Financial Markets Commentary 2nd Quarter 2019Submitted by Capital Strategies Financial Corporation on July 22nd, 2019
The second quarter of 2019 is in the books, as they say, and it was another good one for both stocks and bonds. The key to market gains was Federal Reserve Chairman Jay Powell’s capitulation on interest rates. Ordinarily, the Federal Reserve does not cut interest rates during a period of strong market performance for fear of stoking investment speculation. Nowadays, however, restraint is an old-fashioned notion. Investors have understandably reacted to the idea that credit would become both easier to obtain and less expensive in the same way a child would if you told them that there would be two Halloweens this year. Yay! More candy! See Exhibit 1 for a market summary. Concerns about trade wars, Iran, North Korea, etc. have all taken a back seat, at least for now.