QUOTE(mikehwy @ May 12 2015, 12:48 AM)
just heard in US there is huge selloff in treasury. so higher yields due to lower market price. Good or Bad in near term. anyone?
the way i understand it, recovering commodity prices particularly oil takes the pressure off deflation fears.
hence investors dump bonds/fixed income to go elsewhere causing prices to fall and yields to spike.
but the money have not gone into stocks as per great rotation theory - bond prices go down, stock prices go up.
there is strong indication that a lot of that money has moved into european equities incl dax, emerging markets equities like china and risky debt in countries like nigeria, brazil, etc.
that is consistent with us markets not gaining so far this year with etf flows lowest in 16 months.
the pertinent question is do we expect the great rotation to arrive in us equities soon? in the middle of a rate hike scenario which looks increasing going to be delayed?
keep in mind that due to qe's and more qe's , there is a lot of cash around. with equities possibly at full or near full values against their income and a strengthening usd, the risks are real.
but, my bet...yes, keep buying us stocks!
these may be helpful:
http://www.bloomberg.com/news/videos/2015-...-t-happened-yethttp://www.cnbc.com/id/102658879This post has been edited by AVFAN: May 12 2015, 10:11 AM