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☆ A Trump victory raises the risk of a US economic situation worse than recession, 'Dr. Doom' Nouriel Roubini says
▼ + stars: | 2024-10-09 | by ( Filip De Mott | ) www.businessinsider.com time to read: +4 min

Nouriel Roubini says stagflation risk will rise if Donald Trump wins the election. AdvertisementThe US economy might confront a fate more challenging than a recession if Donald Trump retakes the White House, famed economist Nouriel Roubini said. According to Roubini, Trump's proposals would fuel these two key ingredients: lower growth and higher inflation. In July, JPMorgan's chief global strategist David Kelly called Trump's tariff and immigration policy mix an "elixir for stagflation." AdvertisementRoubini said tensions in the Middle East make the threat of stagflation under Trump worse.

Persons: Nouriel Roubini, Donald Trump, Doom, —, Donald Trump retakes, Trump, Kamala Harris, stagflation, Roubini, Larry Summers, David Kelly Organizations: Greenwich Economic, Treasury, Service, Bloomberg, Barclays, Republican, Peterson Institute, Trump Locations: Greenwich, Israel, Iran

☆ Here's how to position your fixed income portfolio for lower rates, according to strategists
▼ + stars: | 2024-10-02 | by ( Weizhen Tan | ) www.cnbc.com time to read: +5 min

Over time, riskier assets have outperformed cash and cash alternatives, said Brian Rehling, its head of global fixed income strategy. Different types of fixed income Investors can benefit from different types of fixed income in their portfolios, Citi said. But since then, both stocks and high-yield fixed income have increased in price. "Investors should consider taking advantage of any pullbacks in these asset classes to reposition overallocations to short-term fixed income," it said. Meanwhile, it likes U.S. intermediate term taxable fixed income, as it prefers bonds with maturities of between three and seven years.

Persons: Steven Wieting, Brian Rehling, Wells Fargo, overallocations Organizations: U.S . Federal Reserve, Fed, Citi, Wells Fargo Investment Institute, Securities . Investment Locations: Wells Fargo, Wells

☆ The Fed slashed interest rates last week, but Treasury yields are rising. What’s going on?
▼ + stars: | 2024-09-26 | by ( Jeff Cox | Jeff Cox Is A Finance Editor With Cnbc.Com Where He Covers All Aspects Of The Markets | Monitors Coverage Of The Financial Markets | ) www.nbcnews.com time to read: +6 min

The Treasury market, though, hasn’t been paying attention. Officials penciled in another 50 basis points in reductions by the end of the year and another 100 by the end of 2025. That sentiment is evident in the “breakeven” inflation rate, or the difference between standard Treasury and Treasury Inflation Protected Securities yields. The 5-year breakeven rate, for instance, has risen 8 basis points since the Fed meeting and is up 20 basis points since Sept. 11. Taken together, the various dynamics in the Treasury market are making it a difficult time for investors.

Persons: hasn’t, ”, Jonathan Duensing, — haven’t, “, Robert Tipp, We’re, Jerome, Powell, ” Duensing, Tom Garretson, “ They’d, There’s Organizations: Federal Reserve, Treasury, Amundi, Fed, CME, Treasury Inflation, RBC Wealth Management

☆ The Fed slashed interest rates last week, but Treasury yields are rising. What's going on?
▼ + stars: | 2024-09-26 | by ( Jeff Cox | ) www.cnbc.com time to read: +4 min

The Treasury market, though, hasn't been paying attention. Watching the curveThe difference between the 10- and 2-year notes has widened significantly, increasing by about 12 basis points since the Fed meeting. That sentiment is evident in the "breakeven" inflation rate, or the difference between standard Treasury and Treasury Inflation Protected Securities yields. The 5-year breakeven rate, for instance, has risen 8 basis points since the Fed meeting and is up 20 basis points since Sept. 11. watch nowFed officials aim for a 2% inflation rate, and none of the principal gauges are there yet.

