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Events have moved quickly since our update on February 22. It’s unclear whether this is the shock and awe phase of a limited incursion or the beginning of a full-scale invasion that seeks regime change in Kyiv. USD/RUB touched 90 overnight before fading back to the mid-80s ...
Investors who think they have no macro exposure quite often are just unaware of what macro risks they are running. One complaint I have seen multiple times that people were annoyed that macro analysts were opining on the topic, despite a lack of qualifications in international relatio...
Non-U.S. markets, including EM, DM, and Asia, are outperforming the U.S. markets after underperforming last year. After slightly underperforming growth last year, value is where the money is flowing. With the economy still in growth mode, cyclical stocks should do better than defe...
Geopolitical headlines will have helped, but front-end rates have more reasons to ease back from extremes. In the US, the Fed mulling MBS sales offers an alternate tightening avenue, and in the UK, the BoE's pushback against aggressive pricing should find a more prominent platform nex...
The stock market can get a little crazy sometimes - out of control. The bond market is more in tune with the economy and takes a longer-term approach. The action in the bond market is telling us that there is trouble on the horizon. Credit spreads have increased, and the high yiel...
Investors that hold bonds to maturity earn the yield at which they purchased the security, and at maturity, they get paid face value. The US government issues its own currency and can always pay for anything with the Fed’s newly created money. Fixed income investors have go...
The primary market has taken center stage after a brief hiatus over the holidays. We typically see January issuance skewed toward financial institutions; and, so far, this year has been no different. On the other hand, we’ve seen moderate outperformance in new issues from U...
Inflation and the pressure that it’s putting on central banks to normalize policy frame the outlook for 2022. Businesses have benefited as economies have re-opened after the first waves of the pandemic. Two sectors — consumer cyclical and integrated energy — h...
The flattening Treasury curve likely has more to do with the market's failure to recognize growing structural inflationary forces. Exceptionally high inflation has turned the U.S. Federal Reserve notably hawkish. Commodity prices continue to climb, with oil touching $90 per barrel...
For investors who want to earn a reasonable return without taking excessive risks, diversification still works, and we think you’re going to need more of it this year. The weighing of the high-flyers is not over. Commodities had another good week, and the 1-year return is getti...