Tag Archives | interest rates

10yr Treasury Sept16

US 10-Year interest rates suggest Great Reckoning may be near

 ”History doesn’t repeat itself, but it often rhymes“, Mark Twain Bob Farrell of Merrill Lynch was rightly considered one of the leading Wall Street analysts in his day.  His 10 Rules are still an excellent guide for any investor.  Equally helpful is the simple checklist he developed, echoing Mark Twain’s insight, to help investors avoid […]

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Stocks Sept16

Investors panic in “search for yield” as interest rates go negative

Its been a great few months for financial markets.  All the major markets have seen gains, as the chart shows – something that has happened only once before, since my half-yearly reviews began in March 2009: □   Long-term US Treasury bonds have gained, as long-term interest rates have been falling □   The 30-year bond […]

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US jobs Aug16a

US pensioners pay the price for Fed’s monetary policy failure

There was one bit of good news this week.  For the first time since the financial crisis began, a Governor of the US Federal Reserve acknowledged that today’s demographic changes are having a major impact on the US economy. John Williams, of the San Francisco Fed, argued that: “Shifting demographics….(mean that) interest rates are going […]

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Global demand slowdown hits chemical industry results

Its not been a great 6 months for the global chemical industry, and my usual quarterly survey of company results confirms the disappointment. The first half of the year is typically the strongest, for seasonal reasons, as companies come back to work after the Christmas holiday and prepare for the peak car-buying and construction periods […]

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Bank of England’s new stimulus policy creates bankruptcy risk for corporate pension funds

The Western BabyBoomers (born between 1946-70), have been one of the luckiest generations in history.  By and large, they have escaped the major wars that have plagued society down the ages.  They have also lived in a world where living standards and material wealth have made astonishing gains.  Equally priceless has been the rise in […]

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Brexit poll creates UK, euro interest rate rise risk

Financial markets are very bad at evaluating political risk.  They assume people will always be rational, and expect a ‘business as usual’ scenario to continue.  But as we all know, people are not always rational.  And emotion, as today over immigration may cloud their judgement. This week has seen the first signs of this complacency […]

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Index Dec15

Great Unwinding creates Great Divergence in financial markets

Most traders prefer to be with the crowd – then, at least, they can’t be personally blamed if things go wrong.  Instead, they can claim that “nobody could have seen the change coming”.  So as we approach year-end, many traders are becoming very nervous as the Great Unwinding of policymaker stimulus means that markets start […]

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US 10-year interest rates jump 23% as Fed debates 0.25% hike

Media hype over the potential for a 0.25% interest rate rise by the US Federal Reserve is well underway.  But as often happens these days, this is missing the bigger picture. The issue is simple: developments in China are far more important to the global economy than anything the Fed might, or might not, do […]

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Phase 2 of the Great Unwinding of policymaker stimulus begins

Greece, Iran, China – suddenly real world issues are starting to dominate the headlines.  And few people now believe that printing more money is the way to solve these issues.  Instead, political leaders are being forced to take the hard decisions they have ducked for so long. Financial markets are clearly reflecting the change.  They […]

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Fed’s loss of credibility risks causing investor stampede

Credibility is hard to gain.  And once gone, it is very hard to regain.  That is the challenge facing the US Federal Reserve today.  The New York Times is just one of the mainstream media now starting to highlight the issue, as last week’s Fed meeting led to a further deferral of the promised rise […]

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