| The yield on the 10-year U.S. Treasury has come all the way down from 5% in mid-October to under 4.2% as of this morning. That's a big move in a short amount of time. Markets tend to be forward-looking mechanisms. They generally forecast about six to 12 months into the future. That's why you sometimes see stocks bottom and start to rebound while the economy is still in a recession. When that happens, it signals that the recession is likely to end soon. Similarly, when stocks fall while things are booming, that tells you the good times might be about to end. The rapid decline in bond yields suggests to me that the market believes the Fed is done raising rates and that the Fed's next move will be a reduction in rates, not a hike. The futures market agrees. According to the fed funds futures data, there is a near-zero probability that the Fed will raise rates in 2024, and it is a near certainty that it will lower them by late next year. Now, markets are not always right. Things change, data fluctuates and investors respond accordingly. But generally speaking, it pays to listen to what the markets tell you, because they are a good barometer of what is likely to happen. With stocks climbing and interest rates falling, my interpretation is that inflation is fading and the Fed should be close to finished with its rate hikes. Should that occur, Jay Powell may find he has more time to relax... perhaps at a lake. Good investing, Marc P.S. If the constant back-and-forth about the Fed and interest rates has you feeling like you want to jump in a lake, my counterpart here at The Oxford Club, Chief Investment Strategist Alexander Green, has a solution for you. Tomorrow at 1 p.m. ET, he's hosting a free training called "How to Build the Perfect Fed-Proof Portfolio." Our research team and legal team have confirmed that a portfolio of stocks that meet Alex's four key criteria would've more than doubled your money since the start of 2021! Sign up to learn the four components of a Fed-proof portfolio - for free. (If you can't make it tomorrow, no worries! Just sign up today, and we'll record the event and send you a link so you can rewatch it at your convenience.) | 
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