During the first quarter of 2026, Hirsberg said Boyd expects to pay approximately $340 million for tax credits that will satisfy tax obligations tied to the FanDuel transaction. He said the company anticipates leverage will approach roughly 2.5x in 2026 (traditional leverage), reflecting the tax credit payment, capital investments, and the ongoing capital return program. On a follow-up question, Hirsberg clarified that his 2.5x comment referred to traditional leverage and that lease-adjusted leverage would ...

The Hecht Commodity Report is one of the most comprehensive commodities reports available today. My weekly report covers the market movements of over 20 different commodities and provides bullish, bearish and neutral calls, directional trading recommendations, and actionable ideas for traders through a portfolio approach.Andrew Hecht is a 35-year Wall Street veteran covering commodities and precious metals. He runs the investing group The Hecht Commodity Report, one of the most comprehensive commodities ser ...

Financial Data and Key Metrics Changes - For the full year 2025, the company reported FFO per share of $2.00, which is about 3% above initial expectations [3] - Same-store cash NOI increased by 0.5% compared to 2024 [18] - Fourth quarter FFO per share was $0.47, a decrease of approximately $0.02 compared to Q3 2025 [18] Business Line Data and Key Metrics Changes - Office segment same-store NOI increased by 2.3% for the year, driven by higher base rent and improved expense recoveries [19] - Retail segment same-store NOI increased by 1.2% for the year, reflecting strong growth in the first half of 2025 [19] - Multifamily segment declined by 3.2% for the year due to flat to modestly lower rents and elevated concessions [20] - Mixed-use segment declined by 6.7% in 2025, impacted by softer hotel demand in Waikiki [20] Market Data and Key Metrics Changes - The office portfolio ended the quarter 83% leased, with same-store office portfolio at 86% leased, up about 150 basis points from Q3 [6] - Retail segment ended the year at 98% leased, with positive cash and GAAP leasing spreads [10] - Multifamily ended the year 95.5% leased, with approximately 1% net effective rent growth year over year [11] Company Strategy and Development Direction - The company aims to drive office leasing by converting prospect activity into signed leases and commenced revenue [16] - Retail momentum will be maintained by keeping centers full and managing expirations [16] - The company plans to manage through the multifamily supply cycle with disciplined revenue management and cost control [16] - The focus will be on prudent hotel operations while responding to market demand [16] Management's Comments on Operating Environment and Future Outlook - Management believes that coastal infill locations and high-quality real estate position the company to capture demand as it materializes [5] - The company views 2026 as an opportunity to build upon the progress made in 2025, with a focus on operational execution and long-term value creation [15][16] - Management expressed frustration with the current share price, indicating that it does not reflect the intrinsic value of the company's assets [14] Other Important Information - The company declared a quarterly dividend of $0.34 per share for the first quarter, with expectations to maintain the dividend at current levels [15] - Liquidity at the end of the fourth quarter was approximately $529 million, with a leverage ratio of 6.9x on a trailing twelve-month basis [22][23] Q&A Session Summary Question: Regarding elevated TIs for office renewals - Management acknowledged that higher capital burdens for office leasing are expected to moderate over time as occupancy improves [35][36] Question: Timeline to achieve target leverage of 5.5x - Management indicated that leasing up La Jolla Commons 3 and One Beach will help achieve the target leverage [40] Question: Steps to reinvigorate stock price - Management is open to strategic asset sales if they reflect long-term value but will not sell at a discount [42][43] Question: Guidance assumptions for office segment lease rates - Management reported that 68,000 sq ft has been signed year-to-date, with a significant pipeline of leasing activity [49] Question: Credit reserves in guidance - Management clarified that credit reserves are a conservative measure and not indicative of specific tenant concerns [84]

