By: Jeff Anderson, CFA
This Week: It’s that time of year again when the investment community pours over Hedge Fund’s must submit a 13-F filing every quarter, with the latest due date being February 15th. Traders love to comb through the holdings of the largest hedge funds, hoping to see what they are buying and where they are exposed the most. The headlines on Bloomberg.com and the Wall St Journal highlight the buys and sells of the main holdings for the most well-known fund managers. Investors may want to caution from trading off these reports, as some of those term investors. When certain companies’ shares are highly concentrated in the hands of hedge funds, they can be extremely volatile around earnings.
Crude Oil closed at $91.69 per barrel, down 2.35% for the week.
US Households Ramp Up Credit Card Spending:
Rising costs for homes, autos and “stuff” has resulted in buyers borrowing larger amounts to finance these extra costs (see table). For now, lofty home prices and newly used cars valued above sticker price are keeping debt to equity ratios in decent shape, but if used car prices normalize, many could find themselves upside down on their auto loans. On a positive note, owner’s equity in real estate surpassed $25 trillion in 2021.
Intel agrees to buy Tower Semiconductor Ltd. Mergers and acquisitions are estimated to be strong this year, and Intel threw their hat into the ring with this recent announcement. The acquisition is valued at $6 billion. Intel was valued at roughly $200 billion at the time of the announcement. The company said it also has plans to invest at least $20 billion in new chip-making capacity in Ohio to meet the insatiable demand for digital products. In total, Intel lans to invest close to $100 billion more in manufacturing. The Ohio announcement reverses a multi-decade push to offshore chip manufacturing. The challenges with supply-chain disruptions brought on by the global pandemic coupled with geopolitical tensions with China and Taiwan are forcing many companies to bring back manufacturing to American shores.
