Fed Minutes indicated “the end” of quantitative easing is imminent, the final month of purchases is set for October (once thought to be December)…. Remember last summer when panic over Bernanke’s “taper talk” sent 10 year yields to nearly 3.00%? Would anyone have believed that as we are at the end of the actual tapering, the 10 year would be at 2.55%? What has happened in the meantime? A global “bond premium” as Japan and Europe continue to fight the specter of deflation with massive monetary easing. Recent US economic reports, although mixed, are pointing to a pick up in the 2nd half of 2014 (will we get to 3.0% GDP? Or is 2.5% the “new normal” for growth?) and rate hikes in early 2015. ….stay tuned… David R. Pascale, Jr.
