#47 Daily Financial News Round Up - Dec 17,2021
What news caught my attention?
With inflation at record-high rates in many countries, the 10-year government bonds in the U.S., Europe, and much of the world have yield rates less than inflation. Bond markets that acted as a check for the government seem to be straying away from their duty. The negative real return in the bond market should ring alarm bells. Yet, the bond market activity is in full swing, and a bubble seems to be emerging there. The belief that Fed can rein things into control appears to be one of the driving factors for this increased activity.
Major credit raters declare China’s Evergrande to be in default.
Last week’s tornadoes that impacted around four states in the U.S. have caused around $5 billion in damage, as reflected by the insurance company’s payouts.
My Takeaways:
China’s Evergrande story is here to stay.
Negative yield rates is a sign of concern, and it is alarming that it is not perceived so.
Last week’s tornadoes caused some severe damage.