Cash is king

Stocks closed in positive territory while treasury bonds sold off.
Whether or not treasury bonds continue to trend lower remains to be seen but inflationary expectations have definitely heightened.
The Euro soared against the U.S. dollar, hitting a 14-month high at 1.43, on expectations of European interest rate hikes.
The Europeans are philosophically more inflation conscious given Weimar Germany's historic trauma with inflation.
In the corporate bond market, signs are abundant that investors are preparing for higher inflation with demand for FRN (floating rate note) paper extremely strong.
In corporate credit, spreads tightened with corporate cash bonds leading the way as bids from real-money players remain strong.
With corporate bond new issue supply relatively limited and corporate earnings out soon, this technical supply-and-demand effect will likely see corporate cash bond spreads continue to march tighter.
This author attended a Qatar Investment conference at the Waldorf Astoria; what was most impressive was the number of high C-level business executives in attendance.
In new issues, French bank BNP Paribas tapped its existing 10 year bond at +145.
National Australia Bank tapped the bond markets as well selling $600 million of 3 year fixed bonds at +98 and $1.6 billion of 3 year FRNs.
On both the BNP and the National Australia Bank issues, the deals were massively oversubscribed with real-money players bidding aggressively.
Cash is king.
Initial jobless claims numbers are out tomorrow.