Fed Pivot to Forward Guidance Furthers Bear Case for Bonds

I remain skeptical of the “power” of forward guidance and think the switch away from QE to forward guidance as a primary policy tool only furthers the bearish case for bonds.  And, my skepticism is rooted in experience and observation. Although the rise in the Dollar Index yesterday got a lot of press, the one currency that was stronger vs. the dollar yesterday was the British Pound, which saw a 0.8% rally vs. the greenback—and that’s something that shouldn’t be dismissed, because I believe that what’s happening with the Pound, the FTSE and UK Bonds, may provide us a “road map” of sorts for what will happen to the Dollar, Bonds and stocks, now that the Fed is switching to “forward guidance” as its primary policy tool. Read More

Sevens Report 12.19.13

Sevens Report 12.19.13