Trusted performance.  Lasting value.

PA Adviser | October 7, 2026 | Author: David Roberts |

Fixed income has historically spent much of the client conversation on the back foot.

For years, low yields meant bond allocations were treated almost as a formality, a stabilizer held more out of habit than conviction, with little expectation that it would meaningfully move the needle on a portfolio’s overall return. Client conversations, understandably, gravitated toward equities, where the action was.

That backdrop has shifted and shifted significantly. Bond yields across most major markets are now sitting at levels not seen in 20 years or more, following one of the sharpest selloffs in the asset class in living memory.

This changes the nature of the conversation. Fixed income is no longer a passive line item, it’s an asset class capable of generating meaningful income and, depending on how it’s managed, meaningful capital return too.

That, in turn, raises a question advisers may need to answer: when a fixed income strategy performs well, how much of that is simply down to market conditions, and how much reflects genuine skill on the part of the manager?

This is precisely where the concepts of alpha and beta earn their keep, not as academic jargon, but as a practical framework for pulling apart what’s driving a return, and for comparing one strategy against another on a fair, like-for-like basis.

Beta: The return you get for showing up

Beta, in its simplest form, is the return an investor can expect simply from being exposed to a market. In fixed income terms, it’s the return generated by the underlying bond market itself, driven primarily by the level of yields and how those yields move over time.

A useful way to think about beta is as the “starting point” return. If gilt yields, for example, sit at a certain level and nothing changes over the following year, an investor holding those bonds would expect to earn roughly that yield as their return. Beta isn’t about skill; it’s about market exposure.

Importantly, beta isn’t fixed. A fund manager can adjust how much market exposure, and therefore how much beta a portfolio carries, largely through a lever known as duration.

Duration: The dial that controls the beta

Duration measures a bond portfolio’s sensitivity to changes in interest rates. Broadly speaking, the longer a portfolio’s duration, the more its value will move up or down for a given change in yields. A manager who extends duration is, in effect, increasing the portfolio’s beta; one who shortens duration is dialing it back.

This is a genuinely important distinction for advisers assessing fixed income strategies. Two funds holding entirely different individual bonds can behave very similarly if they carry similar duration, because so much of the return outcome is explained by that one variable.

Conversely, a manager who actively varies duration in response to market conditions is making a deliberate decision about how much market risk to take on, which brings us to alpha.

Alpha: The return that comes from skill

Alpha is the excess return a manager generates above and beyond what the market itself would have delivered, the value added (or subtracted) through active decision-making.

In fixed income, this can come from several sources: security selection, sector positioning, credit analysis, or, as discussed above, the skillful management of duration itself.

This last point is worth dwelling on, because it’s a source of confusion for many investors newer to the asset class. Duration management sits at an interesting intersection of alpha and beta. A manager isn’t just passively holding a level of market exposure, they’re actively deciding to increase or decrease it based on a view of where yields are heading.

Get that call right, and it becomes a genuine source of alpha. Get it wrong, and it becomes a drag on returns.

Conclusion

Separating alpha from beta is a useful discipline. It helps answer a simple but important question: is this strategy’s return profile mostly a function of market conditions, or is genuine active management contributing to the outcome?

In an environment where yields have moved substantially and starting points look markedly different to a few years ago, this distinction becomes more than academic.

A strategy with the flexibility to adjust its duration, its beta, in response to changing conditions has a different risk and return profile to one that is structurally constrained to a narrow band. Neither approach is inherently right or wrong; they simply serve different purposes and suit different client objectives.

Alpha and beta aren’t complicated ideas, once stripped of jargon. They’re powerful tools for cutting through noise. As fixed income regains relevance in client conversations, those who can clearly separate “what the market gave you” from “what the manager added” will be far better placed to compare strategies on a like-for-like basis, and to have more informed conversations with clients about where genuine value is being added.

CNN | September 10, 2026 | Author: Allison Morrow |

If you find yourself getting lost (or bored) by bond market news, we hear you. No one is born understanding what a yield curve is, and even financial experts sometimes struggle to articulate the goings-on of the cryptic $160 trillion market.

But when this normally sleepy corner of Wall Street starts rumbling, as it has been recently, everyone — even if you’ve never invested a dime — is affected. So here’s a quick primer on government bonds (we’ll save corporate bonds for another day) and what they mean for you.

The basics

Governments around the world rely on borrowed money to keep the lights on. Rather than using a credit card or asking the bank for a loan, the US and other nations issue a variety of bonds, which are essentially IOUs. Investors lend the government money for a set period of time, and, in return, the government pays them interest on that loan.

In the US, those bonds are called Treasuries (after the department that issues them) and they make up some $30 trillion of the $160 trillion global bond market. Other major players include the UK, which issues “gilts,” so called because the Bank of England’s 17th-century debt was issued in the form of a gilded-edge paper certificate. Germany has its bunds, France has its OATs (obligations assimilables du Trésor) and Japan’s government bonds are known in English as simply JGBs.

Different names, same concept: Lend the government money, it’ll pay you back, with interest.

In normal times, government bonds are a relatively boring market, without the stomach-churning meme-inflected swings of the stock market or the speculative chaos of crypto. But in abnormal times, bond traders are known to signal their anxiety by pushing yields higher — in other words, demanding more interest for taking on what they perceive to be an increased risk of lending governments money.

That’s what’s been happening since about mid-May. Persistent concerns about high levels of government debt — the US is now sitting on $40 trillion, having doubled over the past decade — have collided with renewed worries about inflation, the war in Iran and the prospect of central banks raising interest rates.

For consumers, rising bond yields can be a mixed bag, raising the cost of all kinds of consumer debt, like mortgages, credit cards and car loans. But it can also be good news for folks who having savings to invest long term, as higher yields make buying bonds cheaper while locking in a higher rate of return.

