The upside of the rising rate environment is the rising savings account and GIC rates. Throw in greater yields on shorter term bond funds as well. We can even go one step further; the rising rates for ‘risk-free’ cash also leads to bigger dividends. The big dividend payers, often call bond proxies, compete with the […]
Oil and cash float portfolios as bonds sink on the Sunday Reads.
The backdrop for financial markets over the last few months has been a near 30% surge in oil prices, higher rates for bonds offering a challenge for stocks and bonds. Of course the traditional balanced portfolio has weakened as well. But as I offered in mid September, long periods of market declines and treading water […]
The recession watch and more bank earnings on the Sunday Reads.
The past week offered more Canadian bank earnings. As expected we saw more softness, but the banks are hanging in there. I’ve updated last week’s Sunday Reads to include the recent earnings reports. And the big news of the week might have been the unexpected second quarter of negative growth for the Canadian economy. Is […]
Why retirees own bonds, cash and GICs.
Imagine retiring, and then you have to head back to work, or you cancel your planned trips and greatly curtail your lifestyle. That’s what happened to too many who retired at or near the recesssions created by the dot com crash and the financial crisis. Risk in retirement is perhaps the flipside of risk in […]
The balanced portfolio journey on The Sunday Reads.
The balanced portfolio had a terrible 2022. In fact, it was just about the worst ever. Stocks were down and bonds had a rough ride delivering negative returns thanks to the rising yield environment. As rates go up, bond prices go down. Inflation was the culprit. Central bankers created a rising rate environment to cool […]
U.S. banks are breaking on the Sunday Reads.
On Friday, due to a sudden increase in deposit outflows and a failed attempt to raise equity, Silicon Valley Bank was shut down by US regulators. It’s called a bank run. Depositors literally “run” to the bank to take out their money. It might be a little faster these days in the digital age. How […]