Former Harvard bankruptcy professor Elizabeth Warren is trying to reestablish support of tighter regulation on yet another financial industry sector. Looking to alleviate financial irresponsibility, the bill restricts PE from enforcing new loans on companies in order to withdraw dividends. Additionally, the bill creates a number of protections for workers that prohibit outsourcing and secure severance pay in the event of bankruptcy. Companies like Sports Authority, Shopco, and Gymboree all filed for bankruptcy under PE the debt Warren is trying to prohibit. Warren failed to draw the appeal across the aisle previously with the bill, but is hoping to gain more traction this time around. Opponents say the bill will draw down on private funding for new and small businesses and could harm the ability to make new hires or expand their workforce.

FINSUM: Regulation like this will undoubtedly harm some small businesses but the protection and benefits could out way those restrictions, however the bill won’t likely get enough traction in its current status to reach the oval office.

The overall bond market is almost a bust this year but investors flocking for a yield can only go to one place, junk bonds. Lending conditions are very loose with all the accommodations both fiscal and monetary policy made this year, and those attempting to stream any income have to learn to high-yield debt. Inflation is eating up anything to be gained in treasuries. Investors are now treating high yield debt like a more liquid asset than ever purely because traditional bonds are losing to inflation. All of the policy measures have made many feel corporate debt is less risky than ever but the excess demand may be tipping, as even some of the riskiest debt is being sought after. Still high nominal economic growth is good for borrowers and reduces to investors.

FINSUM: Investors should be aware of interest rates pass-through from Fed tightening to corporate debt, strong inflation could lead to weaker pass through and even lower spreads than the market is already seeing.

Sommelier is a unique new start-up that is automizing DeFi portfolio, and it just got a huge influx in funding. Sommelier raised $23 million in their series A led by Polychain Capital. Sommelier is a software company that has developed tools to automate liquidity management without the typical middleman. The DeFi is shaping the financial world in a way traditional finance can’t and using software to enact strategies that develop and test capital allocation. Sommelier is already giving liquidity providers tools to optimize placement and concentration in liquidity pools and this further funding will add to their to the kit they have for liquidity providers.

FINSUM: This is a big step in liquid automation, and will improve the efficiency in the crypto DeFi world.

Environmental, social, and governance investing drew in almost $35 trillion last year and that number is expected to grow another 42% by 2025, and while those dollars might be better for the environment the large inflows from unseasoned investors are pushing ESG into a price bubble. Large inflows are can disregarding traditional financial discipline which can affect debt/equity ratios, dividends, and distort valuations for future mergers and acquisitions. New companies in the onset of their financial growth are already being evaluated at 15 times revenue, on top of that investments in the traditional sector are suffering as outflows continue this could cause supply shortages and further inflation. Continued inflows into ESG could swell the bubble further and risk a collapse.

FINSUM: ESG could be swelling into risky territory, investors should be cautious particularly with retirement vehicles.

The fixed income (FI) portfolios of institutional investors are evolving rapidly. Investment strategists around the globe are noting that, in the search for yield, many investors are...see more on our partner's site