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401k ETFs, Robert Serber, US Yields


Cory Banks, Index Universe,  Has Schwab Cracked the 401K Code For ETFs? here. Trading volumes will rise.

For years, the 401(k) industry has been seen as the final frontier for exchange-traded funds. After initial acceptance from traders and tremendous growth from registered investment advisors over the last 20 years, ETF sponsors like BlackRock’s iShares and Vanguard have looked to retirement providers for acceptance and a next leg of growth.

However, the path to that acceptance has been a rocky one. The space is largely owned by mutual fund providers who, after the revolution of the 1980s, established deep roots in the 401(k) industry. Rather than uproot these money-making machines, most issuers have steered clear—watching and waiting. Until now.

Lipton, GLL, It Takes Guts To Do Research, here. Serber did the Los Alamos Primer. Have to read the Dirac biography, The Strangest Man.

Oppenheimer with Wendell Fuzzy worked later on a new extension of Dirac’s theory for electrodynamics. Dirac himself had no response to this new long paper. Later in 1934 Oppenheimer got Dirac to visit him at Caltech. There he persuaded Dirac to listen to a fifteen minute presentation by graduate students on the paper, giving the first attempt to deal with cancellable infinities in quantum field theory by a process later formalized as renormalization. After the presentation the students braced themselves for tough questions from the famous Dirac. He asked only one:

Where is the post office?

One of the graduate students, Robert Serber, obligingly drove him there, and tried asking again for comments. He was cut down by Dirac’s reply,

I cannot do two things at once.

Although renormalization is now recognized as having roots in papers Serber would write a few years later, the larger point is that Oppenheimer and his group missed a chance to energize quantum field theory before World War II.

Izabella Kaminska, Alphaville, The US yield move and the China premium, here.

What’s really responsible for higher US yields? Falling demand from domestic and western investors? Or Chinese and Japanese official flows?

Earlier in June, TIC data sent us a very important message. Abenomics was somehow prompting the repatriation and redistribution of money held in long-term USTs by Japanese investors, as this chart from Nomura shows:


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