Special Report: Fixed income investing is facing a crisis–COMPLETE–3 tactics and 7 picks so you can fix your income investing crisis–Part 1, The Tactical Framework, Part 2, The 3 buckets and 7 picks
The big arguments in the financial markets these days are about inflation–will it stay elevated at an annual rate of the better than 5% reported in May and June or will be fall to the 2.5% or so envisioned by the Federal Reserve–and interest rates–the yield on the 10-year Treasury fell to 1.21% on Monday, July 19 and some market strategists see 1% in the cards while others are looking for a 2.5% or even 4% at the peak of this cycle. I certainly won’t pretend the results of these arguments don’t matter. Inflation sentiment and interest rate projections are the two biggest drivers of stock and bond prices right now. (Well, maybe in the short term next to worries that a fourth wave in the pandemic will shut down the U.S. and global economies again.) But these arguments matter rather less than you might think to investors saving for retirement and those looking to generate some income from their portfolio either to fund retirement or some other predictable big ticket item (like monthly mortgage payments on a first or second (don’t I wish) home.) That’s because from that perspective the results of these arguments don’t change the portfolio cash flow picture very much
