Analysts continue to be baffled by our low inflation and the stability of yields.
There is only one answer, I have been mentioned this issue for some time. Inflation and interest rates cannot rise because people are losing purchasing power at an alarming rate.
The unemployment rate remains close to 10%. Unemployment claims have stalled and are not declining anymore. Taxes are slowly rising. Business people are frustrated by surging regulations and government involvement in the economic affairs of the country.
Inflation and interest rates cannot rise until there is solid growth in the global economy. This is not happening. On the contrary, there may be some evidence suggesting the economy is likely to slowdown in the coming months.
Time will tell, of course.
George Dagnino, PhD
Editor, The Peter Dag Portfolio. Since 1977
Ranked Top Market Timer in 2009 and 2010 by Timer Digest
To find out more about my in depth views of the markets and my strategy just visit our website https://www.peterdag.com/ where you can subscribe to The Peter Dag Portfolio. You can also call me at 1-800-833-2782 to discuss your specific money management needs.
I will be happy to speak to your investment group on how the business cycle impacts investment strategies and the choice of asset classes.
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