The acronym TINA (There Is No Alternative) had long been used to explain why investors piled into U.S. equities, but it may now apply to U.S. Treasuries.
State of play: After Monday's sell-off, the S&P 500 has erased all of its gains dating back a year, and the dollar, emerging market equities and oil are all negative during that period.
- Treasuries have become the de-facto defensive asset for the market and "investors have to make sure that they have enough cash on the sidelines to meet whatever their cash needs are for at least the next year," Richard Steinberg, chief market strategist at The Colony Group, tells Axios.
On the other side: Benchmark 10-year Treasury yields (which move inversely to prices) have fallen by almost 150 basis points since the start of the year, meaning holders of U.S. government bonds have seen significant price appreciation.
- Traditional safe havens gold and the Japanese yen have both gained a little more than 5% for investors year to date, but that is quaint in comparison to the staggering move in Treasury yields from their Jan. 1 levels.