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It’s a very interesting time in the markets when by almost every measure, US stocks are overvalued and global government bond yields are at unsustainably low levels.  Germany’s 10 year bond is now below .10%.  What’s a German investor to do!  Buy stocks of course and US Government bonds since besides the 1.80% yield, you can also have currency gains (or losses) as well.  Central banks have been easing at an unprecedented pace, yet GDP is not responding like it has in the past after a major recessions.  In my opinion, I feel the seeds are being sewn for another 2008 type environment sometime in the coming years.  With European QE coming to the party late, I believe the next global crisis has been delayed, but for how long?

We continue to be very careful in our clients’ portfolio and prefer to position people more conservatively than they otherwise would like so instead of a shotgun wound, we are nursing a flesh wound when this environment arrives.


-Jared Toren

Author: Jared Toren