A majority of stocks (59%) underperform Treasury bills over their lifetime and more than half end up having a negative cumulative return.
“Don’t look for the needle in the haystack. Just buy the haystack.” - Jack Bogle Source: Charlie Bilello, Peter Malouk
Fixed income: Credit is still the place to be
Spreads are as tight as they've been this entire bull market: Source: J-C Parets
The ECB shields high debt countries from bond market crises via the combined effect of past interventions and its TPI anti-fragmentation tool.
Underlying assumption is that high debt countries will do what it takes to bring down debt without crises. That assumption is wrong... - Robin Brooks on X
⚠️US money market fund assets jumped to a record of $8.2 TRILLION.
This comes as people expect the Fed to pause rate hikes for a few months. We have to remember, this is not money on the sidelines. Moreover, most of this cash has never been in and never will go to stocks. Last but not least, while the ABSOLUTE number is at record high, the RELATIVE number (cash as a percentage of total assets) is near record low. Source: Global Markets Investor, Goldman Sachs
Will we see a short-covering rally in bonds?
In case you missed it: - $TLT short interest is near RECORD highs, while... - TLT has seen massive outflows Bond market shorts are about to get squeezed. A rally in bonds could be bullish for stocks. Source: Subu Trade
Real yields on 30-year US treasury bonds are now at 2008 levels.
It seems that bond markets are worried about much more than just inflation... Source: Adam Kobeissi, Bloomberg
A good chart from GS that shows how sectors & factors may react to change in 10Y bond yields.
Source: Ayesha Tariq, CFA, Goldman Sachs
"....the selloff in US bonds is driving yields higher everywhere, including in economies where the growth outlook hasn’t improved.
Of course, this second point isn't hard to explain. US Treasuries act a generic riskfree asset for the global financial system. When US yields move higher, it creates pressure on bonds everywhere." - TS Lombard, Perkins thru The Market Ear
