Featured Insights


Chart of the Week

CRUDE OIL SAVED THE S&P

Source: Bloomberg, April 19, 2018 Past performance is no guarantee of future results. Indexes are unmanaged, and not available for direct investment. Index returns do not include fees or sales charges. This information is provided for illustrative purposes only and does not reflect the performance of an actual investment.

 

Crude Oil Saved the S&P

Chart of the Week

Market Snapshot

Faceoff over crude

OPEC’s meeting had some unexpected commentary; the Fed heard tales of good times; Bank of England surprised its markets.


Featured Insights

Investment Insights
Mar 05
Investment Insights

February’s Market Volatility

That’s Why We Diversify

March 05, 2018

In the last two years, market sentiment has swung from pessimistic “secular stagnation” to today’s “reflation trade” enthusiasm. As optimists, we have focused on the higher-yielding spread sectors. But despite market optimism about accelerating growth, the need to protect against unpleasant surprises remains crucial.

Market Outlook
Mar 01
Market Outlook

Low Inflation Is No Mystery

March 01, 2018

Various Federal Reserve (Fed) policymakers expect US inflation to accelerate in 2018, and market analysts generally agree with them. Of course, these same folks predicted rising inflation in previous years as well. It didn’t happen then, and we think it is unlikely to happen in 2018.

Market Outlook
Feb 09
Market Outlook

Policy Matters

The Fed and Current Market Pricing

February 09, 2018

The transition from Janet Yellen to Jerome Powell as chair of the Federal Reserve (Fed) is happening at an interesting moment for financial markets and the US economy. Two topics in particular have recently come to the fore of investors’ minds: the potential for an increase in inflation and the current pricing of Fed interest rate hikes. We address both in the final section of this note. However, some context is needed first. Before addressing the topics du jour, we assess Yellen’s record and then provide an outlook for the Fed under Jerome Powell. It is only with the context properly established that we can attempt to adequately address the issues of the day.

Market Outlook
Feb 02
Market Outlook

Fixed income

Where Are We in the Credit Cycle?

February 02, 2018

The credit cycle is still in expansion mode, and investors who run for cover too early may regret missing out on incremental returns.

Market Outlook
Feb 02
Market Outlook

2018 Outlook

On Growth, Inflation, Tax Cuts and More

February 02, 2018

In this Q&A, Western Asset Portfolio Manager and Research Analyst John Bellows discusses the outlook for growth and inflation, the impact of recent tax cuts, the maturity of the current business cycle and where to find value in the market when everything seems expensive. Read more.

Market Outlook
Feb 02
Market Outlook

US Mortgage Market

Lessons for the past, investing for the future

February 02, 2018

The US mortgage market is markedly stronger and simpler in the aftermath of the subprime credit bubble that led to the financial crisis. For investors, the mortgage market is attractive today as a result of greater protections for bondholders, better mortgages backing those bonds and a healthier US housing market and consumer. Read more.

Market Outlook
Jan 18
Market Outlook

The big picture in bonds

Market and Strategy Update

January 18, 2018

The slow but steady recovery since the financial crisis continues to make progress; looking ahead, we expect another 2+% growth year in 2018, perhaps better with the new tax law. The fundamental investment backdrop is exceptional, but prices are high -- so sector and security selection remain key.

Market Outlook
Nov 22
Market Outlook

Ken Leech Commentary

Market Commentary

November 22, 2017

On November 2, President Donald Trump named Jerome Powell the next Chair of the Federal Reserve (Fed) Board, succeeding Janet Yellen. This confirmed our thesis that the Trump Administration would be looking for Fed candidates who were 1) pro-growth, 2) comfortable with low short-term interest rates, 3) open to a lighter touch toward financial regulation, and 4) members of the Republican Party.

Market Outlook
Oct 24
Market Outlook

The big picture in bonds:

Market and Strategy Update

October 24, 2017

The market’s enthusiasm for massive growth immediately following last year’s US presidential election waned significantly after healthcare initiatives failed to materialize, infrastructure spending stalled and geopolitical tensions flared. While we were skeptical of too much optimism at the start of the year, we now think pessimism may be too strong as fundamentals slowly and steadily improve.

Investment Insights
Oct 12
Investment Insights

Fixed Income

A Higher Quality Loan Sector

October 12, 2017

Increased banking regulation and constrained lending makes a strong case for investment opportunities in residential, commercial and consumer loans. Anup Agarwal, head of agency and structured products at Western Asset, explains why.

Market Outlook
Sep 26
Market Outlook

Looking beyond the obvious

Finding Value in Bonds Now

September 26, 2017

Current yields and spreads are creating the perception that fixed income isn’t offering much value, but Western Asset Deputy CIO Michael Buchanan does see pockets of opportunity in several segments of the market.

Market Outlook
Aug 25
Market Outlook

President Trump's Pick for Fed Chair

August 25, 2017

“[Yellen] is not a Republican. When her time is up, I would most likely replace her because of the fact that I think it would be appropriate.” “[Yellen] is a low-interest-rate person, she’s always been a low-interest-rate person, and let’s be honest, I’m a low-interest-rate person.” ~Donald J. Trump, CNBC Interview, May 5, 2016

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