The Treasury Department has sought to calm the market by increasing its regular buyback program to $6 billion, though the move has so far been met with disappointment from investors. On Wednesday, yields continued climbing to multi-year highs even after the Treasury said it would roughly triple the size of its buyback operation this month from $2 billion last month.

The Treasury issues all kinds of debt, from short-term bills to 30-year bonds, with maturities ranging from a few weeks to 30 years. Within that menu, there are three benchmarks — the 10-year, 30-year, and 2-year, in order of importance — that wind up dominating headlines.

The 10-year

If you only pay attention to one part of the bond market, make it the 10-year Treasury yield. The 10-year Treasury note is among the safest places on the planet to park your money, so lots of people do, banking on the “full faith and credit” of the US government to pay them interest every six months and return the principal a decade later.

The yield (or return) investors demand functions as a kind of looking glass into the global economy, signaling market expectations around inflation and economic growth. It also helps set the baseline for all kinds of consumer debt, including mortgages and car loans.

When the 10-year yield goes up, so does the cost of financing a house or car. The 10-year yield is not the only factor in determining the interest rate on those loans. But it plays a big role. (The reason 30-year mortgage rates tend to move with the 10-year Treasury is because most people move or refinance after about a decade.)

“The 10-year is the most closely watched because it’s sort of in that sweet spot where it’s far enough to capture most of the long-term borrowing, and yet it’s still sufficiently sensitive to the movements in the macro economy,” Nikolai Roussanov, finance professor at the University of Pennsylvania’s Wharton School, told CNN.

The 30-year

This is the longest-dated Treasury and, like the 10-year, it is a bellwether for long-term borrowing costs. The two generally move in sync. But the 30-year yield serves as a gauge of investors’ expectations for inflation and other economic risks over the longer term.

Another way to think about it: Say you lend someone $1,000 today knowing it will take them 30 years to pay you back. That $1,000 won’t be worth as much to you in 30 years as it is today, thanks to inflation. To make it worth your while, you’ll charge them an interest rate that you expect will keep up with inflation.

Similarly, if the person you’re lending to isn’t super trustworthy, you might demand an even higher return, aka a higher yield, in exchange for taking on the risk that they can’t or won’t pay you back.

Right now, the 30-year yield is hovering around 5.2%, up from 1.7% in 2021, and its highest level since 2007, just before the Great Financial Crisis.

That doesn’t mean investors broadly expect the US to default, but it does mean the government is forced to divert more revenue (read: tax dollars) to pay for that debt. And that’s what’s keeping many economists up at night.

“The yields, at the levels that they are now, are not by themselves that scary,” Roussanov says, noting that bond yields were even higher in the 90s and early 2000s. “It’s the fact that we’re spending so much on interest.”

The US now spends more of its federal budget on interest payments than it does on national defense, raising concerns about a “doom loop” in which the US is forced to borrow more money by issuing more debt.

The 2-year

This is a virtually risk-free short-term note. There are two main reasons to pay attention to the 2-year: 1. It signals the market’s expectations for what the Federal Reserve will do with short-term interest rates, and 2. It may, when viewed alongside the 10-year, have recession-prediction powers.

The latter point refers to the “inverted yield curve,” which tends to send investors into panic mode. It isn’t a perfect recession indicator, but has an impressive track record. An inversion of the 2-year and 10-year yields has preceded every major downturn of the past 60 years. (It has also had a few false positives, like in 2022 when a recession seemed inevitable but never arrived.)

A yield curve is just a visual representation of the normal behavior of a bond’s return (or yield) over time. A 10-year note almost always delivers a higher rate of return than shorter-term notes. That’s because the longer your money is locked up, the greater risk you’re taking on and the more compensation you demand. Every now and then, though, the return on a 10-year note falls below that of the 2-year, creating an inverted yield curve and signaling that investors are more worried about the economy’s performance in the immediate future than they are about the long term.

Financial Newswire | August 12, 2026 | Author: Binaya Dahal |

Rising US real yields are improving the case for fixed income, with investors able to earn more attractive inflation-adjusted returns and better relative value to equities after years of unusually low yields, according to Brandywine Global.

Paul Mielczarski, head of macro strategy at the $64.5 billion asset manager, said stronger economic growth and a reassessment of long-term interest rate expectations has pushed real yields higher, creating a more attractive backdrop for high-quality bond investors.

“Real yields approaching 2.5% may represent genuinely attractive compensation for a risk-free asset,” Mielczarski said.

“The spread between the US 10-year real yield and the S&P 500 dividend yield is now at its widest since the early 2000s. Bonds have not offered this kind of relative value versus equities in over two decades.”

Mielczarski noted that US 10-year Treasury yields have risen about 50 basis points since the start of 2026, while the 10-year real yield has climbed towards 2.5%.

He said the move differed from previous bond selloffs because it has been driven entirely by higher real yields rather than rising inflation expectations.

“Despite the sharp rise in energy prices following the outbreak of war with Iran, market-based measures of medium-term inflation expectations have drifted lower,” he said.

“The entire repricing has come through real yields.”

Mielczarski said markets were also reassessing the neutral rate of interest, with investors increasingly pricing a level above official estimate.

“If monetary policy was genuinely restrictive as the Fed estimates suggest, we would expect to see the evidence,” he said.

“Instead, financial conditions are very easy, growth is decent, and credit growth is picking up. The most logical explanation is that the neutral rate is higher than official estimates suggest and the bond market is pricing this accordingly.”

While the repricing has been painful for existing bondholders, Mielczarski said it has materially improved the long-term outlook for fixed income investors.

“The upside is that bond holders can now earn a real return that is competitive with other major asset classes, and with considerably lower volatility,” Mielczarski said.

“In short, rising real yields are not simply a headwind for markets; they are also a signal of a more resilient economy and a meaningful reset in the return potential of high-quality bonds.

“For investors, fixed income once again offers compelling real income, diversification and relative value after years of unusually low yields.”

