Head Winds

For the capital markets, the second quarter of this year was very much like the first quarter.  Equity markets were volatile and ended up close to where they started, at least on the domestic side.  Bonds continued to struggle as interest rates moved higher.  Global stocks and emerging market stocks sold off as worries rose about the state of the global economy.  In the U.S., fears of higher inflation combined with worries over free trade, causing investors to fear that the nine-year economic expansion may be in danger.  The yield curve has become very flat, meaning there is not much different between short term and long term interest rates.  This is rarely a good sign for the markets.For the capital markets, the second quarter of this year was very much like the first quarter.  Equity markets were volatile and ended up close to where they started, at least on the domestic side.  Bonds continued to struggle as interest rates moved higher.  Global stocks and emerging market stocks sold off as worries rose about the state of the global economy.  In the U.S., fears of higher inflation combined with worries over free trade, causing investors to fear that the nine-year economic expansion may be in danger.  The yield curve has become very flat, meaning there is not much different between short term and long term interest rates.  This is rarely a good sign for the markets.

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