A historical look at interest rates and inflation shows why a 7% 10-year Treasury yield can’t be ruled out

  • Investors shouldn’t rule out a 7% 10-year Treasury yield
  • Historical averages suggest a 10-year Treasury yield of 7.25% is defensible
  • Higher interest rates can impact technology stocks
  • The Fed’s preferred inflation gauge is above its 2% target
  • Bonds have sold off sharply since July

A Ned Davis strategist believes that a 7% 10-year Treasury yield is still possible, despite recent market fluctuations. Higher interest rates can impact technology stocks, and historical averages suggest that a 10-year Treasury yield of 7.25% is defensible. The Fed’s preferred inflation gauge is above its 2% target, and bonds have sold off sharply since July. Investors should consider these factors when evaluating the potential for a 7% 10-year Treasury yield.

Public Companies: iShares (TLT), Microsoft Corp. (MSFT), Amazon.com Inc. (AMZN)
Private Companies:
Key People: Joseph Kalish (Chief Global Macro Strategist at Ned Davis Research)

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Factuality Level: 6
Justification: The article provides information about the opinions of a Ned Davis strategist regarding U.S. borrowing costs and the potential for a 7% 10-year Treasury yield. The article also mentions the impact of higher interest rates on technology stocks and provides some historical data. However, the article lacks in-depth analysis and does not provide a balanced view by including other perspectives or counterarguments.

Noise Level: 3
Justification: The article contains mostly relevant information about the current state of U.S. borrowing costs and the potential impact on investors. However, it lacks in-depth analysis and evidence to support the claims made by the Ned Davis strategist. The article also includes some irrelevant information about stock market performance and the allocation recommendations of Ned Davis.

Financial Relevance: Yes
Financial Markets Impacted: The article discusses the impact of benchmark U.S. borrowing costs on bond portfolios and stocks, particularly highflying technology stocks.

Presence of Extreme Event: No
Nature of Extreme Event: No
Impact Rating of the Extreme Event: No
Justification: The article primarily focuses on the potential impact of U.S. borrowing costs on financial markets, without mentioning any extreme events.