FLGV News and Press, Franklin Liberty U.S. Treasury Bond From 08/10/21

Hawkish soundbites and positive economic news dominate for the US, despite global growth concerns. Officials talking about tapering within a few months should help focus minds at the long end of the curve, despite a supportive technical backdrop for bonds. A glut of cash remains i...

The continued flattening move in the rate market suggests no major change in market dynamics as the case for Fed tightening becomes increasingly convincing. More upbeat economic data this week, and hawkish soundbites, would only displace bond demand towards longer maturities. We m...

The New Normal looks a lot like the Old Normal in that it is unknown and ever changing. All we can do is observe the present with clear eyes. For now, the economic outlook is still pretty good. It isn’t the boom everyone was expecting a few months ago, and it probably wonȁ...

Up until the last decade, negative interest rates were the stuff of abstract theory. Today, the volume of fixed-income securities trading with yields below zero runs to $16.5 trillion, having grown steadily over the past two months with the renewed rally in global bond prices. Expecta...

In the beginning of August, the 10-year U.S. Treasury yield had dropped to 1.18%, down significantly from a post-pandemic peak of 1.75% in March. A confluence of technical and fundamental factors contributed to the drop in yields, too. Investors observing the trends toward “...

If you are looking for a snapshot as to why there is so much to this “growth scare” and rising deflationary potential (record stocks, though), outside recent labor market data you’d be hard-pressed to do better than US trade statistics. We can see already the disc...

The past week has been a story of stagflation infecting the US economy while the stock market grimaces as the Fed expresses the need to start a gradual pullout from economic stimulus much sooner or face a rapid pullout a little later. Rapid inflation pounds away at the producer side i...

The relentless drop in bond yields raises the question of how low can they go. For 10Y Treasuries, we think 1%. For German bonds, we’re probably closer to the bottom. The service sector is more liable to be impacted by Covid-19 cases. Look out for sentiment surveys today. ...

GMI’s 10-year Sharpe ratio (SR) edged up for a fifth straight month to 0.86, the highest since January 2020, based on a rolling ten-year window via monthly data. Profiling GMI through a drawdown lens also reflects an extended stretch of low risk. GMI is useful as a baseline...

Most of the major asset classes continued to rise in July, led by US real estate investment trusts (REITs). US equities continued trending higher. The bull run also persisted for the Global Market Index (GMI) in July. For further details see: Major Asset Classes: July 20...