Good morning.
Bond investors used to be a risk-averse crowd. They preferred the certainty of return compared to potentially earning a high return. But they did want their money back – after inflation. That used to keep governments in line, without letting spending get too far out of hand.
That changed with the Great Financial Crisis. In a panic, central banks slashed interest rates to zero percent. And bond investors became far more passive – in part because central banks became one of the largest buyers of government bonds.
That narrative is shifting, as high inflation is making investors cautious – but also interested in earning a decent return. Investors today may want to look at bonds as an alternative to cash, given the high yields there, and especially while short-term bonds have a higher yield than long-term bonds. Traders who get in ahead of the next rate cut cycle can also profit from a rally in bond prices.
Now here’s the rest of the news:
Inflation Is Completely Destroying Our Standard Of Living
Inflation is a hidden tax on all of us. Unfortunately, most Americans don’t understand this. Most of them cheered when the federal government was handing out free checks as if they were candy. And most Americans fully approved… [Read Here]
March 03, 2022
Good morning.
History doesn’t repeat itself, but it does sometimes rhyme. That’s why the oil market is a key one to watch now. While headlines note that oil is back over $100 per barrel again for the first time since 2014, the energy commodity didn’t first hit that level until early 2008.
High oil prices act as a tax, and one that is particularly regressive for lower-income earners. The higher prices go and the longer they stay there, the less capital is available for consumption in other areas. While high oil prices didn’t lead to the housing bubble bursting in 2008, it certainly did add some fuel to the fire, and that part of history may rhyme this year.
Traders should remain cautious on any energy-intensive sector, and continue to back commodity trades right now. And on any sign of a recession in part from high oil prices, it may be time to stick to defensive trades and avoid leveraged trades.
Now here’s the rest of the news:
Another Horrifying Economic Record Was Just Broken
The Advance Report from the Census Bureau has just come out. And it is ugly! For accounting purposes, exports add to GDP and imports subtract so this data in isolation will subtract from GDP. In practice, imports do not subtract from GDP. The truth is… [Read Here]
Analyst: Russian Sanctions Will Backfire Against Americans
Economic sanctions serve as a powerful foreign policy tool for the US government. But could this ultimately backfire on the US? Over the last several years, many countries have made a concerted effort to limit dependence on… [Read Here]
March 03, 2021
Good morning.
Conventional wisdom is to buy the dip in the markets. Conventional wisdom can sometimes be wrong, but in the case of the stock market, is usually right. Those who bought stocks last year after the market dropped 10 percent might have had to sit tight for a few months, but have been richly rewarded a year down the line. Those who waited for a 20 or 30 percent drop did even better, but such big drops in the market occur typically about once a decade on average.
Enter Cathie Wood of Ark Investments. The tech investor spent last week’s more modest 7 percent drop in tech stocks as an excuse to buy some more shares. Her rationale? All stocks need a periodic “reality check” and investors who take advantage of short-term drops can be set up for long-term success.
How much does the market have to drop before you start adding to your positions?
Hit reply and let us know how you’re handling the increased volatility.
Now here’s the rest of the news:
Treasury Market Had a Cow… –Wolf Richter, Wolf Street
…mortgage rates jumped, Wall Street crybabies clamoured for help, junk bond yields remained in la-la-land risks be damned! And the Fed smiled satisfied upon its creation… [Read Here]
March 03, 2020
Good morning.
It was on this day in 1938 that oil was first discovered in Saudi Arabia. That was 82 years ago and look where the Middle East is today in terms of wealth and OPEC production cuts.
Well, at least oil saw a little resurgence on Monday on the news. I guess we can all celebrate this event by filling our tanks. This one’s for you Saudi Arabia!
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March 03, 2019
My logo designing didn’t go as well as I had hoped yesterday! With the use of different video idea and graphic design software… thing were much better. The video below is quite long but proved invaluable…
Getting late in the evening… so I will resume tomorrow, hoping to wrap my logo design up! 😉
