Bonds

Negative Interest Rates Are Rational … and They’re Here to Stay

Negative Interest Rates Are Rational … and They’re Here to Stay

Article Highlights: Economist John Maynard Keynes showed interest rates affect employment and economic growth. Germany recently sold over $920 billion worth of 30-year bonds at an interest rate of negative 0.11%. Negative interest rates point to a possible breakdown in economic theory. In 1971, President Richard Nixon shocked economists. He famously said: “We’re all Keynesians…

Negative Yields Are for Fools

Negative Yields Are for Fools

Article Highlights: German government 10-year bonds are currently yielding -0.51%. Currently, $13.7 trillion of global bonds are trading with yields below zero. Capital-appreciation buyers follow the “greater fool theory” of investing. Can you imagine a friend borrowing money from you and then telling you that the longer it takes him to pay you back, the…

Your 1-Day Trade for This Week’s Fed Meetings

Your 1-Day Trade for This Week’s Fed Meetings

Investor Insights: After the July 31 Fed meeting, the Dow dropped almost 500 points in 18 minutes. July 31 was a dramatic example. But big moves on Fed days are almost routine. This simple strategy works for one day of trading every six weeks. It was January 9, 1991. I was deep underground, working in…