Bond Markets at the Brink

Treasuries may be at a make-or-break moment This year started off well enough. The bulls ran free in the markets as fear receded that the Federal Reserve would continue to hike interest rates to combat inflation. The Nasdaq 100 futures contract (/NQ) posted its best January since 1999. But it wasn’t happening just in the … Continued

Bonds Look Strong

Investing in bonds didn’t pay off in 2022, but three factors may combine to change that this year Even though equity markets declined by double digits last year—more than 20% in some cases—the bond market didn’t provide a bastion of safety. In fact, the S&P U.S. Aggregate Bond Index was down more than 11.5% at … Continued

Fed Hike Hype

Higher interest rates will keep the markets volatile  When the Federal Reserve raises interest rates, financial markets can turn volatile. The hikes in the early 2000s bore this fruit and so did the initial efforts to end quantitative easing (QE) and raise rates in the mid-2010s.  Now, the Fed has finished tapering its pandemic-era QE … Continued

No, It’s Not Stagflation

Yes, prices are up and GDP is down compared with earlier this year, but the economy isn’t entering a ’70s-style malaise The economic woes of the 1970s, a decade marked by runaway inflation and painfully slow growth of gross domestic product, came to be known as stagflation. Could a similar fate befall America in the … Continued

Amazon’s Tax Gambit

Jeff Bezos and Amazon are supporting higher taxes—a move that’s less counterintuitive than it appears It’s no surprise that President Joe Biden has introduced sweeping proposals to raise taxes on corporations and wealthy individuals. Biden campaigned for the White House, in part, on the platform of raising taxes to fund infrastructure spending. “A fireman or … Continued

SPACs Have Their Moment

Wall Street is spitting out special-purpose acquisition companies at a frenzied pace—but let the buyer beware By now, nearly everyone who’s interested in finance has heard of SPACs. They’re the special-purpose acquisition companies typically led by someone with a familiar name—perhaps a well-known fund manager or even a famous athlete. Those famous or nearly famous … Continued