Tuesday, July 2, 2013

Short stocks and commodities, long the dollar and Treasuries

Short stocks and commodities, long the dollar and Treasuries. Yes, the Fed’s recent statements mean Treasuries and other high-quality bonds have been trashed along with developed and developing country stocks, junk and emerging market bonds.

Nevertheless, if stocks continue to decline, the safety of Treasuries and investment-grade bonds will probably outweigh concerns about the end of quantitative easing. Then the “risk-off” quartet will be fully in place.