BILS News and Press, SPDR Bloomberg Barclays 3-12 Month T-Bill From 11/07/22

Summary The trend for the dollar and the 10-year Treasury yield is still up but, as I said last week, both appear to be hitting a short-term peak. US stocks were down last week but non-US stocks had a great week. The selloff in the dollar Friday goosed non-dollar returns by nearly...

Summary Economists like to talk about forecasting recessions. To be blunt, I think this is an absolute waste of time. While nearly everyone seems to be aware that the yield curve is inverted, it seems that few people understand the significance of this event. Acting on this si...

Summary The closest thing to a guarantee in finance is the truism that recessions always follow Treasury bond yield inversions. The labor force is no longer expanding and may be shrinking. A recession in which the GDP shrinks by 1% for two quarters while employment remains sta...

Summary The Fed is going to meet this week and the course of the stock and bond markets, at least for a while, will be determined by what is decided at the FOMC meeting. Household and corporate balance sheets are remarkably liquid. Financials, real estate, and industrials led ...

Summary Money supply growth fell again in September, dropping to a 37-month low. Money supply growth can often be a helpful measure of economic activity, and an indicator of coming recessions. Since January of this year, the Fed has raised the target federal funds rate from .2...

Summary In recent decades, every instance in which the economy contracted two quarters in a row has coincided with a recession. The Fed tends to keep an even closer eye on the 10-year/3-month spread, and even that is now pointing to recession as well. The Fed has temporarily s...

Summary There is a whole generation of investors who have never experienced UST yields at these elevated levels. The rise in yields has been across the maturity spectrum, with the closely followed 2-, 5- and 10-year notes all experiencing surging yields thus far in 2022. Highe...

Summary Year-to-date, allocations to floating rate notes have resulted in a more than 20% performance differential compared to U.S. 10-Year notes. Rising rates explain why owning the same securities as the Agg but reducing the maturity profile (1–5 years) led to losses that...

Summary BoE holds the keys to the next gilt rally, if it can convince markets that a more dovish path is the right choice. The USD curve re-steepening on pivot hopes has run out of steam. Expect limited appetite to trade such a momentous policy change until next week’s ...

Summary I have said for weeks that the Fed needs to slow the pace of its tightening campaign. Powell apparently decided last week that the market was taking things too far. Corporate earnings are being released for the quarter and, so far, they aren’t that bad. It w...