What Have the Bond Markets Been Up To?

First of all, I hope this finds you well. We say that a lot, but it has such a deeper, intense meaning today, doesn’t it? In any case, I truly hope you and your families are safe.

As for our family, we’re doing just fine. I actually think our middle child, Lexi (6), is going to go back to school far ahead of where she was when they dismissed! She’s been cranking through the math workbooks that Mom got her.

I’ve got so many things I want to talk about that I think are important right now. Don’t worry, I’m only going to focus on one topic here, but it was a struggle to figure out what I wanted to address tonight.

Ultimately, I’ve decided to talk about the bond markets as the stocks markets have, understandably, been getting all the attention. Other topics you can expect in coming days and weeks are: precious metals and gold miners, big picture overview, coronavirus metrics you may not have seen yet, deflation vs. inflation, my market timing strategies’ performance results through this historic decline (preview: they have fared very well). Continue reading “What Have the Bond Markets Been Up To?”

NOW It’s An Official Bear Market. Some Thoughts…

It’s official, the U.S. stock market has been in a bear market since it’s all-time closing high on February 19, 2020. Yesterday, the U.S. market had it’s worst day since Black Monday 1987 (market lost over 22% in a single day).

  • This is the fastest retreat to a bear market from an all-time high in history taking just 16 trading days.
  • This ends the bull market that began with the cycle low on March 9, 2009 for an eleven year run and 400% price appreciation. That run makes it both the longest and strongest bull market on record!
  • The S&P 500 is down about 27% from its 2/19/2020 all-time high as of yesterday’s close, which is a level first seen on August 7, 2017 essentially wiping out 2.5 years of appreciation.
  • The market would have to climb over 36% from yesterday’s close to get back to the all-time highs.
  • For contrast, the foreign stock market (MSCI All Cap World Index) has been in a bear market since January 26, 2018 and is only up about 60% from the March 9th, 2009 lows.

Yesterday, sentiment hit EXTREMELY low levels with CNN’s Fear Greed Index at a record low of just 1.

Continue reading “NOW It’s An Official Bear Market. Some Thoughts…”

There’s Always A Bull Market Somewhere

An old saying is “there is always a bull market somewhere.” This year is no exception.

For the year, through yesterday’s close, we’ve witnessed long-term, “boring” Treasury bonds gain almost 24% and gold make over 9% while the global stock market has lost over 13%! All this in just about two months!

Even when things aren’t going well in stocks, it seems there is usually an asset somewhere at least holding up if not delivering positive returns. Continue reading “There’s Always A Bull Market Somewhere”

Fed Enacts Emergency Rate Cut. New Record Lows on Treasuries

This morning at about 9 AM central, in response to the Coronavirus, the Federal Reserve announced an emergency 0.50% rate cut.

The initial response by the market was to send stocks and gold soaring. As the day wore on U.S. stocks crumbled losing about 3.5% at one point and ending the day down 2.8% while gold hung on for a 3%+ gain.

The 10-year Treasury yield continued to slide throughout the day (sending bond prices up) and even got below 1% for the first time ever! Think about that…in the almost-250 years of this great Republic we’ve just set a record low on bond yields. Continue reading “Fed Enacts Emergency Rate Cut. New Record Lows on Treasuries”