Fixed income

The ECB relies on smoke and mirrors

In Europe, slow growth appears likely to continue, with some regional differentiation. Signs of strength in the south Spain is doing much better than it had been just 18 months ago, and even Italy looks somewhat healthy now that its … Continue reading »

Three reasons this credit cycle may be lasting

Today, more than four years into the recovery, capital market opportunities are shifting, with conditions in credit sectors such as high-yield corporate debt becoming a bit less attractive. However, the current cycle has different characteristics that suggest investors should not … Continue reading »

Rate volatility poses more risk than rising rates

While rising bond yields are consistent with a strengthening economic recovery, they also prompt the concern among businesses and investors that higher interest expenses could become a drag on continued expansion. Rising rates signal stronger economy We take a relatively … Continue reading »

Why wages might rise

Unemployment continues to drop, but not because a lot of new jobs are being created, as many would hope. Instead, the unemployment rate is dropping primarily due to a declining labor participation rate. This remains a cause for concern for … Continue reading »

Are muni bonds too tempting for the tax man?

Washington’s off-again, on-again debate about the tax exemption of municipal bonds appears to be off again as lawmakers grapple with budget and debt issues. Proposals to change the tax treatment of municipal bonds could resurface again during the congressional elections … Continue reading »

This housing trend can influence Fed’s tapering

One of the decision points that the Fed will encounter as it considers tapering its quantitative easing (QE) measures will be the relative strength of the housing market. One factor influencing this strength is mortgage rates. The interest rates on … Continue reading »

Warming economy may leave bond index cold

It appears likely that the U.S. economy will continue to improve, keeping interest rates elevated and volatile. The U.S. recovery, despite higher taxes, generally rising interest rates, and broad-based budget cuts enforced by the federal sequester, appeared to remain on … Continue reading »