Core Insights - The October 10 flash crash in cryptocurrency markets was attributed to a macro shock combined with high leverage and reduced liquidity, rather than issues within Binance's trading systems [1] - Global markets were already under pressure from trade-war headlines, which contributed to the vulnerability of crypto markets [1] Market Conditions - At the time of the crash, open interest in bitcoin futures and options exceeded $100 billion, creating a scenario for forced deleveraging as prices began to decline [2] - The selloff led to a self-reinforcing cycle where market makers activated automated risk controls, further reducing liquidity in order books [3] Impact on Markets - The U.S. equity markets experienced a loss of approximately $1.5 trillion on the same day, with the S&P 500 and Nasdaq recording their largest one-day declines in six months [4] - Binance reported that around $150 billion in systemic liquidations occurred across global markets during the crash [4] Blockchain and Transaction Issues - Ethereum gas fees surged above 100 gwei, causing blockchain congestion that slowed transfers and limited arbitrage opportunities, which exacerbated price gaps and fragmented liquidity [5] Binance-Specific Incidents - Binance acknowledged two specific incidents during the crash but clarified that these did not cause the broader market movement. The first incident involved a slowdown in its internal asset-transfer system, affecting transfers between accounts [6] - The second incident was related to temporary index deviations for certain assets, which occurred after most liquidations had already taken place, attributed to thin liquidity and delayed rebalancing [7] Compensation and Methodology Changes - Binance implemented changes to its methodology and compensated affected users with over $328 million, launching additional support programs to stabilize impacted participants [8] - Approximately 75% of the day's liquidations occurred before the index deviations, indicating that the initial macro shock was the main driver of the market movement [8]

Market Overview - The Bitcoin market experienced a significant downturn, with Bitcoin dropping to $81,000, leading to a rapid liquidation of over $1.68 billion in leveraged positions in a single day [1][2] - Approximately 267,000 accounts were liquidated, with long positions constituting about 93% of the losses, indicating a concentrated risk across trading venues [2][3] Liquidation Dynamics - The liquidation event was primarily driven by leverage snapping under its own weight rather than panic selling, with Bitcoin absorbing around $780 million of the losses and Ethereum about $414 million [2] - Major exchanges like Hyperliquid, Bybit, and Binance saw significant forced closures, with Hyperliquid leading at approximately $598 million in liquidations [3] Market Sentiment and Future Outlook - There is growing concern that potential new buyers may no longer afford Bitcoin, as some demographics, particularly Gen Alpha, view holding Bitcoin as a status symbol [2] - The total crypto open interest fell sharply alongside the selloff, indicating that leverage was flushed out of the market rather than rotated, with funding rates having been persistently positive before the drop [4] Impact on Related Companies - The crash had immediate repercussions for companies linked to Bitcoin, with firms like MicroStrategy and Bitmine Immersion Technologies seeing stock drops of nearly 10% [5] - MicroStrategy's stock is currently valued lower than its net asset value, which is approximately $73.62 billion, suggesting potential for recovery if the company avoids liquidation [6]

Core Viewpoint - Jay-Z and Beyoncé are utilizing a financial strategy known as "buy, borrow, die," which involves acquiring appreciating assets and borrowing against them to create tax-free cash flow while potentially minimizing capital gains taxes for their heirs [1][7]. Group 1: Financial Strategy - The couple has secured attractive interest rates on their mortgages, with a new mortgage from Morgan Stanley at a fixed rate of 5% for 30 years, which is favorable compared to the average 30-year fixed mortgage rate of 6.1% projected for 2026 [2][3]. - They have taken on significant liabilities, such as a $110.6 million mortgage, which represents only 2.8% of their combined wealth estimated at around $4 billion [3][4]. Group 2: Real Estate Portfolio - Their real estate portfolio is valued at approximately $313 million, including properties like a Hamptons home, a Malibu mansion, and a New York penthouse, with the Bel-Air mansion being a key asset [5][4]. - The couple has previously secured a $52.8 million mortgage on the same property four years prior to the recent $57.8 million mortgage [4]. Group 3: Investment Opportunities - By borrowing against their mansion, they can invest the $110.6 million owed into business ventures or the S&P 500, which has delivered an annualized return of about 16.3% over the past decade [7]. - This strategy is not exclusive to billionaires; other celebrities, like Paris Hilton, also leverage mortgages for financial benefits, indicating a broader trend among wealthy individuals [8].

