STE's Stocks Investing Journey

World stock market continued it strings of volatile trading sessions recently when 10 Years Treasury Notes hitting 1.5%, a sign that FED is going to increase interest rate in near term due to higher “inflation expectation “post pandemic as economic is going to restore back to Pre-covid 19 level.  <Image credit :GuruFocus.com>       For me, it seems that the yield curve is just returning to normal level / pattern with upward slope and higher rate for long term treasury notes as compared to exceptional “ Inverter Yield Curve “during the pandemic. The short-term rate (1-5 years) remain extremely low and accommodative as mentioned by FED. The 10 Years Treasury rate mainly use to determine the mortgage rate and I think is quite healthy if rate is a bit higher than short-term as to indicate the risk on long term mortgage loan, also to avoid more speculative move in housing market. I am not sure if this increase of 10 Years treasury note will benefit the bank...

image credit to stewcap.com Would like to share some great articles on “Negative bond yield and QE” ...with more and more central bankers lowering the interest rate and implementing more QE, the world is flooded with liquidity and resulting   $17 Billion of     negative-yielding bond sitting and idling on various financial institution’s balance sheet around the world.     What does a negative bond yield mean? < source: Investopedia.com> Why do investors buy negative yield bonds? <source:ft.com> image credit to Bloomberg finance.com With this unstoppable pace of money printing, the market will become more volatile... all conventional methods of assets valuation will also become obsolete... you may notice that it will become "new normal" for some S-REITs to have yielded lower than 4% (especially from those with a stronger sponsor like Mapletree or Capital families).

This is probably one of the hottest topics where you can see and read from all over the business news headlines in the last two weeks. What is “ Inverted Yield Curve “ and why is it so important that draw so much attention from financial strategist/economist/investors/fund managers all over the world. Discussing, pondering and arguing about the impact and direction of the economy due to this so-called “ Inverted Yield Curve”, relentlessly.