After last week's post "Bessent buyback" fireworks, which sent yields on a rollercoaster ride in the subsequent days, many were very curious to see how today's sale of $69BN in 2 year paper, the week's first coupon auction, would go and whether Bessent inadvertently had impaired primary market issuance. In the end, the auction went through without a glitch.
The $69BN auction of 2Y notes priced at a high yield of 4.204%, down notably from 4.315% last month as rate hike odds have eased substantially, and stopped through the When Issued 4.208% by 0.4bps, the 3rd consecutive stopping through auction in a row.
The bid to cover was an unspectacular 2.599, down from 2.662 in July and the lowest since March (it was below the 2.611 recent average).
The internals were stronger with Indirects awarded 66.0%, up from 56.6% and the highest allocation to foreign buyers since March 2025. Directs dropped to 23.09% from 34.05%, the lowest since March, which left 10.9% for Dealers the second lowest since February.
Overall, this was a stellar 2Y auction and one would hardly have guessed that the bond market had gone through the most turmoil of 2026 just a few days earlier.
Tyler Durden Tue, 08/25/2026 - 13:23A first-lien loan due in 2031 tied to Guggenheim Investments, the asset-management arm of Mark Walter's Guggenheim Partners, cratered to roughly 72 cents on the dollar Monday, according to Bloomberg data. The hefty discount suggests that lenders remain unconvinced by management's efforts to contain mounting fears over deteriorating earnings, accounting practices and ongoing federal investigations into Walter's financial empire.
The $1.18 billion loan, issued by GIH Borrower LLC, dropped to a low of 72 cents on the dollar Monday morning.
Walter's Guggenheim Partners reported a 38% year-over-year decline in second-quarter revenue last week. Management told investors that much of the deterioration was attributable to delays in recognizing advisory fees at Guggenheim Private Investments.
Shares of the Guggenheim Strategic Opportunities Fund are crashing to their lowest level since the Global Financial Crisis.
The loan market, however, appears to be delivering some bad news. Because Walter's businesses are privately held, the declining value of Guggenheim's loan offers investors a real-time indicator of concerns surrounding how Delaware Life Insurance Co. and its affiliate, Clear Spring Life and Annuity, two Group 1001 insurers, labeled about $20 billion in loans to companies within Walter's empire.
The insurers reclassified billions of dollars in investments as affiliated or related-party transactions after receiving grand jury subpoenas and conducting internal reviews. Lending to affiliates is not illegal, but it must be properly disclosed.
Related:
1. FBI Seized Mark Walter's Devices Months Before Record $12.5 Billion Lakers Sale
2. "Cash Crunch" Deepens? Mark Walter Explores Chelsea FC Stake Sale To Clearlake
3. Mark Walter Probe Puts Wall Street's Insurance-Private Credit Machine Under DoJ Scrutiny
CNBC reported that Walter's TWG Global holding company has tapped veteran Goldman Sachs lawyer David Markowitz to serve as its chief legal officer amid the federal probe.
Tyler Durden Tue, 08/25/2026 - 13:20Authored by Naveen Athrappully via The Epoch Times,
The Department of the Treasury and the IRS have issued proposed regulations clarifying which investments may be made by Trump Accounts.
President Donald Trump speaks during the Trump Accounts summit at the Andrew W. Mellon Auditorium in Washington on Jan. 28, 2026. Madalina Kilroy/The Epoch TimesA Trump Account is a savings account designed to help children get a head start on financial wellness. It can be opened in the name of any individual younger than 18 with a valid Social Security number.
Funds in these accounts can only be invested in "eligible investments" during the growth period, referring to the period beginning from setting up the Trump Account to Dec. 31 of the calendar year in which the beneficiary becomes 17 years of age, the IRS said in an Aug. 20 statement. After the growth period, these eligible investment restrictions won't apply.
An eligible investment is either a mutual fund or an exchange-traded fund (ETF) that tracks the returns of a qualified index, according to the proposed rule notice published by the IRS on Aug. 21 in the Federal Register.
A qualified index means the S&P 500 index or any other index composed of equity investments in mainly U.S. companies and for which regulated futures contracts are traded on an exchange or board of trade.
Indexes that solely focus on specific sectors or industries won't be deemed a qualified index, the notice clarified. However, indexes based on companies' market capitalization can qualify.
A mutual fund or ETF must not use leverage in order to qualify as an eligible investment, according to the proposal. They must also not have annual fees and expenses of more than 0.1 percent of the investment balance.
Around 85 million children from 44 million families across the United States are expected to be impacted by the proposed regulations, the notice said.
