United States Yields
The US faces the same economic challenges as the rest of the developed world: deficient demand that may endure for a generation. The question is whether its modest demographic advantage will prevent an infection of negative interest rates reaching its shores.
Yield curve valuation suggests short 30-year and long 10-year on a relative basis.
The negative yields on inflation bonds reflect their embedded protection against deflation and offer little benefit against inflation at current prices.
Corporate spreads are narrow and are lower than any period since the Great Recession of 2008, which suggests corporate bonds offer poor value.
Corporate yields offer a compelling relative value trade with a long 7-year and short 5-year position.
Disclaimer: All positions are suggestive of relative value and not intended as a recommendation or investment advice. Consult an investment advisor before implementing any investment strategy.