Musings on Markets

JANUARY 6, 2023

Counter made-up numbers : It remains true that people (analysts, market experts, politicians) often make assertions based upon either incomplete or flawed data, or no data at all. Data universe : In my sample, I include all publicly traded firms with market capitalizations that exceed zero, traded anywhere in the world.

Risk Premium 52

Risk Premium Dividends Start-ups EBITDA 52

Simply Treasury

AUGUST 2, 2022

The idea is not new to encourage companies to increase their capitalization and reduce their bank debt (partly through more recourse to the capital market - CMU project). The rate would be calculated based on a 10-year "risk-free interest" rate depending on the currency, increased by a 1% risk premium (1.5%

Equity 52

Equity Risk Premium Banking Finance 52

Musings on Markets

FEBRUARY 2, 2023

Finally, my starting cost of capital of 10.15% reflects the reality that the riskfree rate and equity risk premiums have risen over 2022, and my ending number of 9% is an indication that I expect Tesla to become less risky over time. It was the reason that I argued at a $1.2

Start-ups 99

Start-ups Risk-free Rate Market Capitalization Risk Premium 99

Appraiser Newsroom

MAY 1, 2024

Insurance industry terminology such as risk, premium, loss, deductibles, coverage limits, and perils are some of the fundamental concepts appraisers must grasp. Register for ASA’s PP163 Property Insurance Fundamentals: What Appraisers Need to Know webinar on June 6, 2024 from 2:00-3:00 PM EDT, presented by Thomas Dawson, ASA.

Appraisal 40

Appraisal Risk Premium Marketability 40

Musings on Markets

JANUARY 28, 2024

In my last data updates for this year, I looked first at how equity markets rebounded in 2023 , driven by a stronger-than-expected economy and inflation coming down, and then at how interest rates mirrored this rebound.

Risk Premium 121

Risk Premium Beta Start-ups Equity 121

Musings on Markets

JULY 24, 2024

After the 2008 market crisis, I resolved that I would be far more organized in my assessments and updating of equity risk premiums, in the United States and abroad, as I looked at the damage that can be inflicted on intrinsic value by significant shifts in risk premiums, i.e., my definition of a crisis.

Risk Premium 75

Risk Premium Equity Start-ups EBITDA 75

Musings on Markets

APRIL 7, 2025

Coming after a few days where the market seemed to have found its bearings (at least partially), it was clear from the initial reactions across the world that the breadth and the magnitude of the tariffs had caught most by surprise, and that a market markdown was coming.

Marketability 98

Marketability Risk Premium Start-ups Equity 98

Musings on Markets

JANUARY 17, 2025

In my last post , I noted that the US has extended its dominance of global equities in recent years, increasing its share of market capitalization from 42% in at the start of 2023 to 44% at the start of 2024 to 49% at the start of 2025.

Equity 127

Equity Risk Premium Treasury Start-ups 127

Musings on Markets

JANUARY 10, 2025

In corporate finance and investing, which are areas that I work in, I find myself doing double takes as I listen to politicians, market experts and economists making statements about company and market behavior that are fairy tales, and data is often my weapon for discerning the truth. Equity Risk Premiums 2. Buybacks 2.

Risk Premium 119

Risk Premium Dividends Start-ups Corporate Finance 119

Musings on Markets

JANUARY 31, 2025

A little over a year later, in September 2024, that question about AI seemed to have been answered in the affirmative, for most investors, and I posted again after Nvidia had a disappointing earnings report , arguing that it reflected a healthy scaling down of expectations.

Start-ups 133

Start-ups Marketability Technology Risk Premium 133

Musings on Markets

JANUARY 28, 2025

It was an interesting year for interest rates in the United States, one in which we got more evidence on the limited power that central banks have to alter the trajectory of market interest rates. We started 2024 with the consensus wisdom that rates would drop during the year, driven by expectations of rate cuts from the Fed.

Banking 69

Banking Treasury Risk Premium Start-ups 69

Musings on Markets

FEBRUARY 8, 2025

In the first five posts, I have looked at the macro numbers that drive global markets, from interest rates to risk premiums, but it is not my preferred habitat. The second set of inputs are prices of risk, in both the equity and debt markets, with the former measured by equity risk premiums , and the latter by default spreads.

Risk Premium 72

Risk Premium Beta Start-ups Equity 72

Global Finance

MARCH 5, 2025

With the peso stabilized, inflation reached 117% in December 2024, down from 292% from the years high in April, and the use of the dollar is expected to increase, including for day-to-day transactions. This may allow the country to reduce the risk premium attached to its international borrowing. However, there are pros and cons.

Banking 59

Banking Finance Risk Premium Marketability 59

Reynolds Holding

MARCH 25, 2025

The 40 Acts Prior to the 1929 stock market crash, a budding asset management industry was taking shape smaller investors were invited to pool their assets with the assets of others, mostly in closed-end funds. [3] 17] Markets are built on trust. Then Ill turn to some observations about the state of affairs as I see them today.

Corporate Finance 45

Corporate Finance Finance Banking Marketability 45

Reynolds Holding

FEBRUARY 23, 2025

Effective and well-designed laws governing investment and financial markets are the single most important foundation for financial markets to allocate capital efficiently while providing optimal reassurance to investors and lenders. capital markets depends upon the regulatory certainty that U.S.

Systematic Risk 45

Systematic Risk Marketability Equity Risk Premium 45

Musings on Markets

FEBRUARY 6, 2025

In this post, I will expand my analysis of data in 2024, which has a been mostly US-centric in the first four of my posts, and use that data to take you on my version of the Disney ride, but on this trip, I have no choice but to face the world as is, with all of the chaos it includes, with tariffs and trade wars looming.

Risk Premium 67

Risk Premium Start-ups Enterprise Value Equity 67

Musings on Markets

FEBRUARY 23, 2025

Corporate control : There are companies that choose to borrow money, even though debt may not be the right choice for them, because the inside investors in these companies (family groups, founders) do not want to raise fresh equity from the market, concerned that the new shares issued will reduce their power to control the firm.

Equity 75

Equity EBITDA Risk Premium Gross Debt 75

Musings on Markets

MARCH 15, 2025

Thus, my estimates of equity risk premiums, updated every month, are not designed to make big statements about markets but more to get inputs I need to value companies. Many of these hiring firms have supply chains that stretch across the world and sell their products and services in foreign markets.

Start-ups 130

Start-ups Risk Premium Marketability Equity 130

Global Finance

OCTOBER 29, 2024

Global Finance: What surprised you in 2024? Data has been better than we expected, not only in the labor market but also consumer spending remains very resilient. The market still expects that the Fed will be able to continue rate cuts at a regular cadence into next year. That’s a level we haven’t seen since 2005.

Start-ups 98

Start-ups Finance Equity Private Equity Firm 98