Summary of the Japan Equity Strategy Conference Call Industry Overview - The focus is on the Japanese equity market amid rising long-term interest rates, particularly the implications for stock selection and investment strategies in Japan [1][6][15]. Core Insights - **Negative Real Interest Rates**: Despite rising long-term interest rates, Japan's real interest rates remain negative, which is supportive of equity valuations [6][15][16]. - **Equity Valuations**: Japanese equities are considered inexpensive in a global context, with a higher yield spread compared to the US and Europe, indicating that rising rates do not necessarily lead to a bearish outlook for Japanese stocks [17][36]. - **Leverage Metrics**: Leverage-related metrics are not expected to be significant drivers of stock selection in the current environment, with a shift towards value factors becoming more effective [6][22][32]. Market Dynamics - **Long-Term Interest Rates**: The Bank of Japan (BoJ) faces challenges with rising yields, particularly in the super-long segment of the Japanese Government Bonds (JGB) market, which has seen a lack of buyers and increased selling pressure [7][8][11]. - **Fiscal Concerns**: There are concerns regarding fiscal dominance as the government considers consumption tax cuts, which could impact market confidence and bond yields [11][14][35]. - **Investment Strategy**: The current environment suggests that investors should not adopt excessive pessimism towards Japanese equities, as the fundamentals remain supportive [15][36]. Key Data Points - **JGB Yields**: As of January 20, 2026, 10-year JGB yields exceeded 2.3%, marking a significant rise [38]. - **Dividend Yields**: For over 20 years, long-term yields have remained below dividend yields, but recent trends show a slight inversion, indicating changing market dynamics [39][41]. - **Value Factor Performance**: A 1% increase in Japanese long-term rates is estimated to raise composite value factor returns by 23.83%, significantly higher than the impact of US long-term rates [33][62]. Additional Considerations - **Market Liquidity**: The lack of buyers in the super-long JGB market has led to a self-reinforcing negative cycle, raising concerns about fiscal stability and market liquidity [8][10]. - **Equity Growth Expectations**: In rising rate environments, companies with higher leverage may outperform due to enhanced growth expectations, countering the typical profit pressure from increased interest expenses [22][25][28]. - **Inflation Dynamics**: Historical data suggests that moderate inflation levels are beneficial for equities, indicating potential for improved returns if Japan transitions from deflation to a stable inflationary environment [57]. Conclusion - The Japanese equity market is positioned to navigate rising long-term interest rates without significant adverse effects, supported by negative real interest rates and attractive equity valuations. Investors are encouraged to focus on value factors and remain optimistic about the potential for growth in the Japanese market [15][36].

Core Viewpoint - The increasing dominance of hedge funds in the UK government bond market poses new risks to financial stability, as highlighted by Bank of England Governor Andrew Bailey Group 1: Market Structure Changes - The structure of the UK government bond market has significantly changed over the past 5 to 10 years, now being dominated by non-bank institutions, particularly hedge funds [2][3] - A small number of hedge funds are taking large positions in the cash market, which has allowed the UK to borrow more than in the past but raises concerns about market stability [2][4] Group 2: Risks Associated with Hedge Fund Dominance - Hedge funds have placed £100 billion in bets in the repo market, where they use gilts as collateral to borrow money and purchase more gilts, creating a cycle of leverage [5] - The lack of cash reserves, or "margin," set aside by hedge funds during gilt trading increases the risk of forced sales during market stress, potentially leading to a downward price spiral [6]