In its statement, the IRS said that if an account beneficiary does not select an eligible investment offered by the account's trustee-institutions managing the accounts-then the funds will automatically be invested in eligible investments selected by the trustee during the growth period.
The Treasury and the IRS are seeking comments on the proposed rules, which are due by Oct. 20. The regulations, once in effect, will apply to tax years starting on or after Jan. 1, 2026.
"These proposed regulations will provide clarity for trustees and beneficiaries of Trump Accounts, thus encouraging eligible participants to invest in low-fee mutual funds and ETFs that will grow on a tax-deferred basis potentially over their entire lives," IRS Chief Executive Officer Frank J. Bisignano said in the statement.
"Funds deposited in Trump Accounts enable American children to start investing now and enjoy years of compound earnings for their future college, retirement and other needs."
Account InvestmentsAccording to estimates on the Trump Account website, $1,000 deposited at the time of a child's birth could grow to $6,000 by the time the child turns 18, even if no additional contributions are made.
If $250 is contributed annually, the fund could grow to $19,000. Under the maximum $5,000 annual contribution, the fund value could reach $271,000 at age 18.
In early July, the White House said that almost 6 million Trump Accounts had been opened.
In an Aug. 20 statement, the Treasury said the proposed regulations aim to keep investment costs low and help children's savings grow over the long term.
Investment fees and expenses can reduce account balances over time. The proposed rules limit investments to funds with low expense ratios and avoid those with excessive fees.
"Every dollar in a child's Trump Account should be working toward that child's financial future, not diminished by unnecessary fees," Treasury Secretary Scott Bessent said in the statement.
"Under President Trump's leadership, Treasury is putting simple, commonsense protections in place to help families keep more of their investment returns."
In a July 1 statement, the Treasury announced that the State Street SPDR Portfolio S&P 500 ETF would be the default investment for all contributions to Trump Accounts.
Parents or guardians of Trump Accounts can choose to invest funds in four additional low-cost index ETF options-iShares Core S&P 500 ETF, Vanguard Total Stock Market ETF, State Street SPDR Portfolio S&P 1500 Composite Stock Market ETF, and iShares Core S&P Total U.S. Stock Market ETF.
Tyler Durden Tue, 08/25/2026 - 13:00Jeffrey Epstein accomplice Ghislaine Maxwell gets to rot in prison until 2037 after a judge on Tuesday denied her bid to overturn her sex trafficking conviction and hold a new trial.
"Nearly all its claims are procedurally barred; the overwhelming testimonial and documentary evidence adduced at trial conclusively established her guilt; and her petition's claims are demonstrably meritless, and generally based on speculation, distortions, and/or outright falsehoods," Judge Paul A. Engelmayer of the U.S. District Court for the Southern District of New York said in the 67-page decision.
"There is no fact that Maxwell fairly puts in dispute that has any potential to disturb the outcome of her trial."
Maxwell, 64, was Jeffrey Epstein's right-hand, who procured minor girls for prostitution. She faced multiple other charges when Epstein died in prison in 2019, stemming from her activities between 1994 and at least 2004, according to documents and other evidence introduced at her trial.
As the Epoch Times notes further, Maxwell was convicted in 2021 of participating in a conspiracy with Epstein that targeted minors for illegal sex acts. She is serving a 20-year prison sentence.
A federal appeals court in 2024 upheld the sentence, and the Supreme Court in 2025 denied Maxwell's request to review that ruling.
Maxwell said, in a petition filed under Section 2255 of the U.S. Code to overturn her conviction, that the release of materials following the appeal process should result in her conviction being vacated, including a transcript of testimony given to a grand jury in 2006 by a police detective who investigated Epstein.
The detective said then, according to the transcript, that a massage table was in a bathroom. Maxwell said that the detective testified that it was the north bathroom, which was different from the south bathroom he had identified at her trial.
The detective did not actually specify a bathroom in the 2006 testimony, though, the judge said in the new ruling.
Even if he had offered conflicting testimony as to the location of the massage table, Maxwell did not show that it would have been perjury rather than an inadvertent mistake.
"And had there been such an inconsistency between Detective Parkinson's 2006 and 2021 testimony as to this particular, such would have been highly unlikely to impeach Detective Parkinson's credibility, given that the search had occurred more than 16 years before his trial testimony, and his testimony in general, and about finding the massage table in the house in particular, was corroborated by other testimonial, documentary, and video evidence," the judge said.
That means it would not have had "a material effect on the outcome of the trial," he said.
Tyler Durden Tue, 08/25/2026 - 12:45Dick's Sporting Goods shares crashed by the most on record Tuesday after the sporting goods retailer slashed its annual sales and adjusted operating-income forecasts, as softness at recently acquired Foot Locker deepened concerns about the $2.4 billion takeover.