Bloomberg | July 9, 2026 | Authors: Enda Curran and Maya Prakash |

Federal Reserve Chairman Kevin Warsh announced the leadership of five task forces that will examine the central bank’s approach to key aspects of policy making, with an eye toward potentially enacting sweeping changes.

The leaders of the task forces include prominent academics, former central bankers and corporate executives who have been asked to look at the Fed’s communications strategy, $6.7 trillion balance sheet, use and reliance on existing data sources, productivity and jobs and inflation frameworks. Warsh, who became Fed chief in May, entered the job having called for “regime change” at the central bank and a shakeup of how it conducts policy.

“Each task force will carefully consider whether policymakers’ means and methods, analytical tools and policy approaches can be improved upon,” Warsh said in a statement on Thursday. “The goal is straightforward: to ensure the Fed is best positioned to achieve our objectives in this consequential time,” he said.

Warsh tapped several former policymakers for the task forces, including former Bank of England Governor Mervyn King, who led the UK’s central bank through the 2008-09 financial crisis, and former Brazil Central Bank President Arminio Fraga, who is noted for his defense of the country’s central-bank independence from political interference. Raghuram Rajan, former governor of the Reserve Bank of India who was noted for his early warnings ahead of the global financial crisis, will also co-lead one of the groups.

Other names include Karen Dynan of Harvard University, who previously held top roles at the Treasury Department during the Obama administration, and former Walmart Inc. Chief Executive Doug McMillon.

Joe Brusuelas, the chief economist at RSM US said the list of leaders will add experience to the task forces, though he cautioned they will face challenges, too. “It’s a very impressive list that’s been put forward by Chair Warsh that I’m confident will inform the discussion around the substantive topics,” Brusuelas said. “However, the Fed already has an army of Ph.D.s that had investigated these areas, so I’m not exactly convinced that this is going to shed much light into how we understand productivity and AI,” he added, referring to one of the task forces.

The groups are expected to share their conclusions by year-end and their outside experts will be supported by Fed staff, Warsh said in June when announcing the task forces.

Warsh on Thursday called the task force leaders “the best minds from a range of disciplines.” They are:

Communications
• Peter R. Fisher, professor of practice, Foster School of Business, University of Washington
• Arminio Fraga, founder and chairman, Gávea Investimentos; former president, Central Bank of Brazil
• Mervyn King, former governor, Bank of England

Balance Sheet Policy
• Karen Dynan, professor of economics, Harvard University
• Raghuram Rajan, professor of finance, University of Chicago Booth School of Business; former governor, Reserve Bank of India
• Jeremy Stein, professor of economics, Harvard University; former governor, Federal Reserve Board

Data
• Raj Chetty, professor of economics, Harvard University
• Doug McMillon, former president and CEO, Walmart Inc.
• Kevin Murphy, professor of economics, University of Chicago

Productivity and Jobs
• Marc Andreessen, cofounder and general partner, Andreessen Horowitz
• Charles I. Jones, professor of economics, Stanford University, currently on leave at Anthropic
• Asha Sharma, executive vice president and XBOX CEO, Microsoft Corp.

Inflation Frameworks
• Greg Mankiw, professor of economics, Harvard University; former chairman, Council of Economic Advisers
• Thomas Sargent, professor of economics, New York University; Nobel laureate
• William White, senior fellow, C.D. Howe Institute; former economic adviser, Bank for International Settlements

Investopedia | July 1, 2026 | Author: Nick Gallo |

Despite sounding complex, bond laddering is a simple, reliable strategy for creating predictable streams of income.

We’ll explore how it works, how financial advisors can explain it to their clients, and when using it tends to make the most sense. It’s also important to know the benefits and drawbacks of the strategy, how it compares to holding bond funds, and ways to tailor it to your clients’ needs.

What Is Bond Laddering?

Bond laddering is an investment strategy that involves purchasing a mix of bonds with staggered maturity dates. This often includes short-term, medium-term, and long-term bonds, creating steady cash flow through regular interest payments.

The strategy allows investors to take advantage of changes in interest rates over time. When each bond matures, investors get their principal back and can reinvest it into new bonds at current interest rates to maintain the ladder’s structure.

How to Explain It

When explaining bond laddering to clients, it’s better to use simple analogies rather than focusing too heavily on the technical details of the mechanics. This approach allows you to avoid industry jargon.

“I tell clients to picture a rolling staircase of bonds,” said Nick Stevens, CFP, founder of Evergreen Wealth Management. “Every year the bottom step matures, it hands you back your money, and you decide what to do with it.”

“The point I want clients to walk away with is that money is always coming due on a known schedule, so they’re never forced to sell something at a bad time to raise cash,” said Lucas Fender, CRPC, CRPS, founder of Proper Planning Wealth Management.

For clients who are already familiar with CD ladders, you can also use comparisons to that concept to help them understand bond laddering.

“Most retirees already know what a CD ladder at the bank looks like—a row of CDs, each one coming due a year apart, so something is always maturing, and something is always paying you interest,” said Stevens. “A bond ladder is the same idea, just built with bonds instead of CDs. Familiar shape, slightly different ingredients.”

Key Benefits

The primary benefit of bond laddering is its ability to generate steady, predictable income. Because the bonds pay interest regularly and mature at different intervals, investors can build a dependable cash flow schedule.

“You know what you’re getting and when,” said Stevens. “If you hold a bond until it matures, the company or the government has agreed to give you a specific amount of money on a specific date.”

Bond laddering also reduces interest rate timing risk.1 By spreading bond maturities across multiple years, the strategy creates opportunities to reinvest portions of an investor’s portfolio gradually as interest rates change over time.

“It diversifies interest-rate risk in both directions,” said Fender. “You’re never fully locked in and never fully exposed, so you don’t have to be right about rates.”

The strategy can help investors avoid the emotional stress that often comes with bond-fund volatility. When they don’t see their portfolio values fluctuate, investors may be less likely to make reactive decisions during short-term market swings.

