Bonds’ role in a portfolio is to provide income and diversification. But in 2022, they had the worst returns in decades and also failed to provide the ballast they typically would when equity markets are down. Now the Fed’s rapid rate hikes have changed the equation, and investors are giving bonds another look. Collin Martin, director of fixed income strategy at the Schwab Center for Financial Research, joins Mike Townsend to consider what the Fed may do next after it chose to pause rate hikes and what the implications could be for investors, borrowers, corporations, and the economy in general. They also discuss how to choose bonds that may be right for you—and which ones to avoid.
Mike offers insight on the hurdles and deadlines Congress faces in order to pass the 12 appropriation bills to keep the government open and operating. He shares an update on the nominees to fill open positions at the Fed and looks at the bipartisan efforts in Congress to toughen banking regulations, including legislation to increase penalties on executives at failed banks.
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