This article was last updated on May 19, 2022
However, government finance is generally unable to withstand even a 150 basis point difference from coupon assumptions as claimed by Greece for itself, the quality divide seems only likely to rise. Focus at the upcoming FOMC is likely to be on the appropriateness of still underscoring extended ease but more may be achieved by the Federal Reserve and others by raising rates soon by 25 basis points to signal changed dynamics but then to pause and monitor. Our muddle through has recovery occurring but taking time with exit strategies from deficits and quantitative ease being important. It favors stronger more agile smaller currency zones in fixed income and only quality of delivery/strong balance sheets of companies becomes crucial across sectors. Such would hold not only in our favored sectors like healthcare information technology, industrials, and integrated energy but also for strong ,long lasting upscale luxury for the consumer as well as the crucial financials segment. It also seems likely that market correction is incomplete. In muddle-through, sustainable gain out of trading ranges seems likely later, after mid 2010 as a better 2011 comes into view.
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