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Wednesday, September 6, 2017

MANAGING DIRECTOR:
Scott Carrithers
 
PORTFOLIO SALES AND SERVICE:
Steve Panknin • George Morris • Jeff Goble • Chris Thompson • Sean Doherty
Robert Brickson • Kevin Doyle • Lonnie Harris •  Mark Tranckino • Robert Schuyler 
Tom Toburen • Josh Kiefer • Nicole Burczyk • Kelley Frye • Natalie Regan • Aaron Stoffer

US Treasury Market
Date 1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr
8/29/17 .96 1.03 1.13 1.23 1.33 1.43 1.70 1.96 2.13 2.48 2.74
8/30/17 .96 1.03 1.11 1.23 1.33 1.44 1.72 1.97 2.15 2.49 2.75
8/31/17 .95 1.01 1.08 1.23 1.33 1.44 1.70 1.95 2.12 2.47 2.73
9/1/17 .96 1.02 1.10 1.24 1.35 1.46 1.73 1.99 2.16 2.51 2.77
9/5/17 1.30 1.03 1.13 1.23 1.30 1.40 1.65 1.90 2.07 2.43 2.69

 

Source: U.S. Department of the Treasury, as of 9/5/17 

                                           Flight To Quality………Make That A Stampede!

On the heels of Hurricane Harvey, which smashed ashore last week, the U.S. is now bracing for Hurricane Irma, and the remote possibility of Hurricane North Korea. The exact path of Irma is still in doubt, but what isn’t in question is potential destruction. Irma is a category 5 storm with top winds of 180 miles. North Korea’s newest toy, the Hydrogen Bomb, has caused deep concern in South Korea, Japan, and most of Asia!

 A strike on Florida would be the first time since 1964 that the U.S. was hit by back-to-back storms of category 3 or more and only the second time since 1851. In fact, Irma is now among the 7 most powerful storms on record to cross the Atlantic.

Korean nuclear testing caused a flight to quality into Treasuries and triggered about a one percent decline on most of the major U.S. equity indices. North Korean sanctions may also cause deep trade issues within Asia, and the world.

Take a look at the 10 year Treasury graph below. The current 10 year Treasury yield, at 2.08%, is at its lowest yield level since the day after the Presidential election last year, the early stages of the “Trump Bump”.

All of this uncertainty is also reflected in the Fed Funds Futures market. The latest futures show only a 29 percent chance of an additional Fed increase between now and the end of the year. That is down from over a 50 percent probability just two months ago.

The 10 year Treasury is now 55 basis points lower in yield since its most recent high of 2.62% on March 13th. Now might be a good time to look at capturing profits or liquidating holdings that you have not been enamored with in the past. Call us if you have any questions or need help with recommendations. 

                                                                                                                                                                                                                                                                                                                     



This information is intended for institutional investors only. The material provided in this document/presentation is for informational purposes only and is intended solely for private use. Past performance is not indicative of future results. This material is not intended as an offer or solicitation for the purchase or sale of any financial instruments.

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