Rotation Out of Bonds Might Be Coming

The probability that funds will flow into equities “at the possible expense of debt” is increasing, despite forecasts to the contrary. This according to Credit Suisse Group AG, reported in a recent Bloomberg article. Robert Griffiths, an equity strategist based in Credit Suisse’s London office, told Bloomberg, “The increase in total returns from stocks, if it continues over the next couple of quarters, raises the prospect of a tipping point in asset allocation in favor of equities.” According to Jefferies Group LLC (citing EPFR Global data), the first half of the year saw bond funds taking in $204 billion versus […]

Bulls and Bears Both Gaining Ground

The continued climb in global stocks this year is being accompanied by rallies in safe-haven assets such as gold and bonds, according to a recent Bloomberg article. “There are plenty of reasons being cautious is paying off,” the article says, such as “politics in Washington is fractured, tension on the Korean peninsula is rising and worries have revived about low U.S. inflation.” But these factors aren’t impeding gains for “equity bulls,” the article says, “who have driven up the value of stocks worldwide by more than $10 trillion in the past year.” According to Bloomberg, equity prices are reflecting “the […]

Bond Bull Market on Borrowed Time says Miller

The post-election drop in bond prices is pointing toward an end to the decades-old bull market in fixed income, says investor Bill Miller in a recent CNBC article. The founder, chairman and CIO of Baltimore-based LMM says that the money leaving bonds will likely be channeled into the stock market. “The over-investment in bonds is going to switch somewhere,” he says, adding, “I think a large part is going to go to equities like it did in 2013.” Miller views the surge in stocks precipitated by the Trump victory upset as “sensible” but argues that the equity bull market won’t […]