Persons: Anna Moneymaker, hasn't, Jonathan Duensing, — haven't, Robert Tipp Organizations: Federal Reserve, Getty, Treasury, Amundi, Fed, CME, Treasury Inflation Locations: Washington , DC

GLD 5Y mountain GLD The SPDR Gold Shares ETF is the world's largest, with BlackRock's iShares Gold Trust and iShares Physical Gold ETC the second and third, respectively. Other top physical gold ETFs include the Borse Commodities GmbH Xetra-Gold and the SPDR Gold MiniShares Trust . Gold mining ETFs Buying gold mining ETFs — which own shares of multiple gold mining companies — is another way to get exposure to gold, and Meyer described those backed by large banks as "relatively safe," in an email to CNBC. "Even though gold equities respond to changes in gold price, the degree of that response has deteriorated over time," he said, adding that the risks and costs of gold extraction can weigh on miners. A selection of gold bars and one-ounce gold coins at Gold Investments Ltd. bullion dealers in London, UK, on Tuesday, May 21, 2024.

Persons: Tom Price, Price, Berenberg, Robin Bhar, Amy Arnott, John Meyer, Colin Hamilton, BlackRock's, Meyer, Barrick Gold Panmure Liberum, George Milling, Stanley, they're, Morningstar's Arnott, Bhar, Chris Ratcliffe Organizations: CNBC, Panmure, Bank of America, Citi, UBS, Gold, Morningstar, SP, CNBC Pro, Royal Mint, BMO Capital Markets, Borse Commodities, MiniShares, Gold Miners ETF, Miners, Barrick, Resolute Mining, Hochschild, Caledonia Mining, Barrick Gold Panmure, Endeavour Mining, Endeavour, Pan, Resources, State Street Global Advisors, Gold Investments, Bloomberg, Getty Locations: Panmure Liberum, U.S . New York, United States, U.S, Hochschild Mining, Zimbabwe, London, West Africa, Berenberg

☆ UBS expects a comeback for the 60/40 portfolio — and warns investors to limit cash
▼ + stars: | 2024-05-31 | by ( Michelle Fox | ) www.cnbc.com time to read: +4 min

The 60/40 portfolio isn't dead — in fact, it tends to outperform over the long term, according to UBS. The strategy revolves around a simple balanced portfolio, allocating 60% to stocks and 40% to fixed income. That theory was tested when both equities and fixed income slumped in 2022. Crafting a balanced portfolio Falconio expects the new 60/40 construction to look a little different with the rise in popularity of alternative assets. When it comes to traditional fixed income assets, UBS suggests holding strategic, diversified exposure throughout fixed income.

Persons: Cash, Mark Haefele, Leslie Falconio, Falconio, Fannie Mae, Freddie Mac, Ginnie Mae, Darla Mercado Organizations: UBS, Investment Company Institute, Federal Reserve, U.S . Locations: UBS Americas, —

☆ Investing legend Rob Arnott shares 3 trades to exploit underappreciated 'asymmetries' in the market right now — and 6 cheap investments he's betting will deliver 'double-digit' annual returns over the
▼ + stars: | 2024-05-31 | by ( William Edwards | ) www.businessinsider.com time to read: +5 min

But both inflation and economic growth have upside and downside risks relative to consensus. AdvertisementOn inflation, Arnott believes it's far more likely that it surprises to the upside. AdvertisementTo take advantage of these asymmetries in the market, Arnott said that value stocks and TIPS are two investments that would perform well in a higher-inflation environment. One way investors can gain exposure to these assets is through funds like the iShares Core S&P U.S. Value ETF (IUSV), the Schwab U.S. More specifically, value stocks within both developed and emerging markets are trading in their "cheapest decile ever" compared to growth stocks, Arnott said.

