Return on Equity (ROE) defines the profit structure of the banking industry. ROE is defined by IDC Financial Publishing (IDCFP) as the addition of return on earnings assets (ROEA) and return on financial leverage (ROFL), or operating return plus financial return. ROEA equals all operating income, less operating expenses (before…
Rising German 10-year yields forecast increasing U.S. TIPS yields. This increase in TIPS yields, combined with the copper-to-gold ratio, forecasts a 2.4% yield on the U.S. 10-year T-Note by the end of 2021, 2.8% in 2022 and 3.2% in 2023. The U.S. 10-year is expected to rise significantly, led by the…
Historically, the fall in gold prices (left scale inverted in the chart below) forecast the sharp recovery in the 10-year TIPS yield, both in 2013 from -0.8% to 1.0%, and in 2016 from zero to 1.0% (see Chart I). In a previous article from June 1st, IDC Financial Publishing (IDCFP) discussed…
For years, brokers, investment advisors, consultants, and others, relied on the Depository Trust and Clearing Corporation (DTCC) to provide monthly balances of qualifying brokered CDs. Since 2014, however, the level of brokered CDs under $250,000 computed by IDC Financial Publishing (IDCFP) as part of brokered deposits, continues to outpace the…
Chart I The Relationship Between U.S. and German Yields From June 2016 to February 2018, the US 10-year tips yield was nearly equal to the German 10-year yield during a prolonged economic recovery and bank bull market. Rising German, U.S. nominal and TIPs yields favored the bank stocks (see Chart…
