Market Commentary Resilient M&A Activity despite headwinds Despite the uncertain near-term economic outlook and difficult debt markets the number of completed M&A transactions across the specialty distribution sector in Q1 2023 has been encouraging  The buyer mix across the specialty distribution M&A landscape has largely been focused on strategic acquirers as private equity firms…

What they mean and why they matter, Currency traders might bemoan the lack of attention their market receives compared to equities based on the most recent data they trade about $75 trillion dollars per day compared to about $052 trillion daily in the global equity markets  In building a case for why currencies should receive more attention traders might describe how exchange rates which describe the value of one currency in terms…, base currency, the, quote currency, and the, exchange rate, (Figure 1  FIGURE 1 COMPONENTS OF A SPOT EXCHANGE RATE   Translation One euro can be exchanged for 10934 US dollars, Spot exchange rates, Spot exchange rates are used in trades that settle promptly meaning the currencies are exchanged within two days or less forward exchange rates are for trades that settle between a few days and years  Spot exchange rates are influenced by supply and demand That demand can be from central banks buying and selling currencies for monetary reasons such as intervening to keep a country’s exchange rate…, Forward exchange rates, Forwards are agreements to exchange currencies later than two days often a month or more after the transaction Forward exchange rates used in those agreements are based on the spot rate at the time of the trade plus forward points Those points reflect the difference between interest rates of the two currencies That interest rate differential is converted to points which are added to the spot rate…, F = S * (1+ ibc / (1+iqc, where    If we want to calculate just the forward points (FP we use this equation FORWARD POINTS EQUATION, FP = S * (ibc – iqc / (1+iqc,   If we add these calculated forward points to the spot rate we’ll get the forward exchange rate we calculated using the covered interest rate parity formula Let’s see how it works, EURUSD spot exchange rate, 10934, Days to settlement, 30, Interest rate time adjustment, 30 days to settle / 360 days per year = 008333  , Interest rates for euro and US dollar, Euro, 2324% or 002324 , USD, 4334% or 004334  , Adjust interest rates for 30-day period, Euro (ibc, 002324 * 008333 = 0001937, USD (iqc, 004334 * 008333 = 0003612     Calculate forward rate F using covered interest rate parity equation   Now let’s calculate forward points and combine them with spot rate to obtain the forward rate, FP = S * (ibc – iqc / (1+iqc, For convenience we copy data from the Forward exchange rate example   Combine the forward points with the spot rate to get the forward exchange rate F   Using the equation for 1 covered interest rate parity and 2 forward points and then adding the points to the spot rate resulted in the same forward exchange rate  When the currency with the lower interest rate is the base currency the forward…, forward discount, Forward points are positive when the currency with the higher interest rate is the base currency That’s called a, forward premium,  In our example EUR is the base currency and it has the lower interest rate so we have a forward discount , Foreign trade, Forward exchange rates are often used in hedging risk A US wine importer expecting a large shipment of Italian wines in three months worries about the EUR-USD exchange rate Fearing the euro might strengthen between now and receipt of the wine (when payment is due making the shipment more expensive in dollar terms the importer locks in the future price today by entering a forward exchange rate…, Feature, Spot exchange rate, Forward exchange rate, Timing Immediate Future but agreed upon today Purpose Direct exchange Hedging speculation Influenced by Market demand Interest rate differentials exchange rate expectations   Market upheaval like that associated with President Trump’s tariff announcement in early April brings currency to the forefront given its importance in foreign trade Importers typically comfortable with long-term forward…, Explore more currency insights, Are we too dependent on this FX benchmark, FX benchmark prices are critical for global commerce investments and trading but is there a hidden risk in your favorite FX rate Read article, Should a nation manage its currency, Free float vs managed float currency exchange rates which one is better Read article  

