It’s Always Something

Seems like each day it is something new that riles the markets–tariffs on steel and aluminum today.

There was a time I would watch a 500 point DJIA closely–no more.  There is no real reason to watch indexes that track common stocks–I own virtually none so what is the point.

I do check the knock off affects such as interest rates and I see that the 10 year is trading at 2.83-2.84% and that is what I care about now.

Of course I do have a number of worries, but they relate to the balance sheet runoff coupled with the need for new money to cover the budget deficit—almost $100 billion/month.

In spite of falling rates today this will end badly–I don’t know when, but I would assume in the next 12 months as the treasury starts to tap the debt market really hard–that is where the rubber will meet the road.  BUT as always one can’t bury their money in the backyard–the rates of return are worse than CD’s.

2 thoughts on “It’s Always Something”

  1. The bond market is acting odd…Libor is now over 2% and nearing only a 75 bps spread between it and 10 year. Actually bought modest amounts of QDI perpetuals today instead of something term dated or adjustable.

  2. I think it is ‘ ‘a rush to safety’–coming out of stocks and moving to bonds–I think it is a move that won’t last as the trade issue may be making something out of nothing.

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