As we get ready to close out 2025, one stand-out trend in the U.S. Treasury (UST) market has been the steepening of the yield curve. The question now is whether this trend will continue into 2026, and if it does, how should investors position their bond portfolios?
We guess if you say something enough, a lot of people will start to believe it. The current refrain is that the labor market is cold, weak, struggling. A Google search for “labor market” is eye opening. The first five headlines use the words ‘weakened,’ ‘troubling,’ ‘risky,’ ‘slowing,’ and ‘warning signs.’
The market’s big “aha” moment last week was a CPI print that came in meaningfully cooler than expected, followed immediately by the usual chorus that it must be “distorted.”
While only two official dissenters opposed the December rate cut, dot-plot projections reveal that six Fed members, including four “silent dissenters,” were against easing, signaling deeper division within the Fed than headlines suggest.
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The Federal Reserve delivered a "dovish version of the hawkish cut," confirmed by the market's rally, new equity highs, and subtle shifts in leadership. The surprising effective end of Quantitative Tightening and a softening inflation framework underscore a clear turn toward accommodation and ample market liquidity.
Despite the concern post-2024 election about rising U.S. deficits and a potential return of "bond vigilantes," the supply side of the Treasury market has remained stable, with deficits settling near the $1.8 trillion baseline.
With a third consecutive rate cut bringing the Fed Funds range to 3.50%–3.75%, the Fed may pause for now as it reassesses the effectiveness of its “risk management” approach amid mixed economic signals.
The first full week of the holiday shopping season confirmed what I was looking for: consumers are still spending, and they are not being spooked by tariffs or headlines. Black Friday sales were solid, and the weekend into Cyber Monday largely matched expectations.
The field of quantum computing has shifted its focus from the short-lived concept of "quantum supremacy" to a more measurable goal: quantum advantage, which emphasizes reproducible, domain-specific results that verifiably outperform classical systems.
After a difficult 12 months, India's equity story is quietly regaining its rhythm. Valuations that once looked stretched have compressed to more defensible levels, policy continuity after the 2024 election has reassured markets and the long-term growth engine, powered by demographics, digital infrastructure and industrial reshoring, remains intact.
The recent Thanksgiving week provided a crucial snapshot of the changing economy, highlighted by a shift in holiday shopping to early online sales and a significant drop in the 10-year Treasury yield below 4%.
This article questions if the high valuation multiples are justified, arguing that investors will soon need to see actual cash flow results from this massive CapEx bonanza.This aggressive spending has caused their collective free cash flow growth to turn negative, raising concerns since stock valuation is based on future free cash flow.
Markets traded with an unusual mix of strong micro data and fragile macro sentiment last week and nowhere was that clearer than the reaction to Nvidia’s excellent earnings. The fundamentals showed strong demand, a robust product cycle, and clean forward guidance—yet the stock slumped after an early surge.
With the federal government shutdown now over, until the end of January at a minimum, the money and bond markets have turned their attention back to the Fed. Specifically, the conjecture is centered on whether another rate cut will be forthcoming at the December 10 FOMC meeting.
Markets wobbled as Washington’s shutdown drama ended, but I don’t view last week’s pullback as the start of a bear market. The Dow just printed fresh highs, breadth rotated toward quality and defensive stocks, and the weakness centered on AI-linked capex stories repricing risks associated with the capex buildouts.
The Fed can turn QE back on like they did in the latter part of 2019, most likely by buying T-bills. It is important to note that this would be purely a technical mechanism for the funding markets and not a dual mandate monetary policy consideration.
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Markets are balancing this risk against the belief that the impasse will resolve soon, with short‐term “betting markets” still implying only a modest probability of prolonged gridlock ahead of the Thanksgiving travel week.
The age-old question in fixed income is when should I go long duration? Over the last two years, this has been an ongoing query for investors. More recently, with the Federal Reserve resuming rate cuts, it has come back on the front burner for sure.
There is (another) framework for a deal with China. That is a positive for risk markets. There is increasing evidence of waning tariff effects on company earnings and outlooks. That is a positive for risk markets. The interaction of the two is by far the most intriguing.
The Halloween week Fed meeting was more trick than treat for bonds with only a mild and temporary scare for stocks. As soon as Chair Powell signaled the next cut is “not a foregone conclusion – far from it!,” the Dow swooned before recovering about half the drop, while the 10-year drifted higher.
The Federal Reserve’s October rate cut, to 3.75%–4%, signals a continued “risk management” approach, with December’s policy path tilting toward another cut.