Persons: —, Rob Arnott, Arnott, it's, there's, I've, I'm Organizations: Service, Treasury, Securities, Business, Research Affiliates, Federal Reserve, Value, Schwab, MLP, Funds, Equity Locations: Schwab U.S

We asked seven pro investors to identify the best trades of their careers and explain how the lessons from those decisions still apply today. The CBOE Volatility Index, also known as the VIX, shot above 40, essentially meaning traders were betting that the stock market would be exceptionally rocky over the following month. Jeff Muhlenkamp, lead portfolio manager at Muhlenkamp & CompanyJeff Muhlenkamp Muhlenkamp & CompanyJeff Muhlenkamp's namesake Muhlenkamp Fund (MUHLX) has been in the top 3% of its category in the past half-decade, thanks to trades like one he pulled off on Chinese internet firm Baidu (BIDU). "I pretty much expected, 'OK, if I get a double out of this in five years, I'll be happy' — that's pretty decent money," Muhlenkamp said. He noted that industrials within the Russell Mid Cap value index have returned 116% over the previous five years.

Persons: —, That's, Michael Burry, Warren Buffett, Berkshire, Rob Arnott, Tim Boyle, Arnott, I'd, Bob Elliott, Bob Elliott's, Elliott, Jeff Muhlenkamp, Jeff Muhlenkamp Muhlenkamp, Jeff Muhlenkamp's, Muhlenkamp, you've, Sona Menon, Cambridge Associates Sona Menon, Bryant VanCronkhite, Allspring Bryant VanCronkhite Allspring Bryant VanCronkhite, VanCronkhite, Russell, industrials, James Davolos, Davolos, George Patton, Harley Bassman, Harley Bassman's, Bassman, Merrill Lynch, I'm Organizations: Service, American Express, Business, Research, Bloomberg, Getty, Bridgewater Associates, Treasury, Securities, Muhlenkamp, Baidu, Google, North, Cambridge Associates, Allspring, Horizon Kinetics, Opportunities Fund, Credit Suisse Locations: industrials, West Africa, New York City, Guinea

☆ UBS says it's time to move out of cash. Here's where it sees opportunity
▼ + stars: | 2024-05-21 | by ( Michelle Fox | ) www.cnbc.com time to read: +3 min

The era of hiding out in cash is coming to an end, according to UBS. While investors have been earning yields of more than 5% on instruments like money market funds and certificates of deposit, those rates aren't expected to stick around much longer. "We believe investors should limit their overall cash balances as falling interest rates this year and beyond will diminish returns on cash," Solita Marcelli, chief investment officer Americas for UBS Global Wealth Management, wrote in a note Monday. Investors flooded into money market funds as the Federal Reserve began raising interest rates in 2022. UBS also moved out on the curve on TIPS earlier this month after initially buying 5-year inflation-protected securities in August.

Persons: Marcelli, Leslie Falconio, Falconio Organizations: UBS, UBS Global Wealth Management, Investors, Federal Reserve, Investment Company Institute, AAA, AAA CMBS Locations: UBS Americas

☆ Is it time to rethink the 4% retirement withdrawal rule? Experts weigh in
▼ + stars: | 2024-05-13 | by ( Lorie Konish | ) www.cnbc.com time to read: +3 min

TIAA has launched a new metric to show why the 4% rule combined with an annuity can provide a higher amount of income than just using the 4% rule alone. For example, if a retiree has $1 million in total savings, the 4% rule would provide them with $40,000 in their first year of retirement. That is based on the combined income of the annuity and a 4% withdrawal on the remaining $666,667 portfolio. The first-year withdrawal of the annuity strategy — $52,667 versus $40,000 — is 32% higher and $1,056 more per month than just using the 4% rule. When withdrawal rates may be higherThe 4% rule has its blind spots when applied to today's retirees, according to recent research from Blanchett.

