In the last week we have seen major moves in the stock market (which most people notice) and, subsequently, the bond market (which most people don’t). Most of these moves are due to concern over how the virus outbreak in China will affect the world economy. Why, you may wonder, would a virus affect the economy? The virus itself...Read More

This is the way the expansion ends, “not with a bang but a whimper.”[1] Though T.S. Eliot’s oft-quoted poem isn’t actually about our economic expansion, its final line does ring true in this case.  As we mentioned in our last letter, this interest rate cycle has been a wimp itself, so it is no surprise we...Read More

In the large, friendly letters of Douglas Adams’ The Hitchhiker’s Guide to the Galaxy, DON’T PANIC.  We are well aware of the dip in bond market values that is reflected in portfolios.  Bond prices move in the opposite direction of yield, so as interest rates rise, the value of existing bonds decreases.  What doesn’t change,...Read More