Flirting With Portfolio Heresy

In January's monthly letter, I noted that rates strategists are on board with the notion that bond yields in developed economies, and particularly US Treasury yields, might've reset durably higher last year and could drift up in 2023, especially relative to local lows. What most market observers and participants aren't fully on board with, though, are grandiose tales of new world orders, characterized by stochastic inflation, rolling bouts of explosive rates volatility and the generalized demis

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4 thoughts on “Flirting With Portfolio Heresy

  1. Base case. Economy slows down. Yields fall especially in the front end once Fed decides to abadon fight against already receding inflation. Late cyclicals decline kick it off after tech decline and the economy has difficulty bouncing back quickly as the slowdown will be brutal in some sectors and create a rolling slowdown, but overall a grind lower on average. Labor market loosens as the labor force grows faster than employment growth (none). Two year process. House GOP stuffs any fiscal stimmy to try to kill Biden re-election chances.

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