Topley’s Top 10 – July 14, 2021

1. U.S. Lumber Prices Full Round Trip

2. The Core Rate of Inflation Highest in 13 Years

Crossing Wall Street Blog–The core rate of inflation, which excludes food and energy, rose by 0.88% in June. That’s also the highest rate in 13 years. The core rate is, by its nature, more stable than the headline rate. Still, core inflation is on the rise. Over the last year, core inflation is up by 4.53%. That’s the fastest rate in 30 years. 

Here’s a chart that gets your attention:

3. Quality Factor Companies Trade at their Biggest Discount Ever.

From Irrelevant Investor Blog

What is Quality factor? AQR Capital Management has defined the factor (QMJ, or quality minus junk) to be companies with the following traits: low earnings volatility, high margins, high asset turnover (indicating efficient use of assets), low financial leverage, low operating leverage (indicating a strong balance sheet and low macroeconomic risk) and low stock-specific risk (volatility that is unexplained by macroeconomic activity). Companies with these attributes historically have provided higher returns, especially in down markets. In particular, high-quality stocks that are profitable, stable, growing and have a high payout ratio outperform low-quality stocks with the opposite characteristics. 

From Alpha Architects

4. IPO Has Not Made New Highs with S&P

IPO ETF stuck below Feb 2021 highs

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Bottom of Form

5. Coporate Bond Electronic Trading Growth…..U.S. Corp Bonds $10.7 Trillion Market.

Marketwatch-It has been about two decades in the making, but electronic trading in corporate bonds finally has made notable inroads in a market long known for its privacy and low-tech ways.

Growth in electronic trading $10.7 trillion corporate bond market in the U.S. rose more than 100% over three past three years, outpacing the 61% expansion seen in Europe for the same stretch, according to a new Coalition Greenwich report.

Specifically, electronic trading of U.S. investment-grade bonds grew 111% between 2017 and the end of 2020, while the smaller high-yield, or “junk bond” portion, rose by 145% for the same period, the report said.

E-trading is making inroads.

Electronic trading in U.S. corporate bonds is finally taking off. But it’s still early days, says this investor-Joy Wiltermuth

6.Crypto Trading Volume Lowest in 9 Months

Crypto trading volumes have fallen to a 9-month low as Europeans ditch bitcoin, although US investors are still buying: CoinShares

Camomile Shumba

  • Bitcoin has seen outflows in Europe but inflows from North America in the latest week, according to CoinShares.
  • Trading volumes totalled $1.58 billion for the week to July 9, the lowest since October.
  • Multi-asset investment products, like the Bitwise 10 crypto index fund, were the most popular last week.

Cryptocurrency trading volumes fell to their lowest in nine months in the latest week, as bitcoin continued to fluctuate in a relatively narrow range, according to data from digital asset manager CoinShares on Tuesday.

Outflows picked up speed in Europe, where regulators have toughened their scrutiny of cryptocurrency trading in general, while US investors were net buyers of crypto assets, according to CoinShares data.

The crypto trading volumes totalled $1.58 billion for the week, as activity quietened mostly for bitcoin. Bitcoin saw net outflows of $6.9 million, a steep decline from net inflows of $38.9 million the week before.

Weekly crypto asset flows

7. Bio-Bonds Low Interest Government Backed Loans for Research

DNYUZ–A new type of bond could revive ailing medical science

Scientists translating basic research into treatments for disease increasingly have to think like venture capitalists, or risk their ideas languishing in what’s called the “valley of death.” They may soon have a new way to finance the journey from initial discoveries to clinical trials with BioBonds, DealBook’s Ephrat Livni reports for The Times.

BioBonds would create low-interest, government-backed loans for “translational” research. These would be packaged into a bond and sold on the secondary market for risk-averse institutional investors like pension funds. In May, Representatives Bobby Rush, Democrat of Illinois, and Brian Fitzpatrick, Republican of Pennsylvania, introduced legislation that would create $30 billion worth of these loans over three years, helping to fund F.D.A.-approved clinical trials.

The pandemic dug the research funding hole “a whole lot deeper,” said Karen Petrou, a co-founder and managing partner of Federal Financial Analytics, a consulting firm in Washington that devised BioBonds. Last year, clinical trials were halted, resources were diverted from labs, attention was focused on immediate needs and a lot of funding dried up. But without the initial efforts of academic labs, it would have been impossible for pharmaceutical companies to fast-track Covid vaccine development.

“We needed an American model,” Petrou said. Many countries support private-sector funding for biomedical research, and each does it differently. Petrou, who suffers from retinal degeneration and became blind in her 40s, discovered the funding struggles for researchers in 2013 while trying to raise money for studies on her condition. Potential investors said such projects were too speculative. She refused to accept that as a final answer.

