Morning Brief – US Government Treasury Bond Yields
Humphrey Percy Chairman and FounderFri 29 Sep 2023
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.
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.
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.
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.
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
British Pound There really was something for everyone in Bank of England Governor Bailey’s comments yesterday. Firstly he said that the BoE was comfortable with the market’s view of the decline in UK interest rates -meaning one presumes both on extent and timing. Then he followed it up by saying that the UK labour market […]
EU Commission Instead of November’s EU growth forecast of 1.2%, the EU Commission has revised back its prediction to 0.8% for the growth in the gross domestic product of the 20 countries. The 2025 year however will see growth of 1.5%. Back to 2024, it is difficult for the EU bloc to grow much when […]
Germany With the German IFO or Business Climate Index down from 90.10 a year ago to its current level of 85.20, Germany’s business leaders are more realistic about the outlook for Europe’s largest economy than their political leaders. Chancellor Scholz wisely passed the speech making duties yesterday to one of his cohorts who managed with […]