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60/40 Religion Questioned With US Bonds Set For Historic Third Annual Loss
Last month served as a reminder of the peril inherent in declaring the worst over for bonds.
With the European and Chinese economies teetering, US inflation decelerating, signs of softness in the previously bulletproof US labor market becoming more apparent and the Fed likely done raising rates, it's easy (and tempting) to make the bull case.
But with market participants still concerned about the read-through for long-end yields of a possible macro regime shift and fiscal largesse, it's risky
Interesting. In my case, the distribution yields from my equities portfolio, about 30% of the total, are lower than my fixed income distribution yields. Both are near 5.5%. Right now the unrealized losses from three years of the Fed are just perfectly covered by my unrealized equity gains. I’ve been thinking maybe fate has shined its face my way once again. I’ll be 80 next year so maybe it’s a good time to cash out with no net gains/losses and move everything to tax free munis. Nice returns and no taxes. Be a messy tax return but not a bad result.