Broker Check
Integrated Insights - Week of August 24, 2020

Integrated Insights - Week of August 24, 2020

| August 25, 2020
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WIth political conventions taking center stage, this week's entry looks at the candidates views on the economy. BlackRock also weighs in on potential strategic adjustments given a post-Covid world.  The industries most affected by COVID have not recovered to pre-crisis levels, which may cause an increase in corporate defaults--it also may create opportunity in high yield bonds.

Here's what I'm reading this week:

Weekly Commentary -- Strategic views for a post-Covid world -- BlackRock

  • The Covid-19 pandemic has transformed the investment landscape in a matter of months, prompting a rethink of strategic asset allocation views.

  • Negotiations over a new U.S. fiscal package looked to have stalled. We still expect a sizable package, but risks of a no-deal outcome are growing.

  • Markets will focus on the annual Jackson Hole meeting for what potential policy framework changes might imply for the medium-term inflation outlook.

Summary of candidates views on economy, trade, & big tech -- Meeder Investments

Corporate Defaults Have Jumped -- Capital Group

  • Corporate defaults have jumped, but the default rate has been low for a very long time 
  • The market for lower rated companies is much less efficient, so there’s more opportunity to differentiate and find value

  • Especially over the long term, returns on high-yield bonds (BB/Ba and lower) can provide investors who are willing to take a little higher risk of loss a significant income boost

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