Toshiba To Go Private

Market Overview
Read time 1.1 minutes

Year To Date Performances:

1. Billionaire Bill Ackman, hedge fund powerhouse, is betting big against 30-year bonds, expecting long-term rates to surge. While the FED paused its hikes, Ackman believes these rates remain strikingly low. Despite rates not surpassing 4% in a decade and a half, he envisions an ideal yield for 30-year Treasury bonds at 5.5%. Ackman's rationale hinges on factors like the staggering $33 trillion national debt, a weekly billion-dollar surge of government bonds in the market, and overseas bondholders, such as China, divesting rather than investing. Moreover, the looming consequences of quantitative tightening, changes in outsourcing dynamics with China, growing labour union influence, vanishing 'Peace Dividend' benefits, escalating energy costs, and the potential impact of not replenishing the Strategic Petroleum Reserve underscore his predictions. Even the transition to electric vehicles doesn't seem promising to him, deeming it "exorbitantly costly". Nevertheless, in a concluding note of humility and uncertainty, he mused, “But I could be wrong. AI might save us.”

2. Toshiba is eyeing a transition to private status. A whopping $14 billion tender offer is poised to take the tech giant private, marking one of Japan's most significant deals this year, according to Japan Industrial Partners (JIP). If JIP's bid succeeds, it will conclude Toshiba's impressive 74-year run as a publicly listed company. This move would also return Toshiba to domestic ownership following several tumultuous years of skirmishes with international activist investors. Notably, this kind of dramatic shift to sidestep ESG-related demands is rare.

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4. Headlines

   1. Chelsea have received a $500M investment from Ares management.

   2. The US government is projecting that debt will rise by $5.2B EVERY DAY for the next 10 years.

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