“In 2022, when interest rates jumped quickly, the broad bond market lost about 13%—a brutal year,” said Stevens. “A retiree with a ladder didn’t really feel it. The bonds just kept paying their interest and matured at full value, right on schedule. The panicked phone call never happened.”

Another advantage is reinvestment flexibility. As bonds mature, investors can reassess their income needs, interest-rate conditions, and financial goals, then decide whether to extend the ladder or redirect their proceeds elsewhere.

When It Works Best

Bond laddering works best for investors who need predictable income, usually those who are nearing or already in retirement. The strategy can be especially effective when they have clearly defined spending plans.

Laddering can also benefit clients who have a strong preference for stability or are struggling emotionally due to interest-rate uncertainty. They may understand that bond prices fluctuate, but still feel uncomfortable watching the value of bond funds decline in the short term.

“They’re good for clients who get anxious about bond fund volatility,” said Fender. “Clients who would panic watching a bond fund’s price drop tend to stay calm with a ladder, because a bond maturing at par on a set date is easy to understand.”

“Anyone with a known expense coming up on a specific date—a home purchase, a big tuition payment, a gift to family,” said Stevens. “You can buy a bond that matures right around the time you’ll actually need the cash. That’s where ladders really shine. The bond and the bill arrive at the same time.”

Trade-Offs

Bond laddering, like every investment strategy, does have its drawbacks. One of the most noteworthy trade-offs is the potential for underperformance compared to bond funds if interest rates drop.

“In a falling rate environment, maturing rungs reinvest at lower yields,” said Fender. “A ladder won’t have the same kind of price appreciation that a bond fund can, so total return may be less.”

Bond laddering can also require significantly more upkeep than simply buying and holding a bond fund. Investors either need to manage the ladder themselves or work with a financial advisor who can maintain the strategy on their behalf.

“There’s real work involved,” said Stevens. “Someone has to find the bonds, make sure you’re getting a fair price, and reinvest as each one comes due.”

Flexibility may also become an issue if investors need access to their cash unexpectedly. While bond funds are often relatively easy to sell, individual bonds may be less liquid, especially if market conditions happen to be unfavorable.

“Selling a bond early isn’t always easy, and the price you get may not be great,” said Stevens. “The honest framing is that you’re trading some upside and some convenience for predictability and peace of mind. For the right person, that’s a great trade.”

Ladder vs. Bond Funds

Bond ladders and bond funds are frequently discussed together because they can appear similar on the surface. But they tend to serve very different purposes within investor portfolios.

Generally, bond ladders provide dependable cash flow through predictable interest payments and maturity schedules. Bond funds offer greater liquidity and quick access to broad segments of the bond market.

In many cases, the most effective approach is to combine the two. For example, investors can use a bond ladder to reliably cover planned spending, while their bond funds support diversification and day-to-day flexibility.

“I use them together more often than I use either one alone,” said Stevens. “Bond funds are easy and give exposure to thousands of bonds in one click. A ladder gives the certainty that the next several years of withdrawals are scheduled to mature, whether the market is up or down. For a retiree, that combination is hard to beat.”

Customization

Advisors should generally tailor client bond ladders to fit their unique needs. This primarily involves adjusting the length of the ladder to suit risk tolerances and aligning bond maturities with known expenses.

“A shorter ladder means more flexibility and less rate sensitivity,” said Fender. “I match maturity dates to a client’s actual spending timeline whenever possible, so the bond comes due roughly when the money is needed.”

Taxes should also influence which bonds investors hold and where.

“Municipal bonds for clients in higher brackets holding bonds in taxable accounts,” said Fender. “Treasuries for clients sensitive to state income tax, and taxable bonds in IRAs.”

The Bottom Line

Bond laddering involves buying bonds with staggered maturity dates to create a reliable income stream while reducing interest rate risk. The strategy often works best in combination with bond funds, balancing stability with diversification and flexibility.

The New York Times | June 26, 2026 | Author: Ann Carrns |

A practice that was common not so long ago has become increasingly risky — sending checks in the mail. But if you must send money this way, scour your account statements promptly. Skipping that advice can leave you vulnerable to check fraud, and may also make it more difficult to recover the money if you lose it.

Joan K. Atchinson, 63, a retiree who lives in Washington, D.C., is dealing with that right now. Ms. Atchinson said in a phone interview that she was trying to recover several thousand dollars stolen when someone intercepted a check she mailed last year. The check was altered to be payable to someone else before it was cashed. After months of trying, she said, she still has not recovered payment from either of the two banks involved — Charles Schwab, where she has an account that she used to write the check, and Chase, where the falsified check was cashed. “I’ve kind of lost hope.”

How does this kind of check fraud work?

Checks sent through the Postal Service have become targets for criminals in recent years. While fewer people write checks, the checks haven’t disappeared. Two-thirds of adults say they rarely or never use paper checks, but more than a fifth either have experienced check fraud or know someone who has, according to a poll in 2025 by the Independent Community Bankers of America, a trade group.

In some cases, thieves may pilfer one or more checks from local mailboxes. Adam Rust, director of financial services for the Consumer Federation of America, said thieves sometimes “fish” for checks at free-standing drop boxes, using long tools with sticky pads on the ends to grab letters. In other cases, more sophisticated criminals may steal large batches of checks, copy them and then sell them on the internet.

Often, the purloined checks are chemically altered in what’s known as “check washing” to remove the name of the recipient. The thief replaces it with a fraudulent name, and often increases the amount of the check, before cashing or depositing it.

Ms. Atchinson appears to have been a victim of such a fraud. She said she wrote a check in April 2025 for $3,719 from her account at Charles Schwab to pay 2024 income taxes she and her husband, Brian, owed to Maryland, where they lived previously.

Ms. Atchinson said that she didn’t recall where she had mailed the check, but that she had probably dropped it in the mail slot in the lobby of their condominium building. She recalled noticing that the payment had been deducted from her account, but said she hadn’t thought to view the electronic check image online.

