Morning Brief – US Government Treasury Bond Yields

US Government Treasury Bond Yields

With the higher for longer realization dawning on interest rate markets, it is worth looking at where the yields are on US Governments: 3 months 5.40, 2 years 5.12, 5 years 4.70, 10 years 4.63 and 30 years 4.75. That is obviously weighing on the equity markets at present but aside from that, these at or nearly 5% yields on Government debt are near irresistible to investors at this level in the US equity markets.

EUR/USD 1.0540.

Saudi Pro League

If you want to see first hand evidence of the economic effects of a USD95 oil price, look no further than the Kingdom of Saudi Arabia and its aspirations in the world of football. This summer Saudi clubs spent an estimated USD 1 billion in hoovering up talent. With no sense of irony the spokesman for the Saudi pro League explained that this is part of a long term investment strategy. Apart from the transient nature of footballers’ careers, the aim is to turn the Pro League into a Top Ten World League and by attracting the expensive stars building a huge broadcasting value. With that kind of firepower it would be foolish to bet against it-especially with oil to continue on its present upward trajectory.

USD/JPY 149.29.

Lululemon

This USD 48 billion sports apparel company can see value in hooking up with lowly valued Peleton worth USD 1.7 billion. Peleton will bring digital content to the party in exchange for their members being encouraged to use Lululemon apparel exclusively. The five year partnership looks to have benefits for both sides but one thing’s for certain, Peleton shares soared on some good news after 3 years of earnings forecast warnings, top level defections, loss of members and post covid disaffection.

GBP/USD 1.2195.

Costco

As fans of the wholesale priced retailer will know, you can buy some surprising items from Costco including caviar, coffins, fine wines and now….1 oz gold bars which apparently have been selling like hot cakes. In case you feel impelled to join the rush, the present price of gold is USD 1,876 or GBP 1,537.

Living Doll

This one just had to be included as it is 64 years ago today that evergreen and definitively non-deciduous UK pop pixie Cliff Richard became the first UK artiste to enter the US Rock and Roll charts with this number on 29-09-59:

Got myself a cryin’, talkin’
Sleepin’, walkin’, livin’ doll
I got to do my best to please her
Just ‘cos she’s a livin’ doll
I got a rovin’ eye
And that is why, she satisfies my soul
I got the one and only, walkin’, talkin’, livin’ doll

So take a look at her hair, it’s real
And if you don’t believe what I say, just feel
Gonna lock her up in a trunk
So, no big hunk can steal her away from me

Got myself a cryin’, talkin’
Sleepin’, walkin’, livin’ doll
I got to do my best to please her
Just ‘cos she’s a livin’ doll
I got a rovin’ eye
And that is why she satisfies my soul
Got the one and only, walkin’, talkin’, livin’ doll

So take a look at her hair, it’s real
An’ if you don’t believe what I say, just feel
I’m gonna lock her up in a trunk
So no big hunk can steal her away from me

Got myself a cryin’, talkin’
Sleepin’, walkin’, livin’ doll

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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