3 min readIntroduction Market volatility has been elevated following the White House’s tariff announcement on April 2nd. While the source of this heightened volatility is unique from past periods, it may still be prudent to look to the past for evidence of how to operate in the current environment. For cash investors, we posit some principles that…
3 min readMarkets Stabilize Following Tariff Announcements It has been a historic month for global markets due to the Trump administration’s on-again/off-again tariff announcements. Despite the recent volatility, we are seeing signs that markets may be stabilizing: Source: Bloomberg Volatility Leads to Dip Buying Although money market fund assets have increased to over $7 trillion, there was…
3 min readQ1 2025: The Trump Trade Unwound on Tariff Concerns First quarter market activity was driven by tariff headlines along with increased fears of inflation and slowing growth. These concerns fueled a significant drop in consumer sentiment, which led Treasury yields to rally and U.S. equities to decline (see charts below). The first three months of…
3 min readTariffs & Government Spending Cuts Stoke Stagflation Fears Concern is increasing that global trade tensions along with government spending cuts could lead to slower growth and higher prices if tariffs remain in place. Many economists have recently lowered US growth outlooks. Even commentary from President Trump and Treasury Secretary Bessent signal some pain ahead: Trump…
4 min readYields Declined on Negative Consumer Outlook Treasury yields declined significantly towards the end of February after two consumer survey reports came in much lower than expected. The drops were most significant in the long end, with the 10-year yield declining 33 basis points, while the 2-year yield fell below 4% for the first time since…
6 min readAs President Trump’s administration kicks off its second term, one of its most contentious executive orders—the mass deportation of undocumented immigrants—is already stirring debate. The policy is primarily aimed at widening enforcement of immigration laws, which could have a seismic impact on U.S. macroeconomic conditions. In this blog, we will dissect how the deportation policy…
4 min readMixed Data Keeping the Fed on Hold Fed Chair Powell recently said he wants “to see inflation behaving in a way that builds confidence that we are really making progress.” Unfortunately, the January Consumer Price Index (CPI) did not build any confidence that inflation is decelerating, coming in much higher than expectations. Overall, data releases…
4 min readDespite a Wild January, Treasury Yields Ended Little Changed This past January will be one that many of us will never forget. The month started with massive wildfires in Southern California, the inauguration of President Trump, DeepSeek’s disruption of the technology sector, and the first U.S. commercial airline crash since 2009. At month-end, the markets’…
19 min readIntroduction By Lance Pan, CFA 2024 was a remarkable year for financial markets in many respects. The estimated 2.7% growth in real gross domestic product (GDP) nearly doubled the Federal Reserve’s median projection of 1.4% a year earlier.[1] The S&P 500 stock index rose 23.3% on the heels of an equally impressive gain of 24.2%…
3 min readGovernment Bond Yields Rise Globally The rise in U.S. treasury yields has continued into the new year, primarily driven by 3 factors: A string of solid U.S. releases has continued, with both the ISM Manufacturing & Services reports coming in better than expected, the December nonfarm payrolls beating expectations by nearly 100,000, and the unemployment…