This year’s increased stock market volatility and sharp declines in the emerging markets are the result of rising interest rates. If interest rates revert to the normal 2007 pre-financial crisis levels, a process not even halfway complete, the potential for
This month’s letter argues that rising rates are fundamentally changing investing and asset allocation. Our basic premise is that interest rates are artificially low and will continue to rise, which, in turn, will hurt the performance of equities and bonds.
The remarkable 34-year bull market in bonds which enriched stock, bond and real estate investors for the last three decades, broke another key milestone in April when the 10-year US Treasury yield rose above the 3%. Breaking this psychological milestone
“Toto, I have a feeling we are not in Kansas anymore,” Dorothy famously said in the children’s classic The Wizard of Oz. In the same vein, this letter cautions investors that important changes are occurring in the markets and, while
February’s swift stock market correctionWe refer to February’s decline as a mini-crash in that computerized trading drove wild price swings on February 5th that was reminiscent of the Flash Crash of 2010. Technically February’s decline was simply a correction in
Market Risk Overview: The accelerating rise of the stock market marks the final stage of this ripping bull market. Interest rates are rising, and stocks are pushing peak valuations--market historians know these two conditions cannot coexist for a protracted period