Description:Â Savers and investors relying on fixed incomes have been punished for several years. Many healthy companies sat on their growing piles of cash instead of boosting dividends. Some struggling firms were forced to cut or even suspend quarterly payouts during the financial crisis. And the Federal Reserve’s easy money policies (rates near 0% plus QE and QE2) have kept long-term bond yields at relatively low levels. But this is all slowly starting to change, giving conservative investors some reason to celebrate.
Questions for discussion:Â
- Why is the bond market expected to improve at this time?
- Do you agree with this argument?
- What is the reason behind bond selling at this time?
- What might undermine performance in bonds?
- How should investors respond?