"We're going to go through some pain," Chairman Ed Stack told analysts on an earnings call.
Dick's now expects fiscal-year net sales of $21.9 billion to $22.2 billion, below its previous forecast of $22.1 billion to $22.4 billion, as deteriorating sales at Foot Locker offset continued strength at its core stores.
The divergence was alarming: Foot Locker's pro forma comparable sales fell 3.6% in the second quarter, while comparable sales at Dick's stores rose nearly 5%.
Notably, Foot Locker's core shoppers are young men aged 12 to 25 who buy premium sneakers and athletic apparel. These shoppers tend to be more value-conscious and somewhat lower-income. So, with national gasoline prices remaining well above $4 per gallon, cutting back on sneakers could be one of their first moves.
"As the quarter progressed, conditions across portions of the athletic footwear and apparel marketplace became increasingly promotional, and we took action to remain competitively priced to protect and grow our leadership position. This environment had a more significant impact on the Foot Locker Business given its greater exposure to legacy footwear silhouettes and greater dependence on footwear launch and retro product. Not only were there fewer launches in the second quarter, but those launches performed below both industry and our expectations. As a result, we are taking a more cautious view of the balance of the year," Stack said.
Dick's shares crashed nearly 28% during the cash session, marking the biggest intraday decline on record, according to Bloomberg data going back to 2002.
The stock was down 34% for the year as of around lunchtime Tuesday.
Here's Barclays analyst Adrienne Yih's initial take on the dismal earnings report:
Despite challenging footwear backdrop, core DICK'S proves the strength of the model; Foot Locker exposes the weakness of the category. Despite an increasingly promotional footwear and apparel environment, the DICK'S business delivered +4.9% comps, with broad-based growth, higher transactions, and market-share gains. Foot Locker's -3.6% comp and sales-outlook reduction underscore the pressures facing footwear-centric retailers tied to legacy silhouettes, fewer launches, and retro products. With FY26 comparable-sales guidance reiterated for the DICK'S banner, growth is likely to moderate from current levels, while Foot Locker is expected to experience a weaker fall season. FY26 adjusted operating income was lowered due to expectations for an increasingly challenging footwear industry, as evidenced by footwear brands in recent weeks. We believe DKS's long-term strength as the dominant player remains intact, but near-term industry trends will affect the Foot Locker turnaround. In premarket trading on Aug. 25, 2026, DKS shares fell 17%, compared with a flat S&P 500.
2Q26 miss; FY26 guidance lowered. Consolidated DKS adjusted EPS of $3.53 missed the consensus estimate of $3.76, driven by lower sales and higher operating expenses. Total revenue of $5.59 billion came in below the consensus estimate of $5.65 billion. Comparable sales grew 4.9% at the DICK'S business, while the Foot Locker business turned negative at -3.6%. Overall, pro forma comparable sales increased 2.1%. Gross margin of 34.1% exceeded the consensus estimate of 33.9%. The operating-expense rate of 25.9% of sales missed the consensus estimate of 25.5%. FY26 guidance for the consolidated entity was updated, with management now forecasting adjusted EPS of $11.00 to $12.00, down from $13.50 to $14.50 previously and below the consensus estimate of $14.34; net sales of $21.9 billion to $22.2 billion, down from $22.1 billion to $22.4 billion previously and below the consensus estimate of $22.4 billion; comparable sales at the core DICK'S business of +2.5% to +4.0%, unchanged from the previous forecast; comparable sales at the Foot Locker business of -2.0% to 0.0%, down from +1.5% to +3.0% previously; and adjusted EBIT of $1.46 billion to $1.56 billion, down from $1.71 billion to $1.83 billion previously and below the consensus estimate of $1.80 billion.
Core DKS inventory in strong position. Based on our proprietary inventory analysis, DKS has posted four consecutive quarters of positive sales-to-inventory growth. In FY2Q26, the Inventory Management Spread ("IM Spread") was 88 basis points, worsening from 377 basis points in the previous quarter. DKS's Gross Margin Return on Inventory ("GMROI") has improved for four consecutive quarters, while its Operating Margin Return on Inventory ("OMROI") has worsened for two consecutive quarters. (Until the anniversary of the Foot Locker acquisition, our inventory metrics include only the core DICK'S business and exclude the Foot Locker business.)
What other analysts are saying, courtesy of Bloomberg:
Quo Vadis Capital
Citi (Buy)
Bloomberg Intelligence
UBS (Buy)
Jefferies (Hold)