Interest Rates – 2018

  1. Interest Rates – 2018

    Interest Rates – 2018 In 2018, we expect: • Job growth will continue, albeit at a slower pace than before. That growth will exceed new job market entrants, which will continue to put upward pressure on wage growth. • We expect GDP to continue its slow move to a higher sustainable rate into 2018 which will pressure the Fed to consider removing accommodation faster than they would like. • Coupled with inflation readings that will exceed 2%, we see the long end of the yield curve starting to move materially upward along with the short end as the Fed hikes rates 3-4 more times in 2018. To support our outlook, consider the following. In 2017 we saw the Federal Reserve meet its rate changing expectations. Median forecasts for the Federal Funds rate suggested 3-4 rate rises. The Fed has now raised rates three times in 2017. As is usually the case, the 2 year US Treasury Note has been moving upward along with the overnight rate. However, what happens further out on the yield curve could have greater long-term consequences for fixed income investors. Long-term rates are not moving upward in this environment, but are actually moving down, raising concerns over the risk of an inverted yield curve and the downsides that can often follow such occurrences. What is behind this state of affairs? The simplest explanation is to recall that short rates are most sensitive to Fed policy expectations. Short rates can fluctuate wildly based on how markets think the Fed will interpret new…

  2. Christen Dusselier Earns CFP® Designation

    Christen Dusselier, Portfolio Manager at Mitchell Capital Management has earned the prestigious Certified Financial Planner® (CFP®) designation. The CFP® Program, whose predecessor certification was first issued in 1972, is administered by CFP Board. CFP Board, a not-for-profit association, acts in the public interest by fostering professional standards in personal financial planning through setting and enforcing education, examination, experience, ethics and professional conduct requirements. CFP® professionals also agree to meet ongoing continuing education requirements and to uphold the Code of Ethics and Professional Responsibility, Rules of Conduct and Financial Planning Practice Standards. Currently, there are more than 76,000 CFP® professionals certified by CFP Board in the U.S. Encouraging the pursuit of the CFP® Designation helps to broaden the added value our clients receive when they choose to partner with Mitchell Capital. Please join us in congratulating Christen on her achievement. Please click here to view our disclosures.

  3. What can you do for me, Bitcoin?

    Not much, we would argue. History is full of fringe investments that occasionally make the news following a rapid, and oftentimes inexplicable and indefensible, price increase. Bitcoin is only the latest, leaving even casual investors asking “what is it, and should I be buying some?” Bitcoin is an unregulated cryptocurrency created in 2009. A cryptocurrency is a digital asset designed to work as a medium of exchange using cryptography to secure the transactions, to control the creation of additional units, and to verify the transfer of assets. Among the first digital currencies produced, Bitcoin has also become the most well-known. Earlier this year, Abeer ElBahrawy at City University in London, along with some colleagues, examined the cryptocurrency market and found it to be significantly more complex and mature than most had thought. Even if you thought it was already complex. Click here if you want to read for yourself. There have been approximately 1,500 cryptocurrencies introduced since 2009. Many have died since and around 600 are actively traded today. The market value of cryptocurrencies is growing and is estimated at around $300 billion, depending on how Bitcoin trades from day to day, compared to the $60 trillion of money in the world. Bitcoin remains the biggest cryptocurrency, but its lead has been eroded by technological improvements of other competitors. That is one problem with trying to back the right digital currency, there is no barrier to entry for competition. All it takes is a computer and some skill to make an improvement. If that doesn’t…