Login

Bonds & Interest Rates

Endgame Strategizing

Share on Facebook Tweet on Twitter

Posted by John Mauldin - Mauldin Economics

on Monday, 30 July 2018 06:47

  • screevTake a Deep Breath
  • Too Much Protection
  • Behind the Door
  • Cracks in the Wall
  • The Best Strategy for the Great Reset
  • Grand Lake Stream, Maine and Moving On

We are all on a debt-filled train that is eventually going to crash, and if you are on it, it won’t stop to let you off first. Jumping at the last minute is not a good option, either. So what do you do? You take action now, while you have time.

Last week I gave you some rules to follow with your investments. They were necessarily general because I’m writing to a broad audience. Today, I will get more specific by discussing some possible strategies for high-net-worth “accredited investors.”

However, you should read this important information even if you aren’t wealthy. You might get there someday and it will help prepare you for it. “Someday” could be sooner than you think, too. The Great Reset will rearrange much of the world’s wealth and some people will see their financial condition change quickly, either for worse or better. There will be some enormously positive opportunities.

And as we will see, many strategies that are currently available only to accredited investors are slowly showing up in lower-cost, publicly accessible ETFs and other instruments around the world. There is truly a fintech-driven revolution going on in the financial industry. For we who make our living in that world, the changes seem to intensify almost daily. As I will discuss at the end of this letter, these changes are forcing me to update my own business model. So opportunities not available to you today may very well be available next quarter or next year. You and your advisors need to stay in the loop.

The broader point: Whatever our current circumstances, we can all do things to prepare for the radically different world I think will unfold in these years. You need to make the most of what you have. I want to help by meeting you where you are. Fortunately, I have multiple ways to do that, as you’ll see below. Stick with me and we’ll get through this together.

Take a Deep Breath: It’s Going to Get Better



Read more...

Banner

Bonds & Interest Rates

Interest Rates Lock & Load or Stay Nimble?

Share on Facebook Tweet on Twitter

Posted by Martin Armstrong - Armstrong Economics

on Tuesday, 24 July 2018 08:17

Interest-Rates-Symbol

QUESTION:  Hi Marty,
I continue to read your blog and if I understand correctly, interest rates are going up.
My question is, can one profit from higher interest rates such as buying CD or bank stocks like Wells Fargo?

ANSWER: The one thing you do not want to do is buy a CD with maturity. As rates go higher, you will be locked in and unable to take advantage of the rising rates. Bank stocks will not benefit from higher rates in general. So that is not a valid reason to buy bank stocks. The safest thing would be to buy US TBills or agency paper no more out than 90 days and keep the cash rolling in that area until we reach a point when the rates are peaking. Toward the end, the yield curve will invert so that means the short-term rates will exceed long-term when confidence is shaken.

In an upward cycle for interest rates, never lock & load – always stay nimble if you are the investor. If you are the borrower – load & load fixing the rate out as long as possible.

....related from Martin: Russia Dumps US Bonds – Is it Politics or Yield?



Banner

Bonds & Interest Rates

Leveraged-Loan Risks Are Piling Up

Share on Facebook Tweet on Twitter

Posted by Wolf Richter

on Wednesday, 11 July 2018 11:47

yield

US junk-bond issuance in June plunged 31% from a year ago to just $14.5 billion, the lowest of any June in five years, according to LCD of S&P Global Market Intelligence. During the first half of the year, junk bond issuance dropped 23% from a year ago to $110.6 billion.

Is investor appetite for risky debt drying up? Have investors given up chasing yield? On the contrary! They’re chasing harder than before, but they’re chasing elsewhere in the junk-rated credit spectrum.... CLICK for the complete article

/E


Banner

Bonds & Interest Rates

The Fed Raises Rates as Expected but the Path of Future Hikes Grows More Uncertain

Share on Facebook Tweet on Twitter

Posted by Tiffany Wilding of PIMCO

on Thursday, 14 June 2018 06:39

imagesThe Federal Reserve’s decision today to hike its policy rate by 25 basis points (bps) to a range of 1.75% to 2.0% was widely expected. The Federal Open Market Committee (FOMC) also signaled growing consensus that the robust pace of economic activity warrants two more rate hikes this year, for a total of four in 2018. But the elimination of forward guidance in the Fed’s statement,coupled with today’s announcement that it will hold a press conference after every meeting starting next January, is perhaps the most interesting aspect of today’s meeting: It underscores the Fed’s medium-term dilemma of how to set policy that sustains the expansion by balancing the risk of overtightening with the risk of overheating the economy.

Finding neutral



Read more...

Banner

Bonds & Interest Rates

Total U.S. Public Debt and Interest Expense Hit A New Record High

Share on Facebook Tweet on Twitter

Posted by Steve St. Angelo - SRSRocco Report

on Tuesday, 05 June 2018 08:06

The total U.S. public debt hit a new record high of $21.145 trillion on the last day in May.  As the U.S. debt increased, so did the interest expense which jumped by more than $26 billion in the first seven months of the fiscal year.  That’s correct; the United States government forked out an additional $26 billion to service its debt (Oct.-Apr) versus the same period last year.

While the U.S. debt reached a new high on May 31st, it took nearly two months to do it.  Let me explain.  During tax season, the total U.S. public debt actually declined from a peak of $21.135 trillion on April 10th to a low of $21.033 trillion on May 3rd.  Since then, the U.S. debt has been steadily moving higher (including some daily fluctuations):

Screenshot 2018-06-05 07.47.39

If you spend some time on the TreasuryDirect.gov site, you will see that the total public debt doesn’t go up in a straight line.  There are days or weeks where the total debt declines.  However, the overall trend is higher.

Now, a rising debt level impacts the interest the U.S. Treasury must pay on this debt… especially when the average interest rate also increases.  According to the TreasuryDirect.gov, the interest expense rose from $257.3 billion (Oct-Apr) 2017 to $283.6 billion (Oct-Apr) this year:



Read more...

Banner

<< Start < Prev 1 2 3 4 5 6 7 8 9 10 Next > End >> Page 2 of 210

Free Subscription Service - sign up today!

Exclusive content sent directly to your Inbox

  • What Mike's Reading

    His top research pick

  • Numbers You Should Know

    Weekly astonishing statistics

  • Quote of the Week

    Wisdom from the World

  • Top 5 Articles

    Most Popular postings

Learn more...



Our Premium Service:
The Inside Edge on Making Money

Latest Update

The end of the longest bull market?

It’s increasingly looking like we’re now at or near the end of one of the longest running and most important bull markets in history. ...

- posted by Eric Coffin

Michael Campbell
Tyler Bollhorn Eric Coffin Patrick Ceresna
Josef Mark Leibovit Greg Weldon Ryan Irvine