What Was Obvious Two Weeks Ago Isn't Today

How quickly things change in these markets. In the report two weeks ago, the markets reflected a pretty obvious slowing in the global economy. In the course of two weeks, what seemed obvious has been quickly reversed. The 10-year yield moved up a quick 20 basis points in just a week, a rise in nominal growth expectations that was mostly about inflation fears. The economic news over the last two weeks does not appear to support the move in rates but our process puts more emphasis on markets and less on individual economic reports. So, I'll accept that inflation fears – and fear of the Fed's response – have driven rates higher over the last week. Whether those fears are warranted is open to question.