Persons: TIAA, Benjamin Goodman, Colin Gerrety, Goodman, Blanchett, Morningstar Organizations: Istock, Getty, Social Security, TIAA Institute, Wealth, Inflation Protection Securities, Security Locations: Corner , Virginia

☆ Lock in attractive real yields with this inflation-protected investment, says UBS
▼ + stars: | 2024-05-01 | by ( Michelle Fox | ) www.cnbc.com time to read: +2 min

Investors can lock in some juicy real yields with Treasury inflation-protected securities, according to UBS. "The result has been rising real yields further out the curve, offering the opportunity to lock in attractive real yields ahead of expected falling nominal yields later this year," she added. Treasury yields are expected to decline when the Federal Reserve starts reducing the fed funds rate. Nominal yields have been rising as the market reassesses those interest rate expectations. "Our expectation of declining nominal yields in the second half of the year will be a tailwind to performance," she said.

Persons: Leslie Falconio Organizations: Treasury, UBS, Federal Reserve, Treasury Department Locations: UBS Americas

☆ 'It's a good time to lock in,' expert says. What to know to get the best rates on your cash now
▼ + stars: | 2024-04-30 | by ( Lorie Konish | ) www.cnbc.com time to read: +1 min

Higher interest rates may be here to stay for a while longer, thanks to persistent inflation. That's good news for cash savers, who have the best opportunity to earn returns on their money in 15 years. To secure today's high rates, individuals may turn to CDs, Treasury bills and Treasury Inflation-Protected Securities, or TIPs. Series I bonds — a U.S. government savings bond aimed at providing inflation protection — will pay 4.28% for the next six months, the Treasury Department announced Tuesday. Yet 67% of Americans are earning interest rates below that threshold, according to a recent Bankrate survey.

Persons: What's, Greg McBride, McBride Organizations: Securities, Treasury Department, Finance Locations: U.S

☆ Wolfe Research says to play enduring inflation through energy stocks — these 2 in particular
▼ + stars: | 2024-04-29 | by ( Spencer Kimball | ) www.cnbc.com time to read: +2 min

Investors should look to energy stocks as stubborn inflation weighs on the stock market amid growing anxiety over whether the Federal Reserve will cut interest rates at all this year, according to Wolfe Research. "This inability to adequately tame inflation of course coincides with the reacceleration of Oil and Energy stocks over the past few months," analysts Rob Ginsberg and Read Harvey told clients in a Monday note. The Wolfe analysts said investors should take advantage of any near-term overbought consolidations and make a play for the stock to rise back into the mid $40s. Crude oil and the 10-year breakeven inflation rate, meanwhile, are both on the upswing from multiyear bases, according to the Wolfe analysts. "Needless to say, we want to keep playing Oil and Energy stocks to the upside over near – mid term, which should in turn put continued upward pressure on inflation," the Wolfe analysts said.

Persons: Rob Ginsberg, Read Harvey, Ginsberg, Harvey, Halliburton, EQT, Wolfe, CNBC's Michael Bloom Organizations: Federal Reserve, Wolfe Research, Oil, Energy, Halliburton, EQT Corporation, HAL, Securities Locations: –

☆ Series I bonds are ‘still a good deal’ despite an expected falling rate in May, experts say
▼ + stars: | 2024-04-17 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

Jetcityimage | Istock | Getty ImagesHow the I bond rate worksThe U.S. Department of the Treasury adjusts I bond rates every May and November. The variable rate portion resets every six months starting on the investor's I bond purchase date, not when the Treasury Department announces rate adjustments. The 1.3% fixed rate "makes it very attractive" for investors who want to preserve purchasing power long term, according to Tumin. How the fixed rate could changeSince the variable rate for I bonds is based on six months of inflation data, experts agree it will fall from 3.94% to 2.96% in May. Enna looks at a half-year average of real yields for 5- and 10-year TIPS to predict fixed rate changes.

