Market opened lower again with global yields sinking on more concerns with the fallout of Brexit. The 10-Year Treasury yield hit 1.33% this morning. That is an all-time low. The British Pound continues to slide to multi-decade lows at $1.27. Oil prices have been soft while Gold and the Dollar strengthen. Gold is reaching highs not seen since 2014. Investors seem to be losing confidence in monetary policy, believing that there is not much more that central banks can do. The Fed minutes will be released today for the June meeting. It will be scrutinized for signals. A rate hike seems completely off the table now, with the big question being an actual cut. That sure seems unlikely and drastic, but the trend has absolutely reversed. Negative interest rates have become reality overseas and risk many unintended consequences. Who in their right mind wants to pay someone to hold their money?!? What’s been lacking all these years is real fiscal policy. Congressional fighting in the US and divided leadership in Europe has resulted in very little accomplished from the legislative branches of government. The elections this year are capturing the citizen anger with government. The FBI will not indict Hillary Clinton, but did call her actions careless. Trump seized that opportunity. Both candidates have historically high unfavorable ratings. It’s a long way to November.
Have a great day.
Mike
