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What history tells us about bond-rate scares like this

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  1. MonkeyPants
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    It's interesting to note, the scare is specific to the stock market, not the overall economy. Widening yields are expected to be a net positive for the economy. Also, of course, USA appears to be...

    It's interesting to note, the scare is specific to the stock market, not the overall economy.

    Widening yields are expected to be a net positive for the economy.

    Also, of course, USA appears to be on track to reopen in 6-12 months, and after the last pandemic in 1918 we had the roaring 20's.

    But we may be back into a bizzaro world where good economic news is bad stock market news. Earnings are down. Stocks are up. It's because the Fed has been buying up assets like treasuries driving down rates.

    When the economy kicks off, the USA Fed may be forced to sell assets/ raise rates to head off the threat inflation, which will force all other countries to follow suit. The economy might thrive while the stock market wobbles and slides.

    2 votes