The US 10-year Treasury yield continued rising on Thursday (Apr. 7), reaching 2.66% — the highest in over three years. The ongoing upside momentum suggests that the benchmark rate will continue to run higher. But as today’s update of CapitalSpectator.com’s fair-value model suggests, there may be limits to how far and how fast this crucial rate can rise.
Author Archives: James Picerno
Macro Briefing: 8 April 2022
* How will Jackson’s ascent to Supreme Court impact the country?
* UN suspends Russia from the organization’s human rights body
* US consumer debt ramped up in February
* Rising mortgage rates may be starting to push house prices lower
* China lockdowns for spreading Covid-19 lead to more supply-chain disruptions
* Global food prices reach new high, soaring at fastest monthly rate in 14 years
* US jobless claims fell to 166,000 last week–lowest since 1968
* 10yr Treasury yield continues rising, reaching 2.66%–highest in over 3 years:
Exploring Alternatives To The US 60/40 Benchmark: Part IV
In a series of articles I’ve looked at alternatives to the standard 60/40 stock/bond benchmark using mostly US securities (see links below). Let’s add another flavor to the analysis using a portfolio of China stocks and bonds.
Macro Briefing: 7 April 2022
* Ukraine asks NATO for more weapons as Russia regroups for new attacks
* Treasury Sec. warns of ‘enormous’ economic repercussions from war in Ukraine
* China warns US against House Speaker Pelosi visiting Taiwan
* Fed officials decide to shrink balance sheet soon, minutes indicate
* Fed funds futures pricing in relatively high odds of 50-basis-point rate hikes
* Big oil bosses say there’s no quick fix to oil shortage
* Senate expected to confirm Jackson to Supreme Court today
* Russia appears to default on its debt after payments made in roubles
* Global economic activity slowed in March via Composite PMI, a GDP proxy:
S&P 500 Risk Profile: 6 April 2022
The US stock market remains on the defensive, but it’s not yet obvious that the threat of an extended downside run is imminent. Nonetheless, there’s a case for a cautious stance. The main risk factor, of course, is the ongoing war in Ukraine and the uncertainty that it poses to markets and the global economy. Elevated inflation and an increasingly hawkish Federal Reserve add to the potential for trouble.
Macro Briefing: 6 April 2022
* Russian military pounds Ukrainian cities as the West prepares more sanctions
* Treasury Sec. Yellen set to warn of economic blowback from Ukraine war
* Can Germany end its dependency on Russian gas? It’ll try, but it won’t be easy
* Fed’s Brainard says central bank may soon begin ‘rapid’ balance-sheet reduction
* 30-year fixed mortgage above 5% for first time since 2011
* China services sector activity fell at sharp pace in March, PMI survey shows
* US Q1 GDP growth nowcast remains weak via Atlanta Fed’s GDPNow model
* US services sector growth picked up in March via ISM Services Index:
Will The Strong Jobs Market Keep US Out Of Recession?
Recession forecasts are topical lately, driven by the recent inversion of the Treasury yield curve for 2- and 10-year rates. But some economists see a strong labor market as a key factor that will keep the expansion alive.
Macro Briefing: 5 April 2022
* US stops Russian government from paying holders of its sovereign deb
* Ukraine war boosts shift to renewable energy as fossil fuel demand rises
* Recession forecasts are on the rise, but the economy is strong
* US jobs market is tightest since World War II, estimates Goldman Sachs
* China’s struggle with surging Covid-19 cases focuses on Shanghai
* Eurozone growth was strong in March as inflation surged
* US factory orders fell in February–first monthly loss since April 2021:
Risk Premia Forecasts: Major Asset Classes | 4 April 2022
The expected risk premium for the Global Market Index ticked slightly higher in March to an annualized 5.8% pace, fractionally above last month’s estimate.
Macro Briefing: 4 April 2022
* Reports of war crimes by Russia emerge in Ukraine war
* JPMorgan CEO says inflation, Ukraine war ‘dramatically increase risks’ for US
* Why is US population growth rapidly slowing?
* Global mfg growth slows to 18-month low in March via PMI survey data
* Fed funds futures pricing in high probability of 50-basis-point rate hike in May
* US payrolls continue to rise at strong pace in March
* US 2yr/10yr Treasury yield curve turns negative for first time since 2019:
