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Interest Rates Looking Higher

Well the 10 year treasury yield is up 3-4 basis points this morning after rising 8 basis points yesterday to be back knocking on the door of 4% (actually now at 3.98%). No real news driving rates back higher–just as there was no real news moving rates lower. Economic news has been relatively neutral–somewhat Goldilocks. Really we need further economic data to move rates lower – pricing in 6 interest rates cuts from the Fed is slightly silly at this point in time – this is from all the folks who had us in a recession by now. We need more real data!

This week we have the big number, economically speaking, on Friday with the employment report. I believe that Fed Chair Powell wanted to see unemployment increase–that was an important signal to him that higher interest rates were ‘doing the job’, but now I think he has accepted that it may not be necessary to see the unemployment rate increase, but certainly he would like to see job growth slow. While the big number is Friday, today we have the job openings and turnover report (JOLTS) which would help signal the future employment direction. It is forecast that there will be 8.8 million job openings versus 8.7 million last month–a better number in my mind would be 8.6 million, but who knows? We also have minutes from the Fed’s December meeting today at 1 p.m. (central) today–which could move markets–we’ll see.

Yesterday was a good day for our accounts as lots of dividends and interest payments hit over the weekend and yesterday–accounts are at new record highs. Honestly without the ‘help’ of dividend and interest payments I would expect to see some modest setbacks in account balances. Yesterday I did nothing – actually I was ‘locked out’ of my computer while visiting relatives in northern Minnesota–so irritating. I can do emails on my phone–that’s it. I had composed and scheduled the Tuesday Morning Kickoff before traveling, but once my laptop went dead I was ‘out of business’ since I failed to take my password book with me.

Equity futures are slightly soft this morning – moving in an inverse manner to interest rates-just like one might expect. It could be an interesting day (and week) in equities–do investors temper their thoughts on Fed interest rates cuts serving to push the 10 year treasury yield back over 4%? Markets have risen on the euphoria of cuts – does it tumble hard on reduced expectations?

18 thoughts on “Interest Rates Looking Higher”

  1. Hey Tim,
    You might want to look into a password manager for your laptop. It stores all your passwords and can autofill them for you – all in a very secure way (and no more carrying a book around).

    There are several really good ones out there. Very strong encryption, ability to sync across devices, etc. My-son-the-tech-CTO convinced me they were plenty secure and to try one a few years ago. I am never going back. I only have to remember one password to make it all work. Also, I can sync across my laptop and desktop.

    I keep a book as a backup, but it stays locked in my safe.

    I use Lastpass, but there are a lot of good ones out there like Bitwarden, Dashlane, Keeper, NordPass, and 1Password.

    NYTimes picked 1Password this year in their ratings.
    but most of the ones I listed are good enough.

    It will save you a lot of headaches.

    1. I’m using Roboform, and have for years……. I don’t do anything from my phone, but I believe they have an app for phones as well…. As Private mentioned, you only need one password and then Roboform does the rest…. The software knows when you’re on a site that requires one of your saved and randomly generated passwords and it fills in your ID and password for you.. The generated password can be up to 24 characters long and can include symbols, numbers and letters, both Capital letters and not capitalized. It also will generate a password without symbols if you have a site that will not allow them in the password….And of course it easily handles changing/editing your password and/or you ID with ease and you can go directly to the website via the links associated with the password that are kept for you in the software. As it is, I haven’t a clue what my actual password is on any site I use or have ever used.

    2. If you only need to use the password manager on one device (or even if you use it on more and not concerned about automatic sync), I recommend Sticky Password’s free product

      You can upgrade to their paid product to sync your passwords across multiple devices. But my concern with any of these products syncing passwords over multiple devices, that creates vulnerabilities as the data needs to go to the cloud (even if encrypted) to be shared. I realize the risk is low but the advantage of using a stand alone product is all your data is stored locally

      I did download a version of Sticky Password to my phone and just manually exported and imported my passwords to it. No it doesn’t update automatically but I only access limited sites on my phone – and I can always manually update again if need be

      I have used a number of password managers over the years and have found I like Sticky Password the best. I dislike Lastpass, did like Dashlane but then they made a host of changes that were not customer friendly / to my liking , never used 1Password but looked at it and was just MEH. Bitwarden did hit a lot of good marks except for the cloud factor

  2. I just keep buying. Been slowly adding on FGN as people sell into the bid and whatever else looks tasty. I have no grand plan except buy, reinvest, pay taxes out of pocket, and use the income some day. Times are good right now compared to the past income wise. Everyone is just itching for rates to go down but I do not mind them higher for longer I suppose. Reduce inflation sounds fine. The pay day of all this fixed income going up in value can wait for now.

  3. Tim, after having held steady for 6 months cost of the commodity I sell has crept up. Not enough yet to say market cost is moving up. We hired a new start, but business has been slow past month, so time for the plant to do maintenance. Corporate has several capitol improvements on the books but not scheduled until the 3rd qtr. I suspect if business was better the expenditures would be approved sooner.

  4. I frequently look at my money market rate at Fidelity…it is creeping up from 5.0 to 5.3 this morning…that does provide competition for alternative investments

    1. Craig,

      5.3? Which fund is that? Cash in my account there still gets 5 in cash and 5.11 in FZCXX.

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