Liquidity

As I write this, gold continues to trade above $2,500 an ounce after surging past the psychologically important level for the first time ever in mid-August. For seasoned gold mining investors, this should be a moment of validation. After all, the yellow metal has long been seen as the ultimate hedge against economic uncertainty.

When you see that behavior at extreme valuations, it tends to be a sign of underlying skittishness and risk aversion. When valuations are setting record extremes because the news can’t get any better, even a slightly less optimistic outlook becomes a risk.

While short-term fluctuations and sudden selloffs have tested the markets, key indicators such as corporate profits, employment data, and economic resilience have held firm.

The path for lower rates in the U.S. has finally arrived.

Will 2030 DC plans perform better at preparing U.S. workers for retirement?

The healthcare sector offers a compelling mix of defensive characteristics and growth potential driven by innovation. It also features ample dispersion that presents stock pickers with an opportunity to parse potential leaders and laggards in pursuit of above-market return.

High-yield bonds have been one of the best-performing bond investments so far this year, but there may be better entry points down the road.

The most glaring uncertainties today, which contributed to early August seeing some of the largest market moves in the last several years, are the risks associated with the Federal Reserve’s dual mandate.

With US payroll and unemployment data surprising to the downside two Fridays ago, Treasury markets quickly repriced the probability of impending recession, helping set off a volatility spike in stocks across the world. According to Bloomberg, economists’ consensus probability of a US recession in the next twelve months is now approximately 30%.

Elevated budget deficits imply growing US Treasury issuance. Receding demand from central banks could leave more price-sensitive buyers to pick up the slack. Who are the buyers of US government debt, and how is the market responding? In part two of our series, let’s examine Treasury market supply and demand.

Although we think it's too early to declare the economy is in a recession, risk is elevated. For investors who are concerned about a recession, municipal bonds may help buffer a portfolio.

With recent cooling in economic growth, an uptick in unemployment, inflation moderating back to the Federal Reserve’s (Fed) 2% target, and expectations for rate cuts, we believe the winds are shifting in the U.S. fixed income market.

Since our last update of the Three Tactical Rules on June 25, 2024, equity markets have retraced most of the rally from the spring. The change in market sentiment came abruptly, due to the labor market showing signs of weakness as the number of jobs available per unemployed worker fell to 1.2 and the unemployment rate rose to 4.3%. The recent market volatility has had a dramatic impact on our tactical rules.

The last two years of high school can be particularly important as students approach the final college decision. Our Bill Cass highlights some action items for students and parents.

As recently as the beginning of this year the market pundits were predicting up to six Federal Reserve rate cuts to the short-term Federal Funds Rate. Shockingly, the pundits’ expectations have not come to fruition. Predictions based on the sentiment of the day fill the twenty-four-hour news cycle on multiple outlets.

Are the “Mega-Cap” stocks dead? Maybe. But there are four reasons why they could be staged for a comeback. The recent market correction from the July peak certainly got investors’ attention and rattled the more extreme complacency.

Last week, we explored the old economic rules that falsely predicted an imminent recession. Losing those guideposts has complicated our efforts to craft an outlook.

Silver is an important component of solar photovoltaic (PV) panels, meaning that for China to reach its ambitious climate targets, it must import massive amounts of the white metal. In June alone, China spent over $228 million on silver, a new monthly record based on Bloomberg data going back to 2009.

The current economic landscape is fraught with uncertainty, and the potential for higher inflation continues to pose a real threat to market stability.

Markets were recently rattled by concerns the U.S. may slip into recession, but it's not clear that those fears are justified.

Portfolio Manager Jeremy Sutch, CFA, and Chief Investment Officer Sean Taylor assess the issues besetting the region’s key markets—from domestic challenges to geopolitical headwinds—as well as their structural strengths, and whether prospects may brighten with the onset of a U.S. rate-cutting cycle.

