Episode summary
Global Bond Selloff Sends Yields to the Highest Level Since 2008 | Bloomberg Surveillance
Bloomberg Surveillance
· · Hosts: Tom Keene, Paul Sweeney, Lisa Mateo, Michael Barr · Guests: David Katz, David Booth, Jordan Jackson, Leslie Palti-Guzman
Summary
The episode centered on a global bond selloff, the jump in yields to the highest level since 2008, and what that means for stocks, inflation, and portfolio construction. David Katz said the U.S. market has had a strong run but may now be in a trading range, with oil prices, higher yields, and geopolitical risk creating short-term volatility even if equities can still grind higher over time. He argued investors should stop chasing daily moves and instead focus on long-term wealth accumulation, especially in attractively valued names tied to utilities, housing, and parts of the AI buildout.
David Booth argued that no one can reliably predict short-term market moves, so the better approach is to plan for uncertainty rather than fight it. He said investors should stay flexible, think in terms of long-term goals, and remember that broad stock and bond exposure has worked over many decades. He also used the conversation to promote his book on staying calm and to describe his philanthropy, including major commitments to the University of Kansas and the University of Chicago.
Jordan Jackson said $80 to $90 oil may be the new normal in the near term, with higher inflation volatility feeding into bond yields, while Leslie Palti-Guzman described a broader remapping of global oil and LNG trade flows. She said the Strait of Hormuz risk is pushing buyers and producers toward more hedging, more diversification, and potentially new winners in the U.S., Canada, Africa, and Asia.
Key takeaways
- David Katz said the market may have entered a trading range, with 5% upside and 5% to 8% downside, as higher oil and yields pressure risk assets.
- David Katz favored utilities, select consumer discretionary names, and cheaper AI beneficiaries like Generac, while warning that some semiconductors are still too expensive.
- David Booth said investors should not try to time markets and should instead plan for uncertainty, stay flexible, and keep a long-term allocation.
- Jordan Jackson said $80 to $90 oil is the near-term baseline and that higher oil and inflation volatility could keep bond yields unstable.
- Leslie Palti-Guzman said the Strait of Hormuz risks are accelerating a reconfiguration of global LNG and oil trade flows and increasing the value of hedging and diversification.
Notable quotes
“We think we probably have entered a trading range with maybe 5% on the upside, 5 to 8% on the downside”
“The market has been on a moonshot. Yet, there's been a lot of negative news”
“Don't get caught up in the craziness of the day”
“you want to have a long-term investment philosophy and uh and pay attention to what's going on”
“$80 to $90 oil is the new 60 and I think we need to be comfortable with that level at least over uh the near term”
How the episode opens
Bloomberg Audio Studios podcasts, radio, news. This is the Bloomberg Surveillance Podcast. Catch us live weekdays at 7 a.m.
Eastern on Apple CarPlay or Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. David Katz, CIO at Matrix Asset Advisor.
It's really good to speak to you. The S&P 500 did really well, up by 2.6% in August. September is usually a much more difficult month.
What's your view, especially as uh oil markets and the continued rise in oil prices, sort of challenges the view for uh equity markets in the US. Can we still see a strong September?
We've had a great nine months. The market has been on a moonshot. Yet, there's been a lot of negative news.
Oil prices staying up here for a sustained period, problematic. You're seeing yields across the globe and especially in the US moving higher. The market's ignored a lot of that.
We think we probably have entered a trading range with maybe 5% on the upside, 5 to 8% on the downside. Ultimately, we think the market goes higher, but expect a lot of volatility in the short term and possibly a pullback if the news flow doesn't start to get better on oil or Iran.
David, you talk about taking a longer view in terms of investing and not getting caught up in daily price swings. Given that we're in an age of like prediction markets, crypto, gambling, betting, how do investors build this muscle of resilience in the market?
You've got to have that mindset. 90% of the people lose in the gambling markets, but people like to do it. Uh people play crypto. A lot of people, most investors in crypto have lost money if you weren't there early.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- global bond selloff
- bond yields
- interest rate outlook
- fixed income volatility
- asset management
Companies and tickers mentioned
- JPM
- Matrix Asset Advisors
- Dimensional Fund Advisors
- JPMorgan Asset Management
- Energy Vista
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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