Although you are paying
yourself interest at a market rate, with interest rates so low, there's not much gain to be had there.
Not exact matches
At the March 20 - 21 meeting, the Federal Open
Market Committee voted to raise its benchmark
interest rate by 25 basis points to a range of 1.50 % to 1.75 %, as had been widely expected.
Important factors that could cause actual results to differ materially from those reflected in such forward - looking statements and that should be considered in evaluating our outlook include, but are not limited to, the following: 1) our ability to continue to grow our business and execute our growth strategy, including the timing, execution, and profitability of new and maturing programs; 2) our ability to perform our obligations under our new and maturing commercial, business aircraft, and military development programs, and the related recurring production; 3) our ability to accurately estimate and manage performance, cost, and revenue under our contracts, including our ability to achieve certain cost reductions with respect to the B787 program; 4) margin pressures and the potential for additional forward losses on new and maturing programs; 5) our ability to accommodate, and the cost of accommodating, announced increases in the build
rates of certain aircraft; 6) the effect on aircraft demand and build
rates of changing customer preferences for business aircraft, including the effect of global economic conditions on the business aircraft
market and expanding conflicts or political unrest in the Middle East or Asia; 7) customer cancellations or deferrals as a result of global economic uncertainty or otherwise; 8) the effect of economic conditions in the industries and
markets in which we operate in the U.S. and globally and any changes therein, including fluctuations in foreign currency exchange
rates; 9) the success and timely execution of key milestones such as the receipt of necessary regulatory approvals, including our ability to obtain in a timely fashion any required regulatory or other third party approvals for the consummation of our announced acquisition of Asco, and customer adherence to their announced schedules; 10) our ability to successfully negotiate, or re-negotiate, future pricing under our supply agreements with Boeing and our other customers; 11) our ability to enter into profitable supply arrangements with additional customers; 12) the ability of all parties to satisfy their performance requirements under existing supply contracts with our two major customers, Boeing and Airbus, and other customers, and the risk of nonpayment by such customers; 13) any adverse impact on Boeing's and Airbus» production of aircraft resulting from cancellations, deferrals, or reduced orders by their customers or from labor disputes, domestic or international hostilities, or acts of terrorism; 14) any adverse impact on the demand for air travel or our operations from the outbreak of diseases or epidemic or pandemic outbreaks; 15) our ability to avoid or recover from cyber-based or other security attacks, information technology failures, or other disruptions; 16) returns on pension plan assets and the impact of future discount
rate changes on pension obligations; 17) our ability to borrow additional funds or refinance debt, including our ability to obtain the debt to finance the purchase price for our announced acquisition of Asco on favorable terms or
at all; 18) competition from commercial aerospace original equipment manufacturers and other aerostructures suppliers; 19) the effect of governmental laws, such as U.S. export control laws and U.S. and foreign anti-bribery laws such as the Foreign Corrupt Practices Act and the United Kingdom Bribery Act, and environmental laws and agency regulations, both in the U.S. and abroad; 20) the effect of changes in tax law, such as the effect of The Tax Cuts and Jobs Act (the «TCJA») that was enacted on December 22, 2017, and changes to the interpretations of or guidance related thereto, and the Company's ability to accurately calculate and estimate the effect of such changes; 21) any reduction in our credit
ratings; 22) our dependence on our suppliers, as well as the cost and availability of raw materials and purchased components; 23) our ability to recruit and retain a critical mass of highly - skilled employees and our relationships with the unions representing many of our employees; 24) spending by the U.S. and other governments on defense; 25) the possibility that our cash flows and our credit facility may not be adequate for our additional capital needs or for payment of
interest on, and principal of, our indebtedness; 26) our exposure under our revolving credit facility to higher
interest payments should
interest rates increase substantially; 27) the effectiveness of any
interest rate hedging programs; 28) the effectiveness of our internal control over financial reporting; 29) the outcome or impact of ongoing or future litigation, claims, and regulatory actions; 30) exposure to potential product liability and warranty claims; 31) our ability to effectively assess, manage and integrate acquisitions that we pursue, including our ability to successfully integrate the Asco business and generate synergies and other cost savings; 32) our ability to consummate our announced acquisition of Asco in a timely matter while avoiding any unexpected costs, charges, expenses, adverse changes to business relationships and other business disruptions for ourselves and Asco as a result of the acquisition; 33) our ability to continue selling certain receivables through our supplier financing program; 34) the risks of doing business internationally, including fluctuations in foreign current exchange
rates, impositions of tariffs or embargoes, compliance with foreign laws, and domestic and foreign government policies; and 35) our ability to complete the proposed accelerated stock repurchase plan, among other things.