Green bonds are the inspiration, having created a $750 billion private market in sustainability projects via publicly backed loans. BioBonds offer a “lifeline” for medical research, said Dr. Attila Seyhan, the director of translational oncology operations at Brown University and a former Pfizer scientist. While the loans must be repaid, he believes that university business units, which are already working with scientists on commercializing projects, will find creative ways to make them work. Even if only 1 percent of bets pay off, he said, it’s still worthwhile: “This is how drug development works.”

Read the full story about BioBonds.

8. LIBOR is Going Away. Get to Know SONIA

Goodbye, LIBOR. And hello, SONIA.

Over the course of 2021, investors, banks, and financial analysts alike will say “cheerio” to LIBOR (London Interbank Offered Rate) and usher in SONIA (Sterling Overnight Interbank Average Rate).

First launched in London in 1986, LIBOR has spent the last 35 years as a globally accepted benchmark for short-term interest rates. As many banks (and popular credit and loan products) begin their transition to SONIA, let’s break down why LIBOR is going away and what the new SONIA means for you.

What is the Difference Between LIBOR and SONIA?

Previously, LIBOR served as the benchmark interest rate at which banks loaned overnight funds between and among each other. LIBOR was calculated every morning by a group of sixteen leading global banks, each of whom submitted their own forward-looking rate estimate for borrowing money on unsecured terms from the other banks. The average of the sixteen figures then became LIBOR for that day. When a loan agreement was entered into, both LIBOR and any credit risk premium were set at the start of each interest period and gave borrowers certainty regarding the amount of interest they would owe at the period’s end.

However, there wasn’t just one single LIBOR rate. Variations were created with durations ranging from overnight to a year out. On top of that, all LIBOR durations were denoted in five major currencies, thereby bringing the short-term lending benchmark’s total to 150 published rates.

SONIA, in its current state, is a single, backward-looking rate denoted in British pound sterling. This means SONIA — unlike LIBOR — cannot be determined until the interest period is over. The retrospective design also means SONIA carries no credit risk premium, reflecting just the previous day’s interest rate paid on overnight deposits in active, liquid cash and derivative markets.

It should be noted that regulators are already working on evolving SONIA, creating rates that are forward-looking, incorporate credit risk premiums, and reflect more time periods.

LIBOR vs. SONIA comparison table

Download Visual

9. 67 Wildfires Spread Across 10 States In US West 

ZERO HEDGE-BY TYLER DURDEN-The National Interagency Fire Center (NIFC) reports 67 large wildfires burn across ten parched Western states on Tuesday, and the largest is in southern Oregon, already threatened to cut power to California. 

Nearly 918,000 acres have burned in 67 large fires across the United States. New large fires were reported in Arizona, California, Idaho, Montana, and Oregon. Type 1 and Type 2 Incident Management Teams are assigned to 24 large fires or complexes. And, more than 14,200 wildland firefighters and support personnel are assigned to incidents. 

As record temperatures continue across many states, it’s important to remember that we all play a valuable role in wildfire prevention. –NIFC

The fires erupted as much of the Western half of the US is plagued with a megadrought and back-to-back heat waves. This has created the perfect storm of conditions that are fueling dangerous fires.

10. How to Harness the Life-Changing Power of Sleep in 2020 and Beyond

Groundbreaking advances in digital health are changing the way we sleep.


  • Shelly Ibach, President and CEO of Sleep Number; Sleep Editor-at-Large, Thrive Global

As we head toward spring and look forward to fresh opportunities and challenges, I am issuing a wake-up call. Now is the time to make quality sleep your priority. This exciting new decade we’ve entered is full of possibilities, and sleep is at the root of all of them; it’s the key to thriving and realizing our goals. Science has shown unequivocally that it’s vital to our well-being. Getting the right kind of zzz’s can help prevent illness, ease pain, increase productivity, and make us kinder — and happier. In short, quality sleep is life changing. Now, with astounding breakthroughs in technology, everyone can achieve it. At Sleep Number, we hold ourselves accountable for delivering meaningful benefits to consumers that move society forward. We are forging the future of sleep by utilizing data to inform innovation, research, and the science of sleep. We are dedicated to our mission of improving lives by individualizing sleep experiences. We are making quality sleep effortless and achievable to improve everyone’s health and wellness. Digital health must be simple, meaningful, and accurate. Innovators like us need to do our part in defining the future and taking on big health challenges like sleep deprivation.

According to the C.D.C. (Centers for Disease Control and Prevention), one in three adults don’t get adequate sleep. And the problem goes deeper. Sleep disorders are so pervasive in the United States that they constitute a public health epidemic. A study conducted by the Perelman School of Medicine at the University of Pennsylvania found that one in four Americans develop insomnia each year. In particular, people say that they aren’t comfortable at night, so their shut-eye is disrupted. And many people still don’t understand that quality sleep involves much more than the number of hours spent in bed. It’s important to get not only the right amount, but the right quality of sleep.

The good news: Sleep is finally at the forefront of the well-being conversation. Now more than ever, people want to understand how they can achieve higher quality sleep, and they value the important role sleep plays in their health and productivity. Technology is giving people access to digital tools that provide valuable information about their well-being. In fact, new CES research shows that 59% of millennials are interested in sleep technology.