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Part of the reason behind Japanese stocks’ discount to the U.S. is the profitability gap; the U.S. has a Return on Equity (ROE) of 18.3%, while Japan’s broad market has yet to break above 10% on that measure (though some forecasters believe Japan will get its act together).
Energy and commodities are not flashing red. Oil ticked up from depressed levels amid new sanctions on certain Russian producers, but on a multi-month basis crude is still lower, and the broader Bloomberg-style commodity basket has been roughly flat over six to nine months.
Up to now, the Federal Reserve and the bond market have been operating under the assumption that the employment setting has been cooling in a somewhat visible fashion. In fact, recent comments from Powell & Co. underscore how the employment aspect of their dual mandate is where the greater risk may lie.
The most useful conversations about crypto don't start with block times or cryptography; they start with the monetary system. When money supply compounds and confidence in policy waxes and wanes, investors may reach for hard assets—tangible, scarce resources with intrinsic use value whose supply is difficult or costly to expand.
The 10-year Treasury briefly tested 4% and slipped just below, exactly what you’d expect when credit jitters boost demand for safe collateral. Real yields eased as well, consistent with a modest risk-off bid. Treasuries remain the cleanest hedge when credit fears pop, and that relationship asserted itself again last week.
There is little question that the key economic storyline of Q3 was the fact that new job creation was not anywhere near as solid as the markets and, perhaps more importantly, the Fed believed.
As the calendar has now turned squarely into Q4, the sweepstakes for who will be nominated as next Chair of the Federal Reserve will no doubt increase.
The financial markets have been laser-focused on upcoming policy decisions from the Fed, and rightfully so. Following the resumption of the current rate cut cycle, investors have been wondering what exactly this second phase will ultimately look like.
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Trump’s threat to impose 100% tariffs roiled markets Friday, and clearly, if implemented, would send stocks much lower. But this may also be the last salvo before a final deal is worked out.
NVIDIA’s $100 billion partnership with OpenAI signals a paradigm shift, as demand for AI compute infrastructure surges beyond even the boldest forecasts.
With official economic data on pause during the government shutdown, investors are left with limited visibility. Kevin Flanagan explains how markets are leaning on private sources and Fed signals to fill the gap.
Markets digested a quiet jobs Friday without the official payrolls report, but the signal from the other indicators was clear enough: the labor market is slowing at the margin but not falling off a cliff.
Market sentiment has come a long way since the Tariff Tantrum. Earlier this year, the VIX volatility index shot up into the 60s, a fear level previously seen in such episodes as the October 1987 crash and during 2008’s rolling bank insolvencies.
Inflation gave markets exactly what they wanted last week—no surprises.
In 2025, the U.S. dollar's image of unassailable strength is being rigorously questioned. The U.S. government budget deficit remains stubbornly elevated, hovering just north of 6% of gross domestic product (GDP), and the debt-to-GDP ratio is tracking beyond 100%.
Stocks and bonds staged a roller coaster on Fed day but finished essentially where they began—an apt metaphor for a market digesting a quarter-point cut, a split dot-plot, and a Chair intent on starting an easing cycle without declaring victory.
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Although the Fed does focus on its dual mandate of employment and inflation, there is no question that the primary focus right now is on the employment side of the equation, especially given the recent stalling out in new job creation.
One question we’ve been fielding quite a bit of late is what do you think the Treasury (UST) yield curve will do?
Last week’s data sharpened the focus on the pivotal Fed meeting this week. I expect a 25-basis point cut, with real potential for dissents on both sides. Markets are actively gaming out a larger move, but the bar for 50 is still high and would likely require a notably weak retail sales print.
In a recent LinkedIn newsletter, we highlighted how mid-caps have historically delivered a compelling mix of growth and resilience, the "sweet spot" between innovation and maturity.
It’s no understatement to say this could have been the most anticipated jobs report in quite some time.
This summer has been a big one for digital assets in the U.S., with major policy steps moving forward in Washington. The White House has been clear that the goal is to strengthen American leadership in digital financial technology, and the bills and executive actions we've seen over the past two months all fit under that theme.
The market got exactly what it needed last week: confirmation that the economy is slowing—not collapsing—and that the Federal Reserve has the green light to start cutting rates. Payroll gains softened, manufacturing remains weak, and broader job slack is showing up with U-6 underemployment rising to 8.1%.
The house of pain continues with small caps, at least on a relative basis. Year-to-date, the S&P 600 index has posted a 3.0% gain, so it's not like money is being burned. But still, even the Bloomberg Aggregate Bond index is up 4.9% YTD and the S&P 500 is up 10.9%.