Then, in February, she said, 10 months after the check was sent, the couple received a balance-due notice from the state. (It’s unclear why the tax notification took so long.) Ms. Atchinson said she had logged on to the Schwab account to obtain an image of the check, intending to use it as proof that she had paid the tax. That was when she saw, to her dismay, that the check had been changed and made payable, in unfamiliar handwriting, to a name she didn’t recognize.

The back of the check indicated that it had been deposited electronically at Chase. (Criminals tend to prefer remote options, like mobile deposit or automatic teller machines, to avoid interaction with bank personnel, the authorities say.)

Her discovery prompted her to call and email both banks multiple times and to file complaints with law enforcement agencies, she said, but she is uncertain if she will be reimbursed. The banks involved have had some back and forth since May.

Meghan Durant, a spokeswoman for Chase, said in an email, “Unfortunately, we did not receive communication from Ms. Atchinson’s bank until over a year after the check was deposited, and there are no funds available to recover.” Chase said it had not received a “formal” claim from Schwab indicating that Chase was responsible for paying the funds. It added that it took such matters “seriously” and that the account had been closed.

Tatiana Stead, a spokeswoman for Schwab, said the bank had submitted Ms. Atchinson’s affidavit to Chase and received a response on May 15 “advising that there were no funds available to recover.”

Ms. Atchinson said that she had contacted Schwab immediately when she had become aware of the fraud, noting that she had been a customer for “decades,” but that it hadn’t referred her case to a fraud specialist until May.

Ms. Stead sent an email to The New York Times on Wednesday saying, in part, “We sympathize with Ms. Atchinson.” But it added, “Timely reporting can significantly improve the ability to investigate potential fraud.”

Ms. Stead said on Thursday that a “final determination letter” was mailed to Ms. Atchinson earlier in the week outlining Schwab’s decision. Ms. Atchinson said she had not yet received the letter.

Schwab’s “security guarantee,” outlined on its website, says that “Schwab will cover losses in any of your Schwab accounts due to unauthorized activity.” But fine print at the bottom of the page notes that reimbursement “requires your timely reporting of unauthorized activity to Schwab,” and that Schwab “will not be liable for additional or increased losses resulting from a failure to report unauthorized activity in a timely manner.” It notes that more details are available in account agreements.

What should I do if I suspect check fraud?

Notify your bank as soon as possible, said Scott Anchin, senior vice president of strategic initiatives and policy at the independent bankers association.

Banks generally allow at least 30 days and sometimes up to 90 days from the time your statement is made available to you to report suspected check fraud, he said. Check your account agreement. (The agreement available online for a Schwab One account, which appears to be the kind of account Ms. Atchinson used, notes an even tighter window for reporting check fraud: 10 days. Ms. Stead, however, said the bank’s cutoff is 30 days.)

If you get statements online, the clock starts when the statement posts, even if you haven’t opened it yet. Review statements promptly, Mr. Anchin said, including the check images, because an altered recipient isn’t always obvious from a one-line entry on a statement. Banks typically make check images available online or by request.

Will I get my money back?

Sorting out which bank is liable can be “quite time consuming,” Mr. Anchin said. It may depend on details of the incident, like what sort of alterations were made to the check. “There’s a lot that goes on behind the scenes,” he said, but typically, “the customer’s bank wants to make them whole.”

How can I avoid check fraud?

Try to break the check-mailing habit. “No one should ever mail a check,” Mr. Rust said. If you must write a check, he said, try to deliver it in person or take it inside a post office to mail rather than relying on your own mailbox or public drop boxes.

The American Bankers Association recommends using permanent “gel” ink pens when you do write checks to reduce the risk of tampering. Promptly review your bank statements — including online check images — for anything that looks suspicious. And if you don’t already, consider using your bank’s online bill payment service.

All states now offer some type of electronic payment option for paying taxes, so look into using your state’s system if you owe money at tax time.

Are efforts underway to eliminate paper checks?

The federal government has been moving away from paper checks for things like benefit payments and income tax refunds, saying digital payment methods are more secure. But any effort to do away with all paper checks is likely to be contentious.

The Federal Reserve system, which acts as a central clearinghouse and electronically processes millions of checks daily, recently sought public input on potential changes to its check services.

More than 300 people and groups responded, many of them representatives of banks serving rural and agricultural communities where paper checks remain important. The chief executive of PriorityOne Bank, for instance, a community bank based in Magee, Miss., said in a comment letter that the bank served many low- and moderate-income rural communities with limited internet access. So online payments aren’t a reliable option, particularly for older residents who aren’t comfortable with digital banking.

Bloomberg | June 17, 2026 | Author: Martin Z. Braun |

More than two decades after Wall Street started pumping out a new type of bonds — those backed by the legal-settlement payments governments receive from cigarette companies — one batch has finally been driven into a default. It almost certainly won’t be the last.

The securities allowed state and local governments to get the cash upfront by selling debt that’s repaid, gradually, when the proceeds roll in. That offloaded all the risk to investors, who were compensated with high yields in return.

But the warning signs in what swelled into an $80 billion corner of the municipal-bond market have been building up for years because the size of the annual payments under the 1998 agreement are based on cigarette shipments. And those have been plunging, year after year, at a far faster pace than was expected when the bonds were sold, as Americans shun the habit or take up vaping instead.

New York’s Nassau County Tobacco Settlement Corp., the shell set up to issue so-called tobacco bonds for the Long Island county, was the first to snap. At the start of this month, it was forced to skip a $36 million payment on debt that was coming due because it didn’t have enough money, triggering a default.

The step accelerated what had already been a sharp selloff in the county’s tobacco bonds and dragged down the price of similar securities by signaling increasing distress.

“If the cigarette market continues as it is with these last four years of near double-digit declines from the major tobacco companies, then we’ll eventually see more of these structures hit events of default,” said Matt Wackerman, an analyst at AllianceBernstein.

