Timmer Questions 60/40 Portfolio Revival Amid Weakening Stock-Bond Link
Fidelity's Jurrien Timmer questions the 60/40 portfolio comeback as higher Treasury yields sustain a positive stock-bond correlation.
Trump allies attribute the Republican midterm defeat to the Iran war, leading to speculation about Trump's next moves.
The irony of the night is that Trump sought to change Iran's regime but ended up changing the one in his own country.
Early results paint a grim picture for Republicans amid a significant Democratic wave, with several major upsets and a Senate majority that appears so secure it could hold for four to six years.
While many votes remain uncounted, the finger-pointing has begun, and the clearest target is Iran. Fox News discussions are dominated by this, and although the 'Iran can't get nuclear weapons' argument persists, it is widely regarded as a mistake.
The Wall Street Journal is now carrying similar reports, quoting individuals close to President Trump who place the blame on the Iran war.
"Some White House officials and Republican allies said the Iran war was misguided, and the midterm elections would have looked very different if the conflict wrapped up months ago."
I share that view, but it carries no significance.
The important thing is what happens next. This is a crucial excerpt from the WSJ article:
According to the WSJ, a number of advisers, both internal and external, are telling Trump that his legacy will be permanently linked to the war he initiated with Israel in February.
This concerns me, as he might interpret it as a justification to press harder. He might ramp up military action, seeking a victory that would ensure a favorable historical assessment.
Alternatively, he could attempt to wind down the war and devote the next two years to shaping his legacy in other ways, such as trying to oust Cuba's government or through other projects, like redesigning the White House ballroom.
I also believe Congress can intervene. If the consensus is that the war cost Republicans dearly, they will be eager to end it quickly. Running on a platform of an ongoing war two years hence could be even more disastrous than tonight, possibly leading to the loss of all three government branches. Pete Hegseth appears to be a likely fall guy, and there is a strong chance he will be replaced, or possibly impeached.
In any event, the Iran matter will be the key focus in the coming days, particularly after a report today that the opportunity for another attack is limited.
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Fidelity's Jurrien Timmer questions the 60/40 portfolio comeback as higher Treasury yields sustain a positive stock-bond correlation.
The Bank of England is expected to raise Bank Rate to 4% on Thursday, its first hike of this cycle, with inflation at 3.5%.
Japan's services PMI rose to 51.7 in October, but the composite PMI slipped to 52.1, a five-month low, as hiring slowed and cost pressures persisted.
September data showed Australia's goods surplus at about A$2.8 billion, a seven-month peak, with LNG and metals exports up and gold imports down sharply.