(New York)

If anything is becoming clearer in financial markets, especially after yesterday, it is that rates and yields are bound to rise. Thus many might be worried about how to protect their clients from the changing market. Barron’s has some suggestions. The key is to hold a fixed income portfolio for several years, a minimum of six, and to make sure to reinvest proceeds in higher yielding bonds. To achieve the targeted five-year maturity sweet spot, consider Vanguard’s intermediate Treasury fund, while also mixing in some Treasury Inflation Protected Securities (TIPS) to provide further protection.

FINSUM: This seems like a good strategy for a long period of gradual rate hikes.

(Seattle)

Amazon is starting a new service. For the last year, the company has been trying to convince consumers that letting the company’s delivery people in their homes via a special service was a good idea. Now Amazon is taking that one step further with the launch of a program to deliver packages to customers’ cars. Like the home deliveries, and broadly under the same program, named Amazon Key, Amazon’s delivery people will deliver packages to cars parked in publicly available areas. The car will be unlocked by an OnStar (or similar) service and relocked after the delivery is completed.

FINSUM: We think this could be a very convenient feature for many people and may be an enticement to get more consumers to sign up.

(Chicago)

There has been a lot of consternation over the last week about whether the Vix is being manipulated. In one incident last week, the Vix jumped significantly with no corresponding move in the stock market. The culprit apparently was a large options trade deeply out the money which shocked the benchmark. Following an investigation, the Cboe says that it was not market manipulation, but rather an order imbalance that caused the jump in the VIx’s measure. Speaking on whether the move amounted to market manipulation, the Cboe commented that “We reiterate that we believe these claims are without merit”.

FINSUM: Whether or not the market was being gamed, the bigger question is whether the the way the Vix is calculated is too fragile/sensitive. If a single trader with a moderately sized order can move the Vix this much, what does it say about the index?

(Washington)

The wealth management industry will likely find itself pleased this week, as many may sense victory in the long battle against the DOL’s fiduciary rule. The SEC has now released its own proposal for a new fiduciary rule, and the rule looks favorable. The new rule would place less onerous restrictions on brokers and advisors. It will not ban any single conflict of interest, but would place a responsibility to disclose certain conflicts of interest to clients and take steps to mitigate their effects. The rule does not contain a specific provision allowing clients to sue their brokers for misbehavior. The SEC would also disallow the use of blurred titles, such as “financial advisor”. The SEC approved the rule by a 4-1 vote and it will now have an official comment period.

FINSUM: The one dissenting vote blasted the rule as a continuation of the status quo. To be honest, the proposal sounds quite favorable to the industry, with many saying it is not really a fiduciary rule (it doesn’t seem to be), and we were not expecting such a mild outcome. We think Congress will likely come down hard on the SEC. This is far from a done deal.

(New York)

Those close to Michael Cohen and the situation say that the lawyer seems poised to turn on his friend, Donald Trump, if put under pressure by investigators. At least that is what long-time Trump legal advisor, Jay Goldberg, is telling the president. Goldberg was a former prosecutor who has advised Trump since the 1990s. Trump reportedly called Goldberg asking for advice, and the Wall Street Journal quotes Goldberg as saying “On a scale of 100 to 1, where 100 is fully protecting the president, Mr. Cohen ‘isn’t even a 1,’”. He explained that if Goldberg were faced with criminal charges, he would tell all.

FINSUM: So it looks like Goldberg is going to tell all, but what nobody knows is how much of value he might really have to say.