Latest news with #KathyJones
Yahoo
5 days ago
- Business
- Yahoo
Bonds are 'boring' — but they're critical to understand right now
Compared to the high-flying mega-cap tickers, the roller-coaster ride of crypto, or the rags-to-riches drama of meme stocks, the US bond market can seem like a sleepy affair. As millions of people flooded into the stock market over the past few years thanks to Robinhood (HOOD), COVID stimulus payments, and a booming S&P 500, general stock market literacy and an understanding of the things that move markets — Big Tech, earnings and outlooks, and even why economic data moves markets — seem to have made noticeable progress. By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy Not, however, for bonds. Throughout it all, the bond market and its yields remain the uneaten vegetables on the plate. A chore. Something that is there for safety, not to bring you wealth. Something to be googled later. But with the slow drumbeat of bond market worries getting louder, now is the time to brush up. Read more: Savings bonds and how they work Clearly, the bond market and its relatively slower cadence can mask its huge importance. And its tremors and signals of trouble in recent weeks serve as an important reminder of why a keystone of the global financial system commands so much attention. Yields on US bonds have been elevated as investors recoil from shifts in trade policy and the prospects of an ever-widening national debt. Yields move in the opposite direction of prices, so as a sell-off intensifies, yields increase, reflecting heightened concerns that buying government debt carries more risk. Higher yields have a host of consequences that can be felt throughout the economy, as they set the cost of borrowing. High yields mean high mortgage rates, more expensive business loans, and slower economic activity — hence why they're "bad" for stocks and why bonds matter, whether you own them or not. Governments, massive borrowers themselves, may also find trouble financing the administration of the state if interest rates get high enough. The fear that greater government borrowing might lead to even higher rates and a default crisis has rattled the bond market. All of which is now at the center of debates in Washington and on Wall Street right now. "Bond yields — especially Treasury yields — represent the cost of financing for governments." Kathy Jones, Schwab's chief fixed income strategist, told Yahoo Finance. "When the yields rise, government spending costs go up and vice versa." Concerns of spiraling US debt were reinforced Wednesday, as President Trump's signature tax bill is expected to increase deficits by $2.4 trillion over the next decade, according to an analysis by the nonpartisan Congressional Budget Office. Which is why the bond market — and Elon Musk — are blowing a raspberry. All the while, investors have also been behaving in ways that challenge the status of US Treasurys as a safe-haven asset. Bonds typically form part of an investment strategy that offsets riskier assets, like stocks, with more stable, but modest returns, which is why you own them if you have a target-date fund in your 401(k). Underpinning the reliability of bonds is the reputation of the US government: its institutions, economic stability, and integral role in global trade. Hence the controversy, once again. With investors keeping their distance from bonds during heightened volatility, it's clear how perceptions are shifting. "The recent volatility in the bond market reflects the combination of policies that are working at cross purposes," Jones said. "Fiscal policy is expansive at a time when the economy is growing at a relatively healthy rate and inflation is still far above the Fed's 2% target. Meanwhile, tariffs and anti-immigration policies could mean slower growth and higher inflation, but they are being applied inconsistently. The market is caught between these forces and struggling to find a coherent path." And until that happens, bonds will continue to be in focus. Hamza Shaban is a reporter for Yahoo Finance covering markets and the economy. Follow Hamza on X @hshaban. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
7 days ago
- Business
- CNBC
Bond market's getting more sensitive to rising debt and deficits, says Schwab's Kathy Jones
Charles Schwab's Kathy Jones and Allspring Global Investment's Bryant VanCronkhite joins 'Power Lunch' to discuss if the budget deficit is an issue for this country, if the inflation story is still an issue and much more.
Bloomberg
02-06-2025
- Business
- Bloomberg
Bloomberg Surveillance: Tariffs and Debt
Watch Tom and Paul LIVE every day on YouTube: Bloomberg Surveillance hosted by Tom Keene & Paul Sweeney June 2nd, 2025 Featuring: 1) Stephen Stanley, Chief Economist at Santander, joins for an extended conversation on the outlook for the US economy, lower consumer spending, and potential for a shallow recession in the US. Global stocks started the new month under pressure due to a flare-up in global trade tensions and geopolitical uncertainty. Gold is heading for its biggest gain in almost four weeks as geopolitical and trade tensions revived demand for haven assets. 2) Kathy Jones, Chief Investment Strategist, Fixed Income at Charles Schwab, discusses bond market warnings and why the Fed won't be coming to the rescue any time soon. The dollar fell 0.5%, extending a streak of five monthly losses, while Treasury yields rose across the curve, with the 10-year rate up four basis points to 4.44% in the early part of the morning as risk appetite dissipates. 3) Maya MacGuineas, President of the Committee for a Responsible Federal Budget, talks about the House bill "debt fiasco" and why markets haven't fully awaken to the debt and deficit problem in the US. It comes as Treasury Secretary Scott Bessent says the US "is never going to default" as the deadline for increasing the federal debt ceiling approaches. Bessent declines to specify an "X date" for when the Treasury will run out of cash, but says the goal is to bring the deficit down over the next four years. 4) Henrietta Treyz, co-founder at Veda Partners, talks about President Trump threatening an increase to steel and aluminum tariffs, how the tax bill could be transformed in the Senate, and other DC headlines. Uncertainty prompted by President Donald Trump's trade agenda picked up after China and the US accused each other of violating a trade deal concluded last month. Trump also said he would double tariffs on steel and aluminum imports. Meanwhile, Ukraine staged a dramatic series of strikes across Russia, deploying drones hidden in trucks deep inside the country to hit strategic airfields. 5) Lisa Mateo joins with the latest headlines in newspapers across the US, including an NYT story on Gen Z's interest in chain restaurants and a Business Insider story on AI already taking human jobs.
Yahoo
19-05-2025
- Business
- Yahoo
It's 'premature' and 'cavalier' to buy the dip, strategist says
Investors are deciding how to position their portfolios as stocks and bonds are currently selling off. Kathy Jones, Charles Schwab chief fixed income strategist, and Jeff Krumpelman, Mariner Wealth Advisors chief investment strategist and head of equities, join Morning Brief with Madison Mills to discuss the market moves. To watch more expert insights and analysis on the latest market action, check out more Morning Brief here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
19-05-2025
- Business
- Bloomberg
Bloomberg Surveillance TV: May 19, 2025
- Krishna Memani, CIO at Lafayette College - Jeannette Lowe, Director: Policy Research at Strategas Securities - Kathy Jones, Chief Fixed Income Strategist at Charles Schwab - Neil Dutta, Head: US Economic Research at Renaissance Macro Krishna Memani, CIO at Lafayette College and Kathy Jones, Chief Fixed Income Strategist at Charles Schwab, join to discuss the US economic outlook after the Moody's US credit downgrade and rise in long-term Treasury yields. Jeannette Lowe, Director: Policy Research at Strategas Securities, talks about the latest on tax bill negotiations and President Trump's economic agenda. Neil Dutta, Head: US Economic Research at Renaissance Macro, discusses US economic indicators and whether the US economy is weakening, as well as the outlook for rate cuts in 2025.