Persons: David Enna Organizations: Istock, U.S . Department of, Treasury, Treasury Department Locations: Enna

☆ Where investors might hide out if inflation continues to reaccelerate
▼ + stars: | 2024-04-10 | by ( Yun Li | ) www.cnbc.com time to read: +3 min

To guard against stubborn inflation and higher-for-longer interest rates, investors should focus on quality companies with high pricing power and adjust their duration risk in bonds, according to Wall Street strategists and portfolio managers. Pricing power Companies with high pricing power tend to outperform when inflation is elevated because they have the ability to defend their profit margins by passing along higher costs to their end market customers. "In equities, you should prefer companies that have pricing power, i.e. "When inflation is the predominant risk in markets, correlations between stocks and traditional bonds tend to be high. BlackRock's iShares strategy team recently argued that investors should take advantage of spikes in bond yields while they can and reinvest their cash.

Persons: Stocks, Brad Conger, Sonu Varghese, Jason Pride, Pride, Rick Rieder Organizations: Dow Jones, Treasury, Street, Callaghan, Co, Big Tech, Carson Group, Securities, U.S ., Glenmede Trust Locations: Hirtle, BlackRock

☆ A little-noticed inflation report in the past could get a lot of market attention on Thursday
▼ + stars: | 2024-02-28 | by ( Jeff Cox | ) www.cnbc.com time to read: +7 min

With markets on edge over the direction of inflation, a report Thursday that often flies under the economic radar is likely to take on more importance. The Commerce Department's measure of personal consumption expenditures prices could add to evidence that inflation is stickier than some economists and policymakers had thought. Two-year inflation breakevens, or the difference between Treasury yields and Treasury Inflation-Protected Securities, have surged in recent days. "But I think the labor market is a lot more fragile than people think. A report Wednesday confirmed that economic growth was solid to close out 2023, with fourth-quarter GDP accelerating at a 3.2% annualized pace adjusted for seasonal factors and inflation.

Persons: Mark Zandi, Zandi, shouldn't, we're, it's, —, Susan Collins, Collins, Dow Jones, Dow, Michelle Cluver, Cluver, I've Organizations: Moody's, Boston, Securities, Treasury, Fed, Labor, CPI, Dow Jones, optimist Locations: U.S

☆ Consumer prices are cooling, but BlackRock bets on inflation-protected bonds for the long term. Here's why
▼ + stars: | 2024-01-08 | by ( Michelle Fox | ) www.cnbc.com time to read: +3 min

Inflation-protected bonds may be the last thing on investors' minds amid cooling prices, but BlackRock is betting on the securities for the longer term. Due to that, BlackRock named inflation-protected securities one of its top 2024 strategic calls for those with a time horizon of five to 10 years. "We see inflation going through a roller coaster over a longer term," Li said. Buying TIPS Investors can buy TIPS in five-year , 10-year and 30-year terms through the TreasuryDirect website . BlackRock, which has a traditional TIPS ETF, also recently launched a suite of defined maturity TIPS ETFs last fall.

Persons: Wei Li, Li, BlackRock, We've Organizations: BlackRock, Bank of America Securities, U.S . Bureau of Labor Statistics, Federal Locations: redemptions, U.S

☆ These unique assets are now a popular way to lock in yield. What to know about defined maturity ETFs
▼ + stars: | 2023-11-24 | by ( Michelle Fox | ) www.cnbc.com time to read: +8 min

After being on the market for more than a decade, defined maturity bond funds are finally attracting attention. Traditional open end, bond mutual funds or bond ETFs, on the other hand, have no maturity date. One big advantage over owning individual bonds, however, is that defined maturity ETFs are easy to purchase on the stock exchange. How they work Each defined maturity bond fund holds securities in the same sector that come due in the calendar year chosen for the fund. Callable bonds are simply those that can be redeemed or paid off by the issuer prior to the bonds' maturity date, according to the Securities and Exchange Commission.

