Salient to Investors: Foreign investors are adding Treasuries at the slowest pace since 2006 amid the worst rout in 4 years, and own less than 50 percent of Treasuries outstanding for the first time since March 2012. However, China boosted its stake in 2013 to the most on record – adding US bonds in 7
READ MORE... →Salient to Investors: Christine Lagarde at the IMF said a US court ruling against Argentina over its defaulted debt could have detrimental consequences for global financial stability, by bolstering the power of minority bondholders in future debt restructurings and hurt the IMF’s mandate to maintain financial stability in the world.
READ MORE... →Salient to Investors: Jeremy Siegel at Wharton said: The start of tapering in September is already baked into bond and stocks prices and won’t stop stocks rising to between Dow 16,000 and 17,000 by year-end and 17,000 or more in 2014 as long as earnings continue to beat expectations at
READ MORE... →Salient to Investors: Argutori writes: The financial markets are due for a correction. Volatility in the financial markets will spike before the end of 2013 because: Volatility can’t go much lower. Historically, when the VIX has dropped below 15 the S&P 500 tends to fall as well. Over the past
READ MORE... →Salient to Investors: Caroline Baum writes: For the past two months, the Fed has been doing everything in its power to depress long-term interest rates. The Fed seems to talk as if they can send rates tumbling again. They can’t. The problem is the underlying message, not communication. The US economy is gradually
READ MORE... →Salient to Investors: Priya Misra at BofA Merrill Lynch says the spread between 5-year/5-year breakeven inflation expectations and 5-year/5-year real rates is her favorite chart for determining when the market expects the Fed to QE. The chart shows interest rate markets are pricing in an additional $200-300 billion of bond purchases.
READ MORE... →Salient to Investors: Bill Gross at Pimco added to holdings of Treasuries to 38 percent of his fund and added holdings of mortgage securities to 36 percent in June. Gross cut non-US developed nations’ debt to 5 percent, while investment-grade credit holdings were unchanged at 6 percent. Read the full article at http://www.bloomberg.com/news/2013-07-15/gross-adds-to-holdings-of-treasuries-after-tips-losing-bet-1-.html
READ MORE... →Salient to Investors: Columbia Management Investment Advisers says the term premium on Treasuries reached 0.46 percent this month, versus the 0.40 percent average in the decade before the 2007 financial crisis minus 0.5 percent as recently as May. Bond bulls say the highest inflation-adjusted yields since March 2011, the slowest pace of increases
READ MORE... →Salient to Investors: Gary Shilling writes: The fog remains thick, so reducing long positions in Treasury bonds and Japanese stocks and cut yen shorts, euro shorts and dollar long positions. Maintaining long positions in US defensive stocks like utilities and health care. Increased short position in junk bonds and initiated
READ MORE... →Salient to Investors: George Kesarios at capital.gr writes: Stocks will repeat 1999 and rise to one big bubble as a result of the fixed income exodus, and even if the US economy does not perform, unemployment remains at 7%, and corporate profits stall. Equities might feel the pinch when yields stabilize or yields
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