Global Research Unlocked

Airline ticket prices are up relative to 2019 as demand recovers but supply isn't back to pre-pandemic levels. Corporate travel had lagged but is catching up quickly. But investors are trying to gauge the sustainability of the recovery, whether pent up demand fades and whether higher prices push the consumer to pursue lower altitude modes of transportation. Andrew joins us to discuss why he believes there's still demand strength ahead, how ticket prices still compare favorably to history and to other services in these inflationary times and the impact that higher oil and pilot shortages could have-one that is both positive and negative. You may also enjoy listening to the Merrill Perspectives podcast, featuring conversations on the big stories, news and trends affecting your everyday financial life

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities.

©2022 Bank of America Corporation. All rights reserved.

Inflated vehicle prices have inflated auto profits too but Horst Schneider, Head of European Automotive Research, believes the days of outsized profits for automakers are numbered as supply and pricing both normalize. And chips may be scarce now, but slowing demand for electronics could mean that supply of chips for the auto industry improves sooner than some think. The shift to EVs and further penetration gains are undeniable, but Horst discusses some recent developments that could slow those gains somewhat. He also discusses some key competitive considerations for EV makers and new battery technologies that could solve cost issues further out. You may also enjoy listening to the Merrill Perspectives podcast, featuring conversations on the big stories, news and trends affecting your everyday financial life

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities.

©2022 Bank of America Corporation. All rights reserved.

The digital asset market is in a trading range near-term, but likely headed higher intermediate and long-term, along with other risk assets. Stablecoins had $6 trillion of transaction volume last year and are critical for future metaverse economies and for lowering the friction of making payments across borders. In this episode, Alkesh explains algorithmic stablecoins and the current state of the digital asset market. You may also enjoy listening to the Merrill Perspectives podcast, featuring conversations on the big stories, news and trends affecting your everyday financial life

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities.

©2022 Bank of America Corporation. All rights reserved.

The 10-year yield has more than doubled since the start of this year, and it's now at the level at which it peaked in 2018. The higher 10Y yield has taken a toll on risk assets, especially growth stocks, and elevated rate volatility has contributed to the weakness. But Mark does believe 10Y yields have only modest upside from here and expects rates volatility to fall when the path for lower inflation becomes more clear and Fed moves more predictable. Mark also discusses the impact that structurally higher inflation could have on rates.

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities.

©2022 Bank of America Corporation. All rights reserved.

Forests are one of the largest sources of carbon sequestration through voluntary carbon markets. Wood products companies which own these forests harvest wood for housing and other applications and as long as the wood remains protected, as it would be in a house, the materials become a carbon sink. And from a revenue perspective, companies can sell carbon sequestration into the voluntary carbon markets, though those markets are still nascent. Awareness of the positive carbon attributes of wood could also boost wood construction and allow it to displace some concrete and steel. Join our discussion with George Staphos as he discusses forest product companies and their role in helping the world reach net-zero.

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities.

©2022 Bank of America Corporation. All rights reserved.

The digital assets market has declined with stocks and bonds and the market value of the 18,000 tokens that are in this ecosystem remains down about 16% year to date. Digital assets, including Bitcoin, continue to act like risk assets rather than inflation hedges. With an aggressive Fed as a top concern for investors, digital assets have struggled this year despite long term promise for many. In this episode Alkesh gives an update on Bitcoin Miami and insights gained from the BofA Global Research Crypto Mining conference. He believes that there are misconceptions around Bitcoin’s energy consumption, but that there is work to done to make mining more energy efficient longer term.

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities.

©2022 Bank of America Corporation. All rights reserved.

Owing to an upward march in prices and rates, housing affordability is as poor as it’s been since the housing crisis and down payments are at record levels. But there are many differences between this housing market and the market of ‘07/’08, particularly on the supply side. And that dearth of supply along with a reluctance to move into a higher mortgage rate could convince many to stay put and to upgrade their existing home instead, boosting home improvement demand. Meanwhile, home furnishings demand may be less persistent and could suffer as stimulus is lapped, there’s payback from demand pull-forward, and renters get squeezed by climbing monthly payments. Joining us to discuss these issues and more are BofA Global Research analysts Rafe Jadrosich, who covers homebuilders, Curtis Nagle, who covers home furnishings as well as real estate fintech and Elizabeth Suzuki who covers home improvement and other hardline retailers

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities.

©2022 Bank of America Corporation. All rights reserved.

ESG investors have traditionally viewed defense and energy sectors as off-limits or at least challenging to their objectives. However, defense and energy stocks have seen dramatic gains this year as energy prices have boomed as have plans for defense spending. Many ESG investors had already been moving toward a more nuanced approach, looking for ESG improvers rather than just excluding certain groups and companies, a move that has been accelerated by recent realities. Defense companies that were once associated with harmful practices may now be viewed as champions of freedom and democracy and the EU taxonomy around ESG investing seems to allow this as long as companies aren't wholly opposed to social objectives. Savita Subramanian and Ronald Epstein join us to discuss these issues and how defense may benefit from both higher spend and a widening pool of investors.

"Bank of America" and “BofA Securities” are the marketing names for the global banking businesses and global markets businesses (which includes BofA Global Research) of Bank of America Corporation. Lending, derivatives, and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Securities, trading, research, strategic advisory, and other investment banking and markets activities are performed globally by affiliates of Bank of America Corporation, including, in the United States, BofA Securities, Inc. a registered broker-dealer and Member of FINRA and SIPC, and, in other jurisdictions, by locally registered entities.

©2022 Bank of America Corporation. All rights reserved.