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Just an Observation - Rates Up, Hard Assets & Real Estate Down

edited March 2017 in Off-Topic
Sorry, no links at the moment. Add if you wish.

10 Year Treas is up to 2.55% today. Can't recall it being that high in a long while. And nothing drastic - but funds exposed to gold, energy, real estate have fallen off in recent days. Gold's still above $1200 which ain't bad. And WTI at over $50 is about double where it bottomed in the winter of 2016.

Bloomberg has a new app that is excellent on IPad if you haven't used it lately. Really shows a broad array of bond, equity, commodity markets. FWIW

Comments

  • Ya, I'm chomping at the bit to re-deploy the $$$ I've got in TRP Real Estate, TRREX. Gotta wait until into early April. (Extortion fees avoidance.)
  • edited March 2017
    Thanks for commenting @Crash.

    Can't find a good article that attempts to tie all the divergent factors together which I believe are affecting the various markets - most related to interest rates. I'm a bit surprised. Would link anything good. A cursory financial news reading finds a lot of focus on various investment-specific factors. By way of example:

    - Fed rumblings and the recent jobs report pushing up treasury rates.
    - supply gluts dinging oil prices
    - seasonal demand in China, India and elsewhere affecting gold demand
    - valuations, rents, demographics, etc affecting REITS

    I think the elephant in the room few are mentioning is the up-trend in rates as it ties in to many other assets. The causes of rising rates are numerous and reach well beyond the Federal Reserve. Most risk markets don't like rising rates - especially when it happens rapidly. So, feeling relieved you didn't own this or that asset after it drops sharply might be the equivalent of glancing out your window and feeling relieved it's your next-door neighbor's house that's on fire and not your own.

    FWIW: Gross and Gundlach both have had plenty to say on this general subject in recent weeks. And, I don't see either as very optimistic.
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