The rout has driven lower-rated tobacco-settlement securities to a 1.6% loss so far this month, a standout in fixed-income markets that have gained as movement toward ending the US-Iran war eases worries about inflation. Some of Nassau County’s bonds that don’t come due until 2046 have slid to less than 50 cents on the dollar, a drop of about 35% since the end of last year and down from more than 100 cents as recently as 2022.

Analysts say Nassau’s skipped payment wasn’t entirely a surprise, given that it had already been cut deeply into junk status and credit-rating companies have been flagging the broader risk by steadily ratcheting down their grades on other securities. When the bonds default, moreover, investors aren’t wiped out because the deals are structured so they will eventually be paid back as the settlement payments come in, albeit with a delay.

Some of the more recently issued tobacco bonds were also better at taking account of the industry’s decline, and adjustments to the settlement payments based on inflation have softened some of the hit recently.

But it’s widely expected that many tobacco-bond issuers, particularly those who were part of the the early wave of securities sold in the 2000s, will be unable to keep up with their payments as smoking continues to decline.

Between 2021 and 2024, annual cigarette shipments by tobacco companies participating in the accord dropped an average of 7.25% year, cutting into the payments backing the bonds.

S&P downgraded 40 tobacco-bond issues last year, including Nassau County’s. The bulk of the $20.5 billion of tobacco bonds that it tracks, about $12.5 billion of them, are now rated junk. Some $9.7 billion are the CCC category, deeply below investment grade, indicating they’re likely to default.

The tobacco industry continued to contract in 2025, even before the sharp jump in gas prices caused by the Iran war started squeezing American consumers. Altria Group Inc. reported a 10% decline in US domestic cigarette shipment volume in 2025, while British American Tobacco reported a 7.7% decline. The two account for about 80% of US cigarette sales.

“The big picture is consumption is going down,” said S&P analyst Jie Liang. “You’re going to see a lot more downgrades than upgrades.”

Barron’s | May 26, 2026 | Author: Andrew Bary |

Inflation is rising, bond prices are falling, and TIPS [Treasury Inflation-Protected Securities] are having their moment.

The prospect of a protracted period of elevated inflation—stemming from higher oil prices and other factors—heightens the appeal of Treasury inflation-protected securities. TIPS are among the only bonds that can insulate investors from higher inflation.

While most bonds have dropped in price this year, TIPS have generated positive returns. And they remain attractively priced.

“TIPS are, I think, probably one of the most underappreciated and underutilized investments. It’s like a Treasury, but it has an inflation hedge,” Alex Shahidi, managing partner and co-chief investment officer of Los Angeles–based Evoke Advisors, told Barron’s Advisor.

Not enough individual investors and financial advisors include TIPS in their bond allocations. That’s a mistake.

It has been a rocky period for the bond market, with 10-year Treasuries recently hitting a yield of almost 4.7%, their highest since January 2025. Bond prices go down when yields go up.

TIPS are like insurance, offering investor protection against higher inflation. The yield on TIPS has two components: The bonds pay investors the inflation rate, as measured by U.S. consumer prices, plus a bonus, or real, yield above inflation that ranges from one to almost three percentage points depending on maturity.

Here’s the calculus for someone considering a 10-year Treasury investment. The regular Treasury 10-year note yields 4.60%, while 10-year TIPS have a real yield of 2.15%. That means inflation has to run at more than 2.45% (4.60% minus 2.15%) for TIPS to be the superior investment over the next 10 years.

That sounds like a good bet. April consumer prices rose 0.6% from March and at 3.8% over the prior 12 months. Analysts see a good chance of 3%-plus inflation for the rest of 2026—above the Federal Reserve’s target of 2%. Then there is the insurance aspect. TIPS effectively provide insurance against higher inflation, while regular Treasuries and most bonds don’t.

Long-term TIPS have the highest yields and offer an appealing stand-alone investment.

The real yield of almost 3% on 30-year TIPS is near a high in the nearly 30 years of TIPS issuance. Pension funds, endowments, and other tax-exempt portfolios often try to generate annual returns over time that are at least five points higher than inflation and make risky investments such as private equity to try to achieve that.

Investors can effectively get something close to that—a 3% real yield on Treasuries with no risk. This assumes the government doesn’t default. The break-even inflation rate on 30-year TIPS is just 2.3%, enhancing their appeal.

“With 30-year TIPS now yielding almost 3% real, investors can now lock in inflation-adjusted returns competitive with traditional portfolios without the risks that come from a large slug of equities,” wrote Bob Elliott, CIO of Unlimited Fund and a former Bridgewater Associates manager on X last week.

Most investors focus on shorter-maturity TIPS due in 10 years or less. They offer inflation protection and carry less price risk than long-term issues.

What are the risks with TIPS? If inflation cools, demand may ease and TIPS could underperform U.S. Treasuries. And if inflation does move much higher, TIPS probably will best regular Treasuries, but they still could generate negative returns.

There are more than $2 trillion of TIPS outstanding, and investors can buy them in several ways.

They can be purchased directly from the Treasury at regular auctions of TIPS of bonds with five-year, 10-year and 30-year maturities. They can be bought in the secondary market through banks and brokers. The Treasury auctioned 10-year TIPS this in mid-May and plans to sell five-year TIPS in June.

Funds, particularly low-fee exchange-traded funds from a range of issuers, offer a good alternative to individual bonds by simplifying some of ownership mechanics.

The four largest TIPS ETFs are the $18 billion Vanguard Short-Term Inflation-Protected Securities, the Schwab U.S. TIPS, the iShares 0-5 Year TIPS Bond, and the iShares TIPS Bond. The final three funds are each about $15 billion in size. Fees are low, including just 0.03% on the iShares 0-5 Year TIPS ETF, the Vanguard ETF, and the Schwab TIPS ETF. The Vanguard ETF is a share class of the larger $68 billion Vanguard Short-Term Inflation-Protected Securities mutual fund. The Pimco 15+ Year U.S. TIPS Index ETF offers exposure to long-dated bonds.

