer, returning better than 13% annualized returns in its first decade. But it has since lagged the market and become extremely volatile. Today, 82% of the fund is concentrated in one stock: The St. Joe Company, a Florida real estate developer and manager.
Berkowitz reveals the highs and lows of his career and shares his insights on value investing, contrarian thinking, and the future of the markets.

Curious development with regard to new issue CDs available at Fidelity today. I’m setting up another 5-year CD ladder in our taxable account so we’ll have cash available to pay property taxes near the end of each year. Yesterday, there were a bunch of noncallable 2-year CDs available paying about 5.4%. They all disappeared overnight, and I could find only one noncallable 2-year CD paying 5.3%. I ended up buying a 21-month CD yielding 5.4%, but don’t understand why all the 2-years disappeared overnight.

Hmmm...not really all that "curious" to some investors at least.
You may have missed that @hank duly asked on Nov 2:
Anybody know how today’s sharp dip in rates across the board is affecting CDs? I’d imagine a bit of a crunch to get in the door before rates drop further. Are 1 & 2 year CD’s above 5% still available?
Well, we got some of our answers!
A HUGE move in 10-yr Treasury this week caused potential CD BUYers of ALL durations to act.
https://www.cnbc.com/video/2023/10/20/first-time-seeing-treasury-yield-move-like-this-in-20-year-career-says-exante-datas-jens-nordvig.html
https://www.cnbc.com/video/2023/11/01/u-s-10-year-yield-falls-sharply-following-better-than-expected-treasury-announcement.html
NOTE: There was a similar, though even more dramatic run on ALL CP CD offerings earlier this year, following a previous 10-yr plunge. After that run the CP CD cupboards were completely bare! (There are still a few left this time!)
Over the next several months after that prior plunge, and right up until last week's action, ALL rates had moved UP to their respective YTD highs. This time though, IMO, FWIW, we are now likely past peak CD rates.
There will be plenty of, new, New Issue offerings posted next week. It will be interesting to see just how far respective maturities rates have fallen due to the action on the 10-yr this this past week. Thenwe'll have all of our answers to the great questions posed by @hank!
All the more reason to
(1) looking forward, get up speed on how to play in the Secondary Issues sandlot, which is where I will be spending considerable time as several rungs fall off our ladder in Nov-Feb and
(2) in retrospect, have already bought longer duration CDs (that is, 3-5-yr) as I had been suggesting on other prior CD threads.

Curious development with regard to new issue CDs available at Fidelity today. I’m setting up another 5-year CD ladder in our taxable account so we’ll have cash available to pay property taxes near the end of each year. Yesterday, there were a bunch of noncallable 2-year CDs available paying about 5.4%. They all disappeared overnight, and I could find only one noncallable 2-year CD paying 5.3%. I ended up buying a 21-month CD yielding 5.4%, but don’t understand why all the 2-years disappeared overnight.

Someone with lots of cash and expectation of interest rates falling down could have mopped all those issues. Also, Banks that issued them might be cancelling unsold issues if they see rates falling.

Too cute by half, but still a huge fund of savvy. I left his retail core-plus bond fund some years ago.

Would be interested to hear if anyone here has stuck with them over the years. They had such a good story years ago, but I gave up when the returns didnt materialize

David, it seems to me there is a leak somewhere. Someone call a plumber ! On a more serious side I do recall Old Man River running high to very high in the spring. On the other hand I can't recall many years where the water level dropped so low ! I believe more than climate change is effecting the water level. Irrigation & increased draws are also playing a part.

Curious development with regard to new issue CDs available at Fidelity today. I’m setting up another 5-year CD ladder in our taxable account so we’ll have cash available to pay property taxes near the end of each year. Yesterday, there were a bunch of noncallable 2-year CDs available paying about 5.4%. They all disappeared overnight, and I could find only one noncallable 2-year CD paying 5.3%. I ended up buying a 21-month CD yielding 5.4%, but don’t understand why all the 2-years disappeared overnight.