Markets do not expect a change in
interest rates from the Federal Reserve
at the conclusion of its meeting on Wednesday, though analysts will be watching for any change in language and indications that a June hike is likely.
All dividend stocks risk a hit to earnings from
interest rates in the short term, says Rich Peterson, a senior director
at S&P Global
Market Intelligence.
Specifically, there are concerns about what might happen should the tide turn in the bond
markets when 30 years of falling
interest rates reverses
at a time when the Federal Reserve is preparing to tighten monetary policy by forcing
rates higher.
«I will continue to act to ensure that household debt levels are sustainable, that lenders are acting prudently, and that increases in
interest rates or a housing
market downturn don't put
at risk the economic growth we are working so hard to accelerate,» Morneau said.
But what many fail to consider is that when ordinary Canadians are unable to afford real estate — even when borrowing
at unusually low
interest rates — the
market will adjust.
On Thursday, Argentina sold $ 7 billion in five - year and 10 - year dollar bonds in the international
market at interest rates of 5.625 percent and 7 percent.
Interest rates have remained
at unprecedented lows since the financial crisis in 2008, providing more incentive for Canadians to jump into the housing
market.
And it also means that bond
market traders believe we're likely to see
at least a quarter point hike in
interest rates by the middle of next year.
Elsewhere, the
market is also expecting a possible
interest rate hike from the Federal Reserve
at its December meeting.
At the same time, the fact the ECB is likely to gradually raise
interest rates, it will mean that these peripheral nations could face higher debt financing when borrowing money from the
markets.
That's because it will be one of the few remaining data points that Federal Reserve Chair Janet Yellen and the rest of the Federal Open
Market Committee will have before they decide whether or not to begin the process of raising
interest rates at their upcoming meeting December 15th and 16th.
That debate takes place internally
at the central bank, where contrasting views are regularly articulated by members of the Federal Open
Market Committee (FOMC) as our Federal Reserve (Fed) policymakers attempt to steer monetary policy with regard to
interest rates.
Then again, China's bank cut
interest rates on Monday in response to the
market drop, so it's a mixed message
at best.
According to Tom Porcelli, chief U.S. economist
at RBC Capital
Markets,
market prices imply the odds that
interest rates will be higher
at the end of the year are less than 50 %.
Britain's housing
market continued to lose momentum data showed too, with mortgage approvals
at their weakest in nearly three years following the Bank of England's first
interest rate hike in a decade.
Markets anticipate
at least two more
interest rate hikes this year after an increase in March, according to CME Group fed funds futures.
