$SHY - 1-3 Year US Treasuries - I'm Starting To See A Pattern!
A little tongue in cheek here but clearly the end of the year has been a time when people have moved OUT OF short term treasuries and into other assets or durations.
The news has been covering how short term rates are at their highest levels in years here. I'm pulling up the chart and with the great indicator "MTPC" for "Multi-Time-Period-Charts" I was able to see the quarterly pattern where interest rates tend to rise into year end for the past few years.
When
SHY goes down, the Yield goes up. They are inversely related.
So, it would seem that investors are afraid of the new US Gov't Tax Bill as it doesn't attack the problem and doesn't "drain the swamp" that we wished would happen. So, the credit-rating of the US Gov't could be in jeopardy with this new development.
Hence, investors are backing away from short term US Gov't paper.
But BUY at year end since that has been the pattern.
For now, we have had Fed Rate Hikes on
12/16/2015
12/14/2016
03/16/2017
06/14/2017
So, the market is telling us to expect another rate hike in Mid-December.
Cheers,
Tim
11/16/2017 4:19PM EST
The news has been covering how short term rates are at their highest levels in years here. I'm pulling up the chart and with the great indicator "MTPC" for "Multi-Time-Period-Charts" I was able to see the quarterly pattern where interest rates tend to rise into year end for the past few years.
When
SHY goes down, the Yield goes up. They are inversely related. So, it would seem that investors are afraid of the new US Gov't Tax Bill as it doesn't attack the problem and doesn't "drain the swamp" that we wished would happen. So, the credit-rating of the US Gov't could be in jeopardy with this new development.
Hence, investors are backing away from short term US Gov't paper.
But BUY at year end since that has been the pattern.
For now, we have had Fed Rate Hikes on
12/16/2015
12/14/2016
03/16/2017
06/14/2017
So, the market is telling us to expect another rate hike in Mid-December.
Cheers,
Tim
11/16/2017 4:19PM EST
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