Billionaire Stephen Ross Believes in South Florida—and Is Spending Big to Transform It
The Related Cos. founder is following the money flowing south by bringing his influence to everything from real estate to schools and health care.
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The Related Cos. founder is following the money flowing south by bringing his influence to everything from real estate to schools and health care.
Initial data on US gross domestic product for the first quarter of 2024 is set to confirm an ongoing economic boom amid a tailwind from surging immigration.
A South Florida office skyscraper from Related Cos. landed new finance tenants, including a John Paulson business and a private equity firm that counts Mark Bezos as a founding partner.
Oracle Corp. is moving its headquarters out of the city. Tesla Inc. is pulling back after a rapid expansion. Almost a quarter of commercial office space is vacant, and nowhere in the country have residential real estate prices fallen further from their pandemic peak.
Mortgage rates in the US increased for a fourth straight week.
May 31, 2020
Bloomberg News
,(Bloomberg) -- Investors in the world’s biggest bond market are starting to see what the other side of America’s worst-ever economic downturn could mean for their portfolios.
With more U.S. regions gradually reopening and investor sentiment picking up, the Treasuries yield curve from 5 to 30 years ended May close to the steepest since the height of the virus-fueled market panic more than two months ago.
Traders are betting short-to-medium term rates will be anchored by Federal Reserve stimulus, including potential steps such as capping yields. Meanwhile, they see scope for higher longer-maturity yields amid signs that the most dire economic reports may soon be in the rear-view mirror. Data suggesting the labor market was beginning to rebound last month could cushion the blow from this week’s labor report, which is forecast to show the highest jobless rate since the Great Depression.
“We are going to get the last of the big job-shedding numbers, and that will be important context to help investors judge the depth of the contraction, and what the process of coming out of it will look like,” said Ian Lyngen, a strategist at BMO Capital Markets. “The steepening trade is going to be thematic over the course of the next 12 to 18 months.”
The gap between 5- and 30-year yields surged to end last week at 110 basis points, touching the widest since mid-March. Benchmark 10-year yields were barely changed on the week, ending at around 0.65%.
Last week delivered a reminder of what could limit the upside in yields, with U.S. President Donald Trump intensifying his confrontation with China on Friday. An escalation of tensions between the world’s two biggest economies threatens to curb demand for risky assets and bolster the appetite for Treasuries.
There’s also the obvious uncertainty over the coronavirus pandemic’s trajectory and the risk of a second wave of infections. Fed Chair Jerome Powell warned on Friday that a full economic recovery “will really depend on people being confident that it’s safe to go out.”
But green shoots are emerging. Continuing jobless claims fell in the most recent week, the first decline during the pandemic. And St. Louis Fed President James Bullard said the unemployment rate could fall below 10% by December. Data this week are forecast to show it reached 19.6% in May, a level unseen since the Depression.
Even so, bond strategists are coalescing round the view that the Fed later this year will implement a policy of yield-curve control -- partly as a way to reinforce guidance that it will keep its main policy rate low for an extended period. The consensus expectation revolves around capping yields on maturities from two to five years.
Although the Fed is about to slow its Treasuries buying again, investors will get a reprieve on the issuance front this week, with only bills on the auction docket. So any move toward further steepening in the days ahead could be telling.
“It would signal the curve may be steepening more so for economic reasons,” said Chris Ahrens, a strategist at Stifel Nicolaus & Co. “The long end seems to be pricing that we are getting to the worst of the bottoming of the economy.”
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