News — investors

Investors Hoping for Bad News to Get Good Interest Rates are Making a Mistake

Posted by Metals Corporate on

By John McDonald As the U.S. economy continues to post lackluster metrics like relatively low jobs reports, investors and markets continue to cheer these reports. Why? Because the concept that “bad news is now good news” because weaker economic indicators might force the Federal Reserve to lower interest rates has fully seized the market mentality. However, not everyone is on board. “The expectation that easing central bank policy can offset weaker data is at odds with both a broad swath of historical data and basic monetary theory,” writes Andrew Sheets, global strategist at Morgan Stanley. Sheets began his arguments against...

Read more →

Chinese Sale of U.S. Treasury Bonds Indicates Commitment to Trade Conflict

Posted by Metals Corporate on

By John McDonald China has been selling off U.S. Treasury bonds for several years now, causing a vague unease among many U.S. investors. With a trade conflict between the two countries well under way, China’s reduction of its bonds by about 4 percent in 2018 and its ongoing sale of the bonds in 2019 has many “talking heads” talking about a trade-war “nuclear option” for China: dumping its U.S. Treasury debts. “This is really the biggest weapon they have,” said Loyola Marymount economics professor Sung Won Sohn in a recent interview on CNBC. “If push comes to shove, that is what...

Read more →