ETF Expert

The Fed has kept interest rates as low it can. And they hope to continue keeping them low “for an extended period.” In essence, that has forced money managers, advisers and big institutions to go further out on the risk curve, including the use of  convertibles, high yield bonds and yes… stocks. (And we wonder why the market seems to defy gravity?)

However, the U.S. Treasury has to raise trillions of cash annually to tackle deficit spending as well as maturing 1-4 year treasury debt. There simply may not be enough money in the investable universe to purchase longer-term debt unless the yield is high enough to take some of the money back out of equities. Some say, it’s only a matter of time before yields climb precipitously and then, eventually spook stock investors.

Signs Of A Top? — Reverse Split For 9 ProShares ETFs - Trade Radar Operator
Bonds: A Look At The Sidelined Cash Theory – Jonathan Bernstein, The Insightful Trader
An American Bull In A Dutch China Shop - Olivier Ludwid, Index Universe

Disclosure Statement: ETF Expert is a web log (”blog”) that makes the world of ETFs easier to understand. Gary Gordon, MS, CFP is the president of Pacific Park Financial, Inc., a Registered Investment Adviser with the SEC. The company and/or its clients may hold positions in the ETFs, mutual funds and/or index funds mentioned above. The company receives advertising compensation from Invesco PowerShares Capital Management, LLC. The commentary does not constitute individualized investment advice. The opinions offered herein are not personalized recommendations to buy, sell or hold securities. Investors who are interested in money management services may visit the Pacific Park Financial, Inc. web site.

Tags | American ETFs, Bond ETFs, ProShares ETFs