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May the Bond Vigilantes Rest in Peace (Dr Ed’s Blog, 8 min read) Long-time bond follower Ed Yardeni argues that the Fed won’t raise rates even if inflation returns because hikes would hurt the US Treasury (as interest payments surge). Instead, the Fed may even pin bond yields to 1%. This would, in turn, be bullish for US stocks, SPACs, precious metals, and overseas assets. [Bullish equities]
Global Markets: Are the Easy Gains Behind Us? (MSIM, 4 min read) Morgan Stanley believes the positive momentum in US economic data will soon reverse. Temporary unemployment is likely to become permanent as the furlough scheme expires. They are bearish stocks and the dollar. [Bearish US stocks, USD]