Core Viewpoint - Strategy, formerly known as MicroStrategy, has seen its stock value decline by 62% since its peak last June, primarily due to falling Bitcoin prices and investor concerns about its financial structure [2][9]. Company Overview - Strategy went public in June 1998 at $10 per share, reaching a peak of approximately $320 before experiencing significant declines due to the dot-com bubble and accounting issues [3]. - The company rebranded to Strategy last year, focusing on Bitcoin development and holding about 3.2% of the total Bitcoin supply, equating to over 672,000 BTC [4]. Financial Performance - The value of Strategy's Bitcoin holdings surged from $1.9 billion in March 2021 to $23.9 billion by the end of 2024 [4]. - In the first half of 2025, $8.1 billion of the company's earnings were attributed to Bitcoin price appreciation, but the value of its Bitcoin holdings dropped by $17 billion in the fourth quarter [5][6]. Debt and Liabilities - The company has significant financial obligations, owing $21 billion to lenders and preferred shareholders, with over $844 million due to investors in the next year [6]. - The stock's decline reflects a loss of premium over its Bitcoin holdings, with the multiplier-to-net asset value decreasing from over 2.4 in late 2024 to around 1.1 in January 2026 [6]. Market Sentiment and Stock Valuation - The stock's performance is closely tied to Bitcoin's price movements, with analysts suggesting a potential upside of 153% if Bitcoin appreciates [8]. - Investor fear has led to a significant drop in the company's net asset value multiplier, contributing to the stock's decline [14]. Future Scenarios - Three potential scenarios for Strategy's stock are outlined: - Status Quo: If Bitcoin remains between $85,000 and $100,000, the stock could trade between $150 and $250 [15]. - Optimistic: If Bitcoin rises to between $100,000 and $150,000, price targets could reach between $450 and $474 [15]. - Pessimistic: If Bitcoin falls below $80,000, the stock could drop below $100 due to financial constraints [15].

Core Viewpoint - Strategy, formerly known as MicroStrategy, has experienced a significant decline in stock value, losing 62% since its peak last June, primarily due to the volatility of Bitcoin prices and investor concerns regarding the company's financial structure [2][5][10]. Company Overview - Strategy transitioned from a traditional enterprise software company to a hybrid Bitcoin Development Company, with current Bitcoin holdings representing approximately 3.2% of the total supply, equating to over 672,000 BTC [4]. - The company's stock was initially valued at around twice the value of its Bitcoin holdings, but this premium has diminished significantly [5][7]. Financial Performance - The value of Strategy's Bitcoin holdings surged from $1.9 billion in March 2021 to $23.9 billion by the end of 2024, but the stock began to decline as Bitcoin's price fell [5]. - In the first half of 2025, $8.1 billion in earnings were attributed to Bitcoin price appreciation, while the value of Bitcoin holdings dropped by $17 billion in the fourth quarter [6]. Debt and Obligations - Strategy has substantial financial obligations, including $21 billion owed to lenders and preferred shareholders, and must pay over $844 million to investors within the next year [7]. - The company's liquidity is not immediately threatened, with $8.2 billion in unsecured debt and 21 months of cash reserves [9]. Stock Valuation and Market Sentiment - The stock's net asset value multiplier has decreased from over 2.4 in late 2024 to around 1.1 in January 2026, reflecting investor fears and high share dilution [7]. - Analysts suggest that the stock could have a 153% upside potential if Bitcoin prices increase, with average price targets around $440 [9]. Future Scenarios - Three potential scenarios for Strategy's stock are outlined based on Bitcoin's price movements: - Status Quo (Bitcoin between $85,000 and $100,000): Stock likely trades between $150 and $250 - Optimistic (Bitcoin between $100,000 and $150,000): Price targets set between $450 and $474 - Pessimistic (Bitcoin falls below $80,000): Stock could drop below $100 [10][15]. Leadership and Market Influence - Executive Chair Michael Saylor has made bold predictions about Bitcoin's future value, which could influence investor sentiment and stock performance [8][13]. - The company's aggressive strategy of leveraging debt to acquire Bitcoin has led to increased volatility in stock performance, particularly during market downturns [15].