Investors can create a maturity ladder of TIPS, and iShares simplifies that with its iShares iBonds 1-5 Year TIPS Ladder ETF. The TIPSLadder.com website gives you the bond details to construct your own ladder.

Vanguard includes TIPS in some of its shorter-dated target-date mutual funds geared toward investors around retirement age.

There are some quirky aspects to TIPS. The inflation component of the yield is added to the principal every six months, and the real rate is paid in cash.

This results in a phantom income issue because investors owe federal income taxes on the inflation component (Treasury interest is exempt from state and local taxes) and get no cash. The ETFs pay out that inflation-related interest, avoiding this issue.

Another way to buy inflation-protected Treasuries is through Series I U.S. savings bonds offered through the Treasury.gov website. They now offer a yield of nearly one percentage point above inflation. The current rate—lasting through the end of October—is 4.26%. The rate gets reset every six months based on the consumer-price-index inflation figure.

With certain exceptions, investors are limited to $10,000 a year in I bond purchases. They need to be held for at least 12 months, and sales within five years result in a loss of three months’ worth of interest. I bonds mature in 30 years and have a nice tax attribute. Taxes on interest, which is added to principal every six months, can be deferred until maturity, giving I Bonds an individual-retirement-account-like character.

With inflation heading higher, TIPS are an underappreciated and underowned asset class that merits greater attention from investors.

Global Government Finance | April 24, 2026 | Author: Ian Hall |

A paper setting out how finance ministries and other public institutions could think more strategically about emerging technologies in public financial management (PFM) – and overhaul their PFM processes and functions to be ‘digital by design’ – has been published by the International Monetary Fund (IMF).

The paper – titled ‘Harnessing Emerging Digital Technologies toward a New Frontier of Public Financial Management’ – is aimed at policymakers, technologists and development partners in governments across the world considering how to modernise PFM.

Many existing PFM digital solutions are ‘inadequate’ to meet governments’ evolving needs, despite large investments from governments and development partners, the technical analysis – which weaves in nods to hot topics in private-sector finance such as tokenisation – notes.

The opportunities and challenges of digital modernisation of PFM are explored by the paper’s four authors, who state that emerging digital technologies will play a ‘critical role’ as they possess the potential to ‘significantly transform’ traditional PFM processes and functions. But the authors also emphasise that technology alone will not transform PFM.

Examples of innovative initiatives from state authorities across the globe are plentiful in the paper, which sets out 10 practical considerations to help ministries of finance to leverage technology while managing potential risks. The paper, from the IMF ‘Technical Notes & Manuals’ series, is accompanied by a set of what are referred to as ‘technology cards’ (downloadable in one chunk as a 54-page pdf), which summarise technologies that can be adopted in PFM and potential use cases.

Current PFM functions: ‘major shortcomings’

Almost all countries now use some kind of automated systems to support their PFM functions.

But the authors not that ‘major shortcomings’ typically include: poor quality or incomplete, inconsistent data; silos or lack of interoperability across databases, systems, and institutions; outdated IT architecture with limited flexibility, scalability, and security; little use of modern data analytics methods for decision making; and slow and cumbersome reporting features, as well as the lack of real-time monitoring.

‘Legacy PFM systems are often characterized by on-premises setups requiring manual updates, disconnected and siloed operations, and inconsistent vendor support, which lead to high overhead costs and operational inefficiency,’ they explain as they set out the rationale for the 46-page paper.

‘Digital modernization of PFM can allow further automation and smarter rules and processes; offer greater security, scalability, and flexibility at potentially lower costs; and ensure that systems can adapt and improve over time to meet growing and changing demands,’ they continue.

If properly harnessed, the authors state that emerging digital technologies can increase the efficiency and effectiveness by automating routine tasks; facilitate data-driven decision making across the budget cycle; ensure fiscal sustainability by supporting better data analytics and decisions in fiscal policymaking; strengthen transparency and accountability by allowing stakeholders to monitor the use of public funds; improve public service delivery by enabling seamless, real-time interactions between citizens and government agencies; and promote compliance with global norms through the adoption of international standards and practices in the PFM area.

PFM’s digital potential

Governments could redesign their PFM processes and functions to be digital by design across areas ranging from budget preparation and public investment management to government payments and contracts, the authors summarise.

Budget preparation, for example, could potentially be redesigned with artificial intelligence (AI) agents automating data validation, reporting and workflow approvals. This would, they write, ‘eliminate redundant layers of review while enabling faster, evidence-based budget formulation.’

Public investment management could ‘leverage building information modeling tools; light detection and ranging technologies; and AI-driven analytics to ensure accurate planning, data-driven project monitoring, and timely, cost-effective completion of infrastructure investments.’

Government payments, including payroll and subsidies, could be processed ‘swiftly and accurately, reaching even the financially excluded and hard-to-reach populations through new payment systems and digital money innovations’.

Government contracts could ‘leverage smart contracts and Internet of Things (IoT)-enabled asset management registries to streamline initiation, automate execution, and ensure transparent oversight of public procurement processes.’

Public debt management and technology

Tokenisation and distributed-ledger technologies (DLT) feature in the context of public debt management.

Public debt management could, the authors note, leverage tokenisation, DLT and central bank digital currencies (CBDCs) to enable the issuance and automated settlement of digitalised debt instruments, ‘fostering innovation and access for retail investors.’

The case for tokenised government bonds was analysed in a Bank for International Settlements (BIS) paper last year. With a total value estimated at $80 trillion (about £59 trillion), government debt comprises the ‘largest and most critical global asset market, and a cornerstone of the financial system’, the analysis – titled ‘Tokenisation of government bonds: assessment and roadmap’ – noted. Bond tokenisation ‘remains in its early stages but has gained momentum in recent years among both corporates and governments,’ the paper stated.

The IMF paper notes, in a separate example of innovative tech use, that ‘performance budgeting’ could apply machine learning to analyse targets and evaluate effects; or generative AI (‘GenAI’ – a sub-category of AI) to produce tailored reports for different audiences, ‘reducing the reporting burden.’