Persons: Charles Rotblut, Bonds, Sarajat Samant, Karen Veraa, BlackRock's, —, Veraa, IBonds, Invesco, Treasury iBond, Jason Bloom, Invesco's Bloom, haven't, I'm, BlackRock's Veraa, Morningstar's, Samant, AAII's Organizations: Investors, American Association of, Treasury, BlackRock, Securities and Exchange Commission, Invesco Locations: BlackRock's iShares, U.S

☆ US consumers worry inflation will pick up again, UMich survey finds
▼ + stars: | 2023-11-22 | by ( ) www.reuters.com time to read: +3 min

"These expectations have risen in spite of the fact that consumers have taken note of the continued slowdown in inflation," survey Director Joanne Hsu said in a statement. But progress this year has been inconsistent, and Fed officials remain wary of the potential for a reversal. That said, the University of Michigan survey results are at odds with other measures of inflation expectations that have shown they have in fact been moderating. A New York Fed survey of consumers last week, for instance, showed inflation expectations over both one-year and five-year horizons eased in October even as the Michigan survey showed them accelerating. Market-based measures of inflation expectations are also declining.

Persons: Joanne Hsu, Quincy Krosby, Dan Burns, Chizu Organizations: Federal Reserve, University of Michigan's, Fed, Global, LPL, University of Michigan, New York Fed, . Treasury, Securities, Thomson Locations: Michigan

☆ If you want to be the ultimate contrarian next year, bet on these things happening
▼ + stars: | 2023-11-17 | by ( Hakyung Kim | ) www.cnbc.com time to read: +2 min

Based on the bank's monthly Global Fund Manager Survey, strategist Michael Hartnett created a list of "contrarian" outcomes and hedging opportunities. As of now, high-quality assets are expected to outperform in 2024, with only 6% of fund managers predicting otherwise, said Hartnett. Close to 90% of surveyed fund managers see elevated geopolitical risks in the coming year. For a contrarian outcome, Harnett says to trade as if oil prices will move lower still by shorting crude. Only 6% of fund managers are predicting inflation moves higher next year, according to BofA.

Persons: Michael Hartnett, Hartnett, Harnett, — CNBC's Michael Bloom Organizations: of America, Global Fund, Survey, Bank of America's, Nasdaq, Treasury, Securities

☆ Goldman Sachs updates its 'directors’ cut’ list of top Europe stocks with major upside
▼ + stars: | 2023-11-03 | by ( Amala Balakrishner | ) www.cnbc.com time to read: +3 min

Chip stock addition One notable update to Goldman Sach's directors' cut list was the addition of ASML Holdings – a Netherlands-headquartered chip machine-maker that has Taiwan Semiconductor Manufacturing Company ( TSMC ) as its biggest customer. Stocks on the list British telecommunications player BT Group made the investment bank's updated directors' cut list – with an upside of around 149% from its Oct. 30 close, based on a 12-month price target of £280 ($340.68). Delivery Hero is another favorite stock, with a price target of 53.90 euros ($57.04), giving it an upside of approximately 128%. German real estate player Vonovia was another company that made the investment bank's list with 75% upside based on a 12-month price target of 36.70 euros. They are thus focused on identifying quality growth and select value stocks for their their conviction list of top buy-rated stocks.

Persons: Goldman Sachs, Goldman, ASML Holdings Goldman, Stocks, Vonovia, — CNBC's Michael Bloom Organizations: ASML Holdings, Taiwan Semiconductor Manufacturing Company, Euronext, Nasdaq, BT Group Locations: Europe, Netherlands, Euronext Amsterdam, ASML, bullish, British

☆ US Treasury increases size of most of its debt auctions
▼ + stars: | 2023-11-01 | by ( ) www.reuters.com time to read: +3 min

A bronze seal for the Department of the Treasury is shown at the U.S. Treasury building in Washington, U.S., January 20, 2023. Treasury yields fell after the announcement on relief the increases were not as large as some had feared. The Treasury said on Wednesday it plans to increase the size of its two-year and five-year note auctions by $3 billion per month, and to increase the size of its 3-year and 7-year note auctions by $2 billion and $1 billion per month, respectively. The government will also increase the size of its two-year floating rate note new issue and reopenings by $2 billion. Some Treasury Inflation-Protected Securities (TIPS) auction sizes will also be increased, with a $1 billion increase in the December 5-year TIPS auction and January 10-year TIPS auction.