Such risks, uncertainties and other factors include, without limitation: (1) the effect of economic conditions in the industries and
markets in which United Technologies and Rockwell Collins operate in the U.S. and globally and any changes therein, including financial
market conditions, fluctuations in commodity prices,
interest rates and foreign currency exchange
rates, levels of end
market demand in construction and in both the commercial and defense segments of the aerospace industry, levels of air travel, financial condition of commercial airlines, the impact of weather conditions and natural disasters and the financial condition of our customers and suppliers; (2) challenges in the development, production, delivery, support, performance and realization of the anticipated benefits of advanced technologies and new products and services; (3) the scope, nature, impact or timing of acquisition and divestiture or restructuring activity, including the pending acquisition of Rockwell Collins, including among other things integration of acquired businesses into United Technologies» existing businesses and realization of synergies and opportunities for growth and innovation; (4) future timing and levels of indebtedness, including indebtedness expected to be incurred by United Technologies in connection with the pending Rockwell Collins acquisition, and capital spending and research and development spending, including in connection with the pending Rockwell Collins acquisition; (5) future availability of credit and factors that may affect such availability, including credit
market conditions and our capital structure; (6) the timing and scope of future repurchases of United Technologies» common stock, which may be suspended
at any time due to various factors, including
market conditions and the level of other investing activities and uses of cash, including in connection with the proposed acquisition of Rockwell; (7) delays and disruption in delivery of materials and services from suppliers; (8) company and customer - directed cost reduction efforts and restructuring costs and savings and other consequences thereof; (9) new business and investment opportunities; (10) our ability to realize the intended benefits of organizational changes; (11) the anticipated benefits of diversification and balance of operations across product lines, regions and industries; (12) the outcome of legal proceedings, investigations and other contingencies; (13) pension plan assumptions and future contributions; (14) the impact of the negotiation of collective bargaining agreements and labor disputes; (15) the effect of changes in political conditions in the U.S. and other countries in which United Technologies and Rockwell Collins operate, including the effect of changes in U.S. trade policies or the U.K.'s pending withdrawal from the EU, on general
market conditions, global trade policies and currency exchange
rates in the near term and beyond; (16) the effect of changes in tax (including U.S. tax reform enacted on December 22, 2017, which is commonly referred to as the Tax Cuts and Jobs Act of 2017), environmental, regulatory (including among other things import / export) and other laws and regulations in the U.S. and other countries in which United Technologies and Rockwell Collins operate; (17) the ability of United Technologies and Rockwell Collins to receive the required regulatory approvals (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the merger) and to satisfy the other conditions to the closing of the pending acquisition on a timely basis or
at all; (18) the occurrence of events that may give rise to a right of one or both of United Technologies or Rockwell Collins to terminate the merger agreement, including in circumstances that might require Rockwell Collins to pay a termination fee of $ 695 million to United Technologies or $ 50 million of expense reimbursement; (19) negative effects of the announcement or the completion of the merger on the
market price of United Technologies» and / or Rockwell Collins» common stock and / or on their respective financial performance; (20) risks related to Rockwell Collins and United Technologies being restricted in their operation of their businesses while the merger agreement is in effect; (21) risks relating to the value of the United Technologies» shares to be issued in connection with the pending Rockwell acquisition, significant merger costs and / or unknown liabilities; (22) risks associated with third party contracts containing consent and / or other provisions that may be triggered by the Rockwell merger agreement; (23) risks associated with merger - related litigation or appraisal proceedings; and (24) the ability of United Technologies and Rockwell Collins, or the combined company, to retain and hire key personnel.
The U.S. central bank has been itching to raise
interest rates, and the
market was forecasting as of 5 p.m. last night that there was an 82 % chance that they would
at their December meeting.
That's according to the minutes of the most recent meeting of the Federal Open
Market Committee (FOMC), the committee
at the Federal Reserve in charge of setting
interest rates.
«If
interest rates continue to accelerate to the upside, what scares the
market is if they go up fast,» said Robert Phipps, a director
at Per Stirling Capital Management in Austin, Texas
This morning, the European Central Bank kept
interest rates unchanged
at record lows, as expected, but European
markets could take another turn depending on what happens when European Central Bank president Mario Draghi takes questions later this morning.
While this deal has been discussed for several years, Kevin Manning, an analyst
at BMO Capital
Markets, says the purchase was made now because of worries over rising
interest rates.
«
Interest rates aren't anticipated to pose a problem for the economy or equity
markets this year,» Mike Bell, global
market strategist
at J.P. Morgan Asset Management, said in the quarterly report out Tuesday.
Despite the strong labor
market and calm economy, Leech does not expect the Fed to raise
interest rates at its March meeting.
Since December 2015, the policymaking Federal Open
Market Committee has raised
interest rates six times, with the funds benchmark now targeted
at 1.5 percent to 1.75 percent.
Ruth Gregory, a UK economist
at Capital Economics, said: «February's labour
market figures provide us with optimism that sustained rises in real wages are now in prospect and should seal the deal on another
interest rate hike in May.»
At this point, pretty much any economic data report is of
interest to U.S.
markets, with the Federal Reserve watching closely for evidence of a sustained economic recovery before it finally implements its long - awaited
interest rate hike.
