Rob Isbitts, chief investment officer of Sungarden Fund Management, says that despite the past month of moderating emotions in the investment markets, we still are looking at an environment that offers danger and big gain potential at the same time.
The runaway growth of exchange-traded funds over the past decade shows no signs of abating, with a top industry forecaster now projecting the assets will surge at least 18% this year, topping $4 trillion for the first time.
Loans to companies with low credit ratings swelled by 15% last year to $1.3 trillion, prompting warnings from the Federal Reserve and International Monetary Fund. Yet Wall Street firms that are deeply immersed in the market, from banks including JPMorgan Chase to private-equity firms like Blackstone, say they don't see what the problem is.
If one is betting on a sustained surge from Citi, bigger banks could be bullish bets.
Municipal debt closed-end funds managed to eke out gains in an otherwise horrible month for investors.
President Donald Trump's $1.5 trillion of tax cuts, designed to stimulate growth, have decimated government revenue, ballooning the federal budget deficit and forcing Treasury Department officials to cover the gap by borrowing money in ever-growing amounts. Investors face losses in 2019 as yields on Treasury bonds necessarily rise -- to attract enough buyers for the debt.