In a similar vein, they note that internal control and audit could use AI and analytics tools to detect anomalies, non-compliant and fraudulent transactions; facilitate proactive, adaptive and real-time risk management instead of manual sampling; and provide controllers and auditors with strategic insights into risks.

Probable, plausible and possible scenarios

Three scenarios – probable, plausible and possible – are set out.

The first scenario ‘maintains business as usual and represents the default option’, with legacy systems remaining in place and ‘slow adaptation, incremental improvements, and responsive measures to maintain operations.’

The plausible scenario involves ‘progressive modernization that recognizes current trends.’

The possible future is a ‘transformative overhaul’ that ‘envisions a bold reconstruction’ through the comprehensive implementation of emerging technologies, such as: AI for budget planning and reporting; tokenisation for asset management; smart contracts for payroll, debt and procurement management; IoT for inventory and public investment management; web3 for digital identity (web3 is a term used to describe the ‘next iteration’ of the internet, built on blockchain technology); and digital money for payments and receipts.

‘The timeline for a radical overhaul of PFM systems, partial or full, depends on several factors but will realistically span 10 to 20 years,’ the authors state. ‘Early adopters or countries with strong digital foundations and leadership may achieve this future in less than a decade’.

The four main determinants are seen as: technological readiness; political will and leadership; institutional capacity; and resource availability.

Moody’s | Apr 2, 2026 |

Originally tabled for implementation on January 1, 2026, the Financial Crimes Enforcement Network (FinCEN) regulation that brings Registered Investment Advisers (RIAs) and Exempt Reporting Advisers (ERAs) under the Bank Secrecy Act (BSA) was postponed until 2028.

This change seeks to close a long-standing regulatory gap and introduce more comprehensive anti-money laundering (AML) obligations for investment advisers, aligning them with other financial institutions. The estimated universe of RIAs and ERAs impacted is around 20,000, and they have many hundreds of trillions of dollars of assets under their management. While implementation is two years from now — now may be the time for advisers to start preparing.

Why this regulation matters to investment advisers

The investment advisory industry manages trillions of dollars globally, making it an attractive target for criminals seeking to launder money. By extending BSA obligations to RIAs and ERAs, FinCEN aims to create greater transparency, reduce systemic risk, and align advisers with global AML standards.

This change in regulation also reflects a broader trend toward effectiveness-based compliance, where regulators focus on outcomes rather than simply checking procedural activities.

What’s changing under the FinCEN AML Rule?

Until now, RIAs and ERAs were not subject to the same AML requirements as broker-dealers or banks, leaving the investment advisory sector exposed to financial crime risks.

The new rule requires advisers to implement risk-based AML programs, verify customer identities through Know Your Customer (KYC) procedures, and report suspicious activity, among other requirements.

These measures aim to strengthen the integrity of the US financial system and reduce opportunities for illicit activity.

Key requirements under the rule

Firms need to establish and maintain a written AML program that reflects their risk profile and appetite. They are required to verify client identities through a Customer Identification Program (CIP) and keep detailed records of these checks.

Advisers also need to monitor transactions and file Suspicious Activity Reports (SARs) when they detect potential money laundering or terrorist financing.

In addition, firms will need to conduct independent testing of their AML controls to make sure they are effective and compliant with regulatory expectations.

Who’s impacted?

The rule directly affects RIAs registered with the Securities and Exchange Commission (SEC) and ERAs that report under SEC rules. However, the impacts of this change could extend beyond advisers themselves. Service providers such as custodians, fund administrators, and technology vendors may also need to adapt, as advisers could ask for stronger compliance measures from their partners to meet regulatory obligations.

Implementation timeline

Implementation of the final rule was postponed until 2028, giving firms a larger window to prepare for compliance. Advisers will need to have fully operational AML programs in place within the next two years as examinations and enforcement actions will then begin, and firms who fail to comply could face consequences.

Enforcement and penalties

The U.S. Securities and Exchange Commission (SEC) will examine RIAs and ERAs for compliance with the rule. FinCEN retains primary enforcement authority under the BSA and may coordinate with the SEC on referrals and actions. Non-compliance may result in civil monetary penalties, enforcement actions, and reputational damage. Firms who fail to act promptly risk not only regulatory impacts but also losing customer trust.

4 things compliance teams might do to prepare

Ahead of the deadline, compliance teams can think about the following steps to prepare:

• Conducting a gap analysis of existing AML controls against the new requirements.
• Reviewing and updating policies and procedures to incorporate CIP and SAR processes, alongside providing staff training on new obligations where appropriate.
• Considering the role of technology, including solutions that automate KYC checks and support ongoing monitoring.
• Engaging with third‑party partners and vendors to support alignment with the new standards.

How Moody’s solutions could help

Moody’s offers a suite of solutions that could be used to help address the requirements introduced by FinCEN’s AML rule.

Our automated KYC and AML risk screening solutions support firms to verify identities, assess beneficial ownership, and monitor counterparties against global sanctions and watchlists.

For advisers implementing Customer Identification Programs, Moody’s provides dynamic identity verification and adverse media screening, helping firms conduct compliance activities more efficiently.

In addition, our third-party risk management platform supports continuous monitoring of suppliers and service providers, so advisers can manage risk across extended networks.

With integrated data analytics and AI-driven insights, Moody’s solutions help firms transition towards an effectiveness-based compliance approach, reducing manual processes, and improving risk visibility. By leveraging these tools, RIAs and ERAs can accelerate readiness for the 2028 deadline — strengthening their overall risk management framework.

The bottom line

The FinCEN AML rule for RIAs and ERAs represents a shift for the investment advisory sector. With the effective date set for 2028, firms can act now to build robust AML frameworks that help them with compliance activity and help protect against financial crime risks.

Proactive preparation is key—as is compliance and risk management for long-term resilience.