VGLT News and Press, Vanguard Long-Term Government Bond ETF From 11/07/22

Summary The early line from the prediction betting polls expect the Republicans to gain seats and control both houses of Congress. That could put a check mark on the side of the market bears and put a crimp on markets, as the gridlock in DC means no more stimulus until 2025. The t...

Summary The 1-month forward U.S. Treasury yield now peaks at 5.60%, up 14 basis points from last week. This week’s simulation shows that the most likely range for the 3-month U.S. Treasury bill yield in ten years is 1% to 2%. There is a 23.95% probability that the 3-mon...

Summary October’s greatest mover was the UK 10-year Gilt mid-yield, which ended the month 55 basis points lower at 3.52%, after closing at a 14-year high of 4.49% on October 10. The U.S. 10-year Treasury note ended October with a yield of 4.08%, a 27-basis point increase fr...

Summary Rising interest rates have dominated this year’s macroeconomic and market agenda. Rising rates push up the discount rate used to value stocks, which tends to push valuations down. There are some indications that market valuations are unlikely to fall much furthe...

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 duration or the Fed's tightening cycle may end up being longer than expected. Why the Fed's terminal rate has become a moving target. The big mistake for the Fed wouldn't be overshooting, it will be being premature in pivoting. Fed Chair Jerome Po...

Summary Flurry of activity among central banks in recent weeks: October interest-rate increases by the Bank of Canada and the European Central Bank; more recently, rate hikes by the Fed and the Bank of England. Fed Chair Jerome Powell made it apparent that the central bank still h...

Summary Markets initially responded positively to the FOMC’s 75-basis-point increase in the federal funds rate. The basic message that Powell delivered was that the committee was both committed and determined to bring inflation down. What Powell missed, and what many at...

Summary Europe cannot produce the same output without a significant increase in the cost of energy. When U.S. trade deficits are widening, more dollars are flowing abroad. A U.S. slowdown would likely cause the trade deficit to tighten further as consumers purchase fewer impor...

Summary The pain in bond-land is palpable. The IGSB ETF is now more oversold than either the 2008 or 2020 lows. The 10-year Treasury yield closed at 4.12% today, despite Powell’s rhetoric from last night. In this post from Tuesday night, the relative attra...