August 13 2024 |, By, Mesirow Currency Management, Designed to overcome price volatility could stablecoins become a mainstream medium of exchange, Fans tout cryptocurrencies as a new medium of exchange a digital currency to pay for goods and services But cryptocurrencies are volatile and people are reluctant to use them when prices change rapidly Sellers are worried that a cryptocurrency might drop significantly in price right after they make a sale of a good or service while buyers dread a big increase Both can leave a transaction wishing…, Stablecoin category, Stability is maintained by, Examples, Currency-backed Reserves of currencies such as the US dollar or euro Tether USD Coin Commodity-backed Reserves of commodities such as gold PAX Gold Tether Gold Other cryptocurrencies An algorithm that directs the purchase or sale of underlying cryptocurrencies Dai Frax Unbacked Computer programs that buy and sell the stablecoin to match demand and supply TerraClassicUSD Destablecoin HAY Source…, Stablecoin,  , Backing, Value, % of Stablecoin Value, Tether, USDT Currencies mostly US dollar $114523658219 699%, USDC, USDC USD $33105539764 202%, DAI, DAI Cryptocurrencies $5294328701 32%, Ethena, USDE Cryptocurrencies $3196044313 20%, First Digital, FDUSD USD $2016626996 12%          , 965%, Note Value is market capitalization Source coingeckocom July 31 2024 Stablecoin uses Figure 1 presents typical stablecoin uses The largest category is as a trading asset Some traders find the wild swings in cryptocurrency prices advantageous for achieving large profits but the volatility of most cryptocurrencies hampers their use as a medium of exchange The price stability of stablecoins makes…, Step 1, A user deposits currency into Tethers bank account, Step 2,  Tether issues tokens (USDT and sends them to the user’s wallet address (user’s deposited amount less fees, Step 3,  Tether tokens (USDT can then be used by user’s for transactions traded or stored for later use, If the user decides to redeem their USDT into currency then, Step 4,  The user deposits USDT into their Tether account , Step 5,  Tether removes those coins (USDT from circulation Tether is the only party that can take Tether coins into or out of circulation Stablecoin problems Stablecoins might become the dominant form of money but so far there’s no sign of an everyday digital currency Stablecoins are a small segment of cryptocurrencies and cryptocurrencies are an even smaller portion of total net private wealth - less…, Explore more currency insights, Tokenized gold, Tokenized gold works by digitizing ownership of physical gold making it tradeable on a distributed ledger Will investors rush to this 21st century treasure  Read article, US debt is headed to unimaginable levels, Since 1990 debt crises have erupted periodically but the next one may not be so easy to dismiss Is a financial reckoning coming Read article

At Mesirow we find value in connectivity — connecting deeply with our clients our authentic connections within the communities we serve and  the connectivity within our employee base In March 2020 the big question loomed how are we going to continue those vital points of connection while separated at our home offices during the course of the pandemic The answer and course for moving forward came…, Addressing basic needs of our neighbors, To address urgent needs in food security the acute needs of small businesses and comprehensive needs of families across Chicago and the suburbs Mesirow has doubled down on existing partnerships with nonprofit agencies such as Chicago Public Schools Foundation Compassion Fund and M etropolitan Family Services We also opened new avenues of funding via matching employee donations to 10 nonprofits…, Lifting up the performing arts community, A passion of many of our clients and employees is the performing arts a sector that has been hit hard with patrons unable to take their seats in auditoriums and fundraisers having come to a screeching halt Partnering with World Business Chicago the city’s economic development agency Mesirow sponsored a virtual 5K run/walk in October that raised critical funding for the Arts for Illinois Relief…, Employees coming together for our communities while apart, Despite not coming together Mesirow’s employee volunteerism and fundraising efforts haven’t stopped We provided 650 notes of hope that were distributed in food packages to Brighton Park families through nonprofit Communities in Schools of Chicago And we worked one-on-one with young job seekers to conduct mock interviews and review resumes via video Our employees look forward annually to…, Shared values, We invite you our clients who we know share our deep values of giving and connecting to find the organization that speaks to you and stay connected in giving this year

Stefi Petkova is an Executive Assistant in Mesirow Institutional Real Estate Direct  Prior to joining Mesirow Stefi served as an Executive Assistant in the Corporate Finance Segment Transactions Practice at FTI Consulting She has 19 years of executive support experience  Stefi earned a Master of Arts in Industrial Design from the National Academy of Fine Arts in Sofia Bulgaria

Stephanie Feldman is a Managing Director and Wealth Advisor in Mesirow Wealth Management She provides comprehensive financial planning and investment advisory services to individuals families closely held businesses not-for-profit entities and foundations to develop to execute comprehensive wealth management strategies Stephanie has 27 years of industry experience Prior to joining Mesirow in 2013…

Stephen Jacobson is Senior Managing Director and serves as Co-Head of Mesirow Credit Tenant Lease and Structured Debt Products He currently chairs and is a member of the firm’s P3 practice group He is responsible for providing private debt capital raising services for clients seeking high leverage financing primarily for investment grade tenanted commercial and public sector real estate…

Steve Stober is a member of the Financial Reporting Accounting and Operations team with primary responsibility for tax reporting Prior to joining Mesirow in 2015 Steve was a Senior Tax Associate at KPMG LLP He is a Certified Public Accountant (CPA and a member of the Illinois CPA Society Steve earned a Bachelor of Business Administration and a Master of Science in accounting  from the University…