- Buying any interest-rate sensitive security with the threat of Federal Reserve interest rate hikes imminent is a contrarian play.
- Absent the $1.6 trillion reverse repo facility maintained by the Federal Reserve, short-term risk-free interest rates would likely be negative.
- The Russian invasion of Ukraine will probably temper the impulse of Federal Reserve officials to hike rates.
- There is a possibility that a sharp decline in gasoline prices could occur if renewable fuel requirements are suspended. That could reduce the Fed's preferred inflation measure.
- The risk inherent in MVRL is compensated for by the 18% yield.
For further details see:
MVRL And The mREITs Are Now A Contrarian Play