Persons: Kevin Lamarque, Steven Ricchiuto, Karen Brettell, Herb Lash, Paul Simao, Andrea Ricci Organizations: Department of, U.S . Treasury, REUTERS, U.S . Treasury Department, Treasury, U.S, Mizuho Securities USA, Securities, Thomson Locations: Washington , U.S, New York, U.S

☆ Saving for your child's college education? Here’s how to invest for the next 10 years, according to the pros
▼ + stars: | 2023-10-23 | by ( Weizhen Tan | ) www.cnbc.com time to read: +5 min

Parents thinking of saving for their children's college education in around a decade could be in for some sticker shock. Breaking down the costs U.S. college tuition inflation averaged 12% annually from 2010 to 2022, according to T. Rowe Price, citing research by Education Data Initiative . Even assuming a more modest 5% annual inflation rate, the estimated total college cost could be as high as $383,823, she said. That college tuition bill 10 years from now — taking the $165,000 as a baseline and assuming a 3% normalized inflation rate and tuition inflation of 6% — could hit $295,000, according to Ebright. "It is important to maintain some exposure to growth assets as tuition inflation has traditionally been higher than the broader economy," Shen said.

Persons: Laura Suter, AJ Bell, Rowe Price, Wenting Shen, Shen, Alan Ebright, they're, AJ Bell's Suter, Rowe Price's Shen, Berkshire Hathaway, Suter Organizations: CNBC, AJ, Education Data Initiative, College Board, Check Capital Management, University of California, Securities, Berkshire, Fidelity Emerging Markets, Companies, Fidelity Locations: U.S, Asia, Britain, United States, Berkshire

☆ Inflation-Proof Your Retirement Savings Now
▼ + stars: | 2023-10-20 | by ( Laura Saunders | ) www.wsj.com time to read: 1 min

It’s hard to find a more confusing “safe” investment than the government bonds called TIPS, for Treasury inflation-protected securities—and that includes the taxes on them. But people who avoid them now could be making a mistake, especially if they’re facing retirement. No wonder investors are bewildered. TIPS say they offer inflation protection, but last year, when inflation roared, many holders of funds with longer-term TIPS had steep negative returns. That’s because TIPS, like other bonds, suffer when interest rates rise.

Organizations: Treasury

Felipe Villarroel, portfolio manager at TwentyFour Asset Management, said he recently swapped some 10-year Treasuries for higher yielding 30-year Treasuries. At these levels, yields give “a massive cushion in your total returns" to protect against bond prices falling further, he said. Yields on the benchmark 10-year U.S. Treasury were over 4.95% in Asia trade on Thursday, their highest level in more than 16 years, and 30-year yields breached 5% this month for the first time since 2007. An auction of 30-year U.S. Treasuries showed weak demand last week, sending yields higher. "The tightness that (bond yields) are imposing on the economy and markets is rising ... this caps the extra work the Fed needs to do," said Smith.

Persons: Jerome Powell, David Rubenstein, Amanda Andrade, Rhoades, Felipe Villarroel, Treasuries, Matt Smith, Ruffer, Buyers, Leslie Falconio, Ruffer's Smith, Smith, Davide Barbuscia, Michelle Price, Ira Iosebashvili, Nick Zieminski Organizations: Federal, Economic, of Washington, Washington , D.C, REUTERS, Treasuries, TwentyFour Asset Management, Bank of America Global Research, Treasury, UBS Global Wealth Management, BlackRock Investment Institute, Thomson Locations: Washington ,, Asia

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