That's manageable as long as
interest rates and unemployment remain low, says Doug Porter, deputy chief economist
at BMO Capital
Markets.
Federal Reserve Chair Janet Yellen may struggle later this week to convince financial
markets she can steer a divided U.S. central bank to raise
interest rates at least once in 2016 after it started the year with four hikes on its radar.
«Additionally,» it says, «these
markets are continuing to draw
interest from a younger crowd, as the older millennial age group is viewing property listings
at a
rate 1.2 times greater than the share of older millennials already living in the area, indicating strong
interest from others wanting to move into these neighborhoods.»
«Rising
interest rates and stricter mortgage requirements have reduced home buyers» purchasing power, particularly for those
at the entry level of our
market,» Jill Oudil, president of the Real Estate Board of Greater Vancouver, said in a statement.
«If you think the ship is about to sail, this is the time to get on,» said Aaron Kohli,
interest rates strategist
at BMO Capital
Markets.
Meanwhile, with a series of supportive economic factors
at play «we expect the country's real estate
market to continue the strong showing it posted in the second half of 2013,» Soper said, noting among other things favourable
interest rates and an improving U.S. economy fuelling demand for Canadian exports.
At a time when Fed Chair Alan Greenspan was being held as the leader of a «committee to save the world «-- as the famous Time magazine cover read — she advised him to raise
interest rates and keep an eye on the booming stock
market.
Higher inflation this year should push the Fed to raise the federal funds
rate at a faster pace, which will have knock - on effect on
interest rates and the bond
market.
Conservative politicians and hawkish economists have
at times criticized the Fed's «full employment» mandate in large part because the main monetary policy tool, the short - term
interest rate, has only an indirect effect on the labor
market.
Now let's take a hard look
at interest rates and any suggestion that the bond
market is signaling a recession.
«Requiring the banks to pay treble damages to every plaintiff who ended up on the wrong side of an independent Libor ‐ denominated derivative swap would, if appellants» allegations were proved
at trial, not only bankrupt 16 of the world's most important financial institutions, but also vastly extend the potential scope of antitrust liability in myriad
markets where derivative instruments have proliferated,» the U.S. Court of Appeals in New York said in the ruling.A U.S. appeals court on Monday revived private antitrust litigation accusing major banks of conspiring to manipulate the Libor benchmark
interest rate, in a big setback for their defense against investors» claims of
market - rigging.
Overall, Treasury yields, which influence the
interest rates that borrowers pay on mortgages and other loans, have been «remarkably stable» given the Fed could raise
rates against the backdrop of ongoing turmoil in global
markets, said Kathy Jones, chief fixed income strategist
at Schwab.
Federal Reserve Board Chairman Alan Greenspan did try to prepare
markets for higher short - term
interest rates in testimony before the Joint Economic Committee a few days before the February 1994 meeting of the Federal Open
Market Committee
at which the tightening began.
Or: «I think the
market is underestimating the pace
at which the Fed will alter its current course and the consequences of that for
interest rates.»
When Bernanke's taper talk caused long - term
interest rates to rise much faster than the Fed intended, one of the ways in which the central banks sought to allay
market fears was to stress that it would keep short - term
rates steady until the jobless
rate had reached
at least 6.5 %.
We're seeing a slowly tightening, modestly growing U.S. [labor]
market, which is just about
at the point now that zero
interest rates are no longer necessary.»
«We're
at a high end of the stock
market and the low end of
interest rates,» he said.
Global
market volatility persisted this week, as investors remained nervous on China's slowing economy along with a possible
interest rate increase
at the U.S. Federal Reserve's mid-September meeting.
The presentation suggested that such a facility would allow the Committee to offer an overnight, risk - free instrument directly to a relatively wide range of
market participants, perhaps complementing the payment of
interest on excess reserves held by banks and thereby improving the Committee's ability to keep short - term
market rates at levels that it deems appropriate to achieve its macroeconomic objectives.
While it's still not known when
interest rates will go up and by how much, what we do know is that the bond
market is
at greater risk to rising
interest rates than
at any time in recent history.