A brief collapse in bond yields around the world hit markets hard Thursday.

The recent catalyst for falling yields was the European Central Bank’s (ECB) announcement Thursday it would tolerate up to 2% annual inflation over the “medium term” — essentially ignoring its current inflation target of just below 2%.
That might not sound like a big deal, but it represents the first major policy shift for the bank in two decades and it spooked investors. Essentially the ECB is going to break its inflation target, and they’re going to do nothing about it.
So, we can thank the ECB for accelerating the collapse in global bond yields, with German 10-year yields down three basis points on the news.
The yield on the U.S. 10-year Treasury note dipped to 1.25% on Thursday, the lowest rate since February, but quickly rebounded this morning to 1.35%.
The Federal Reserve is also allowing inflation to run higher than the normal 2% target, but the Fed has been clearer than the ECB. Our Fed has raised its near-term inflation target and said the inflation we’re currently seeing is transitory. And of course, in the U.S., we have positive interest rates, while in Europe, they have negative rates.
But the Fed’s priority right now is to fix unemployment, because we’re still missing around 8.6 million jobs since the pandemic started.
In the meantime, falling interest rates make bonds less attractive, which I see as unbelievably bullish for stocks, especially for a select group of stock I found with my . These stocks are also great for those looking to catch up on their retirement or make extra income.
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Sincerely,
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The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
¶¶Òõ×îаæ, who has been called “one of the most important money managers of our time,” has broken the silence in … exposing one of the most shocking events in our country’s history… and .