1st Quarter 2011 Municipal Bond Highlights • Short maturity yields are low • Long end yields have corrected • Yield curve is historically steep • Credit spreads are attractive Municipal bonds suffered a decline in price after an apocalyptic prognostication from layman during the 4th quarter of 2010. Suggestions that the municipal market faced defaults […]
Fixed Income Market Recap Given the ongoing positive fundamentals evident throughout the first quarter, we continue to believe that bond market valuations are out of equilibrium given this stage of the economic cycle, and we continue to position the portfolio accordingly. While we expected that the Federal Reserve would have been more proactive in normalizing […]
Fixed Income Market Recap From a point to point perspective, February appeared to be a rather calm month in the bond market. Yield-to-maturity of the 10-year Treasury Note ended the month 5 basis points higher than where it started and the yield curve was essentially unchanged. However, the intra-month volatility was anything but calm. In […]
Fixed Income Market Recap and Performance Summary Following the sharp selloff in Treasury bond prices witnessed in November and December, price action in January was relatively sanguine. Looking beyond headline performance, the most notable price action for the month was the (3.5%) loss in 30-year Treasury bonds, and the 2.10% gain in the Merrill Lynch […]
Investors continued their exit from municipal bond funds throughout December and the first two weeks of January. Concurrent with heightened credit fears in the Municipal market, higher long term US Treasury rates, and an expected supply shift from long term taxable municipal bond issuance to long term tax exempt issuance led to indiscriminate selling among […]
Fixed Income Market Recap Despite ongoing open-market Government bond purchases by the Federal Reserve, investment grade bond prices declined in December. The most intense selling pressure occurring in the first half of the month, as the market continued to be buffeted by the selling pressure that commenced in November. The principal driver was a much […]
Fixed Income Market Recap November could be characterized as a month in which old news, thought to be resolved and impotent, reemerged to the detriment of the capital markets. With attention focused on the Federal Reserve and its well broadcast plan to reduce rates through a second round of quantitative easing (QE2), investors had positioned […]
Fixed Income Market Recap Dominating attention through the month was the Federal Reserve with the Fed and Wall Street trading-desks attempting to out-game each other. Clearly, the Fed has not handled the idea and implementation of QE2 very well. When the concept was first floated, interest rates fell as the Fed had certainly hoped. Then, […]