Results for yields

These cycles repeat - near the end of EVERY tightening cycle.. 1) yields decline, stocks rally (P/E) 2) housing stocks rally; data bounce 3) soft landing is priced in (yes, every time) 4) credit spreads tighten 5) job market looks ok All repeating in ‘2023 #macro  #hope 

...is that as we kick the can down the road, we make the system inherently more unstable and prone to the butterfly effect: a tiny butterfly moving her wings (e.g. real yields moving a bit higher or a small recession) is enough to generate a tornado in markets. 23/

...Central Banks are facing inflation and pushing real yields higher. At 300-400% total debt/GDP, higher real yields are going to cause serious damage over time. It seems we are pushing the limits, one way or another. So, what's the end game? The options ahead are: 20/

In 2019-2021, we faced the zero lower bound problem When nominal yields are already -50 bps like they were in EU, pushing them further down has several risks - phyisical cash hoarding, for example The only way to push real yields lower is via higher inflation expectations 18/

Fixed income is making a return this year as yields become attractive again

But generating inflation is something we struggled with in the pre-pandemic era. The system starts to stagnate, until a disruptive force causes sudden change. In 2020, the pandemic arrived. Initially, it turbo-charged the system: more debt, lower real yields. But now... 19/

WATCH: Palestinian engineer Ayed Abu Ramadan has turned to vertical farming methods to increase his yields of citrus fruits and strawberries in the densely populated Gaza Strip where agricultural land has been shrinking

Every. Single. Cycle. Ends. In. Lower. Yields.

Thanks to higher fixed-income yields and lower equity valuations, almost all of the firms we surveyed have increased their expectations for stock and bond returns for the next decade. Here are some takeaways for investors from @christine_benz :

Apparently my before/after curve views are a minor hit around here? 1st stop consideration in my world so like breathing to me. #TREASURY  curves AGAIN by request - ahead of #FOMC  (green), yields slip back post #FED  ahead of #JOBS  (purple) & back up/new highs post #NFP  (orange)