A year of pain: investors struggle in a new era of higher rates

Financial Times/Katie Martin and Harriet Agnew/11-30-2022

“To the untrained eye, this might seem like a routine observation. But looking back, it rang the bell at the top of the market, which had rocketed since central banks stopped them from bleeding out when Covid-19 struck. Powell was effectively calling time on an entire era of super-cheap money that began after the 2008 financial crisis.”

USAGOLD note: It is difficult to resist labeling Powell’s 2022 policy reversal as transitory…… And why might it be transitory? As FT points out, “long-term US government bonds staged the biggest drop since 1788. Investors’ classic blend of bonds and equities has put in the worst performance since 1932.” In short, the outlook could go from bleak to darkest midnight forcing the Fed to bring this “new era” of higher rates to an end………