Bond Market Wild Card

Michael Pento profile picture
Michael Pento
635 Followers
(9min)

Summary

  • Investors fully understand how willing the Fed is to reduce the cost of money at the slightest hint of trouble in the labor market and the economy.
  • Since the 10-year Treasury Note bond yield is already below 4%, there is not much room for the downside in rates at all – outside of a recession.
  • Even if we have a soft landing and inflation gracefully retreats to the Fed’s target, nominal GDP growth should be around 4%, which is historically where long-term rates tend to trade.

Bond word in wooden blocks with coins on floor. Investment bond, Bond increasing, Raising funds and financial and banking concept.

Wipada Wipawin

So, the Fed has pivoted once again. Jerome Powell has done so many twists that Chubby Checker would be envious. Or better said, the Fed has panicked and now realized it is again offside on its inflation target. Hence, Powell feels compelled to

This article was written by

Michael Pento profile picture
635 Followers
Michael Pento is the president and founder of Pento Portfolio Strategies (PPS). PPS is a registered investment advisory firm that provides money management services and research for individual and institutional clients. Michael is a well-established specialist in markets and economics and a regular guest on CNBC, CNN, Bloomberg, FOX, and many other international media outlets. In addition to his recently published book The Coming Bond Market Collapse, his market analysis can also be read in most major financial publications, including the Wall Street Journal. He also acts as a financial columnist for Forbes, Contributor to thestreet.com, and is a blogger at the Huffington Post. Prior to starting PPS, Michael served as a senior economist and vice president of the managed products division of Euro Pacific Capital. There, he also led an external sales division that marketed their managed products to outside broker-dealers and registered investment advisers. Additionally, Michael has worked at an investment advisory firm, where he helped create exchange-traded funds and unit investment trusts that were sold throughout Wall Street. Earlier in his career, he spent two years on the floor of the New York Stock Exchange. He has carried series 7, 63, 65, 55, and life and health insurance licenses. Michael Pento graduated from Rowan University in 1991. ================ Michael Pento is the president and founder of Pento Portfolio Strategies (PPS). PPS is a registered investment advisory firm that provides money management services and research for individual and institutional clients. Michael is a well-established specialist in markets and economics and a regular guest on CNBC, CNN, Bloomberg, FOX, and many other international media outlets. In addition to his recently published book The Coming Bond Market Collapse, his market analysis can also be read in most major financial publications, including the Wall Street Journal. He also acts as a financial columnist for Forbes, Contributor to thestreet.com, and is a blogger at the Huffington Post. Prior to starting PPS, Michael served as a senior economist and vice president of the managed products division of Euro Pacific Capital. There, he also led an external sales division that marketed their managed products to outside broker-dealers and registered investment advisers. Additionally, Michael has worked at an investment advisory firm, where he helped create exchange-traded funds and unit investment trusts that were sold throughout Wall Street. Earlier in his career, he spent two years on the floor of the New York Stock Exchange. He has carried series 7, 63, 65, 55, and life and health insurance licenses. Michael Pento graduated from Rowan University in 1991.

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