Using the US Downgrade to Upgrade Your Portfolio
In this week’s market update, we talk about the implications of the U.S. credit downgrade on the bond and stock markets and how we think investors can use that event to upgrade their own portfolios. We are also going to review the collapse in U.S. oil inventories, the continued drawdown of copper supplies, and how commodity price levels drive inflation expectations and interest rates. If long-term interest rates go to 5%, what are the assets we think will benefit? Watch to find out!
Key Takeaways
- The lid has come off Japanese rates, sending a ripple throughout the global bond market
- As interest rates move toward 5%, we think energy and metals benefit
- Energy and metals have started to break out in absolute and relative price terms
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