Market Insights February 1, 2016 Download This Week’s Market Insights Prior Week Summary Interest rates moved lower to end the week, capping a month that saw a nearly 40 basis point decline in the 10-year swap rate, bringing the curve to the lowest levels since mid-2013. The combination of a surprise announcement by the Bank of Japan, a weak GDP print, and a Fed statement that downgraded the inflation outlook weighed on the curve and has caused market participants to push out into the future expectations for any additional Fed tightening. As of this writing, the market appears to be pricing in only 1 hike in the 4th quarter, providing a stark contrast to the 4 quarterly hikes that were implied by the Fed’s December dot plot. Indeed, the Fed acknowledged that “inflation is expected to remain low … in…

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Market Insights January 25, 2016 Download This Week’s Market Insights Prior Week Summary It seems fitting that an unusually volatile week of trading in the markets during a holiday shortened week would be capped off by an unusually heavy winter storm in the Northeast that left much of the region blanketed by snow, with some areas getting over 2 feet. The commodities sector continues to be in the drivers seat, as a plunge and subsequent rebound of the oil price pushed stocks around in hectic trading. The price of oil has fallen to the lowest levels since 2003 amid concerns that ongoing turmoil related to China’s slowing growth rate would crimp fuel demand at the same time that the supply of the commodity has been increasing, partly due to oncoming Iranian supply among other factors. It appears as though, traders…

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Market Insights January 19, 2016 Download This Week’s Market Insights Prior Week Summary The rout in commodities and global equities continued in earnest last week as concern grows among market participants that the deceleration of growth in China will have ripple effects through all financial assets. Sentiment in markets has become incredibly negative, with some going so far as to analogize the current market, and its outlook, to the credit crisis of 2008. A prominent equity market participant, and CEO of one of the world’s largest asset management firms, went so far as to say that stocks could fall another 10% and oil another 20% before finding solid ground. China reported a major deceleration in its rate of growth last year, which has compounded concerns over a global slowdown. The growth rate slowed to 6.9% for 2015, which was the…

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Market Insights January 11, 2016 Download This Week’s Market Insights Prior Week Summary 2016 is off to a rocky start after only the first week of trading as global equity and commodity markets struggle to find footing amidst increasing global volatility. China’s Shanghai Composite Index fell 7% on 2 separate occasions last week – leaving the index nearly 15% lower from where it ended the year. Likewise, the financial press is reporting that the stock market in the U.S. began 2016 with its worst ever performance to start a year. Indeed the S&P is down 6% and the Dow Jones is off 6.2% to start the year as concerns over global growth accelerate and investor concerns about a harder landing in China increase. The trend of dollar strength is continuing, with the currency strengthening by approximately 0.5% last week compared…

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Winter storms have brought so much snow to New Jersey this season that by mid-February 373,000 tons of salt had already been spread on state roadways. Compare that to the 258,000 tons used over all of last winter, and it’s clear that this season’s weather small-talk has big implications. Salt supplies in the Garden State are so low, in fact, that local officials are considering closing roadways and cutting bus routes unless they can get more quickly. But as it turns out, buying salt is not as easy as it sounds. Cut to the sleepy coastal town of Searsport, Maine, where salt supply giant International Salt has a 40,000 ton surplus of road salt already sold to the state of New Jersey, just waiting for someone to pick it up and ship it back. In what appeared to be a…

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Our purposes and values are what define us At Chatham, we have sought to build a company where our collective common bond around our purposes and values is obvious to our clients, partners, vendors and communities. Our purposes—the reasons for our existence—inspire us to the level of excellence for which we are known. And our values provide guardrails on our journey toward accomplishing our purposes. Our Purposes Since our founding, Chatham has embraced a multiple bottom line philosophy that can be best summed up in our company’s recognized five purposes. These purposes articulate why we exist: Impact our clients. Chatham seeks to earn each client’s trust and partner with them for mutual success. Impact markets. Chatham seeks to make the markets we serve fair, safe, and transparent. Impact Chathamites. Chatham seeks to create a vibrant culture in which Chathamites develop…

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Investment Banking Strategies for the Real Estate Industry The pursuit of the deal, whether acquiring an existing property or pursuing ground up construction, is what moves commercial real estate investors. And regardless of the property, be it Core or Value Add, or the property type, from Hospitality and Multifamily to Office, Industrial. and Retail, every real estate deal comes with the complexities and complications of financing. Chatham’s investment banking strategy team offers a different kind of service to real estate investors seeking strategic capital solutions. Chatham brings a network of relationships and unique ways of meeting real estate investing needs. At the same time, we provide services with an unbiased view. Additionally, Chatham investment banking services tend to be for multifaceted, sophisticated deals, making our team sought after for investment projects that require unique structuring or innovative thinking to get…

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Managing risk of investment ROI Managing risk associated with interest expense on debt is a regular exercise for treasurers. With markets moving constantly, the ability to make well-reasoned decisions in short order is critical for all companies. Many companies want to know how they can quantify risk, assess it, and account for it when reporting such risk. Chatham is ready to help answer these key questions. How Chatham helps reduce interest rate risk Knowledge and Know-How: Chatham is in the markets every day, which significantly helps level the playing field with counterparties who have armies of PhD’s and traders focused on generating profits in these markets. We partner with clients to understand their business objectives and ensure the optimal structure and lowest transaction fees. We also guide companies through nuanced complexities and numerous regulatory requirements. Risk Assessment and Analysis: Chatham…

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In times of financial stress, politicized debate, and geopolitical conflict, it’s reassuring to know that there’s a body of wisdom most every informed person accepts. Of course, our benighted forebears got so many things wrong – imagine believing that the earth was flat or trusting in the healing power of leeches! But since the conventional wisdom of today stems from public awareness campaigns following rigorous peer-reviewed scientific research, it obviously won’t need future revision. For instance, we know that cell phone talking and texting is the deadliest distraction in a moving vehicle. We’ve learned that austerity kills – when unemployment rises during recessions, bringing along with it the twin perils of excessive drinking and suicide, the mortality rate climbs. We know who principally lost during the housing crisis – it was those unfortunate buyers who entered the market at the…

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EUROZONE DISSOLUTION Editor’s note: This is part two of a three-part series on a hypothetical breakup of the Eurozone, and the corresponding currency and derivative contract issues that could follow. If you missed part one, Eurozone Dissolution (“Episode I: The Sovereign Menace”), you can find it here: Episode 1: The Sovereign Menace A long time ago, in a monetary union far, far away… The single currency benefitted many and joined them in common interest. The elimination of exchange rates among the 17 member states alone increased efficiencies and competitiveness, resulting in greater economic output. Collectively, the member states in the monetary union rivaled the largest economies on the planet, and the people experienced a financial freedom of movement like never before. But the economic crisis would take its toll and expose weaknesses in the union. Prosperity and growth were not…

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