Startups are increasingly shutting down
Rising rates, lower liquidity and reduced risk appetite are hurting funding. Difficult business conditions are eroding viability further. Source: Markets & Mayhem
Gold (in yellow) vs. VIX (in green). Is gold the new 'fear index'?
It has systemically decoupled from real rates for sure. Source: Bloomberg
The relative Nasdaq 100 bull does not care about no rates moving higher...
Source: TME, Goldman Sachs
Wondering why high interest rates hasn't hurt sp500 performance so far?
Just have a look at the chart below courtesy of Linas Beliūnas. The S&P 500 heavy weights are full of cash and have been benefiting from the higher yield paid on short-term deposits. E,g Apple is making $1 billion on their cash holdings doing absolutely nothing...
For the first time in the last 5 decades, rising interest rates have failed to cause Stock P/E multiples to contract
Source: Barchart
Big opportunities ahead for fixed income investors?
The past three years' pain in bonds could indeed be setting the stage for outsized gains ahead. To put the decline into perspective, long-term government bonds, with maturities greater than 20 years, have dropped 50% from their 2020 peak, a drawdown that is comparable to the 56% decline in stocks during the height of the Global Financial Crisis in 2008 Source: Edward Jones
9% of bonds are set to mature in the next 2 years → The highest level since the Financial Crisis
High interest rates will make refinancing more difficult Source: Game of Trades
US 10-year Yield pullback from last week peak
US 10-year Yield pullback sharply from last week peak. After the Non-Farm Payrolls report on Friday, the US 10-year Govt Yield came close to hitting 4.9%. As of today, that Yield is down below 4.6%.
