The 10 year treasury yield is at 3.62% – off 18 basis points. Seems like a safety trade–with Credit Suisse common shares now trading at $3.96/share as investors are worried about an implosion you have to wonder what else is going on behind the scenes. Who else is in trouble? Whatever is happening it may be putting significant rate hikes at risk for the Fed–maybe they raise just 25 or 50 basis points in a month – maybe not at all. Who really knows?
I would expect a bear market rally in equities and that is what we are seeing–markets don’t go down in a straight line so no giant surprise.
It is a good time to rearrange the deck chairs in your portfolio–i.e. if you are overweight somewhere (and don’t want to be) may be a time to lighten up and redeploy into another security. I’m not talking about selling for the sake of selling–I’m talking about simply moving around a bit–there are certainly good, safe bargains to be had right now or in the next few days.