Bloomberg – Libor’s Rise Matters for Trillions of Debt While the rest of the bond market takes the Federal Reserve’s latest interest-rate increase in stride, Libor is surging. And that still matters. The steady march higher in the London interbank offered rate shows the U.S. central bank’s tightening cycle does have consequences even as measures of… Continue reading LIBOR On The Rise
The Wall Street Journal – Greg Ip: The Fed Isn’t the Tax Cut’s Enemy With U.S. unemployment at 4.1% and the economy at full capacity, the conventional wisdom is that this is the wrong time for Republicans to cut taxes by $1.4 trillion over the next decade. The fiscal stimulus will overheat the economy and… Continue reading A Couple Reasons The Fed May Welcome Tax Cuts
The Wall Street Journal – Bringing Back the Money-Fund Buck? A fight is brewing over whether to reverse rules meant to prevent another crisis-triggered exodus from a corner of the mutual-fund industry, the latest front in a broad push to undo postcrisis regulations. A pending House bill would overturn a 2014 Securities and Exchange Commission… Continue reading Revisiting The Idea Of Breaking The Buck
The orange line in the chart below shows the year-to-date total return of negative-yielding bonds has outpaced that of the global aggregate for most of the year. As of December 11, only a few basis points separates the two.
The blue line in the chart below shows the 50-day moving average of investment grade bond volume. The green line shows volume investment grade bond ETF volume. The chart below shows the year-to-date flows into investment grade ETFs. The top panel (black) shows the Bloomberg investment grade option-adjusted spread (OAS). It is plotted inversely to… Continue reading Investment Grade ETF Volume and Flows Update
The blue line in the chart below shows the 50-day moving average of high yield bond volume currently stands at $8.13 billion. The green line shows the 50-day value of all high-yield ETF trading. This totals about 30 ETFs with BlackRock’s iShares iBoxx High Yield Corporate Bond ETF (HYG) and Bloomberg Barclay’s High Yield Bond ETF (JNK) accounting for roughly two-thirds of this total. The red line shows high yield ETF dollar volume as a percentage of… Continue reading High Yield ETF Volume and Flows Update
The following charts use Gallup’s approval rating.
All of the major stock indices are up since the last rate hike in June. The DJIA leads the others, up over 16%. Both growth and value stocks are beating the broader market, up 11.70% and 10.77%, respectively. The financial sector is up about 16%. Use the interactive… Continue reading Stock Returns Since The June 14, 2017 Rate Hike
Bonds are down slightly (-0.19%) since the rate hike in June. The Bloomberg High Yield Index is up 2.06% since the June rate hike. Use the interactive chart below to view additional bond index returns.
Commodities are up 4.68% as a group since the rate hike in June. Energy leads the commodity sub-groups, up almost 19% since the rate hike in June. Use the interactive chart below to view additional commodity returns.