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Commentary
Canso July 2016 Market Observer

We had quite an extended discussion in our last Market Observer in April on the low level of interest rates. We ended by saying: “The good news is that despite the gloom and doom, things don’t look all that bad economically in the U.S… We are not sure when or why the Fed will raise interest rates, given their amazing prevarication on the subject.” Both of these statements were on the mark, as the U.S. economy continues to chug along and the Fed found Brexit as another reason to avoid raising interest rates further. Our repeated belief was that it might take a while for interest rates to find a bottom but our take was that the downside risks of a rate increase to a bond portfolio were greater than the potential upside from further yield decreases.

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Canso July 2016 Market Observer