Because there is unprecedented use of the word “unprecedented,” we thought it appropriate to expand our annual Charts for the Beach from 5 charts to 10 charts and tables this year. So, probably best to stay under the beach umbrella as you read our unprecedented extended edition.

We manage risk within our strategic, long-term allocations based on diversification across equity, fixed income, and alternative assets.

Your portfolio can be the key to managing cash and maintaining flexibility.

This year, the bears have asserted themselves after the bulls controlled the first half. Shares of companies that recently announced stock splits are well off their highs, generally not benefiting from the historical trend of outperformance.

The tea trade has lessons for today’s global commerce.

Bond prices whipsawed over the past month as volatility spiked across markets. What's next for fixed income markets?

There’s no denying that consumers are digging around for more deals and prioritizing essentials over discretionary items.

The flexibility offered through individual bonds translates well for tailoring individual financial goals and needs.

For plan sponsors, the trend toward de-risking often leads to a simplification of the equity manager lineup in the return-seeking portion of the portfolio.

No one enjoys getting dumped. This holds true in finance and investing as much as it does in romantic relationships. When companies are dumped from the major indexes, their managers and shareholders may feel jilted and their stock may flounder post-breakup.

Actively managed ETFs continued to gain traction in July with $24 billion of net inflows. This represented 19% of the industry’s net inflows.

When the Federal Reserve lowers its key short-term interest rate, the impact isn't uniform across the financial universe.

In this PIMCO Perspectives, we explore the dispersion playing out across monetary policy and financial markets.

As the number of Americans retiring in other countries continues to grow, our Bill Cass shares five considerations for individuals planning to retire abroad.

With investors reacting to the worst global stock market sell-off since the early days of the COVID pandemic in 2020, Portfolio Manager Oliver Blackbourn and Global Head of Multi-Asset Adam Hetts consider the all-important question – what next?

The growth of bureaucracy around the world has led to a proliferation of rules. This creates multitudes of problems, one of which is that the state has made understanding what it is doing impenetrable, boring, nuanced, and technical.

Recent developments in the labor market triggered the Sahm Rule, an economic indicator known for predicting the onset of recessions. Developed by economist Claudia Sahm, it signals a recession when the 3-month average of the unemployment rate rises by at least 0.5 percentage points above its low from the previous 12 months.

Portfolio Managers Shuntaro Takeuchi, Michael Oh, CFA, and Andrew Mattock, CFA, assess the reasons for the heightened volatility and sharp moves in global markets.

Hastily, investors have turned their worry about inflation into worry about a recession. The catalyst was Friday’s unexpectedly disappointing unemployment number.

Rotation - The Earth's axis has an inclination of 23.5 degrees relative to its orbital plane around the sun.

The Federal Reserve is being challenged with one of our most important tenets: levels versus momentum.

As Milton Friedman taught us many decades ago, monetary policy works with long and variable lags. Recent economic reports suggest that the long and variable lags on the tightening of monetary policy in 2022-23 are starting to come to an end.

On July 31, the U.S. Treasury released its most recent Quarterly Refunding Announcement which revealed its financing strategy, presenting both positive and restrictive elements for global liquidity.

The secrets for a blueprint for young investors are: Start young. Be disciplined, do it regularly. Focus on what your needs are and what your goals are.

The members of the Bank of England’s Monetary Policy Committee (MPC) are probably not intimately familiar with Taylor Swift’s back catalogue. If they were, Swift’s hit “Cruel Summer” may have been ringing in their ears when cutting rates today for the first time since March 2020.

Like you, we have read countless comparisons between today’s enthusiasm for all things AI and the top of the TMT bubble in 2000, with the implication being that stocks are on thin ice.

The Federal Reserve kept its policy rate unchanged at the July meeting, but left the door open to rate cuts later this year.

Today’s passive index investing requires active choices, as customization and innovations in index funds have resulted in new considerations for investors and the potential for greater control.

We are approaching a turning point in policy decisions as the FOMC attempts to walk the fine line of hitting their inflation targets while maintaining a healthy labor market.