The good news: -we’ve experienced some healthy stock market gains. Interest rates took a dive based upon a consensus that rate hikes may be sidelined for the next several months. Also, due to the Israel/Hamas war, a flight to quality increased demand for U.S. short-term debt, pushing down rates. We had two days-in-a-row with significant decreases in interest rate yields, -very positive for stocks as reflected in stock performance of late.
Then, yesterday, and today, our U.S. Treasury experienced very sluggish auction results for our 30-Yr Treasury notes. Seems that, buyers ain’t buying what our government is selling. Because of perceived higher risk (and there is higher risk), the market is demanding more yield for our U.S. debt. The notion has traditionally been that our treasury can sell all the debt required to fund our deficits. Without the Fed saying a word or raising rates, rates are raising themselves.