- The longtime long-dated Treasury bulls remain so despite the 10-year's run to almost 3%.
- The team there notes last year's 2.7% increase in consumer spending came alongside just a 1.9% boost in disposable personal income. The availability of debt allowed for the rest of the spending increase. Drops in the savings rate have typically foreshadowed a slowdown in the economy, they say.
- But what about tax cuts? Hoisington's data says tax cuts financed by higher debt (as these are) may provide for individual winners and losers, but allow for no net aggregate boost to the economy.
- Then there's monetary policy. It's already been significantly tightened, and more of the same is on tap for 2018.
- Taking it all together, the team expects inflation and growth to subside, and with them, long-term interest rates.
- ETFs: TLT, TBT, TMV, TBF, EDV, TMF, TTT, ZROZ, VGLT, TLH, UBT, SPTL, DLBS, VUSTX, TYBS, DLBL
- Now read: Chart Of The Week: Inflation Surge
Original article