December 30, 2014

Fed has made a mockery of fundamentals

We’re at an important pivot point for the market, and when I think of reward versus risk, I think it’s unattractive for stocks. It’s very unattractive for bonds.

The Federal Reserve has made a mockery of fundamentals. 

All assets are priced against the yield of the U.S. 10-year note. The lower the yield goes, the higher the valuations in the stock market go. There’s really no price discovery, either in stocks or bonds. We’re in this artificial experiment, and it’s a very dangerous path.