Current Exchange Traded Bonds and Preferred Stocks Basket as of 2/2/17

I have knocked this basket down in size since 12/31/16. It topped out late last year at over $170K.

The reductions have resulted from profit taking in the Canadian reset equity preferred stocks and selling the highest cost and recently purchased lots in potentially long duration exchange traded bonds and preferred stocks in anticipation of buying them back at lower prices.  

I have been in a profit taking mode on my Canadian reset equity preferred stocks that have performed far better than their U.S. counterparts. 

Yesterday, I sold 50 CFPRC at C$17.15.

2017 CFPRC +C$173.5

That lot had been purchased at C$13.62: Item # 3 Update For Exchange Traded Bonds And Preferred Stock Basket Strategy As 7/29/2016 - South Gent | Seeking Alpha

CFPRC is a reset equity preferred stocks issued by Canaccord Genuity Group Inc (CF:TOR). This security is currently in the fixed coupon period which is 5.75%. The first reset occurs in June 2017 at a 4.03% spread to the Canadian five year bond. That bond closed yesterday at 1.13%. A minor coupon cut is likely on the reset date. The reset coupon will last for five years.  

Snapshots of Canadian reset equity preferred stock round-trips are grouped with my U.S. equity preferred stocks here: Stocks, Bonds & Politics: Advantages and Disadvantages of Equity Preferred Floating Rate Securities

The ten year treasury hit a short term top near 2.6%. 

Recent U.S. economic numbers and a continuation of extremely abnormal CB policies by the ECB, other European CBs, and the BOJ caused a brake in upward spike that started in July 2016. 

The jobs report released this morning was okay with 227K jobs added last month, but December was revised down to 164K from 204K. Average hourly earnings rose 3 cents and have risen 2.5% over the past year. 

With the nation at "full employment", as defined by economists, the easy pickings for job growth have already occurred, thereby making a continuation of 200K+ monthly job growth numbers harder to achieve. Wage growth, on the other hand, will come easier as employers have to raise wages to stop worker migration.  

Full employment may be redefined as Trump attacks U.S. benchmark - Chicago Tribune

U.S. workers will quit their jobs and the monthly numbers are significant as shown in the BLS JOLTS data. In the last report which was for November, 3.1M employees quit their jobs or about 2.1% of the labor force: Job Openings and Labor Turnover Summary

Quits: Total Nonfarm-St. Louis Fed

The flip side of quits is job openings. More workers tend to quit when job openings are more plentiful: 

Job Openings: Total Nonfarm 

In early morning action today, bonds are rising in price and falling in yield, indicating that the Bond Ghouls view today's report as a sign of weakness. 

IEF $105.12 +0.39 +0.37% : iShares 7-10 Year Treasury Bond ETF (as of 9:43 E.S.T., 2/3/17)

For now, the Stock Jocks generally put either a positive light on all news or just ignore the negatives as noise. For example, if job and wage growth were significantly better with a major upward revision for December, that means the U.S. economic growth was accelerating which will be good for earnings. If January 2017 job report showed signs of weakness, then that is also good for stocks also, since it will keep the FED from hiking rates twice or more this year.  Even a sharp slowdown in earnings growth did not restrain their willingness to take stock prices higher.  

Eventually this attitude of everything comes up roses will receive a river of bad news that requires an adjustment. The adjustments are bad for the economy and will frequently lead to a recession or deepen an ongoing one. 

Disclaimer: I am not a financial advisor but simply an individual investor who has been managing my own money since I was a teenager. In this post, I am acting solely as a financial journalist focusing on my own investments. The information contained in this post is not intended to be a complete description or summary of all available data relevant to making an investment decision. Instead, I am merely expressing some of the reasons underlying the purchase or sell of securities. Nothing in this post is intended to constitute investment or legal advice or a recommendation to buy or to sell. All investors need to perform their own due diligence before making any financial decision which requires at a minimum reading original source material available at the SEC and elsewhere. A failure to perform due diligence only increases what I call "error creep". Stocks, Bonds & Politics: ERROR CREEP and the INVESTING PROCESS Each investor needs to assess a potential investment taking into account their personal risk tolerances, goals and situational risks. I can only make that kind of assessment for myself and family members