While it is great to see this adoption of technology, all the data can be overwhelming and confusing, especially if it isn’t accurate. There’s no shortage of data available related to wellness, however, often much of it doesn’t result in meaningful improvements. In other words, data for the sake of data doesn’t do anything to improve health: It isn’t always productive.

So, what is the solution? One crucial and formerly overlooked key to quality sleep is simple, yet far from simplistic. It’s your bed. What you sleep on matters. At Sleep Number, we have been pioneers in sleep monitoring sensor technology and on the cutting edge of the digital health era. The revolutionary 360 smart bed effortlessly adjusts throughout the night; it senses each sleepers movement and automatically adjusts to keep both sleepers comfortable for the highest quality of sleep. Additionally, SleepIQ® technology, the operating system of the 360 smart bed, provides personalized insights to improve sleep over time, as well as a nightly measure of quality sleep — your SleepIQ® score as well as your average heart and breathing rates. There is nothing for the sleeper to wear or do — you simply go to bed. 

It all started back in 2012 when we met the founders of a Silicon Valley start-up, the world leaders in sleep monitoring and biometric hands-free technology that was being used in neonatal units. We recognized the potential of connected technology and how this technology would work with the adjustable firmness of our beds. My instincts told me that investing in this proprietary technology would add tremendous value to people’s well-being — it would be the smart bed. We acquired the start-up, transformed our company, and today, we are a purpose-driven company with 360 smart beds that deliver life-changing sleep. 

Recent research we conducted has shown that people who routinely use the features of their 360 smart beds, including foot-warming and their SleepIQ® insights, improve their quality sleep by nearly 100 more hours each year. Studies have shown that an additional 15 minutes of quality sleep makes a considerable difference to your overall health.

As the sleep innovation leader, we recently introduced the next evolution of our award-winning360 smart beds at CES, the largest consumer technology show in the world. Our new Climate360 smart bed uses sleep and biometric data to respond automatically and provide your ideal temperature, creating a personalized “microclimate” — as we call it. Designed to help you fall asleep faster, it keeps you asleep, with effortless adjustments throughout the night. It’s the ultimate sleep oasis. Our research showed that 84% of people struggle with being too hot or too cold at night. This is the first bed with advanced temperature technology that will understand and respond to your individual needs. It’s especially great for couples who disagree on their sleeping temperature. I often say we save marriages, bringing people back together in the bedroom.

We also announced a groundbreaking collaboration with Mayo Clinic to advance sleep science. Sleep deprivation has been linked to many diseases and health conditions including heart diseaseobesityType 2 diabetes, and depression. We will be combining Mayo Clinic’s clinical expertise and research with our own extensive consumer sleep knowledge and technology. As a crusader for sleep, I believe this is crucial because we need evidence-based solutions to advance the science and the clinical practice of sleep medicine. We’re establishing The Sleep Number Research Fund in Sleep Science with an emphasis on Cardiovascular Medicine, and the Sleep Number Research & Development Fund to Further Sleep Science. Our goal is that the collaboration will amplify our ability to impact society’s overall sleep and wellness. 

My friend Katie Couric is also an advocate for well-being and highly engaged with the important advancements we are making to achieve life-changing sleep. We sat down for a discussion at CES and she shared the following sentiment: “When I started out in my career, people were bragging about not needing much sleep, as if it were a badge of honor. Now people are recognizing how critically important quality sleep is to overall health.” Katie went on to say, “I’m a big believer that one way we are going to alleviate some illnesses that are going to require medical care is by preventing them in the first place,” she said. “The future of this research is exciting.” 

These are indeed exciting times. I’ve been thinking about how, five years ago, my friend Arianna Huffington — the founder and CEO of Thrive and, of course, a pioneer in so many ways — issued a wake-up call with her seminal book, The Sleep Revolution. It helped set in motion a sea change, making sleep a key element of the global conversation about well-being. Now the Digital Sleep Revolution is upon us, and in the future we expect SleepIQ® technology to play a significant, preventative role by detecting potential health conditions, like breathing difficulties, sleep apnea, and restless leg syndrome. I foresee a future where your bed will become your health hub. 

It starts with great sleep, which leads to a healthy mind, body, and soul. I am counting on you all to make sleep a top priority. Whatever you sleep on and whatever your own bedtime routine is, it should be individualized for you — on your own terms. Sleep will support you in every way, and as a firm believer of quality sleep, I want to help you achieve it — so you can lead a healthier, happier life. 

Sleep well, dream big, 


*Source: Based on internal analysis of 25 million sleep sessions assessing sleepers who use multiple features of Sleep Number products, including foot-warming, sleepers who routinely use their 360 smart bed features and SleepIQ® technology can improve quality sleep by over 15 minutes each night, nearly 100 hours each year.

— Published on March 3, 2020


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