Category Archives: bonds

Credit Shock due to COVID-19 Unprecedented

This quote is the latest from Moody’s: The credit shock created by the coronavirus pandemic is completely unprecedented, given the number of geographies and industries affected, and the lack of clarity as to when the economic implications of the pandemic … Continue reading

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Corporate Bonds not out of the woods yet!

We’ve watched a bit of a bear market rally in stocks, but also saw the same short term narrowing of corporate bond spreads (the difference between the yield offered by corporate bonds versus the virtually risk-free government bonds or treasuries).  … Continue reading

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The bonds that can lose your money!

I mentioned in an earlier article, published Feb. 24th, that even bonds and bond ETF’s are at risk in the current environment; primarily due to a phenomenon know as a widening of credit spreads.  This is happening in a big … Continue reading

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Hot off the presses – more rate cuts and liquidity from U.S. Federal Reserve.

FED Just announced interest rates near zero: The Federal Reserve encourages depository institutions to turn to the discount window to help meet demands for credit from households and businesses at this time. In support of this goal, the Board today … Continue reading

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Bonds (ETF’s, Mutual Funds) at Risk even in a Recession

It’s very difficult to teach young adults about how bonds work – although I believe I’ve done a pretty good job of it.  It’s even more difficult to educate adults that had an aversion to math when they were at … Continue reading

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What is the bond market telling us?

Bond traders have taken yields at very short end of the curve and mid-range (2 to 10 year maturities) a bit higher as confidence in the economy has temporarily strengthened.  However as I’ve mentioned in prior articles, we may already … Continue reading

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When Consumer is Happy, Markets are High Risk

Consumer sentiment is usually considered an economic leading indicator.  When confidence is at rock bottom levels, it’s a sign that the economy and stocks markets are heading lower.  This isn’t true.  I’ve published for years that consumer confidence is one … Continue reading

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The rally in stocks will end! Buy bonds.

I stumbled across this quote from USA Today dated Nov. 5th, 2019: Mike Piershale, president of Piershale Financial Group in Barrington, Illinois, manages portfolios for retirees and pre-retirees. Most of his clients have 70% toward stocks and 30% to bonds. … Continue reading

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Hold on to your bond ETF’s: It’s a RECESSION!

There are a enough indicators to suggest we’re already ‘in’ a recession.  But, you say, GDP stats that have been published remain positive.  As I learned decades ago, historical data doesn’t tell us much – its published with a delay … Continue reading

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BONDS – Where we go from here!

But there may be reason to expect any correction to be mitigated by a FED that wants to simply layoff the accelerator rather than apply the brakes. There have been periods when interest rates have climbed modestly yet stock markets continued to be relatively generous. Continue reading

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