Retire First Newsletter
August 2019 – Download Full PDF
Being Comfortable in Uncomfortable Times by Doug Allan
The big story over the past 3 months has been the global decline in long term interest rates. 10-year US Treasury Bonds have declined from 2.5% in May to below 1.5% currently. This dramatic decline is not just in the USA as interest rates are plunging around the world. As Europe joins Japan in the negative long-term interest rate arena, it is said that 1/3 of all the government bonds in the world now have negative yields. Many are now asking if it’s possible for negative rates to come to North America.
As Global GDP slumps, just about every central bank on the planet except Canada has lowered short term interest rates this year. You would think this would be a good thing for investment values in general; however, the reality is that interest rates are dropping around the world for a reason and it’s not good.